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WGL Holdings, Inc. Reports Increased First Quarter FY 2008 Earnings and Raises Earnings Guidance

-- Consolidated GAAP earnings up -- $0.95 per share vs. $0.92 per
share for the comparative quarter

-- Consolidated non-GAAP operating earnings up -- $0.96 per share
vs. $0.90 per share for the comparative quarter reflecting
improvements in regulated and non-regulated businesses

-- New utility rates effective in Maryland and the District of
Columbia

-- Increased fiscal year 2008 non-GAAP operating earnings
guidance range -- $2.35 to $2.45 per share

WASHINGTON, Feb 04, 2008 (BUSINESS WIRE) -- Consolidated Results

WGL Holdings, Inc. (NYSE: WGL), the parent company of Washington Gas Light Company (Washington Gas) and other energy-related subsidiaries, today reported net income determined in accordance with Generally Accepted Accounting Principles in the United States of America (GAAP) for the quarter ended December 31, 2007 of $47.2 million, or $0.95 per share, an increase of $2.1 million, or $0.03 per share, over net income of $45.1 million, or $0.92 per share, reported for the first quarter of fiscal year 2007.

"These excellent results for the first fiscal quarter underscore our progress in achieving a number of strategic objectives and reinforce our outlook for an excellent year," said James H. DeGraffenreidt, Jr., chairman and chief executive officer of WGL Holdings. "Successful regulatory outcomes, the expansion of our asset management program, continued customer growth and improved unregulated results will continue to drive fiscal year 2008 earnings growth."

Financial performance is evaluated based on non-GAAP operating earnings (loss) per share. Non-GAAP operating earnings (loss) per share excludes the effects of: (i) warmer-than-normal/colder-than-normal weather for our regulated utility segment; (ii) certain unusual transactions and (iii) unrealized mark-to-market gains (losses) on energy-related derivatives. Refer to "Use of Non-GAAP Operating Earnings (Loss) Per Share" and supporting reconciliations attached to this news release for a detailed discussion of management's use of this non-GAAP financial measure, as well as reconciliations of earnings per share determined in accordance with GAAP to non-GAAP operating earnings (loss) per share for both our consolidated and segment results.

For the first quarter of fiscal year 2008, our non-GAAP operating earnings were $0.96 per share, an increase of $0.06 per share over non-GAAP operating earnings of $0.90 per share for the same quarter of the prior fiscal year.

First Quarter Results by Business Segment

Regulated Utility Segment

Our regulated utility segment reported net income determined in accordance with GAAP of $44.2 million, or $0.89 per share, for the first quarter fiscal year 2008, an increase of $1.2 million, or $0.01 per share over net income of $43.0 million, or $0.88 per share for the same quarter of the preceding fiscal year. For the first quarter of fiscal year 2008, non-GAAP operating earnings for the regulated utility segment were $0.88 per share, an increase of $0.05 per share, over non-GAAP operating earnings of $0.83 for the same period of the prior fiscal year. The increase in non-GAAP operating earnings is primarily due to: (i) the implementation of new rates in Virginia on February 13, 2007, in Maryland on November 27, 2007 and in the District of Columbia on December 31, 2007; (ii) an increase in realized margins from our asset management program; (iii) an increase in customer usage primarily due to a shift in weather patterns and (iv) the addition of over 12,300 active customer meters since December 31, 2006. Partially offsetting the increase in non-GAAP operating earnings were: (i) higher uncollectible accounts expense primarily due to an adjustment to the accumulated reserve made in the prior period to reflect better collections; (ii) transition related expenses for our business process outsourcing program and (iii) higher property taxes in Virginia.

Retail Energy-Marketing Segment

The retail energy-marketing segment reported net income determined in accordance with GAAP of $3.3 million, or $0.07 per share, for the quarter ended December 31, 2007, an increase of $605,000, or $0.02 per share, over net income of $2.7 million, or $0.05 per share, reported for the same quarter of fiscal year 2007. Non-GAAP operating earnings for the retail energy-marketing segment were $0.09 per share for the first quarter ended December 31, 2007, a $0.01 per share improvement over $0.08 per share for the same quarter of prior fiscal year. The year-over-year improvement in non-GAAP operating earnings reflects higher margins per therm sold for natural gas and lower interest expense. Partially offsetting these improvements were higher operating expenses.

Earnings Outlook

We are raising our GAAP earnings estimate for the full fiscal year 2008 to a range of $2.30 to $2.40 per share. This estimate includes projected full fiscal year 2008 earnings from our regulated utility segment in a range of $1.99 per share to $2.05 per share and projected full fiscal year 2008 earnings from our unregulated business segments in a range of $0.31 per share to $0.35 per share.

We are also raising our consolidated earnings estimate for the full fiscal year 2008 based on non-GAAP operating earnings to a range of $2.35 per share to $2.45 per share. This estimate includes projected full fiscal year 2008 non-GAAP operating earnings from our regulated utility segment in a range of $1.97 per share to $2.03 per share, and projected full fiscal year 2008 non-GAAP operating earnings from our unregulated business segments in a range of $0.38 per share to $0.42 per share. Refer to the "Reconciliation of GAAP Earnings Guidance to Non-GAAP Earnings Guidance" attached to this press release for a reconciliation of our GAAP earnings estimate to our estimate based on non-GAAP operating earnings per share.

We assume no obligation to update this guidance. The absence of any statement by us in the future should not be presumed to represent an affirmation of this earnings guidance. For the assumptions underlying this guidance, please refer to the slides accompanying our Webcast that will be posted to the WGL Holdings Web site, www.wglholdings.com.

Other Information

We will hold a conference call at 10:30 a.m. Eastern time on February 5, 2008, to discuss our first quarter financial results. The live conference call will be available to the public via a link located on the WGL Holdings Web site, www.wglholdings.com. To hear the live Webcast, click on the "Webcast" link located on the home page of the referenced site. The Webcast and related slides will be archived on the WGL Holdings Web site through March 4, 2008.

Headquartered in Washington, D.C., WGL Holdings has three operating segments: (i) the regulated utility segment which primarily consists of Washington Gas, a natural gas utility that serves over one million customers throughout metropolitan Washington, D.C., and the surrounding region; (ii) the retail-energy marketing segment which consists of Washington Gas Energy Services, Inc., a third-party marketer that competitively sells natural gas and electricity and (iii) the heating, ventilating and air conditioning (HVAC) segment, which consists of Washington Gas Energy Systems, Inc., a provider of design-build energy efficiency solutions to government and commercial clients. Additional information about WGL Holdings is available on our Web site.

Unless otherwise noted, earnings per share amounts are presented on a diluted basis, and are based on weighted average common and common equivalent shares outstanding.

Please see the attached comparative statements for additional information on our operating results. Also attached to this news release are reconciliations of earnings per share determined in accordance with GAAP to non-GAAP operating earnings (loss) per share for both our consolidated and segment results as well as reconciliations of our GAAP earnings guidance to our non-GAAP earnings guidance.

Forward-Looking Statements

This news release and other statements by us include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 with respect to the outlook for earnings, revenues and other future financial business performance or strategies and expectations. Forward-looking statements are typically identified by words such as, but not limited to, "estimates," "expects," "anticipates," "intends," "believes," "plans," and similar expressions, or future or conditional verbs such as "will," "should," "would," and "could." Although we believe such forward-looking statements are based on reasonable assumptions, we cannot give assurance that every objective will be achieved. Forward-looking statements speak only as of today, and we assume no duty to update them. Factors that could cause actual results to differ materially from those expressed or implied include, but are not limited to, general economic conditions and the factors discussed under the "Risk Factors" heading in our most recent annual report on Form 10-K and other documents filed with or furnished to the Securities and Exchange Commission.



                          WGL Holdings, Inc.
                  Consolidated Statements of Income
            Three Months Ended December 31, 2007 and 2006
                             (Unaudited)

-------------------------------------------------- -------------------
                                                   Three Months Ended
                                                      December 31,
----------------------------------------------------------------------
(In thousands, except per share data)                2007      2006
----------------------------------------------------------------------

OPERATING REVENUES
  Utility                                          $461,950  $431,021
  Non-utility                                       289,676   301,941
----------------------------------------------------------------------
     Total Operating Revenues                       751,626   732,962
----------------------------------------------------------------------

OPERATING EXPENSES
  Utility cost of gas                               265,801   248,676
  Non-utility cost of energy-related sales          275,543   289,843
  Operation and maintenance                          68,849    62,605
  Depreciation and amortization                      24,255    18,640
  General taxes and other assessments                27,243    25,446
----------------------------------------------------------------------
     Total Operating Expenses                       661,691   645,210
----------------------------------------------------------------------

OPERATING INCOME                                     89,935    87,752
Other Income (Expenses)--Net                            588      (172)
Interest Expense
  Interest on long-term debt                          9,980    10,008
  Other - net                                         2,757     3,204
----------------------------------------------------------------------
     Total Interest Expense                          12,737    13,212
Dividends on Washington Gas preferred stock             330       330
----------------------------------------------------------------------
INCOME BEFORE INCOME TAXES                           77,456    74,038
INCOME TAX EXPENSE                                   30,259    28,940
----------------------------------------------------------------------
NET INCOME APPLICABLE TO COMMON STOCK              $ 47,197  $ 45,098
======================================================================

AVERAGE COMMON SHARES OUTSTANDING
  Basic                                              49,416    48,985
  Diluted                                            49,645    49,130
======================================================================

EARNINGS PER AVERAGE COMMON SHARE
  Basic                                            $   0.96  $   0.92
  Diluted                                          $   0.95  $   0.92
======================================================================


   Net Income (Loss) Applicable To Common Stock--By Segment ($000):

Regulated utility                                  $ 44,202  $ 42,995
----------------------------------------------------------------------
Non-utility operations:
     Retail energy-marketing                          3,281     2,676
     Commercial HVAC                                    273        97
----------------------------------------------------------------------
        Total major non-utility                       3,554     2,773
     Other, principally non-utility activities         (559)     (670)
----------------------------------------------------------------------
        Total non-utility                             2,995     2,103
----------------------------------------------------------------------
NET INCOME APPLICABLE TO COMMON STOCK              $ 47,197  $ 45,098
======================================================================





                          WGL Holdings, Inc.
                     Consolidated Balance Sheets
                          December 31, 2007
                             (Unaudited)

----------------------------------------------------------------------
                                            December 31, September 30,
(In thousands)                                  2007         2007
----------------------------------------------------------------------

ASSETS
Property, Plant and Equipment
      At original cost                      $ 3,095,963  $  3,072,935
      Accumulated depreciation and
       amortization                            (934,351)     (922,494)
----------------------------------------------------------------------
          Net property, plant and equipment   2,161,612     2,150,441
----------------------------------------------------------------------

Current Assets
      Cash and cash equivalents                  18,967         4,870
      Accounts receivable, net                  531,090       192,021
      Storage gas--at cost (first-in,
       first-out)                               253,453       294,889
      Other                                      93,825        81,945
----------------------------------------------------------------------
          Total current assets                  897,335       573,725
----------------------------------------------------------------------
Deferred Charges and Other Assets               399,941       322,195
----------------------------------------------------------------------
          Total Assets                      $ 3,458,888  $  3,046,361
======================================================================

CAPITALIZATION AND LIABILITIES
Capitalization
      Common shareholders' equity           $ 1,013,255  $    980,767
      Washington Gas Light Company
       preferred stock                           28,173        28,173
      Long-term debt                            593,513       616,419
----------------------------------------------------------------------
          Total capitalization                1,634,941     1,625,359
----------------------------------------------------------------------

Current Liabilities
      Notes payable and current maturities
       of long-term debt                        347,451       205,341
      Accounts payable and other accrued
       liabilities                              331,359       216,861
      Other                                     237,569       134,854
----------------------------------------------------------------------
          Total current liabilities             916,379       557,056
----------------------------------------------------------------------
Deferred Credits                                907,568       863,946
----------------------------------------------------------------------
          Total Capitalization and
           Liabilities                      $ 3,458,888  $  3,046,361
======================================================================





                          WGL Holdings, Inc.
           Consolidated Financial and Operating Statistics
             For Periods Ended December 31, 2007 and 2006
                             (Unaudited)


FINANCIAL STATISTICS
----------------------------------------------------------------------
                                               Twelve Months Ended
                                                  December 31,
----------------------------------------------------------------------
                                               2007          2006
----------------------------------------------------------------------

Closing Market Price--end of period        $      32.76  $      32.58
52-Week Market Price Range                 $35.91-$29.79 $33.55-$27.04
Price Earnings Ratio                               14.7          18.0
Annualized Dividends Per Share             $       1.37  $       1.35
Dividend Yield                                      4.2%          4.1%
Return on Average Common Equity                    11.2%          9.4%
Total Interest Coverage (times) (1)                 4.6           4.1
Book Value Per Share--end of period        $      20.49  $      19.52
Common Shares Outstanding--end of period
 (thousands)                                     49,449        49,129
======================================================================
(1) Calculated using income from continuing operations.





UTILITY GAS STATISTICS
----------------------------------------------------------------------
                         Three Months Ended     Twelve Months Ended
                            December 31,            December 31,
----------------------------------------------------------------------
(In thousands)            2007        2006        2007        2006
----------------------------------------------------------------------

 Operating Revenues
  Gas Sold and
   Delivered
   Residential - Firm  $  304,400  $  281,486  $1,010,323 $  932,277
   Commercial and
    Industrial - Firm      87,669      80,220     286,398    284,839
   Commercial and
    Industrial -
    Interruptible           2,298       2,248       6,668      8,108
   Electric Generation        267         275       1,100      1,099
----------------------------------------------------------------------
                          394,634     364,229   1,304,489  1,226,323
----------------------------------------------------------------------
   Gas Delivered for
    Others
   Firm                    40,395      44,065     136,005    138,147
   Interruptible           12,839      13,290      49,073     44,624
   Electric Generation         90          57         326        253
----------------------------------------------------------------------
                           53,324      57,412     185,404    183,024
----------------------------------------------------------------------
                          447,958     421,641   1,489,893  1,409,347
   Other                   13,992       9,380      38,310     42,847
----------------------------------------------------------------------
    Total              $  461,950  $  431,021  $1,528,203 $1,452,194
======================================================================

----------------------------------------------------------------------
                         Three Months Ended     Twelve Months Ended
                            December 31,            December 31,
----------------------------------------------------------------------
(In thousands of
 therms)                  2007        2006        2007        2006
----------------------------------------------------------------------

Gas Sales and
 Deliveries
  Gas Sold and
   Delivered
   Residential - Firm     198,982     182,784     664,899    559,548
   Commercial and
    Industrial - Firm      62,633      57,729     208,866    194,172
   Commercial and
    Industrial -
    Interruptible           1,847       1,868       5,254      6,377
----------------------------------------------------------------------
                          263,462     242,381     879,019    760,097
----------------------------------------------------------------------
  Gas Delivered for
   Others
   Firm                   134,108     124,093     443,435    392,642
   Interruptible           74,341      76,793     264,853    255,002
   Electric Generation     20,269      10,111     122,108    102,506
----------------------------------------------------------------------
                          228,718     210,997     830,396    750,150
----------------------------------------------------------------------
    Total                 492,180     453,378   1,709,415  1,510,247
======================================================================

WASHINGTON GAS ENERGY
 SERVICES
----------------------------------------------------------------------
 Natural Gas Sales
  Therm Sales
   (thousands of
   therms)                196,474     204,612     717,327    677,831

  Number of Customers
   (end of period)        140,700     142,000     140,700    142,000
----------------------------------------------------------------------

 Electricity Sales
  Electricity Sales
   (thousands of kWhs)    899,469     899,729   3,943,584  2,819,765

  Number of Accounts
   (end of period)         67,100      66,700      67,100     66,700
======================================================================

UTILITY GAS PURCHASED
 EXPENSE
 (excluding off             98.83      104.09      100.07     114.18
  system)                  (cents)     (cents)     (cents)    (cents)
======================================================================

HEATING DEGREE DAYS
----------------------------------------------------------------------
 Actual                     1,241       1,308       3,888      3,519
 Normal                     1,356       1,364       3,807      3,809
 Percent Colder
  (Warmer) than Normal       (8.5)%      (4.1)%       2.1%      (7.6)%
======================================================================

 Number of Active
  Customer Meters (end
  of period)            1,057,882   1,045,572   1,057,882  1,045,572
======================================================================





            WGL Holdings, Inc. (Regulated Utility Segment)
            Three Months Ended December 31, 2007 and 2006
                             (Unaudited)


                         Statements of Income

----------------------------------------------------------------------
                                                    Three Months Ended
                                                       December 31,
----------------------------------------------------------------------
(In thousands)                                        2007     2006
----------------------------------------------------------------------

Operating Revenues                                  $464,428 $433,350
----------------------------------------------------------------------
Operating Expenses:
  Cost of gas                                        268,279  251,005
  Operation                                           50,867   46,588
  Maintenance                                         10,510    9,465
  Depreciation and amortization                       24,046   18,551
  General taxes and other assessments:
    Revenue taxes                                     15,453   15,277
    Other                                             10,882    9,275
----------------------------------------------------------------------
      Total operating expenses                       380,037  350,161
----------------------------------------------------------------------

Operating income                                      84,391   83,189
Other income (expenses) - net                            536     (131)
Interest expense                                      12,151   11,974
Dividends on Washington Gas preferred stock              330      330
Income tax expense                                    28,244   27,759
----------------------------------------------------------------------
      Net income                                    $ 44,202 $ 42,995
======================================================================




                   Utility Net Revenues ($000) (1)

Operating revenues                                  $464,428 $433,350
Less: Cost of gas                                    268,279  251,005
      Revenue taxes                                   15,453   15,277
----------------------------------------------------------------------
      Utility net revenues                          $180,696 $167,068
======================================================================

(1)We analyze the operating results of our regulated utility segment
 based on utility net revenues. Washington Gas Light Company includes
 the cost of the natural gas commodity and revenue taxes (comprised of
 gross receipt taxes, PSC fees, franchise fees and energy taxes) in
 its rates charged to customers as reflected in operating revenues.
 Accordingly, changes in the cost of gas and revenue taxes associated
 with sales made to customers have no direct effect on the net
 revenues or net income of the regulated utility segment.



WGL HOLDINGS, INC. USE OF NON-GAAP OPERATING EARNINGS (LOSS) PER SHARE (Unaudited)

The attached reconciliations are provided to clearly identify adjustments made to diluted earnings (loss) per average common share calculated in accordance with Generally Accepted Accounting Principles in the United States of America (GAAP) to derive non-GAAP operating earnings (loss) per share. Management believes non-GAAP operating earnings (loss) per share provides a more meaningful representation of our earnings from ongoing operations by excluding the effects of: (i) warmer-than-normal/colder-than-normal weather; (ii) certain unusual transactions and (iii) unrealized mark-to-market gains and losses from energy-related derivatives. This presentation facilitates analysis by providing a consistent and comparable measure to help management, investors and analysts better understand and evaluate our operating results and performance trends. Additionally, we use this non-GAAP measure to report to the board of directors, evaluate management's performance and for incentive compensation purposes.

We exclude from non-GAAP operating earnings (loss) per share the effects of warmer-than-normal/colder-than-normal weather to "normalize" weather. Utilization of normal weather is an industry standard, and it is our practice to evaluate our rate-regulated revenues by utilizing normal weather and to provide estimates and guidance on the basis of normal weather. Additionally, we exclude unrealized mark-to-market adjustments for our energy-related derivatives to provide a more transparent and accurate view of the ongoing financial results of our operations. When these derivatives settle, the economic impact is reflected in our non-GAAP operating results, as we are only removing the interim unrealized mark-to-market amounts which are ultimately reversed when the derivatives are settled. These non-GAAP adjustments also assist both management and investors in analyzing period-to-period comparisons.

There are limits in using non-GAAP operating earnings (loss) per share to analyze our results, as it is not prepared in accordance with GAAP and may be different from non-GAAP financial measures used by other companies. In addition, using non-GAAP operating earnings (loss) per share to analyze our earnings may have limited value as it excludes certain items that may have a material impact on our reported financial results. We compensate for these limitations by providing investors with the attached reconciliations to diluted earnings (loss) per average common share, the most directly comparable GAAP financial measure.



            WGL HOLDINGS, INC. (Consolidating by Segment)
  RECONCILIATION OF GAAP DILUTED EARNINGS (LOSS) PER AVERAGE COMMON
         SHARE TO NON-GAAP OPERATING EARNINGS (LOSS) PER SHARE
                             (Unaudited)

                   Quarter Ended December 31, 2007
----------------------------------------------------------------------
               Regulated Retail Energy-         Other
                Utility    Marketing    HVAC   Activities Consolidated
----------------------------------------------------------------------
GAAP diluted
 earnings
 (loss) per
 average
 common share  $   0.89  $         0.07 $0.01 $    (0.02) $      0.95
Adjusted for:
Reversal of
 costs related
 to business
 process
 outsourcing
 (a)              (0.02)              -     -          -        (0.02)
Unrealized
 mark-to-
 market loss
 on energy-
 related
 derivatives
 (b)               0.03            0.02     -          -         0.05
Other
 regulatory
 adjustments
 (c)              (0.02)              -     -          -        (0.02)
----------------------------------------------------------------------
Non-GAAP
 operating
 earnings
 (loss) per
 share         $   0.88  $         0.09 $0.01 $    (0.02) $      0.96
======================================================================

                   Quarter Ended December 31, 2006
----------------------------------------------------------------------
               Regulated Retail Energy-         Other
                Utility    Marketing    HVAC   Activities Consolidated
----------------------------------------------------------------------
GAAP diluted
 earnings
 (loss) per
 average
 common share  $   0.88  $         0.05 $   - $    (0.01) $      0.92
Adjusted for:
Retroactive
 depreciation
 expense
 adjustment
 (d)              (0.05)              -     -          -        (0.05)
Unrealized
 mark-to-
 market loss
 on energy-
 related
 derivatives
 (b)                  -            0.03     -          -         0.03
----------------------------------------------------------------------
Non-GAAP
 operating
 earnings
 (loss) per
 share         $   0.83  $         0.08 $   - $    (0.01) $      0.90
======================================================================





             WGL HOLDINGS, INC. (Consolidated by Quarter)
  RECONCILIATION OF GAAP DILUTED EARNINGS (LOSS) PER AVERAGE COMMON
         SHARE TO NON-GAAP OPERATING EARNINGS (LOSS) PER SHARE
                             (Unaudited)

                           Fiscal Year 2008
----------------------------------------------------------------------
                             Quarterly Period Ended
----------------------------------------------------------------------
                        Dec. 31 Mar. 31 Jun. 30 Sept. 30 Year-To-Date
----------------------------------------------------------------------
GAAP diluted earnings
 per average common
 share                  $ 0.95                           $       0.95
Adjusted for:
Reversal of costs
 related to business
 process outsourcing
 (a)                     (0.02)                                 (0.02)
Unrealized mark-to-
 market loss on energy-
 related derivatives
 (b)                      0.05                                   0.05
Other regulatory
 adjustments (c)         (0.02)                                 (0.02)
----------------------------------------------------------------------
Non-GAAP operating
 earnings per share     $ 0.96                           $       0.96
======================================================================

                           Fiscal Year 2007
----------------------------------------------------------------------
                              Quarterly Period Ended
----------------------------------------------------------------------
                        Dec. 31 Mar. 31 Jun. 30 Sept. 30  Year-To-Date
----------------------------------------------------------------------
GAAP diluted earnings
 per average common
 share                  $ 0.92                                  $0.92
Adjusted for:
Retroactive
 depreciation expense
 adjustment (d)          (0.05)                                 (0.05)
Unrealized mark-to-
 market loss on energy-
 related derivatives
 (b)                      0.03                                   0.03
----------------------------------------------------------------------
Non-GAAP operating
 earnings per share     $ 0.90                                  $0.90
======================================================================





Footnotes:
----------------------------------------------------------------------

(a) Represents the reversal of expenses that were incurred in prior
 fiscal years for initial implementation costs allocable to the
 District of Columbia associated with our business process outsourcing
 plan. These costs were recorded to a regulatory asset in the first
 quarter of fiscal year 2008 upon approval of 10-year amortization
 accounting by the District of Columbia Public Service Commission in a
 December 28, 2007 Final Order.

(b) Represents the change in the unrealized mark-to-market positions
 of our energy-related derivatives that were recorded to income during
 the period. For the regulated utility segment, to the extent that our
 unrealized mark-to-market gains and losses are not shared with
 customers, these amounts are recorded directly to income. All
 unrealized mark-to-market gains and losses for the retail-energy
 marketing segment are recorded directly to income.

(c) Represents favorable regulatory adjustments made during the first
 quarter of fiscal year 2008 applicable to prior fiscal years due to
 revised treatment for hexane costs in Maryland and certain shared
 revenues in the District of Columbia.

(d) Represents an adjustment that reduced depreciation expense
 applicable to the period from January 1, 2006, through September 30,
 2006. This adjustment was recorded in the first quarter of fiscal
 year 2007 upon approval of new depreciation rates by the staff of the
 Virginia State Corporation Commission.





                          WGL HOLDINGS, INC.
             RECONCILIATION OF GAAP EARNINGS GUIDANCE TO
                      NON-GAAP EARNINGS GUIDANCE
                FISCAL YEAR ENDING SEPTEMBER 30, 2008

                             Consolidated
----------------------------------------------------------------------
                                                         Low    High
----------------------------------------------------------------------
GAAP Earnings Guidance Range                           $ 2.30  $ 2.40
Adjusted for:
Reversal of costs related to business process
 outsourcing (a)                                        (0.02)  (0.02)
Unrealized mark-to-market loss on energy-related
 derivatives (b)                                         0.09    0.09
Other regulatory adjustments (c)                        (0.02)  (0.02)
----------------------------------------------------------------------
Non-GAAP Earnings Guidance Range                       $ 2.35  $ 2.45
======================================================================

                      Regulated Utility Segment
----------------------------------------------------------------------
                                                         Low    High
----------------------------------------------------------------------
GAAP Earnings Guidance Range                           $ 1.99  $ 2.05
Adjusted for:
Reversal of costs related to business process
 outsourcing (a)                                        (0.02)  (0.02)
Unrealized mark-to-market loss on energy-related
 derivatives (b)                                         0.02    0.02
Other regulatory adjustments (c)                        (0.02)  (0.02)
----------------------------------------------------------------------
Non-GAAP Earnings Guidance Range                       $ 1.97  $ 2.03
======================================================================

                    Unregulated Business Segments
----------------------------------------------------------------------
                                                         Low    High
----------------------------------------------------------------------
GAAP Earnings Guidance Range                           $ 0.31  $ 0.35
Adjusted for:
Unrealized mark-to-market loss on energy-related
 derivatives (a)                                         0.07    0.07
----------------------------------------------------------------------
Non-GAAP Earnings Guidance Range                       $ 0.38  $ 0.42
======================================================================





Footnotes:
----------------------------------------------------------------------

(a) Represents the reversal of expenses that were incurred in prior
 fiscal years for initial implementation costs allocable to the
 District of Columbia associated with our business process outsourcing
 plan. These expenses were reversed in the first quarter of fiscal
 year 2008 due to the approval of 10-year amortization accounting by
 the District of Columbia Public Service Commission in a December 28,
 2007 Final Order.

(b) Represents the estimated reversal of certain of our existing
 unrealized mark-to-market positions related to our energy derivatives
 that will be recorded to income during fiscal year 2008. For the
 regulated utility segment, to the extent that our unrealized mark-to-
 market gains and losses are not shared with customers, these amounts
 are recorded directly to income. All unrealized mark-to-market gains
 and losses for the retail-energy marketing segment are recorded
 directly to income.

(c) Represents favorable regulatory adjustments made during the first
 quarter of fiscal year 2008 applicable to prior fiscal years due to
 revised treatment for hexane costs in Maryland and certain shared
 revenues in the District of Columbia.



SOURCE: WGL Holdings, Inc.

WGL Holdings, Inc.
News Media
Eric Grant, 202-624-6091
or
Financial Community
Melissa E. Adams, 202-624-6410

Copyright Business Wire 2008

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