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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934

 

Date of Report (Date of earliest event reported): February 26, 2008

 

PORTLAND GENERAL ELECTRIC COMPANY

(Exact name of registrant as specified in its charter)

 

 

 

Oregon

1-5532-99

93-0256820

(State or other jurisdiction of incorporation or organization)

(Commission File Number)

(I.R.S. Employer

Identification No.)

 

121 SW Salmon Street, Portland, Oregon 97204

(Address of principal executive offices) (zip code)

 

Registrant's telephone number, including area code: (503) 464-8000

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the
filing obligation of the registrant under any of the following provisions:

[  ]

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[  ]

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[  ]

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[  ]

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

This current report and its exhibit include forward-looking statements. Portland General Electric Company based these forward-looking statements on its current expectations and projections about future events in light of its knowledge of facts as of the date of this current report and its assumptions about future circumstances. These forward-looking statements are subject to various risks and uncertainties that may be outside the control of Portland General Electric Company. Any forward-looking statement speaks only as of the date on which such statement is made and, except as required by law, Portland General Electric Company undertakes no obligation to publicly update or revise any forward-looking statements, whether due to new information, future events, or otherwise. This current report should be read in conjunction with Portland General Electric Company's Annual Report on Form 10-K for the year ended December 31, 2007 (to be filed on or about February 27, 2008) and previously filed 2007 Quarterly Reports on Form 10-Q.

 

Item 2.02 Results of Operations and Financial Condition.

On February 26, 2008, Portland General Electric Company issued a press release announcing its financial results for the three months and year ended December 31, 2007.

The press release issued February 26, 2008 is furnished herewith as Exhibit 99.1 to this Report, and shall not be deemed filed for purposes of Section 18 of the Exchange Act.

 

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits.

99.1 Press Release issued by Portland General Electric Company dated February 26, 2008.

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

 

 

PORTLAND GENERAL ELECTRIC COMPANY

(Registrant)

 

Date:

February 26, 2008

By:

/s/ James J. Piro

 

 

James J. Piro

Executive Vice President, Finance

Chief Financial Officer and Treasurer

 

EXHIBIT 99.1

Portland General Electric
One World Trade Center
121 SW Salmon Street
Portland, Oregon 97204

News Release

 

 

FOR RELEASE

Media Contact:

5 a.m. EST, February 26, 2008

Gail Baker

 

Director, Corporate Communications

 

Phone: 503-464-8693

 

 

 

Investor Contact:

 

Bill Valach

 

Director, Investor Relations

 

Phone: 503-464-7395

Portland General Electric reports full year

and fourth quarter 2007 earnings results

Reaffirms 2008 guidance

Financial and Operating Highlights

Full Year 2007

Portland, Ore. - Portland General Electric Company (NYSE: POR) today reported net income of $145 million, or $2.33 per diluted share, for the twelve months ended December 31, 2007, compared to $71 million, or $1.14 per diluted share, for 2006. Results for 2007 were driven primarily by increased energy deliveries, excellent plant operations including increased generation from the return of Boardman to full operation and the addition of Port Westward. Results for 2007 also included the following items:

"Our 2007 results demonstrate that Portland General Electric is committed to delivering value to its customers and shareholders alike," said Peggy Fowler, CEO and president of Portland General Electric (PGE). "Our list of accomplishments includes bringing our new Port Westward plant online, completing Phase I of the Biglow Canyon Wind Farm on schedule in December and delivering a year of operational excellence with our overall system performing at a high level."

"Our success can be attributed to the hard work of my co-workers. In 2008, we'll continue to deliver on our commitment to provide our customers with safe, reliable power at a reasonable price while delivering long-term value to shareholders."

Full Year 2007 Summary

Fourth Quarter 2007

For the fourth quarter ended December 31, 2007, the Company reported net income of $24 million, or $0.40 per diluted share, compared to $40 million, or $0.64 per diluted share, for 2006. The decrease was primarily attributable to non-recurring gains in 2006, partially offset by the effects of SB 408, with an estimated collection in 2007 compared to an estimated refund in 2006, and to a reduction in other income.

Fourth Quarter 2007 Summary

Advanced Metering Infrastructure (AMI)

As part of the regulatory approval process for inclusion of AMI in prices, PGE made its final filing on February 6, 2008 and is now waiting for an order from the OPUC. If approved, the tariff will go into effect on June 1, 2008 and continue through December 31, 2010. This proposed two and a half year tariff period coincides with the systems acceptance testing and installation of over 800,000 meters. Once the meters are installed, at an estimated capital cost of $130 million to $135 million, we estimate that AMI will reduce annual operating expenses by approximately $18 million pre tax.

Biglow Canyon Wind Farm

Phase I of the Biglow Canyon Wind Farm, comprised of 76 turbines with an installed capacity of 125 megawatts, was completed and placed in service in mid-December 2007 at a total cost of approximately $255 million (including AFDC). Phase I, which was included in customer prices beginning in January 2008, fulfills PGE's goals for adding renewable energy as outlined in the Company's last Integrated Resource Plan.

Phases II and III of the project are in the advanced planning stages, with an estimated total cost of $700 million to $800 million (including AFDC). Phase II is expected to be completed by the end of 2009 and Phase III is expected to be completed by the end of 2010. All three phases of the project are expected to have a total installed capacity of 400 to 450 megawatts.

Capital Expenditures

Capital expenditures in 2007 totaled $455 million compared to $371 million in 2006. Expenditures for 2007 consisted of approximately $199 million for the Biglow Canyon Wind Farm Phase I, $17 million for Phases II and III, $182 million for ongoing production, transmission and distribution facilities, $40 million for hydro relicensing projects, $16 million for Port Westward and $1 million for AMI.

Capital expenditures in 2008 are estimated to be $428 million. This includes $121 million for Phases II and III of the Biglow Canyon Wind Farm, $229 million for ongoing production, transmission and distribution facilities, $55 million for hydro relicensing projects and $23 million for AMI.

General Rate Case

The Company plans to file a general rate case with the OPUC on February 27, 2008, based on a 2009 test year, with new prices expected to be effective beginning in January 2009. The proposed 8.9% increase in prices is a result of increased generation costs based on higher natural gas and coal prices; increased purchased power costs; and higher general (non-power) costs, including the rising cost of materials and supplies, compliance with government regulation, hydro relicensing improvements, and labor and healthcare benefits. The requested revenue requirement includes a return on common equity of 10.75%, based on an expected capital structure of 50% equity and 50% debt, and an overall weighted average cost of capital of 8.66%.

2008 Earnings Guidance

PGE is reaffirming full-year 2008 earnings guidance of $1.75 to $1.85 per diluted share. Guidance assumes normal hydro conditions and plant operations. PGE is also reaffirming its long-term annual earnings growth expectation of 6 to 8 percent beginning with 2008.

Full Year 2007 Earnings Call and Webcast February 26, 2008

PGE will host a conference call with financial analysts and investors on Tuesday, February 26, 2008, at 5 p.m. EST. The conference call will be webcast live on the PGE Web site at www.PortlandGeneral.com. A replay of the call will be available beginning at 7 p.m. EST on Tuesday, February 26 through Tuesday, March 4.

Peggy Fowler, CEO and president; Jim Piro, executive vice president, CFO and treasurer; and Bill Valach, director of investor relations will participate in the call. Management will respond to questions following formal comments.

The attached consolidated income statements, balance sheets, cash flow statements and supplemental operating statistics are an integral part of this earnings release.

# # #

About Portland General Electric Company

Portland General Electric, headquartered in Portland, Ore., is a vertically integrated electric utility that serves approximately 804,000 residential, commercial and industrial customers in Oregon. Visit our Web site at www.PortlandGeneral.com.

Safe Harbor Statement

Statements in this news release that relate to future plans, objectives, expectations, performance, events and the like may constitute "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995, Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include statements regarding earnings guidance, statements regarding future capital expenditures, statements regarding the cost, completion and benefits of capital projects, such as the Biglow Canyon Wind Farm, as well as other statements containing words such as "anticipates," "believes," "intends," "estimates," "promises," "expects," "should," "conditioned upon" and similar expressions. Investors are cautioned that any such forward-looking statements are subject to risks and uncertainties, including matters and events related to final regulatory review and approval of the deferral of excess power costs related to Boa rdman's outage; regulatory approval and rate treatment of the Advanced Metering Infrastructure and Biglow Canyon Wind Farm projects; the costs of compliance with environmental laws and regulations, including those that govern emissions from thermal power plants; changes in weather, hydroelectric, and energy market conditions, which could affect the availability and cost of purchased power and fuel; and the outcome of various legal and regulatory proceedings. As a result, actual results may differ materially from those projected in the forward-looking statements. All forward-looking statements included in this news release are based on information available to the Company on the date hereof and such statements speak only as of the date hereof. The Company assumes no obligation to update any such forward-looking statement. Prospective investors should also review the risks and uncertainties listed in the Company's most recent Annual Report on Form 10-K and the Company's reports on Forms 8-K and 10-Q filed with the United States Securities and Exchange Commission, including Management's Discussion and Analysis of Financial Condition and Results of Operation and the risks described therein from time to time.

POR-F

Source: Portland General Electric Company

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME

(Dollars in millions, except per share amounts)

(Unaudited)

Three Months Ended December 31,

Twelve Months Ended December 31,

2007

2006

2007

2006

Revenues

$ 470

$ 416

$ 1,743

$ 1,520

Operating expenses

Purchased power and fuel

259

190

879

763

Production and distribution

41

37

150

140

Administrative and other

48

45

184

164

Depreciation and amortization

47

54

181

219

Taxes other than income taxes

20

18

80

75

Income taxes

12

18

71

38

427

362

1,545

1,399

Income from operations

43

54

198

121

Other income (deductions)

Allowance for equity funds used during construction

3

5

16

16

Miscellaneous

(2)

-

8

1

Income taxes

-

1

(3)

2

1

6

21

19

Interest expense

20

20

74

69

Net income

$ 24

$ 40

$ 145

$ 71

Common Stock

Weighted-average shares outstanding (in thousands):

Basic

62,519

62,502

62,512

62,501

Diluted

62,533

62,515

62,534

62,505

Earnings per share, basic and diluted

$ 0.40

$ 0.64

$ 2.33

$ 1.14

Dividends declared per share

$ 0.235

$ 0.225

$ 0.93

$ 0.675

 

 

 

 

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(In millions, except share amounts)

(Unaudited)

At December 31

2007

2006

ASSETS

Electric utility plant, net:

Electric utility plant at cost (includes construction work in progress

of $126 and $412)

$

5,024 

$

4,582 

Less: accumulated depreciation and amortization

(1,958)

(1,864)

Electric utility plant, net

3,066 

2,718 

Other property and investments:

Nuclear decommissioning trust, at market value

46 

42 

Non-qualified benefit plan trust

69 

70 

Miscellaneous

19 

26 

Total other property and investments

134 

138 

Current assets:

Cash and cash equivalents

73 

12 

Accounts and notes receivable (less allowance for uncollectible accounts

of $5 and $45)

178 

177 

Unbilled revenues

92 

88 

Assets from price risk management activities

64 

93 

Inventories, at average cost

64 

64 

Other current assets

67 

93 

Total current assets

538 

527 

Regulatory assets

304 

351 

Other noncurrent assets

66 

33 

Total assets

$

4,108 

$

3,767 

CAPITALIZATION AND LIABILITIES

Capitalization:

Common stock, no par value, 80,000,000 shares authorized; 62,529,787
and 62,504,767 shares issued and outstanding at December 31, 2007 and 2006, respectively

$

646 

$

643 

Accumulated other comprehensive loss

(4)

(6)

Retained earnings

674 

587 

Total shareholders' equity

1,316 

1,224 

Long-term debt

1,313 

937 

Total capitalization

2,629 

2,161 

Current liabilities:

Accounts payable and other accruals

227 

212 

Liabilities from price risk management activities

101 

155 

Accrued taxes

23 

14 

Short-term borrowings

- 

81 

Long-term debt due within one year

- 

66 

Other current liabilities

40 

34 

Total current liabilities

391 

562 

Regulatory liabilities

574 

523 

Deferred income taxes

279 

251 

Non-qualified benefit plan liabilities

86 

84 

Trojan asset retirement obligation

62 

108 

Accumulated asset retirement obligation

29 

26 

Other noncurrent liabilities

58 

52 

Total liabilities

1,479 

1,606 

Total capitalization and liabilities

$

4,108 

$

3,767 

 

 

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In millions)

(Unaudited)

Years Ended December 31

2007

2006

Cash flows from operating activities:

Net income

$

145

$

71

Reconciliation of net income to net cash provided by operating activities

Depreciation and amortization

181

219

Net assets from price risk management activities

(26

)

132

Regulatory deferrals - price risk management activities

26

(132

)

Deferred income taxes

22

(38

)

Allowance for equity funds used during construction

(16

)

(16

)

Senate Bill 408 deferrals

(16

)

42

Power cost deferrals

(9

)

-

Other non-cash income and expenses, net

1

-

Changes in working capital:

Net margin deposit activity

21

(94

)

(Increase) decrease in receivables

(4

)

17

Increase (decrease) in payables

19

(88

)

Other working capital items, net

(2

)

(11

)

Other, net

2

4

Net cash provided by operating activities

344

106

Cash flows from investing activities:

Capital expenditures

(455

)

(371

)

Purchases of nuclear decommissioning trust securities

(23

)

(37

)

Sales of nuclear decommissioning trust securities

21

21

Proceeds from sale of assets

-

6

Other, net

6

1

Net cash used in investing activities

(451

)

(380

)

Cash flows from financing activities:

Issuance of long-term debt

381

275

Short-term borrowings, net

(81

)

81

Repayment of long-term debt

(71

)

(162

)

Dividends paid

(58

)

(28

)

Debt issuance costs

(3

)

(2

)

Net cash provided by financing activities

168

164

Increase (decrease) in cash and cash equivalents

61

(110

)

Cash and cash equivalents, beginning of year

12

122

Cash and cash equivalents, end of year

$

73

$

12

Supplemental disclosures of cash flow information:

Cash paid during the year:

Interest, net of amounts capitalized

$

58

$

55

Income taxes

46

101

Non-cash investing and operating activities:

Accrued capital additions

27

20

Common stock dividends declared but not paid

15

14

 

 

 

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES

SUPPLEMENTAL OPERATING STATISTICS

Three Months Ended
December 31,

Twelve Months Ended
December 31,

2007

2006

2007

2006

Revenues (in millions)

Retail sales:

Residential

$ 215

$ 180

$ 716

$ 628

Commercial

153

141

593

547

Industrial

40

53

159

206

Total retail sales

408

374

1,468

1,381

Direct access customers:

Commercial

-

(1)

-

(6)

Industrial

(3)

(2)

(12)

(6)

Tariff revenues

405

371

1,456

1,369

Accrued revenues

(1)

1

-

3

Regional Power Act credits

-

26

42

35

Provision for collection (refund) - SB 408

7

(10)

18

(40)

Total retail revenues

411

388

1,516

1,367

Wholesale revenues

52

21

201

135

Other operating revenues

7

7

26

18

Total revenues

$ 470

$ 416

$ 1,743

$ 1,520

Energy sold and delivered - MWhs (in thousands)

Retail energy sales:

Residential

2,183

2,125

7,688

7,573

Commercial

1,847

1,860

7,289

7,319

Industrial

610

899

2,485

3,541

Total retail energy sales

4,640

4,884

17,462

18,433

Delivered to direct access customers:

Commercial

116

99

492

430

Industrial

437

137

 

1,673

569

Total retail energy deliveries

5,193

5,120

19,627

19,432

Wholesale sales

882

684

4,042

3,312

Total energy sold and delivered

6,075

5,804

23,669

22,744

Retail customers - end of period

Residential

706,444

696,779

Commercial

97,088

95,734

Industrial

256

259

Total retail customers

803,788

792,772

 

PORTLAND GENERAL ELECTRIC COMPANY AND SUBSIDIARIES

SUPPLEMENTAL OPERATING STATISTICS (CONTINUED)

Degree Days

Heating

Cooling

2007

2006

2007

2006

1st Quarter

1,852

1,814

-

-

Average

1,840

 

1,840

 

-

 

-

2nd Quarter

698

572

56

116

Average

664

 

664

 

67

 

67

3rd Quarter

123

79

344

424

Average

82

 

82

 

385

 

385

4th Quarter

1,701

1,624

-

1

Average

1,575

 

1,575

 

2

 

2

Annual Total

4,374

4,089

400

541

Average

4,161

4,161

454

454

Note: Average represents a 15 year average (1993 - 2007) of degree day data provided by the National Weather Service (Portland Airport).