Business Context and Reporting Period
This Form 8-K, filed on March 1, 2013, covers PNM Resources, Inc., Public Service Company of New Mexico, and Texas-New Mexico Power Company (collectively, the "Company"). The filing announces the results of operations for the three months and the full year ended December 31, 2012.
Key Financial Metrics
The filing text does not provide specific numerical values for revenue, profit, cash flow, margins, debt, or liquidity. These figures are contained within the press release furnished as Exhibit 99.1, which is incorporated by reference but not detailed in the body of this report.
Material Changes and Non-GAAP Measures
The Company utilizes non-GAAP financial measures, specifically "ongoing earnings" and "ongoing diluted earnings per share," to evaluate operations. These measures exclude:
- Net unrealized mark-to-market gains and losses on economic hedges.
- Net changes in unrealized impairments on assets held in trusts for nuclear decommissioning.
- Certain other non-recurring or infrequent items.
Management states these measures remove variances not indicative of fundamental changes in earnings capacity. The filing does not detail specific material changes in financial condition compared to prior periods within the text provided.
Guidance, Outlook, and Risks
The Company provides "ongoing earnings guidance" to reflect management's expectations of financial performance. However, this guidance is not a GAAP measure, and management generally cannot estimate the impact of reconciling items (such as hedge mark-to-market adjustments) on forecasted GAAP earnings. Consequently, a corresponding GAAP equivalent for the earnings guidance is not provided.
The filing includes a limitation stating that the information, including exhibits, is furnished pursuant to Item 2.02 and is not deemed "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, nor is it incorporated by reference in filings under the Securities Act of 1933.
Investor Verification Checklist
- Review Exhibit 99.1 (Press Release dated March 1, 2013) for specific GAAP and non-GAAP financial results for the three months and year ended December 31, 2012.
- Verify the reconciliation between reported GAAP earnings and the Company's "ongoing earnings" guidance.
- Assess the impact of unrealized mark-to-market gains/losses on economic hedges and nuclear decommissioning trust impairments on reported volatility.
- Confirm that the "ongoing earnings guidance" provided by management does not represent an expectation of net earnings as defined by GAAP.