Business Context and Reporting Period
This Form 8-K is a combined current report filed on October 28, 2015, by The Southern Company and its five subsidiaries: Alabama Power Company, Georgia Power Company, Gulf Power Company, Mississippi Power Company, and Southern Power Company. The filing serves to disseminate earnings results for the three-month and nine-month periods ended September 30, 2015.
Key Financial Metrics
The filing text does not provide specific numerical values for revenue, profit, cash flow, margins, debt, or liquidity. These metrics are contained within the attached exhibits (Exhibits 99.01 through 99.07), which are referenced but not included in the provided text. The report highlights the use of both GAAP and Non-GAAP financial measures to present earnings and earnings per share.
Material Changes and Unusual Items
The filing identifies several significant non-recurring or unusual items impacting the financial presentation for the periods ended September 30, 2015, and 2014:
- Kemper IGCC Charges: Estimated probable losses related to Mississippi Power Company's construction of the integrated coal gasification combined cycle facility in Kemper County, Mississippi. These charges significantly impacted earnings and may occur with uncertain frequency in the future.
- AGL Resources Acquisition: Costs related to the proposed acquisition of AGL Resources Inc., which are expected to continue during the completion and integration phases.
- Mirant Corporation and MCAR Settlement: Additional costs related to the discontinued operations of Mirant Corporation and a March 2009 settlement agreement with MC Asset Recovery, LLC. These costs are not expected to recur.
Guidance, Outlook, and Management Commentary
Management utilizes Non-GAAP earnings measures (excluding the charges listed above) to evaluate the performance of ongoing business activities and believes this presentation provides investors with useful additional information. The filing explicitly states that these Non-GAAP measures are not a substitute for GAAP financial measures. No specific forward-looking guidance or quantitative outlook is provided in the text of this report.
Investor Verification Checklist
- Verify the specific dollar amounts for revenue, net income, and earnings per share in Exhibit 99.01 (Press Release) and Exhibit 99.02 (Financial Highlights).
- Review Exhibit 99.03 and 99.04 to quantify the exact impact of Kemper IGCC charges, AGL acquisition costs, and Mirant/MCAR settlement costs on EPS.
- Confirm the status and timeline of the proposed AGL Resources Inc. acquisition.
- Assess the ongoing construction risks and cost estimates for the Kemper County IGCC facility.