Business Context and Reporting Period
This Form 8-K is a combined current report filed by Pinnacle West Capital Corporation and its subsidiary, Arizona Public Service Company (APS). The report covers financial results for the three and six months ended June 30, 2006, with the report date being July 21, 2006.
Key Financial Metrics
The filing text serves as a cover document referencing detailed financial data contained in attached exhibits. Specific numerical values for revenue, profit, cash flow, margins, debt, and liquidity are not provided in the text of this filing. Instead, the report directs readers to the following exhibits for quantitative data:
- Exhibit 99.2 & 99.3: Quarterly consolidated statistical summaries for the six-month periods ended June 30, 2006, and 2005.
- Exhibit 99.7: Earnings variance explanations and condensed consolidated statements of income for the three and six months ended June 30, 2006, and 2005.
- Exhibit 99.9: Earnings news release issued on July 21, 2006.
Material Changes and Non-GAAP Measures
The filing highlights the use of non-GAAP financial measures, specifically defined as "on-going earnings" and "on-going earnings per share."
- Purpose: Management uses these measures to provide a useful indicator of results comparable among periods by excluding the effects of unusual items that occur on an irregular basis.
- Reconciliation: Exhibit 99.10 contains a table reconciling these non-GAAP measures to net income (the most directly comparable GAAP measure).
- Management Judgment: The filing notes that these measures involve management judgments regarding the classification of items as "unusual."
Guidance, Outlook, and Risks
The filing includes standard disclosures regarding the nature of the information provided:
- Preliminary Nature: Some information is preliminary and subject to significant adjustment.
- Third-Party Data: Certain data is based on information received from third parties and may contain inaccuracies for which the company assumes no responsibility.
- Update Obligation: The company assumes no obligation to update or correct the information and reserves the right to discontinue providing it at any time.
- Legal Status: Information furnished under Item 2.02 and in specific exhibits is not deemed "filed" for purposes of Section 18 of the Exchange Act and is not incorporated by reference into other filings unless expressly stated.
Investor Verification Checklist
- Review Exhibit 99.9 (Earnings News Release) for specific revenue, net income, and earnings per share figures for the quarter and year-to-date.
- Examine Exhibit 99.10 to understand the specific adjustments made to derive "on-going earnings" from GAAP net income.
- Consult Exhibit 99.7 for detailed explanations of earnings variances between 2006 and 2005.
- Verify the preliminary nature of the statistical summaries in Exhibits 99.2 and 99.3 against final audited reports when available.