Document/Exhibit Description Pages Size
1: 8-K Date of Report: May 16, 2002 4 15K
2: EX-16 Ex. 16.1: Letter of Arthur Andersen LLP 1 5K
3: EX-99 Ex. 99.1 - Press Release, May 16, 2002 2 14K
4: EX-99 Ex. 99.2 - Press Release, May 17, 2002 5 23K
[GRAPHIC OMITTED] News Release
NYSE:NOR
Contacts:
Investors: Media:
Elizabeth A. Evans Roger Schrum
605-978-2929 605-978-2848
liz.evans@northwestern.com roger.schrum@northwestern.com
--------------------------------------------------------------------------------
NORTHWESTERN CORPORATION REAFFIRMS 2002 PERFORMANCE AND
ANNUALIZED FREE CASH FLOW TARGETS;
COMPANY SELECTS NEW INDEPENDENT ACCOUNTANTS FOR 2002;
ANNOUNCES INVESTOR WEBCAST AT 11 A.M. (EASTERN) TODAY
--------------------------------------------------------------------------------
SIOUX FALLS, S.D. - May 17, 2002 - NorthWestern Corporation (NYSE:NOR) today
reaffirmed that it is targeting substantial transformation in performance by the
company's energy and communications businesses for 2002 resulting in earnings of
$2.30 to $2.55 per diluted share from continuing operations, earnings before
interest, taxes, depreciation and amortization (EBITDA) of between $335 to $355
million and annualized free cash flow of $100 million by year-end.
NorthWestern will conduct a conference call with analysts today at 11 a.m.
Eastern time to discuss the company's targeted 2002 performance and will comment
on recent stock activity. The conference call will be webcast live via the
NorthWestern Corporation Web site at www.northwestern.com or at
www.companyboardroom.com.
NorthWestern announced on May 1, 2002, first quarter 2002 income from
continuing operations was $24.0 million or 65 cents per diluted share, before
extraordinary charges and discontinued operations, compared with income from
continuing operations of $13.2 million or 48 cents per diluted share in the
first quarter of 2001. Revenues from continuing operations were $480.1 million,
compared with $477.6 million in the same quarter in 2001.
"Our strong first quarter performance is continuing into the second quarter
as we reconfirm our previously announced 2002 earnings target of $2.30 to $2.55
per share from continuing operations," said Merle D. Lewis, NorthWestern
chairman and chief executive officer. "We are on target to generate $100 million
in annualized free cash flow by year-end 2002 and EBITDA of $335 to $355
million. Evidence of our strong cash generation capabilities includes our cash
and marketable security increase from $100 million at year-end 2001 to $218
million at the end of first quarter 2002. We believe this strong cash flow
positions us to further reduce debt and
-More-
NorthWestern Corporation Reaffirms 2002 Performance and
Annualized Free Cash Flow Targets
May 17, 2002
Page 2
increase profitability going forward. Additionally, the company retains full
access to its $280 million revolving credit facility, which is undrawn."
"Our strong energy business, along with improving results from our building
communications business, provides a solid platform for improving our capability
of increasing future earnings and dividends," Lewis said. NorthWestern has
increased dividend for 18 consecutive years and has consistently ranked in the
top tier of dividend paying companies among the Dow Jones Utility Index as a
result of its policy of increasing dividends 5 to 10 percent annually. The
company's 2002 annual dividend rate is currently $1.27 per share.
According to Richard R. Hylland, NorthWestern's president and chief
operating officer, NorthWestern's energy operations, which included the recently
acquired energy operations of Montana Power, are leading the company's improved
results in 2002. NorthWestern Energy, the company's electricity and natural gas
business, showed strong performance in the first quarter with EBITDA growth to
$56.5 million, up from $22.3 million in the first quarter 2001.
"NorthWestern Energy is driving our strong performance in 2002 with our
energy operations targeted to deliver in excess of $250 million in EBITDA while
requiring less than $65 million in maintenance and capital expenditures,"
Hylland said, noting that NorthWestern Energy's reported $67 million in EBITDA
in 2001, before a restructuring charge. "Our strong energy operations are on
target to account for more than 70 percent of NorthWestern's operating income in
2002."
Hylland said Expanets, NorthWestern's communications business, showed a
transformation in performance in the first quarter of 2002 with EBITDA of $8.7
million, an improvement of $46.4 million from an EBITDA loss of $37.7 million in
the same quarter in 2002.
"Expanets' improved performance in 2002 is expected to come, in part, from
the continuing benefits of its successful efforts to substantially lower its
cost structure which has resulted in a greater than 50 percent reduction in its
breakeven point as compared to last year," Hylland said. "By restructuring
Expanets sales force for future growth and improved gross margins, migrating the
business to a common information technology platform and eliminating costly
transition expenses, Expanets expects to achieve its previously announced $135
million EBITDA increase in 2002 - reaching $80 to $87 million in EBITDA targeted
for the 2002, compared to a negative EBITDA of $47.5 million in 2001."
NorthWestern Corporation Reaffirms 2002 Performance and
Annualized Free Cash Flow Targets
May 17, 2002
Page 3
As previously discussed in the company's first quarter analysts conference
call on May 1, 2002, NorthWestern's accounts receivables rose $93 million in the
first quarter primarily due to certain delays in billings experienced in
connection with the implementation of the new integrated information technology
platform at Expanets. The implementation delays have been addressed and
NorthWestern expects its accounts receivables to be reduced to normal levels
over the next several months.
Hylland said Blue Dot, NorthWestern's energy-related heating, ventilation
and air conditioning business, is seeing a solid seasonal pick up in revenue
activity in the second quarter and remains on track to meet its full-year 2002
EBITDA target of $30 to $35 million. Blue Dot reported EBITDA of approximately
$10 million in 2001, before a restructuring charge.
"Blue Dot traditionally generates more than 70 percent of its EBITDA in the
second and third quarters," Hylland said. "With the warmer weather, we are
seeing a solid pickup in revenue as we continue to implement sales and marketing
plans for improved performance."
NorthWestern Selects Deloitte & Touche as Independent Auditors for 2002
In light of recent events concerning Arthur Andersen, NorthWestern and its
audit committee has interviewed a number of independent auditing firms for the
year 2002 audit. This process has now been completed and NorthWestern's audit
committee and Board of Directors have selected Deloitte & Touche as the
company's independent accountants. Arthur Andersen had served as NorthWestern's
independent accountants since 1932. The decision to change to Deloitte & Touche
was part of the company's ongoing review by its audit committee and in no way
reflects on Andersen's commitment or quality of service to NorthWestern.
"We expect to have a smooth transition to Deloitte & Touche, one of the
nation's most prestigious independent auditing firms," said Kipp Orme,
NorthWestern's vice president and chief financial officer. "We had no
disagreements with Andersen on matters of accounting principles. However, given
their current challenges, both management and the audit committee felt it was
appropriate to make the change to Deloitte & Touche."
NorthWestern filed its consolidated Form 10-Q with the Securities and
Exchange Commission on May 15, 2002, for its results which ended March 31, 2002.
NorthWestern Energy LLC, formerly the Montana Power Company (MTP), which
consists of the recently acquired MTP energy operations, is required to file
separate financial reports with the SEC with
NorthWestern Corporation Reaffirms 2002 Performance and
Annualized Free Cash Flow Targets
May 17, 2002
Page 4
respect to previously existing public debt of the former Montana Power Company
using predecessor accounting. NorthWestern Energy LLC will file its Form 10-Q on
May 20, 2002, for results ended March 31, 2002. This delayed filing has no
impact on NorthWestern Corporation's already filed Form 10-Q which contains the
corporation's consolidated results including NorthWestern Energy LLC beginning
Feb. 1, 2002.
The financial statements to be set forth in the Form 10-Q for NorthWestern
Energy LLC are required to be presented on the predecessor accounting basis of
MTP which includes the Montana Public Service Commission approved stipulation
agreements reflected in January's results. These agreements include adjustments
to regulatory assets and liabilities during the period of Montana Power
Company's ownership. This predecessor accounting is not reflective of
NorthWestern's post acquisition purchase accounting basis for these operations
in its Form 10-Q filing as required under SEC and generally accepted accounting
principles (GAAP) guidelines.
NorthWestern Corporation, a FORTUNE 500 company, is a leading provider of
services and solutions to more than 2 million customers across America in the
energy and communications sectors. NorthWestern's partner businesses include
NorthWestern Energy, a provider of electricity, natural gas and related services
to customers in Montana, South Dakota and Nebraska; Expanets, the largest
mid-market provider of networked communications solutions and services in the
United States; and Blue Dot, a leading provider of air conditioning, heating,
plumbing and related services. Further information about NorthWestern is
available on the Internet at www.northwestern.com.
Forward-Looking Statements
STATEMENT UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995: All
statements contained herein, as well as statements made in press releases and
oral statements that may be made by us or by officers, directors or employees
acting on our behalf, that are not statements of historical fact constitute
"forward-looking statements" within the meaning of the Private Securities
Litigation Reform Act of 1995. Such forward-looking statements involve known and
unknown risks, uncertainties and other factors that could cause our actual
results to be materially different from historical results or from any future
results expressed or implied by such forward-looking statements. Among the
factors that could cause our actual results to differ materially are: the
adverse impact of weather conditions; unscheduled generation outages;
maintenance or repairs; unanticipated changes to fossil fuel or gas supply costs
or availability due to higher demand, shortages, transportation problems or
other developments; developments in the federal and state regulatory environment
and the terms associated with obtaining regulatory approvals; costs associated
with environmental liabilities
NorthWestern Corporation Reaffirms 2002 Performance and
Annualized Free Cash Flow Targets
May 17, 2002
Page 5
and compliance with environmental laws; the rate of growth and economic
conditions in our service territories and those of our subsidiaries; the speed
and degree to which competition enters the industries and markets in which our
businesses operate; the timing and extent of changes in interest rates and
fluctuations in energy-related commodity prices; risks associated with
acquisitions, transition and integration of acquired companies, including
implementation of information systems and realizing efficiencies in excess of
any related restructuring charges; reduction of minority interest basis
requiring us to recognize an increased share of operating losses at certain of
our subsidiaries; our ability to recover transition costs; approval of our
default supply contract portfolio by the MPSC; disruptions and adverse effects
in the capital market due to the changing economic environment; our credit
ratings with Moody's, Standard & Poor's and Fitch; changes in customer usage
patterns and preferences; and changing conditions in the economy, capital
markets and other factors identified from time to time in our filings with the
SEC.
Any forward-looking statement speaks only as of the date on which such
statement is made, and, except as required by law, we undertake no obligation to
update any forward-looking statement to reflect events or circumstances after
the date on which such statement is made or to reflect the occurrence of
unanticipated events. New factors emerge from time to time and it is not
possible for management to predict all such factors.
###
Dates Referenced Herein and Documents Incorporated by Reference
↑Top
Filing Submission 0001116679-02-001100 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)
Copyright © 2024 Fran Finnegan & Company LLC – All Rights Reserved.
About — Privacy — Redactions — Help —
Mon., May 13, 10:13:20.2pm ET