Chesterton Tribune

 

 

NiSource posts 2019 profit of $328M but subsidiary pays record safety fine

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By KEVIN NEVERS

NiSource Inc. is today reporting a net income in 2019 of $328 million or 88 cents per share, compared to a net loss in 2018 of $65.6 million or 18 cents.

For the fourth quarter NiSource is reporting a net loss of $153 million or 41 cents, compared to a net loss of $19.8 million or 5 cents in the year-ago period.

NiSource was originally scheduled to release its 2019/4Q report on Wednesday but postponed the release following the announcement of a settlement agreement under which its subsidiary, Columbia Gas of Massachusetts, will pay a $53-million fine in connection with the disastrous series of natural-gas explosions which shook three communities in the Merrrimack Valley north of Boston in September 2018.

That fine is the largest ever imposed for breaking a federal pipeline safety law.

Also under that settlement agreement, NiSource will endeavor to sell Columbia Gas of Massachusetts--with any profit from the sale turned over to the federal government--as well as to cease any gas pipeline and distribution activities in Massachusetts. Late on Wednesday, NiSource announced that it has entered into a definitive agreement to sell Columbia Gas of Massachusetts to Eversource Energy, New England’s largest energy delivery company.

Purchase price: $1.1 billion in cash, which NiSource said represents a loss compared to the subsidiary’s book value.

Citing the sale of its Massachusetts subsidiary, NiSource on Wednesday withdrew its 2020 guidance, but said that it still expects to make capital investments this year totaling $1.8-1.9 billion.

To date, costs and expenses related to the pipeline disaster total up to $1.783 billion: $258 million in capital spent on pipeline replacement; up to $1.065 billion in third-party claims and government fines, penalties, and settlements; and up to $460 million in other related costs. Insurance companies to date: $800 million.

“Our performance in 2019 demonstrated the resiliency of the NiSource business plan,” NiSource President and CEO Joe Hamrock said. “During a challenging year, our team remains relentlessly focused on safety and customer satisfaction, starting with the accelerated implementation of SMS, as well as advancing our electric generation strategy in Indiana and executing on nearly $1.9 billion in capital infrastructure and safety investments in our gas and electric systems.”

SMS, according to NiSource, is a “comprehensive approach to managing safety, emphasizing continual assessment and improvement, as well as proactively identifying and mitigating potential risks.”

“Safety is, and will remain, the foundation of everything we do across our business,” Hamrock said. “Our vision is to lead in safety and exceeding existing industry standards, anchored by three pillars--a culture where everyone is empowered to identify and report risk, process safety that adds layers of protection, and enhanced asset risk analytics.”

2019 By Segment

--Gas distribution: operating income of $675.4 million (2018 operating loss of $254.1 million).

--Electric: operating income of $406.8 million (2018 operating income of $386.1 million).

--Corporate and other: operating loss of $191.5 million (2018 operating loss of $7.3 million).

--Total: operating income of $890.7 million (2018 operating income of $124.7 million).

4Q by Segment

--Gas distribution: operating income of $69.6 million (year-ago operating loss of $159.7 million).

--Electric: operating income of $85.4 million (year-ago operating income of $85.7 million).

--Corporate and other: operating loss of $193 million (year-ago operating loss of $4.4 million).

--Total: operating loss of $38 million (year-ago operating loss of $78.4 million).

 

 

Posted 2/27/2020

 
 
 
 

 

 

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