Reports diluted EPS of $.17/share compared with $.24/share in 2Q 2008 Reduces guidance for 2009 to be $1.75 - $1.85 per fully diluted share from $1.85 - $2.00 per fully diluted share SIOUX FALLS, S.D., July 29 /PRNewswire-FirstCall/ -- NorthWestern Corporation d/b/a NorthWestern Energy (NYSE:NWE) reported financial results for the quarter ended June 30, 2009. Significant achievements for the quarter include: -- Received approval from the MPSC to construct the proposed 150 MW Mill Creek Generating Station project with a 50% debt and 50% equity capital structure, return on equity at 10.25% and debt at 6.5%; and -- Amended and restated the revolving credit facility to increase the amount to $250 million from the current $200 million and to extend the maturity date to June 30, 2012 from November 1, 2009. Financial Results Consolidated net income was $6.1 million or $.17 per diluted share for the quarter ended June 30, 2009, compared with consolidated net income of $9.5 million or $.24 per diluted share for the quarter ended June 30, 2008. Computed diluted shares were 36.3 million at June 30, 2009 compared with 39.4 million diluted shares at June 30, 2008. Consolidated net income for the six months ended June 30, 2009 was $28.9 million, a decrease of $4.1 million or 12.4%, from $33.0 million in 2008. "During the second quarter of 2009, we experienced economy-driven weakness in non-firm wholesale transmission revenues in Montana and wholesale power prices in South Dakota when compared with the second quarter of 2008," said Bob Rowe, President and CEO. "We continue to maintain a strong balance sheet. We recently bolstered our liquidity by issuing debt to facilitate execution of our capital projects, specifically including the Mill Creek Generating Station currently under construction. Finally, we are continuing to work to take actions now to focus on discretionary spending to address the declining gross margins." Consolidated gross margin for the second quarter of 2009 was $128.9 million compared with $127.2 million for the second quarter of 2008. The improvement in consolidated gross margin was substantially due to the transfer of our interest in Colstrip Unit 4 to Montana utility rate base and represents our return on rate base. This improvement was offset by decreases in electric transmission, electric wholesale and natural gas margins primarily due to lower demand, as a result of economic conditions and mild weather. Consolidated gross margin for the six months ended June 30, 2009 was $291.8 million compared with $284.0 million in the same period of 2008. Consolidated operating, general and administrative expenses increased to $60.9 million for the quarter ended June 30, 2009 as compared with $53.9 million for the quarter ended June 30, 2008. The increase was due primarily to increased labor and benefit costs due to compensation increases, severance costs, and higher post-retirement benefit costs combining for an increase of approximately $3 million. In addition, the Company experienced approximately $2.9 million higher pension expense in the second quarter of 2009 compared with the second quarter of 2008 based on our funding projections and a revised MPSC pension accounting order issued during the fourth quarter of 2008. The Company also recorded a $3.5 million insurance recovery during the second quarter of 2009 related to previously incurred Montana generation related environmental remediation costs, partially offset by a $1.8 million insurance recovery during the second quarter of 2008. Consolidated operating, general and administrative expenses were $126.3 million for the six months ended June 30, 2009 as compared with $113.9 million in same period of 2008. Property and other taxes were $18.2 million for the three months ended June 30, 2009 as compared with $20.5 million in the second quarter of 2008. For the six months ended June 30, 2009, property and other taxes were $42.5 million compared with $44.2 million in the same period of 2008. The decreases were due to lower assessed property valuations. Depreciation expense was $22.3 million for the three months ended June 30, 2009 as compared with $21.2 million in the second quarter of 2008. For the six months ended June 30, 2009, depreciation expense was $45.0 million compared with $42.3 million in the same period of 2008. These increases were primarily due to plant additions. Interest expense for the three months ended June 30, 2009 was $18.0 million, an increase of $2.2 million from the second quarter of 2008. For the six months ended June 30, 2009, interest expense was $33.1 million compared with $31.8 million in the same period of 2008. These increases were primarily related to an increase in long-term debt outstanding. Income tax expense for the three months ended June 30, 2009 was $3.6 million as compared with $6.0 million in the second quarter of 2008. Our effective tax rate for 2009 was 36.9% as compared with 38.7% for 2008. For the six months ended June 30, 2009, income tax expense was $16.7 million compared with $19.2 million in the same period of 2008. Results from Regulated Operations Regulated electric gross margin for the quarter ended June 30, 2009 was $101.8 million, up 10.9%, compared with $91.8 million for the same period of 2008. This improvement is primarily due to the transfer of Colstrip Unit 4 from the unregulated electric segment to the regulated utility, which will help provide rate stability for our customers. This transfer is reflected as an increase in retail revenue and a reduction to cost of sales. Prior to the transfer of Colstrip Unit 4, all of our Montana electric supply costs were based on power purchase agreements, which are passed through to customers at actual cost with no return component. In addition, the unregulated electric margin for the same period of 2008 included an unrealized loss on a forward electric sales contract of $5.2 million. This increase in electric margin was offset in part by lower transmission volumes with less demand to transmit energy for others across our lines, a decrease in wholesale margin due to lower sales at lower average prices, and higher qualifying facility (QF) supply costs based on actual QF pricing and output. Regulated retail electric volumes for the quarter ended June 30, 2009 totaled 2,298,000 megawatt hours compared with 2,370,000 megawatt hours for the quarter ended June 30, 2008, a 3.0% decrease. The decrease was due to a combination of economic conditions and mild weather partially offset by growth in the number of residential and commercial customers. Wholesale electric volumes were 154,000 megawatt hours for the quarter ended June 30, 2009, an increase from 82,000 megawatt hours for the same period in 2008. The increase was primarily due to the transfer of Colstrip Unit 4 to the regulated utility, partially offset by a decrease in South Dakota wholesale volumes from lower plant availability. Regulated electric gross margin for the six months ended June 30, 2009 was $215.1 million, up 16.1%, compared with $185.3 million for the same period of 2008 generally for the same reasons as the increase in the second quarter discussed above. Regulated retail electric volumes for the six months ended June 30, 2009 totaled 4,961,000 megawatt hours compared with 5,005,000 megawatt hours for the six months ended June 30, 2008. Wholesale electric volumes were 397,000 megawatt hours for the six months ended June 30, 2009, an increase from 131,000 megawatt hours for the same period in 2008. Regulated natural gas gross margin was $28.5 million for the quarter ended June 30, 2009 compared with $30.6 million during the second quarter of 2008. Regulated retail natural gas volumes were 5,417,000 dekatherms for the quarter ended June 30, 2009 compared with 6,055,000 dekatherms for the same period in 2008. The decline in gross margin and volumes is primarily due to warmer weather in all service territories. Regulated natural gas gross margin was $78.4 million for the six months ended June 30, 2009 compared with $81.0 million during the same period of 2008. Regulated retail natural gas volumes were 19,287,000 dekatherms for the six months ended June 30, 2009 compared with 20,227,000 dekatherms for the same period in 2008. The decline in gross margin and volumes is primarily due to warmer weather in Montana and Nebraska. Liquidity and Capital Resources As of June 30, 2009, cash and cash equivalents were $23.0 million compared with $11.3 million at Dec. 31, 2008. As of June 30, 2009, our total net liquidity was approximately $269.3 million, compared with $ 86.2 million at Dec. 31, 2008. The increase in liquidity was due primarily to issuance of $250 million of Montana First Mortgage Bonds in March 2009 and an amendment to the unsecured revolving line of credit that increased the availability under that line from $200 million to $250 million. Cash provided by operating activities totaled $85.4 million for the six months ended June 30, 2009 as compared with $124.6 million during the six months ended June 30, 2008. This decrease in operating cash flows is primarily related to increased pension funding of approximately $41.3 million and a $10.8 million prepayment of a power purchase agreement, offset by lower commodity prices reflected in the change in accounts receivable and accounts payable, as well as decreased cash outflows for natural gas storage injections. Cash used in investing activities during the six months ended June 30, 2009 increased by approximately $3.5 million as compared with 2008 due to increased property, plant and equipment additions. Capital expenditures for the six months ended June 30, 2009 were $46.9 million as compared with $43.1 million in the same period of 2008. Cash used in financing activities totaled approximately $27.2 million during the six months ended June 30, 2009 as compared with $70.1 million during the six months ended June 30, 2008. During the first half of 2009, the Company received net proceeds from the issuance of debt of $249.8 million, made net debt repayments of $243.0 million, paid deferred financing costs of $9.9 million and paid dividends on common stock of $24.1 million. During the six months ended June 30, 2008, the Company made net debt repayments of $42.9 million and paid dividends on common stock of $25.7 million. 2009 Earnings Outlook NorthWestern reduces its earnings outlook for 2009 to be $1.75 - $1.85/fully diluted share from previous guidance of $1.85 - $2.00/fully diluted share. The major assumptions include, but are not limited to, the following expectations: -- Reduced off-system transmission revenues in Montana for the remainder of 2009 -- 2009 net income will increase by approximately $9 million or $.25 per share as a result of the inclusion of our interest in Colstrip Unit 4 in regulated electric rate base; -- Pension expense based on an assumed 8% return on plan assets for 2009; -- Retail electric volumes will be flat compared with 2008 volumes; -- Wholesale electric volumes in South Dakota will decrease due to pricing and volume reductions; -- Residential and Commercial natural gas volumes will be relatively flat compared with 2008 volumes; -- Fully diluted average shares outstanding of 36.5 million; and -- Normal weather in the Company's electric and natural gas service territories for the rest of 2009. Company Hosting Investor Conference Call NorthWestern will host an investor conference call today at 2:30 pm Eastern Time to review its financial results for the quarter ended June 30, 2009. The conference call will be webcast live on the Internet at http://www.northwesternenergy.com/ under the "Investor Information" heading. To listen, please go to the site at least 10 minutes in advance of the call to register. An archived webcast will be available shortly after the call. A telephonic replay of the call will be available beginning at 4:30 pm Eastern Time today through August 29, 2009, at 800-475-6701, access code 107524. About NorthWestern Energy NorthWestern Energy is one of the largest providers of electricity and natural gas in the Upper Midwest and Northwest, serving approximately 656,000 customers in Montana, South Dakota and Nebraska. More information on NorthWestern Energy is available on the Company's Web site at http://www.northwesternenergy.com/. SPECIAL NOTE REGARDING FORWARD--LOOKING STATEMENTS This press release contains forward-looking statements within the meaning of the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995, including, without limitation, the information under "2009 Earnings Outlook". Forward-looking statements often address our expected future business and financial performance, and often contain words such as "expects," "anticipates," "intends," "plans," "believes," "seeks," or "will." These statements are based upon our current expectations and speak only as of the date hereof. Our actual future business and financial performance may differ materially and adversely from those expressed in any forward-looking statements as a result of various factors and uncertainties, including, but not limited to: -- potential adverse federal, state, or local legislation or regulation or adverse determinations by regulators could have a material adverse effect on our liquidity, results of operations and financial condition; -- unanticipated changes in availability of trade credit, usage, commodity prices, fuel supply costs or availability due to higher demand, shortages, weather conditions, transportation problems or other developments, may reduce revenues or may increase operating costs, each of which would adversely affect our liquidity; -- unscheduled generation outages or forced reductions in output, maintenance or repairs, which may reduce revenues and increase operating costs or may require additional capital expenditures or other increased operating costs; and -- adverse changes in general economic and competitive conditions in the U.S. financial markets and in our service territories. Our Annual Report on Form 10-K, recent and forthcoming Quarterly Reports on Form 10-Q, recent Current Reports on Form 8-K and other Securities and Exchange Commission filings discuss some of the important risk factors that may affect our business, results of operations and financial condition. We undertake no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. NORTHWESTERN CORPORATION CONDENSED CONSOLIDATED STATEMENTS OF INCOME (unaudited) (in thousands, except per share amounts) Three Months Ended Six Months Ended June 30, June 30, 2009 2008 2009 2008 ---- ---- ---- ---- Revenues Electric $173,463 $178,967 $381,450 $375,586 Gas 61,330 80,531 220,133 252,174 Other 920 17,008 5,033 34,721 --- ------ ----- ------ Total Revenues 235,713 276,506 606,616 662,481 ------- ------- ------- ------- Operating Expenses Cost of sales 106,840 149,354 314,850 378,438 Operating, general and administrative 60,898 53,866 126,317 113,937 Property and other taxes 18,246 20,540 42,535 44,180 Depreciation 22,260 21,225 44,982 42,316 ------ ------ ------ ------ Total Operating Expenses 208,244 244,985 528,684 578,871 ------- ------- ------- ------- Operating Income 27,469 31,521 77,932 83,610 ------ ------ ------ ------ Interest Expense (18,002) (15,848) (33,136) (31,849) Other Income (Expense) 198 (161) 789 422 --- ---- --- --- Income Before Income Taxes 9,665 15,512 45,585 52,183 Income Tax Expense (3,567) (6,009) (16,674) (19,229) ------ ------ ------- ------- Net Income $6,098 $9,503 $28,911 $32,954 ------ ------ ------- ------- Average Common Shares Outstanding 35,940 38,973 35,937 38,973 ------ ------ ------ ------ Basic Earnings per Average Common Share $0.17 $0.24 $0.80 $0.85 ----- ----- ----- ----- Diluted Earnings per Average Common Share $0.17 $0.24 $0.80 $0.84 ----- ----- ----- ----- Dividends Declared per Average Common Share $0.335 $0.33 $0.67 $0.66 ------ ----- ----- ----- NORTHWESTERN CORPORATION CONDENSED CONSOLIDATED BALANCE SHEET (in thousands) June 30, December 2009 31, 2008 ---- -------- (unaudited) ASSETS Current Assets $260,374 $313,417 Property, Plant, and Equipment, Net 1,852,378 1,839,699 Goodwill 355,128 355,128 Regulatory Assets 223,380 233,102 Other Noncurrent Assets 28,710 20,691 ------ ------ Total Assets $2,719,970 $2,762,037 ========== ========== LIABILITIES AND SHAREHOLDERS' EQUITY Current Maturities of Long-term Debt and Capital Leases $7,310 $229,238 Current Liabilities 313,313 359,339 Long-term Capital Leases 36,202 36,798 Long-term Debt 862,997 634,011 Noncurrent Regulatory Liabilities 234,612 222,969 Deferred Income Taxes 143,233 114,707 Other Noncurrent Liabilities 353,342 401,442 ------- ------- Total Liabilities 1,951,009 1,998,504 --------- --------- Total Shareholders' Equity 768,961 763,533 ------- ------- Total Liabilities and Shareholders' Equity $2,719,970 $2,762,037 ========== ========== NORTHWESTERN CORPORATION CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS (unaudited) (in thousands) Six Months Ended June 30, 2009 2008 ---- ---- Operating Activities Net income $28,911 $32,954 Non-cash items 64,628 73,001 Changes in operating assets and liabilities (8,008) 18,699 ------ ------ Cash Provided by Operating Activities 85,531 124,654 Cash Used in Investing Activities (46,660) (43,058) Cash Used In Financing Activities (27,200) (70,127) Net Increase in Cash and Cash Equivalents $11,671 $11,469 ------- ------- Cash and Cash Equivalents, beginning of period $11,292 $12,773 ------- ------- Cash and Cash Equivalents, end of period $22,963 $24,242 ======= ======= NORTHWESTERN CORPORATION REGULATED ELECTRIC SEGMENT Three Months Ended June 30, 2009 (Unaudited) Results --------------------------------- 2009 2008 Change % Change ---- ---- ------ -------- (in millions) Retail revenue 151.1 166.0 (14.9) (9.0)% Transmission 10.3 12.8 (2.5) (19.5) Wholesale 10.6 3.8 6.8 178.9 Other 1.5 (3.6) 5.1 141.7 --- ---- --- ----- Total Revenues 173.5 179.0 (5.5) (3.1) Total Cost of Sales 71.7 87.2 (15.5) (17.8)% ---- ---- ----- ----- Gross Margin $101.8 $91.8 $10.0 10.9% ------ ----- ----- ---- Avg. Customer Revenues Volumes MWH Counts --------------- ----------- ------------- 2009 2008 2009 2008 2009 2008 ---- ---- ---- ---- ---- ---- (in thousands) Retail Electric Montana $47,366 $53,269 488 498 268,627 265,820 South Dakota 9,496 9,802 108 105 48,181 47,882 ----- ----- --- --- ------ ------ Residential 56,862 63,071 596 603 316,808 313,702 ------ ------ --- --- ------- ------- Montana 64,402 69,587 749 756 60,316 59,449 South Dakota 14,748 15,375 202 200 11,701 11,522 ------ ------ --- --- ------ ------ Commercial 79,150 84,962 951 956 72,017 70,971 ------ ------ --- --- ------ ------ Industrial 8,267 11,622 702 773 72 71 Other 6,840 6,351 49 38 5,843 5,559 ----- ----- -- -- ----- ----- Total Retail Electric $151,119 $166,006 2,298 2,370 394,740 390,303 ======== ======== ===== ===== ======= ======= Wholesale Electric Montana $9,068 $- 96 - N/A N/A South Dakota 1,485 3,780 58 82 N/A N/A ----- ----- -- -- --- --- Total Wholesale Electric $10,553 $3,780 154 82 N/A N/A ======= ====== === == === === 2009 as compared with: ---------------------- Cooling Degree-Days 2008 Historic Average ---- ---------------- Montana 9% colder 27% colder South Dakota 132% warmer 38% colder REGULATED ELECTRIC SEGMENT Six Months Ended June 30, 2009 (Unaudited) Results ------- 2009 2008 Change % Change ---- ---- ------ -------- (in millions) Retail revenue $331.6 $347.3 $(15.7) (4.5)% Transmission 22.3 23.9 (1.6) (6.7) Wholesale 21.7 5.8 15.9 274.1 Other 5.9 (1.4) 7.3 521.4 --- ---- --- ----- Total Revenues 381.5 375.6 5.9 1.6 Total Cost of Sales 166.4 190.3 (23.9) (12.6) ----- ----- ----- ----- Gross Margin $215.1 $185.3 $29.8 16.1% ------ ------ ----- ---- Revenues Volumes MWH Avg. Customer Counts --------------- ----------- -------------------- 2009 2008 2009 2008 2009 2008 (in thousands) Retail Electric Montana $113,460 $120,563 1,166 1,167 268,815 265,962 South Dakota 23,042 22,433 280 264 48,188 47,895 ------ ------ --- --- ------ ------ Residential 136,502 142,996 1,446 1,431 317,003 313,857 ------- ------- ----- ----- ------- ------- Montana 133,294 139,439 1,545 1,555 60,260 59,299 South Dakota 31,421 31,059 430 422 11,588 11,427 ------ ------ --- --- ------ ------ Commercial 164,715 170,498 1,975 1,977 71,848 70,726 ------- ------- ----- ----- ------ ------ Industrial 19,213 23,112 1,467 1,534 72 71 Other 11,151 10,718 73 63 5,242 5,106 ------ ------ -- -- ----- ----- Total Retail Electric $331,581 $347,324 4,961 5,005 394,165 389,760 ======== ======== ===== ===== ======= ======= Wholesale Electric Montana $18,890 $- 299 - N/A N/A South Dakota 2,793 5,846 98 131 N/A N/A ----- ----- -- --- --- --- Wholesale Electric $21,683 $5,846 397 131 N/A N/A ======= ====== === === === === 2009 as compared with: ---------------------- Cooling Degree-Days 2008 Historic Average ---- ---------------- Montana 9% colder 27% colder South Dakota 132% warmer 38% colder NORTHWESTERN CORPORATION REGULATED NATURAL GAS SEGMENT Three Months Ended June 30, 2009 (Unaudited) Results --------------------------------------- 2009 2008 Change % Change ---- ---- ------ -------- (in millions) Retail revenue $50.4 $78.5 $(28.1) (35.8)% Wholesale and other 10.9 2.0 8.9 445.0 ---- --- --- ----- Total Revenues 61.3 80.5 (19.2) (23.9)% Total Cost of Sales 32.8 49.9 (17.1) (34.3) ---- ---- ----- ----- Gross Margin $28.5 $30.6 $(2.1) (6.9)% ----- ----- ----- ----- Revenues Volumes (Dkt) Customer Counts ------------ ------------- --------------- 2009 2008 2009 2008 2009 2008 ---- ---- ---- ---- ---- ---- (in thousands) Retail Gas Montana $21,150 $33,953 2,133 2,523 157,045 155,546 South Dakota 5,744 8,100 550 589 36,571 36,498 Nebraska 5,016 6,979 502 526 36,259 36,344 ----- ----- --- --- ------ ------ Residential 31,910 49,032 3,185 3,638 229,875 228,388 ------ ------ ----- ----- ------- ------- Montana 10,143 16,671 1,049 1,234 22,009 21,770 South Dakota 4,331 6,243 574 542 5,796 5,760 Nebraska 3,649 5,946 565 596 4,496 4,519 ----- ----- --- --- ----- ----- Commercial 18,123 28,860 2,188 2,372 32,301 32,049 ------ ------ ----- ----- ------ ------ Industrial 212 249 22 16 295 305 Other 193 338 22 29 142 139 --- --- -- -- --- --- Total Retail Gas $50,438 $78,479 5,417 6,055 262,613 260,881 ======= ======= ===== ===== ======= ======= 2009 as compared with: ------------------------ Heating Degree-Days 2008 Historic Average ------------------- ---- ---------------- Montana 15% warmer 5% warmer South Dakota 2% warmer 7% colder Nebraska 5% warmer 2% colder REGULATED NATURAL GAS SEGMENT Six Months Ended June 30, 2009 (Unaudited) Results --------------------------------- 2009 2008 Change % Change ---- ---- ------ -------- (in millions) Retail revenue $194.9 $230.4 $(35.5) (15.4)% Wholesale and other 25.2 21.8 3.4 15.6 ---- ---- --- ---- Total Revenues 220.1 252.2 (32.1) (12.7) Total Cost of Sales 141.7 171.2 (29.5) (17.2) ----- ----- ----- ----- Gross Margin $78.4 $81.0 $(2.6) (3.2)% ----- ----- ----- ---- Revenues Volumes (Dkt) Customer Counts -------------- ------------- --------------- 2009 2008 2009 2008 2009 2008 ---- ---- ---- ---- ---- ---- (in thousands) Retail Gas Montana $76,674 $94,697 7,516 8,091 157,220 155,652 South Dakota 24,433 26,788 2,127 2,196 36,838 36,706 Nebraska 20,459 22,146 1,817 1,931 36,536 36,616 ------ ------ ----- ----- ------ ------ Residential 121,566 143,631 11,460 12,218 230,594 228,974 ------- ------- ------ ------ ------- ------- Montana 38,413 46,936 3,785 3,991 22,027 21,728 South Dakota 18,627 20,177 2,070 1,920 5,841 5,799 Nebraska 14,592 17,257 1,796 1,880 4,539 4,556 ------ ------ ----- ----- ----- ----- Commercial 71,632 84,370 7,651 7,791 32,407 32,083 ------ ------ ----- ----- ------ ------ Industrial 1,015 1,537 102 136 297 306 Other 669 843 74 82 142 139 --- --- -- -- --- --- Total Retail Gas $194,882 $230,381 19,287 20,227 263,440 261,502 ======== ======== ====== ====== ======= ======= 2009 as compared with: ------------------------ Heating Degree-Days 2008 Historic Average ------------------- ---- ---------------- Montana 6% warmer 3% warmer South Dakota Remained flat 5% colder Nebraska 7% warmer 2% warmer NORTHWESTERN CORPORATION SEGMENT INFORMATION Three Months Ended June 30, 2009 (Unaudited) (in thousands) Three Months Ended Regulated ----------------- June 30, 2009 Electric Gas Other Eliminations Total -------- --- ----- ------------ ----- Operating revenues $173,463 $61,330 $1,306 $(386) $235,713 Cost of sales 71,623 32,842 2,375 - 106,840 ------ ------ ----- - ------- Gross margin 101,840 28,488 (1,069) (386) 128,873 ------- ------ ------ ---- ------- Operating, general and administrative 44,763 19,290 (2,769) (386) 60,898 Property and other taxes 13,065 5,150 31 - 18,246 Depreciation 17,951 4,301 8 - 22,260 ------ ----- --- --- ------ Operating income (loss) 26,061 (253) 1,661 - 27,469 ------ ---- ----- --- ------ Interest expense (13,757) (3,317) (928) - (18,002) Other income (expense) 182 (12) 28 - 198 Income tax (expense) benefit (4,789) 1,353 (131) - (3,567) ------ ----- ---- --- ------ Net income (loss) $7,697 $(2,229) $630 $- 6,098 ------ ------- ---- --- ----- Three months Regulated Unregulated ended, --------------- ----------- June 30, 2008 Electric Gas Electric Other Eliminations Total -------- --- -------- ----- ------------ ----- Operating revenues $178,967 $80,531 $16,569 $8,653 $(8,214) $276,506 Cost of sales 87,196 49,885 11,624 8,395 (7,746) 149,354 ------ ------ ------ ----- ----- ------- Gross margin 91,771 30,646 4,945 258 (468) 127,152 ------ ------ ----- --- ---- ------- Operating, general and administrative 34,503 15,735 3,219 877 (468) 53,866 Property and other taxes 14,338 5,484 715 3 - 20,540 Depreciation 15,392 4,001 1,823 9 - 21,225 ------ ----- ----- --- --- ------ Operating income (loss) 27,538 5,426 (812) (631) - 31,521 ------ ----- ---- ---- --- ------ Interest expense (9,201) (3,286) (2,993) (368) - (15,848) Other income (expense) 376 281 119 (937) - (161) Income tax(expense) benefit (6,646) (873) 1,561 (51) - (6,009) ------ --- ----- ---- --- ------ Net income (loss) $12,067 $1,548 $(2,125) $(1,987) $- $9,503 ------- ------ ------- ------- --- ------ NORTHWESTERN CORPORATION SEGMENT RESULTS Six Months Ended June 30, 2009 (Unaudited) Regulated Six Months Ended ----------------- June 30, 2009 Electric Gas Other Eliminations Total -------- --- ----- ------------ ----- Operating revenues $381,450 $220,133 $5,957 $(924) $606,616 Cost of sales 166,372 141,779 6,699 - 314,850 ------- ------- ----- --- ------- Gross margin 215,078 78,354 (742) (924) 291,766 ------- ------ ---- ---- ------- Operating, general and administrative 87,741 41,105 (1,605) (924) 126,317 Property and other taxes 31,082 11,378 75 - 42,535 Depreciation 36,342 8,623 17 - 44,982 ------ ----- -- --- ------ Operating income 59,913 17,248 771 - 77,932 ------ ------ --- --- ------ Interest expense (24,907) (6,385) (1,844) - (33,136) Other income 473 255 61 - 789 Income tax (expense) benefit (12,855) (4,123) 304 - (16,674) ------- ------ --- --- ------- Net income (loss) $22,624 $6,995 $(708) $- 28,911 ------- ------ ----- --- ------- Six months Regulated Unregulated ended, June 30, --------------- -------- 2008 Electric Gas Electric Other Eliminations Total -------- --- -------- ----- ------------ ----- Operating revenues $375,586 $252,174 $36,973 $16,575 $(18,827) $662,481 Cost of sales 190,251 171,193 18,656 16,159 (17,821) 378,438 ------- ------- ------ ------ ------- ------- Gross margin 185,335 80,981 18,317 416 (1,006) 284,043 ------- ------ ------ --- ------ ------- Operating, general and administrative 69,873 33,659 6,896 4,515 (1,006) 113,937 Property and other taxes 30,767 11,812 1,594 7 - 44,180 Depreciation 30,787 7,884 3,628 17 - 42,316 ------ ----- ----- -- --- ------ Operating income (loss) 53,908 27,626 6,199 (4,123) - 83,610 ------ ------ ----- ------ --- ------ Interest expense (18,459) (6,485) (6,169) (736) - (31,849) Other income (expense) 585 559 132 (854) - 422 Income tax (expense) benefit (12,333) (8,163) (154) 1,421 - (19,229) ------- ------ ---- ----- --- ------- Net income (loss) $23,701 $13,537 $8 $(4,292) $- $32,954 ------- ------- --- ------- --- ------- DATASOURCE: NorthWestern Corporation CONTACT: media, Claudia Rapkoch, 1-866-622-8081, , or investors, Dan Rausch, +1-605-978-2902, , both of NorthWestern Corporation Web Site: http://www.northwesternenergy.com/

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