UNITED
STATES
|
||
SECURITIES
AND EXCHANGE COMMISSION
|
||
Washington,
D.C. 20549
|
||
FORM
8-K
|
||
CURRENT
REPORT
|
||
PURSUANT
TO SECTION 13 OR 15(d) OF
|
||
THE
SECURITIES EXCHANGE ACT OF 1934
|
||
Date
of Report (Date of earliest event reported): February 1,
2007
|
||
AGL
RESOURCES INC.
|
||
(Exact
name of registrant as specified in its charter)
|
||
Georgia
|
1-14174
|
58-2210952
|
(State
or other jurisdiction of incorporation)
|
(Commission
File No.)
|
(I.R.S.
Employer Identification No.)
|
Ten
Peachtree Place NE Atlanta, Georgia 30309
|
||
(Address
and zip code of principal executive offices)
|
||
404-584-4000
|
||
(Registrant's
telephone number, including area code)
|
||
Not
Applicable
|
||
(Former
name or former address, if changed since last report)
|
||
Check
the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant
under any
of the following provisions:
|
||
¨
Written communications pursuant to Rule 425 under the Securities
Act (17
CFR 230.425)
|
||
¨
Soliciting material pursuant to Rule 14a-12 under the Exchange
Act (17 CFR
240.14a-12)
|
||
¨
Pre-commencement communications pursuant to Rule 14d-2(b) under
the
Exchange Act (17 CFR 240.14d-2(b))
|
||
¨
Pre-commencement communications pursuant to Rule 13e-4(c) under
the
Exchange Act (17 CFR 240.13e-4(c))
|
· |
We
completed our rate proceeding in Virginia, which resulted in
a five-year
rate freeze for customers under the first performance-based rate
plan
approved in that state for a natural gas utility. As part of
the
settlement reached with the parties in the case, we have committed
to
spend approximately $48 million to $60 million to build a new
pipeline
that will improve access to natural gas in certain areas we serve
in
Virginia, particularly during critical peak periods. Also, the
Virginia
Commission approved a permanent weather normalization adjustment
(WNA) for
residential customers as part of the settlement.
|
· |
We
successfully resolved our rate proceeding in Tennessee, which
resulted in
a $3 million base rate increase effective January 1, 2007 to
offset higher
costs and lower natural gas consumption. Additionally, the rate
proceeding
improved our authorized return and improved our capital structure
(55%
debt and 45% equity) that is more consistent with our utilities
and other
non-affiliated utilities.
|
· |
We
continued to grow our asset management business at Sequent which
enables
them to generate greater levels of economic value during periods
of market
volatility.
|
· |
We
expanded, through SouthStar, our retail footprint into the Ohio
and
Florida markets.
|
· |
We
announced our intention to develop a 12 Bcf natural gas salt-dome
storage
facility, known as Golden Triangle Storage, in Beaumont, Texas,
at a
capital cost of up to $180 million. The project will provide
high-deliverability Gulf Coast storage at a key market point,
with the
first phase scheduled to be in commercial operation in 2010.
|
· |
Our
distribution operations segment’s EBIT improved by $11 million, or 4% in
2006 as compared to 2005. We continued to benefit from the improved
operating metrics of the utilities we acquired in 2004. These
results were
offset, however, by customer consumption declines due to
warmer-than-normal weather throughout the year and high natural
gas
prices, particularly during the first quarter of
2006.
|
· |
Our
retail energy operations segment provided stable year-over-year
earnings
contributions despite the effects of declining customer consumption,
warmer weather and a lower of weighted average cost or current
market
price (LOCOM) adjustment to inventory. This segment’s marketing efforts
during the year also resulted in a slight increase in customer
count.
|
· |
Our
wholesale services segment captured significant arbitrage opportunities
due to price volatility and periods of extreme weather conditions.
As a
result, this segment’s EBIT contribution of $90 million was $41 million
higher than in 2005, primarily as a result of additional commercial
activity and storage arbitrage opportunities throughout the year,
as well
as the recognition of hedge gains as forward NYMEX prices declined.
|
· |
Our
energy investments segment made progress on the evaluation and
development
of several projects during 2006. While these projects are expected
to
provide future earnings contributions, the business development
expenses
associated with developing them resulted in a lower year-over-year
performance in this segment as well as the disposition in the
second half
of 2005 of certain non-strategic assets acquired as part of the
acquisition of NUI in December 2004.
|
· |
Our
interest expense for 2006 increased $14 million as compared to
2005. The
increase reflects higher carrying costs associated with higher
inventory
storage balances, as well as higher short-term interest rates,
relative to
the prior year.
|
In
millions
|
2006
|
2005
|
2004
|
|||||||
Operating
revenues
|
$
|
2,621
|
$
|
2,718
|
$
|
1,832
|
||||
Cost
of gas
|
1,482
|
1,626
|
995
|
|||||||
Operating
margin
|
1,139
|
1,092
|
837
|
|||||||
Operating
expenses
|
||||||||||
Operation
and maintenance
|
473
|
477
|
377
|
|||||||
Depreciation
and amortization
|
138
|
133
|
99
|
|||||||
Taxes
other than income
|
40
|
40
|
29
|
|||||||
Total
operating expenses
|
651
|
650
|
505
|
|||||||
Operating
income
|
488
|
442
|
332
|
|||||||
Other
expenses
|
(1
|
)
|
(1
|
)
|
-
|
|||||
Minority
interest
|
(23
|
)
|
(22
|
)
|
(18
|
)
|
||||
EBIT
|
464
|
419
|
314
|
|||||||
Interest
expense
|
123
|
109
|
71
|
|||||||
Earnings
before income taxes
|
341
|
310
|
243
|
|||||||
Income
taxes
|
129
|
117
|
90
|
|||||||
Net
income
|
$
|
212
|
$
|
193
|
$
|
153
|
||||
Earnings
per common share:
|
||||||||||
Basic
|
$
|
2.73
|
$
|
2.50
|
$
|
2.30
|
||||
Diluted
|
$
|
2.72
|
$
|
2.48
|
$
|
2.28
|
||||
Weighted
average number of common shares outstanding:
|
||||||||||
Basic
|
77.6
|
77.3
|
66.3
|
|||||||
Diluted
|
78.0
|
77.8
|
67.0
|
In
millions
|
Operating
revenues
|
Operating
margin (1)
|
Operating
expenses
|
EBIT
(1)
|
|||||||||
2006
|
|||||||||||||
Distribution
operations
|
$
|
1,624
|
$
|
807
|
$
|
499
|
$
|
310
|
|||||
Retail
energy operations
|
930
|
156
|
68
|
63
|
|||||||||
Wholesale
services
|
182
|
139
|
49
|
90
|
|||||||||
Energy
investments
|
41
|
36
|
26
|
10
|
|||||||||
Corporate
(2)
|
(156
|
)
|
1
|
9
|
(9
|
)
|
|||||||
Consolidated
|
$
|
2,621
|
$
|
1,139
|
$
|
651
|
$
|
464
|
|||||
2005
|
|||||||||||||
Distribution
operations
|
$
|
1,753
|
$
|
814
|
$
|
518
|
$
|
299
|
|||||
Retail
energy operations
|
996
|
146
|
61
|
63
|
|||||||||
Wholesale
services
|
95
|
92
|
42
|
49
|
|||||||||
Energy
investments
|
56
|
40
|
23
|
19
|
|||||||||
Corporate
(2)
|
(182
|
)
|
-
|
6
|
(11
|
)
|
|||||||
Consolidated
|
$
|
2,718
|
$
|
1,092
|
$
|
650
|
$
|
419
|
|||||
2004
|
|||||||||||||
Distribution
operations
|
$
|
1,111
|
$
|
640
|
$
|
394
|
$
|
247
|
|||||
Retail
energy operations
|
827
|
132
|
62
|
52
|
|||||||||
Wholesale
services
|
54
|
53
|
29
|
24
|
|||||||||
Energy
investments
|
25
|
13
|
8
|
7
|
|||||||||
Corporate
(2)
|
(185
|
)
|
(1
|
)
|
12
|
(16
|
)
|
||||||
Consolidated
|
$
|
1,832
|
$
|
837
|
$
|
505
|
$
|
314
|
(1) |
These
are non-GAAP measurements. A reconciliation of operating margin
and EBIT
to our operating income and net income is contained Results of
Operations
- AGL Resources.
|
(2) |
Includes
the elimination of intercompany revenues and cost of
gas.
|
In
millions
|
|||||||
Operating
margin for 2005
|
$1,092
|
||||||
Net
change in the fair value of hedges at wholesale services
|
60
|
||||||
Wholesale
services commercial activities
|
5
|
||||||
Wholesale
services inventory LOCOM adjustments (net of hedging
recoveries)
|
(18)
|
||||||
Retail
energy operations inventory LOCOM adjustments
|
(6)
|
||||||
Improved
operating margins at retail energy operations
|
16
|
||||||
Lower
operating margins at distribution operations utilities
|
(7)
|
||||||
Loss
of margin from energy investment assets sold in 2005
|
(9)
|
||||||
Other
|
6
|
||||||
Operating
margin for 2006
|
$1,139
|
In
millions
|
||||
Operating
expenses for 2005
|
$
|
650
|
||
Increased
depreciation and amortization
|
5
|
|||
Increased
payroll, incentive compensation and corporate overhead allocated
costs at
wholesale services
|
6
|
|||
Increased
bad debt expenses at retail energy operations and distribution
operations
|
4
|
|||
Lower
expenses resulting from energy investment assets sold in
2005
|
(8
|
)
|
||
Lower
expenses at distribution operations related to workforce and
facilities
restructurings in 2005 and 2006
|
(15
|
)
|
||
Other
|
9
|
|||
Operating
expenses for 2006
|
$
|
651
|
Dollars
in millions
|
2006
|
2005
|
|||||
Total
interest expense
|
$
|
123
|
$
|
109
|
|||
Average
debt outstanding (1)
|
2,023
|
1,823
|
|||||
Average
interest rate
|
6.1
|
%
|
6.0
|
%
|
(1) |
Daily
average of all outstanding debt
|
In
millions
|
||||
Operating
margin in 2004
|
$
|
837
|
||
Increased
operating margin at distribution operations from acquired
utilities
|
167
|
|||
Wholesale
services commercial activities
|
53
|
|||
Increased
operating margins at retail energy operations
|
14
|
|||
Increased
operating margins at Jefferson Island
|
13
|
|||
Operating
margin from energy investment assets acquired from NUI
Corp.
|
8
|
|||
Increased
operating margin at distribution operations, primarily Atlanta
Gas
Light
|
7
|
|||
Increased
operating margins at Pivotal Propane and AGL Networks
|
7
|
|||
Inventory
LOCOM adjustments at wholesale services
|
(2
|
)
|
||
Net
change in the fair value of hedges at wholesale services
|
(12
|
)
|
||
Operating
margin in 2005
|
$
|
1,092
|
In
millions
|
||||
Operating
expenses in 2004
|
$
|
505
|
||
Operating
expenses at distribution operations from NUI utilities acquired
December
2004
|
125
|
|||
Increased
operating expenses at wholesale services, primarily payroll,
incentive
compensation and depreciation
|
13
|
|||
Operating
expenses at energy investments from NUI acquired assets
|
8
|
|||
Operating
expenses at Jefferson Island
|
3
|
|||
Operating
expenses at energy investments from Pivotal Propane
|
3
|
|||
Other
|
(7
|
)
|
||
Operating
expenses in 2005
|
$
|
650
|
Dollars
in millions
|
2005
|
2004
|
|||||
Total
interest expense
|
$
|
109
|
$
|
71
|
|||
Average
debt outstanding (1)
|
1,823
|
1,274
|
|||||
Average
interest rate
|
6.0
|
%
|
5.6
|
%
|
(1) |
Daily
average of all outstanding debt.
|
· |
distributing
natural gas for Marketers
|
· |
constructing,
operating and maintaining the gas system infrastructure, including
responding to customer service calls and
leaks
|
· |
reading
meters and maintaining underlying customer premise information
for
Marketers
|
Atlanta
Gas Light
|
Elizabethtown
Gas
|
Virginia
Natural Gas
|
Florida
City Gas
|
Chattanooga
Gas
|
|||||||||||||||
Operations
|
|||||||||||||||||||
2006
avg. end-use customers (in
thousands)
|
1,546
|
269
|
264
|
104
|
61
|
||||||||||||||
2005
avg. end-use customers (in
thousands)
|
1,545
|
266
|
261
|
103
|
61
|
||||||||||||||
2004
avg. end-use customers (in
thousands) (6)
|
1,533
|
263
|
256
|
103
|
60
|
||||||||||||||
Daily
capacity (1)
|
2.53
|
0.45
|
0.48
|
0.05
|
0.19
|
||||||||||||||
Storage
capacity (1)
|
48.44
|
12.96
|
9.55
|
-
|
3.61
|
||||||||||||||
Annual
distribution -- 2006 (1)
|
211
|
46
|
33
|
9
|
15
|
||||||||||||||
Annual
distribution -- 2005 (1)
|
232
|
59
|
36
|
10
|
16
|
||||||||||||||
Annual
distribution -- 2004 (1)
(6)
|
233
|
65
|
34
|
9
|
16
|
||||||||||||||
2006
peak day demand (1)
|
1.6
|
0.3
|
0.3
|
0.04
|
0.1
|
||||||||||||||
Peak
storage capacity (1)
|
7.80
|
0.77
|
1.64
|
-
|
1.21
|
||||||||||||||
Average
monthly throughput (1)
|
17.6
|
3.8
|
2.8
|
0.8
|
1.3
|
||||||||||||||
Miles
of main (7)
|
30,284
|
3,030
|
5,235
|
3,207
|
1,521
|
||||||||||||||
Heating
degree days -- 2006 (2)
|
2,466
|
4,110
|
2,869
|
696
|
2,898
|
||||||||||||||
2006
% (warmer) colder than 2005
|
(10
|
%)
|
(18
|
%)
|
(17
|
%)
|
(16
|
%)
|
(7%)
|
||||||||||
Heating
degree days -- 2005 (2)
|
2,726
|
5,017
|
3,465
|
829
|
3,115
|
||||||||||||||
2005
% colder than 2004
|
5
|
%
|
2
|
%
|
8
|
%
|
3
|
%
|
3%
|
||||||||||
Heating
degree days -- 2004 (2)
(6)
|
2,589
|
4,918
|
3,214
|
802
|
3,010
|
||||||||||||||
Rates
|
|||||||||||||||||||
Last
decision on change in rates
|
Jun.
2005
|
Nov.
2002
|
Oct.
1996
|
Feb.
2004
|
Dec.
2006
|
||||||||||||||
Authorized
return on rate base (5)
|
8.53
|
%
|
7.95
|
%
|
9.24
|
%
|
7.36
|
%
|
7.43%
|
||||||||||
Estimated
2006 return on rate base (3)
|
8.45
|
%
|
7.83
|
%
|
7.65
|
%
|
7.41
|
%
|
7.00%
|
||||||||||
Authorized return on equity | 10.9 | % | 10.0 | % | 10.9 | % | 11.25 | % | 10.2% | ||||||||||
Estimated 2006 return on equity (3) | 10.73 | % | 9.4 | % | 8.49 | % | 10.67 | % | 9.01% | ||||||||||
Authorized
rate base % of equity
|
47.9
|
%
|
53.0
|
%
|
52.4
|
%
|
36.8
|
%
|
35.5%
|
||||||||||
Rate
base included in 2006 return on equity (in
millions) (1)
|
$
|
1,238
|
$
|
417
|
$
|
351
|
$
|
120
|
$102
|
(1) |
In
Bcf
|
(2) |
We
measure effects of weather on our businesses using “degree days.” The
measure of degree days for a given day is the mean daily temperature
(average of the daily high and low temperature) and a baseline
temperature
of 65 degrees Fahrenheit. Heating degree days result when the
mean daily
temperature is less than the 65-degree baseline. Generally, increased
heating degree days result in greater demand for gas on our distribution
systems.
|
(3) |
Estimate
based on principles consistent with utility ratemaking in each
jurisdiction. Returns are not necessarily consistent with GAAP
returns.
|
(4) |
Estimated
based on 13-month average.
|
(5) |
The
authorized return on rate base, return on equity, and percentage
of equity
reflected above were those authorized as of December 31, 2006.
Effective
January 1, 2007, Chattanooga Gas’ authorized return on rate base, return
on equity and percentage of equity are 7.89%, 10.2% and 44.8%,
respectively, due to the results of its base rate case settled
in December
2006.
|
(6) |
Includes
amounts for the full year of 2004; however, we acquired these
utilities in
December 2004. The December 2004 end-use customers for Elizabethtown
Gas
was 266 and 103 for Florida City Gas, December 2004 distribution
for
Elizabethtown Gas was 8.2 and 0.9 for Florida City Gas; and December
2004
heating degree days for Elizabethtown Gas was 873 and 239 for
Florida City
Gas.
|
(7) |
Includes
distribution and transmission main
only
|
· |
changes
in the availability or price of natural gas and other forms of
energy
|
· |
general
economic conditions
|
· |
energy
conservation
|
· |
legislation
and regulations
|
· |
the
capability to convert from natural gas to alternative
fuels
|
· |
weather
|
· |
new
housing starts
|
Affiliated
subsidiary
|
Approximate
# of employees
|
Date
of contract expiration
|
||||||||
Communications
Workers of America (Local No. 1023)
|
Elizabethtown
Gas
|
8
|
April
2007
|
|||||||
Utility
Workers Union of America (Local No. 461)
|
Chattanooga
Gas
|
21
|
April
2007
|
|||||||
International
Union of Operating Engineers (Local No. 474)
|
Atlanta
Gas Light
|
26
|
August
2007
|
|||||||
Teamsters
(Local Nos. 769 and 385)
|
Florida
City Gas
|
50
|
March
2008
|
|||||||
Utility
Workers Union of America (Local No. 424)
|
Elizabethtown
Gas
|
160
|
November
2009
|
|||||||
International
Brotherhood of Electrical Workers (Local No. 50)
|
Virginia
Natural Gas
|
141
|
May
2010
|
|||||||
Total
|
406
|
In
millions
|
2006
|
2005
|
2004
|
|||||||
Operating
revenues
|
$
|
1,624
|
$
|
1,753
|
$
|
1,111
|
||||
Cost
of gas
|
817
|
939
|
471
|
|||||||
Operating
margin (1)
|
807
|
814
|
640
|
|||||||
Operating
expenses
|
499
|
518
|
394
|
|||||||
Operating
income
|
308
|
296
|
246
|
|||||||
Other
income
|
2
|
3
|
1
|
|||||||
EBIT
(1)
|
$
|
310
|
$
|
299
|
$
|
247
|
||||
Metrics
(2)
|
||||||||||
Average
end-use customers (in
thousands)
|
2,250
|
2,242
|
1,880
|
|||||||
Operation
and maintenance expenses per customer
|
$
|
156
|
$
|
166
|
$
|
152
|
||||
EBIT
per customer
|
$
|
138
|
$
|
133
|
$
|
131
|
(1) |
These
are non-GAAP measurements. A reconciliation of operating margin
and EBIT
to our operating income and net income is contained in “Results of
Operations - AGL Resources.”
|
(2) |
2004
metrics include only December for Florida City Gas, Elizabethtown
Gas and
Elkton Gas.
|
In
millions
|
2006
|
2005
|
2004
|
|||||||
Operating
revenues
|
$
|
930
|
$
|
996
|
$
|
827
|
||||
Cost
of gas
|
774
|
850
|
695
|
|||||||
Operating
margin (1)
|
156
|
146
|
132
|
|||||||
Operating
expenses
|
68
|
61
|
62
|
|||||||
Operating
income
|
88
|
85
|
70
|
|||||||
Other
expense
|
(2
|
)
|
-
|
-
|
||||||
Minority
interest
|
(23
|
)
|
(22
|
)
|
(18
|
)
|
||||
EBIT
(1)
|
$
|
63
|
$
|
63
|
$
|
52
|
||||
Metrics
- Georgia Market
|
||||||||||
Average
customers (in
thousands)
|
533
|
531
|
533
|
|||||||
Market
share in Georgia
|
35
|
%
|
35
|
%
|
36
|
%
|
||||
Natural
gas volumes (Bcf)
|
38
|
44
|
45
|
(1) |
These
are non-GAAP measurements. A reconciliation of operating margin
and EBIT
to our operating income and net income is contained in “Results of
Operations - AGL Resources. “
|
Expiration
|
Timing
of
|
Type
of fee
|
%
Shared or
|
Profit
sharing / fees payments
|
||||||||||||||||||
Dollars
in millions
|
date
|
payment
|
structure
|
annual
fee
|
2006
|
2005
|
2004
|
|||||||||||||||
Elkton
Gas
|
Mar
2008
|
Monthly
|
Fixed-fee
|
(A
|
)
|
$
|
-
|
$
|
-
|
$
|
-
|
|||||||||||
Chattanooga
Gas
|
Mar
2008
|
Annually
|
Profit
-sharing
|
50
|
%
|
4
|
2
|
1
|
||||||||||||||
Atlanta
Gas Light
|
Mar
2008
|
Semi-Annually
|
Profit
-sharing
|
60
|
%
|
6
|
4
|
4
|
||||||||||||||
Elizabethtown
Gas
|
Mar
2008
|
Monthly
|
Fixed
-fee
|
$
|
4
|
4
|
-
|
-
|
||||||||||||||
Florida
City Gas
|
Mar
2008
|
Annually
|
Profit
-sharing
|
50
|
%
|
-
|
-
|
-
|
||||||||||||||
Virginia
Natural Gas
|
Mar
2009
|
Annually
|
Profit
-sharing
|
(B
|
)
|
2
|
5
|
3
|
||||||||||||||
Total
|
$
|
16
|
$
|
11
|
$
|
8
|
(A) |
Annual
fixed fee is less than $1 million
|
(B) |
Profit sharing is based on a tiered sharing
structure
|
In
millions
|
2006
|
2005
|
2004
|
|||||||
Net
fair value of contracts outstanding at beginning of period
|
$
|
(13
|
)
|
$
|
17
|
($5
|
)
|
|||
Contracts
realized or otherwise settled during period
|
17
|
|
(47
|
)
|
11
|
|||||
Change
in net fair value of contract gains
|
115
|
17
|
11
|
|||||||
Net
fair value of new contracts entered into during period
|
-
|
-
|
-
|
|||||||
Net
fair value of contracts outstanding at end of period
|
119
|
(13
|
)
|
17
|
||||||
Less
net fair value of contracts outstanding at beginning of period
|
(13
|
)
|
17
|
(5
|
)
|
|||||
Unrealized
gain (loss) related to changes in the fair value of derivative
instruments
|
$
|
132
|
$
|
(30
|
)
|
$
|
22
|
In
millions
|
Prices
actively quoted
|
Prices
provided by other external sources
|
|||||
Mature
through 2007
|
$
|
21
|
$
|
80
|
|||
Mature
2008 - 2009
|
6
|
8
|
|||||
Mature
2010 - 2012
|
-
|
2
|
|||||
Mature
after 2012
|
-
|
2
|
|||||
Total
net fair value
|
$
|
27
|
$
|
92
|
Q1
2007
|
Q2
2007
|
Q3
2007
|
Q4
2007
|
Q1
2008
|
Total
|
||||||||||||||
Salt
dome
|
412
|
-
|
-
|
-
|
7
|
419
|
|||||||||||||
Reservoir
|
850
|
1
|
-
|
96
|
116
|
1,063
|
|||||||||||||
Total
volumes
|
1,262
|
1
|
-
|
96
|
123
|
1,482
|
|||||||||||||
Expected
gross margin (in
millions)
|
$
|
9
|
$
|
-
|
$
|
-
|
$
|
4
|
$
|
5
|
$
|
18
|
In
millions
|
2006
|
2005
|
2004
|
|||||||
Operating
revenues
|
$
|
182
|
$
|
95
|
$
|
54
|
||||
Cost
of sales
|
43
|
3
|
1
|
|||||||
Operating
margin (1)
|
139
|
92
|
53
|
|||||||
Operating
expenses
|
49
|
42
|
29
|
|||||||
Operating
income
|
90
|
50
|
24
|
|||||||
Other
expenses
|
-
|
(1
|
)
|
-
|
||||||
EBIT
(1)
|
$
|
90
|
$
|
49
|
$
|
24
|
||||
Metrics
|
||||||||||
Physical
sales volumes (Bcf
/ day)
|
2.20
|
2.17
|
2.10
|
(1) |
These
are non-GAAP measurements. A reconciliation of operating margin
and EBIT
to our operating income and net income is contained in “Results of
Operations - AGL Resources.”
|
In
millions
|
2006
|
2005
|
2004
|
||||||||||||||||
Gain
(loss) on storage hedges
|
$
|
41
|
$
|
(7
|
)
|
$
|
5
|
||||||||||||
Gain
on transportation hedges
|
12
|
-
|
-
|
||||||||||||||||
Commercial
activity
|
107
|
102
|
49
|
||||||||||||||||
Inventory
LOCOM, net of hedging recoveries
|
(21
|
)
|
(3
|
)
|
(1
|
)
|
|||||||||||||
Operating
margin
|
$
|
139
|
$
|
92
|
$
|
53
|
|||||||||||||
In
millions
|
2006
|
2005
|
2004
|
|||||||
Operating
revenues
|
$
|
41
|
$
|
56
|
$
|
25
|
||||
Cost
of sales
|
5
|
16
|
12
|
|||||||
Operating
margin (1)
|
36
|
40
|
13
|
|||||||
Operating
expenses
|
26
|
23
|
8
|
|||||||
Operating
income
|
10
|
17
|
5
|
|||||||
Other
income
|
-
|
2
|
2
|
|||||||
EBIT
(1)
|
$
|
10
|
$
|
19
|
$
|
7
|
(1) |
These
are non-GAAP measurements. A reconciliation of operating margin
and EBIT
to our operating income and net income is contained in “Results of
Operations - AGL Resources.”
|
In
millions
|
2006
|
2005
|
2004
|
|||||||
Operating
revenues
|
(156
|
)
|
(182
|
)
|
(185
|
)
|
||||
Cost
of sales
|
(157
|
)
|
(182
|
)
|
(184
|
)
|
||||
Operating
margin (1)
(2)
|
1
|
-
|
(1
|
)
|
||||||
Operating
expenses (3)
|
9
|
6
|
12
|
|||||||
Operating
loss
|
(8
|
)
|
(6
|
)
|
(13
|
)
|
||||
Other
expenses
|
(1
|
)
|
(5
|
)
|
(3
|
)
|
||||
EBIT
(2)
|
$
|
(9
|
)
|
$
|
(11
|
)
|
$
|
(16
|
)
|
(1) |
Includes
intercompany eliminations
|
(2) |
These
are non-GAAP measurements. A reconciliation of operating margin
and EBIT
to our operating income and net income is contained in “Results of
Operations - AGL Resources.”
|
(3) |
The
following table summarizes the major components of operating
expenses.
|
In
millions
|
2006
|
2005
|
2004
|
|||||||
Payroll
|
55
|
57
|
48
|
|||||||
Benefits
and incentives
|
36
|
34
|
32
|
|||||||
Outside
services
|
41
|
43
|
29
|
|||||||
All
other expenses
|
50
|
57
|
50
|
|||||||
Allocations
|
(173
|
)
|
(185
|
)
|
(147
|
)
|
||||
Total
operating expenses
|
$
|
9
|
$
|
6
|
$
|
12
|
(d) |
Exhibits
|
Exhibit
No.
|
Description
|
99.1
|
Press
release dated February 1, 2007 announcing financial results for
the fourth
quarter and year ended December 31,
2006.
|
AGL
RESOURCES INC.
|
|
(Registrant)
|
|
Date:
February 1, 2007
|
/s/
Andrew W. Evans
|
Executive
Vice President and Chief Financial
Officer
|
Exhibit
No.
|
Description
|
|
|
99.1
|
Press
release dated February 1, 2007 announcing financial results for
the fourth
quarter and year ended December 31,
2006.
|