Dominion Energy Announces Second-Quarter 2022 Earnings

Dominion Energy, Inc. 

Consolidated Statements of Income*

Unaudited (GAAP Based)

(millions, except per share amounts)

Three Months Ended

Six Months Ended

June 30,

June 30,

2022

2021

2022

2021

Operating Revenue

$  3,596

$      3,038

$  7,875

$  6,908

Operating Expenses

Electric fuel and other energy-related purchases

730

487

1,408

1,037

Purchased electric capacity

16

25

29

36

Purchased gas

202

121

847

605

Other operations and maintenance¹

2,036

1,216

3,052

2,298

Depreciation, depletion and amortization

695

604

1,393

1,212

Other taxes

235

222

488

479

  Total operating expenses

3,914

2,675

7,217

5,667

Income (loss) from operations

(318)

363

658

1,241

Other income (expense)²

(204)

377

(78)

744

Interest and related charges

47

518

221

571

Income (loss) from continuing operations including noncontrolling interests
before income tax expense (benefit)

(569)

222

359

1,414

Income tax expense (benefit)

(117)

(47)

119

165

Net Income (loss) from continuing operations including noncontrolling interests

(452)

269

240

1,249

Net Income (loss) from discontinued operations including noncontrolling interests

(1)

26

18

54

Net Income (loss) including noncontrolling interests

$   (453)

$          295

$     258

$  1,303

Noncontrolling interests

-

10

-

10

$   (453)

$          285

$     258

$  1,293

Reported Income (loss) per common share from continuing operations - diluted

$  (0.58)

$         0.30

$    0.23

$     1.49

Reported Income (loss) per common share from discontinued operations - diluted

-

0.03

0.02

0.07

Reported Income (Loss) per common share - diluted

$  (0.58)

$         0.33

$    0.25

$     1.56

Average shares outstanding, diluted

818.4

806.6

815.9

806.3

¹⁾ Includes impairment of assets and other charges and losses on sales of assets.

²⁾ Includes earnings from equity method investees.

* The notes contained in Dominion Energy's most recent quarterly report on Form 10-Q or annual report on Form 10-K are an integral part of the Consolidated Financial Statements.

Schedule 1 - Segment Reported and Operating Earnings

Unaudited

(millions, except per share amounts)

Three months ended June 30,

2022

2021

Change

REPORTED EARNINGS¹

$         (453)

$          285

$         (738)

     Pre-tax loss (income)²

1,383

474

909

     Income tax²

(272)

(131)

(141)

Adjustments to reported earnings

1,111

343

768

OPERATING EARNINGS

$          658

$          628

$            30

     By segment:

     Dominion Energy Virginia

440

431

9

     Gas Distribution

125

95

30

     Dominion Energy South Carolina

124

84

40

     Contracted Assets

20

104

(84)

     Corporate and Other

(51)

(86)

35

$          658

$          628

$            30

Earnings Per Share (EPS):³

REPORTED EARNINGS ¹

$        (0.58)

$         0.33

$        (0.91)

Adjustments to reported earnings (after tax)

1.35

0.43

0.92

OPERATING EARNINGS

$         0.77

$         0.76

$         0.01

     By segment:

     Dominion Energy Virginia

0.54

0.53

0.01

     Gas Distribution

0.15

0.12

0.03

     Dominion Energy South Carolina

0.15

0.10

0.05

     Contracted Assets

0.02

0.13

(0.11)

     Corporate and Other

(0.09)

(0.12)

0.03

$         0.77

$         0.76

$         0.01

Common Shares Outstanding (average, diluted)

832.5

806.6

(millions, except earnings per share)

Six months ended June 30,

2022

2021

Change

REPORTED EARNINGS¹

$          258

$       1,293

$      (1,035)

     Pre-tax loss (income)²

1,638

322

1,316

     Income tax²

(238)

(94)

(144)

Adjustments to reported earnings

1,400

228

1,172

OPERATING EARNINGS

$       1,658

$       1,521

$          137

     By segment:

     Dominion Energy Virginia

958

865

93

     Gas Distribution

419

346

73

     Dominion Energy South Carolina

233

186

47

     Contracted Assets

121

254

(133)

     Corporate and Other

(73)

(130)

57

$       1,658

$       1,521

$          137

Earnings Per Share (EPS):³

REPORTED EARNINGS¹

$         0.25

$         1.56

$        (1.31)

Adjustments to reported earnings (after tax)

1.69

0.28

1.41

OPERATING EARNINGS

$         1.94

$         1.84

$         0.10

     By segment:

     Dominion Energy Virginia

1.18

1.07

0.11

     Gas Distribution

0.51

0.43

0.08

     Dominion Energy South Carolina

0.29

0.23

0.06

     Contracted Assets

0.15

0.31

(0.16)

     Corporate and Other

(0.19)

(0.20)

0.01

$         1.94

$         1.84

$         0.10

Common Shares Outstanding (average, diluted)

832.3

¹⁾

Determined in accordance with Generally Accepted Accounting Principles (GAAP).

²⁾

Adjustments to reported earnings are included in Corporate and Other segment reported GAAP earnings.  Refer to Schedules 2 and 3 for details, or find 

"GAAP Reconciliation" in the Earnings Release Kit on Dominion Energy's website at investors.dominionenergy.com.

³⁾

The calculation of reported and operating earnings per share on a consolidated basis utilizes shares outstanding on a diluted basis with all dilutive impacts, primarily consisting of potential shares which had not yet been issued, reflected in the Corporate and Other segment. As a result of a reported net loss for the three months ended June 30, 2022, any adjustments to earnings or shares would be considered antidilutive and are excluded from the calculation of diluted earnings per share. Effective January 2022, the calculation of diluted reported and operating earnings per share assumes conversion, if dilutive, of the Series A preferred stock to common stock as of January 1, 2022. The Series A preferred stock was reclassified to a liability in June 2022. In prior periods, a fair value adjustment of the Series A preferred stock was included in the calculation of diluted reported earnings per share if dilutive. No adjustments were necessary for the three and six months ended June 30, 2021. During each quarter of 2022, the calculation of reported and operating earnings per share includes the impact of preferred dividends associated with preferred stock of $9 million (Series B) and $11 million (Series C, issued in December 2021). Reported earnings per share for the three and six months ended June 30, 2022 also includes the impact of preferred dividends associated with Series A preferred stock of $5 million and $12 million, respectively.  During each quarter of 2021, the calculation of reported and operating earnings per share includes the impact of preferred dividends associated with preferred stock of $7 million (Series A) and $9 million (Series B). See Forms 10-Q and 10-K for additional information.

(millions, except per share amounts)

1Q22

2Q22

3Q22

4Q22

YTD 2022

Reported earnings

$711

($453)

$0

$0

$258

Adjustments to reported earnings ¹:

    Pre-tax loss (income)

255

1,383

0

0

1,638

    Income tax

34

(272)

0

0

(238)

289

1,111

0

0

1,400

Operating earnings

$1,000

$658

$0

$0

$1,658

Common shares outstanding (average, diluted) 

832.0

832.5

0.0

0.0

832.3

Reported earnings per share ²

$0.83

($0.58)

$0.00

$0.00

$0.25

Adjustments to reported earnings per share ²

0.35

1.35

0.00

0.00

1.69

Operating earnings per share ²

$1.18

$0.77

$0.00

$0.00

$1.94

1) Adjustments to reported earnings are reflected in the following table:

1Q22

2Q22

3Q22

4Q22

YTD 2022

Pre-tax loss (income):

    Net loss on Nuclear Decommissioning Trust (NDT) funds

$125

$454

$0

$0

$579

    Mark-to-market impact of economic hedging activities

(4)

(193)

0

0

(197)

    Discontinued operations - Gas Transmission & Storage segment

(25)

3

0

0

(22)

    Sale of Kewaunee

0

649

0

0

649

    Regulated asset retirements and other charges

65

470

0

0

535

    Storm damage and restoration costs

94

0

0

0

94

$255

$1,383

$0

$0

$1,638

Income tax expense (benefit):

   Tax effect of above adjustments to reported earnings *

(53)

(275)

0

0

(328)

   Deferred taxes associated with Hope Gas, Inc. divestiture⁴

87

3

0

0

90

$34

($272)

$0

$0

($238)

^* Income taxes for individual pre-tax items include current and deferred taxes using a transactional effective tax rate. For interim
  reporting purposes,calculation of such amounts may be adjusted in connection with the calculation of the Company's year-to-date
  income tax provision based on its estimated annual effective tax rate.

²⁾ The calculation of reported and operating earnings per share on a consolidated basis utilizes shares outstanding on a diluted basis
    with all dilutive impacts, primarily consisting of potential shares which had not yet been issued, reflected in the  Corporate and Other
    segment. As a result of a reported net loss for the three months ended June 30, 2022, any adjustments to earnings or shares would be
    considered antidilutive and are excluded from the calculation of diluted earnings per share.  Effective January 2022, the calculation of
    diluted reported and operating earnings per share assumes conversion, if dilutive, of the Series A preferred stock to common stock as of
    January 1, 2022. The Series A preferred stock was reclassified to a liability in June 2022. During each quarter of 2022, the
    calculation of reported and operating earnings per share includes the impact of preferred dividends associated with preferred stock of
    $9 million (Series B) and $11 million (Series C, issued in December 2021).  Reported earnings per share for the three and six months
    ended June 30, 2022 also includes the impact of preferred dividends associated with Series A preferred stock of $5 million and $12
    million, respectively.  See Forms 10-Q and 10-K for additional information.

³⁾ YTD EPS may not equal sum of quarters due to share count difference.

⁴⁾ Represents deferred taxes related to the basis in Hope Gas, Inc.'s stock that will reverse upon completion of the sale.

(millions, except per share amounts)

1Q21

2Q21

3Q21

4Q21

YTD 2021

Reported earnings

$      1,008

$               285

$          654

$      1,341

$         3,288

Adjustments to reported earnings ¹:

    Pre-tax loss (income)

(152)

474

413

(761)

(26)

    Income tax

37

(131)

(149)

172

(71)

(115)

343

264

(589)

(97)

Operating earnings

$          893

$               628

$          918

$          752

$         3,191

Common shares outstanding (average, diluted) 

805.9

806.6

810.0

811.0

808.5

Reported earnings per share ²

$         1.23

$             0.33

$         0.79

$         1.63

$            3.98

Adjustments to reported earnings per share ²

(0.14)

0.43

0.32

(0.73)

(0.12)

Operating earnings per share ²

$         1.09

$             0.76

$         1.11

$         0.90

$            3.86

1) Adjustments to reported earnings are reflected in the following table:

1Q21

2Q21

3Q21

4Q21

YTD 2021

Pre-tax loss (income):

    Net (gain) loss on NDT funds

$        (134)

$             (194)

$             19

$        (259)

$           (568)

    Mark-to-market impact of economic hedging activities

(278)

291

284

(37)

260

    Discontinued operations - Gas Transmission & Storage segment

(35)

(30)

(59)

(705)

(829)

    Regulated asset retirements and other charges

100

278

119

67

564

    Sales of non-wholly-owned nonregulated solar facilities

-

-

23

212

235

    Merger litigation and integration charges

71

48

8

(28)

99

    Workplace realignment

71

-

17

(11)

77

    Storm damage and restoration costs

51

17

-

-

68

    Kewaunee decommissioning revision

-

44

-

-

44

    Other

2

20

2

-

24

$        (152)

$               474

$          413

$        (761)

$              (26)

Income tax expense (benefit):

   Tax effect of above adjustments to reported earnings *

37

(131)

(140)

204

(30)

   Other

-

-

(9)

(32)

(41)

$             37

$             (131)

$        (149)

$          172

$              (71)

* Income taxes for individual pre-tax items include current and deferred taxes using a transactional effective tax rate. For interim reporting purposes,

   such amounts may be adjusted in connection with the calculation of the Company's year-to-date income tax provision based on its estimated 

   annual effective tax rate.

²⁾ The calculation of operating earnings per share excludes the impact, if any, of fair value adjustments related to the Company's convertible preferred

   securities entered in June 2019. Such fair value adjustments, if any, are required for the calculation of diluted reported earnings per share. No

   adjustments were necessary for the three months ended March 31, June 30 or September 30 or for the three and twelve months ended December 31. 

   During each quarter of 2021, the calculation of reported and operating earnings per share includes the impact of preferred dividends of $7 million

    associated with the Series A preferred stock equity units and $9 million associated with the Series B preferred stock equity units. In addition, the 

   fourth quarter of 2021 includes $3 million of preferred dividends associated with the Series C preferred stock issued in December 2021. 

   See Forms 10-Q and 10-K for additional information.

³⁾  YTD EPS may not equal sum of quarters due to share count difference and fair value adjustment associated with the convertible preferred 

   securities.

Schedule 4 - Reconciliation of 2Q22 Earnings to 2Q21

Preliminary, Unaudited

Three Months Ended

Six Months Ended

(millions, except EPS)

June 30,

June 30,

2022 vs. 2021

2022 vs. 2021

Increase / (Decrease)

Increase / (Decrease)

Reconciling Items

Amount

EPS

Amount

EPS

Change in reported earnings (GAAP)

($738)

($0.91)

($1,035)

($1.31)

Change in Pre-tax loss (income) ¹

909

1,316

Change in Income tax ¹

(141)

(144)

Adjustments to reported earnings

$768

$0.92

$1,172

$1.41

Change in consolidated operating earnings

$30

$0.01

$137

$0.10

Dominion Energy Virginia

Regulated electric sales:

Weather

($7)

($0.01)

$7

$0.01

Other

77

0.10

68

0.08

Rider equity return

12

0.01

28

0.03

Electric capacity

(4)

-

(12)

(0.01)

Storm damage and restoration costs

(8)

(0.01)

(8)

(0.01)

Depreciation & amortization

9

0.01

16

0.02

Renewable energy investment tax credits

(38)

(0.05)

23

0.03

Interest expense, net

(8)

(0.01)

(11)

(0.01)

Other

(24)

(0.02)

(18)

(0.02)

Share dilution

(0.01)

(0.01)

Change in contribution to operating earnings

$9

$0.01

$93

$0.11

Gas Distribution

Regulated gas sales:

Weather

-

-

$2

-

Other

20

0.02

54

0.07

Rider equity return

5

0.01

13

0.02

Interest expense, net

(3)

-

(2)

-

Other

8

-

6

-

Share dilution

-

(0.01)

Change in contribution to operating earnings

$30

$0.03

$73

$0.08

Dominion Energy South Carolina

Regulated electric sales:

Weather

$12

$0.01

$13

$0.02

Other

23

0.03

38

0.05

Regulated gas sales

1

-

4

-

Interest expense, net

(3)

-

(3)

-

Other

7

0.01

(5)

(0.01)

Share dilution

-

-

Change in contribution to operating earnings

$40

$0.05

$47

$0.06

Contracted Assets

Margin

($24)

($0.03)

($27)

($0.03)

Sale of non-wholly-owned nonregulated solar facilities

(10)

(0.01)

(9)

(0.01)

Planned outage costs

(45)

(0.06)

(49)

(0.06)

Renewable energy investment tax credits

-

-

(29)

(0.04)

Interest expense, net

(13)

(0.02)

(25)

(0.03)

Other

8

0.01

6

0.01

Share dilution

-

-

Change in contribution to operating earnings

($84)

($0.11)

($133)

($0.16)

Corporate and Other

Interest expense, net

$24

$0.03

$56

$0.07

Other

11

0.01

1

-

Share dilution

-

(0.01)

-

(0.06)

Change in contribution to operating earnings

$35

$0.03

$57

$0.01

Change in consolidated operating earnings

$30

$0.01

$137

$0.10

Change in adjustments included in reported earnings¹

($768)

($0.92)

($1,172)

($1.41)

Change in consolidated reported earnings

($738)

($0.91)

($1,035)

($1.31)

¹⁾

Adjustments to reported earnings are included in Corporate and Other segment reported GAAP earnings.  

Refer to Schedules 2 and 3 for details, or find "GAAP Reconciliation" in the Earnings Release Kit on Dominion Energy's

website at investors.dominionenergy.com.

Note: Figures may not sum due to rounding