LINCOLN ELECTRIC SYSTEM Revenue & Expense Statement (Condensed) DECEMBER 2018 PRELIMINARY

Transcription

1 YEAR TO DATE LINCOLN ELECTRIC SYSTEM Revenue & Expense Statement (Condensed) DECEMBER 2018 (Dollar amounts in 000) Percentage Actual Budget Difference Difference 10) Total Revenue $333,101 $320,678 $12,423 4% 11) Power Costs 129, ,996 (7,255) -5% generation and expenses. 12) Other Operating Expenses 70,147 85,176 (15,029) -18% 13) Depreciation 51,349 51, % 14) Total Expenses 251, ,393 (22,156) -8% 15) Operating Income 81,864 47,285 34,579 73% 16) Non-Operating Expense (Income) 39,935 41,407 (1,472) -4% 17) Change in Net Position (Net Revenue) $41,929 $5,878 $36, % Comments On a YTD basis, Retail revenue is slightly above budget. YTD energy use per customer (residential) continues to be notable as it is 8% above Wholesale revenue is 27.2% above budget YTD primarily due to higher than budgeted sales into the SPP IM as WS4 and TBGS have been called on to generate more than expected / budgeted due to favorable pricing. Produced Power costs are 5% below budget on a YTD basis primarily due to lower than budgeted LRS operation and maintenance costs, partially offset by higher WS4, Rokeby, and TBGS energy costs. Purchased Power costs are 5% below budget primarily due to favorable pricing in SPP IM, lower WS3 energy expenses and lower renewable wind Other Operating expenses (operation & maintenance, administrative & general) are under budget (-18%) due to the timing of project spending in categories including line clearance, wheeling, transmission (balanced portfolio credit), sustainable energy program participation, consulting services, and software purchases. YE Projection Budget 9) Debt Service Coverage Actual Budget 10) Days Cash on Hand (Days)

2 FINANCIAL AND OPERATING STATEMENT December 2018 Preliminary LES.com

3 INDEX REVENUE & EXPENSE STATEMENT - CURRENT MONTH REVENUE & EXPENSE STATEMENT - YEAR-TO-DATE REVENUES, ENERGY & CUSTOMERS - CURRENT MONTH REVENUES, ENERGY & CUSTOMERS - YEAR-TO-DATE OPERATING EXPENSE STATEMENT - CURRENT MONTH OPERATING EXPENSE STATEMENT - YEAR-TO-DATE BALANCE SHEET STATEMENT OF CASH FLOWS DEBT SERVICE COVERAGE INVESTMENT REPORT NOTE: Federal Energy Regulatory Commission accounting guidance for the Southwest Power Pool Integrated Market (SPP IM) transactions (purchases, sales and other charges) requires netting together these transactions based on the time increments. If, during the time increment, sales to SPP are greater than purchases from SPP, the net amount is recorded as wholesale revenue. If, during the time increment, purchases from SPP are greater than sales to SPP, the net amount is recorded as purchased power cost. Because of this netting process, the energy (MWH s) amounts no longer directly correlate to wholesale revenue.

4 REVENUE & EXPENSE STATEMENT DECEMBER 2018 CURRENT MONTH CURRENT CURRENT VARIANCE FROM LAST YEAR VARIANCE FROM DESCRIPTION MONTH MONTH BUDGET MONTH LAST YEAR ACTUAL BUDGET AMOUNT % ACTUAL AMOUNT % OPERATING REVENUES 1. Retail $21,612,326 $20,873,573 $738, % $20,463,558 $1,148, % 2. Wholesale 3,687,869 3,310, , % 3,256, , % 3. Other Revenue 744, , , % 653,276 90, % 4. City Dividend 617, ,085 4, % 589,109 28, % 5. Total Operating Revenues 26,661,921 25,288,256 1,373, % 24,962,597 1,699, % OPERATING EXPENSES 6. Purchased Power 5,950,792 6,177,424 (226,632) -3.7% 7,381,009 (1,430,217) -19.4% 7. Produced Power 5,268,432 5,456,357 (187,925) -3.4% 6,985,749 (1,717,317) -24.6% 8. Operations 1,599,744 2,423,399 (823,655) -34.0% 977, , % 9. Maintenance 638, ,015 (50,066) -7.3% 1,035,407 (396,458) -38.3% 10. Administrative & General 2,969,484 3,786,111 (816,627) -21.6% 2,604, , % 11. Depreciation 4,293,211 4,340,151 (46,940) -1.1% 4,312,949 (19,738) -0.5% 12. Total Operating Expenses 20,720,612 22,872,457 (2,151,845) -9.4% 23,296,563 (2,575,951) -11.1% 13. OPERATING INCOME 5,941,309 2,415,799 3,525, % 1,666,034 4,275, % NONOPERATING EXPENSES (INCOME) 14. Interest Expense 2,191,224 2,199,882 (8,658) -0.4% 1,900, , % 15. Capitalized Interest (211,720) (266,279) 54, % (91,577) (120,143) 131.2% 16. Payments in Lieu of Taxes 962,584 1,006,103 (43,519) -4.3% 992,568 (29,984) -3.0% 17. City Dividend Expense 635, , % 622,269 13, % 18. Other ,500,000 (10,499,880) % 19. Total Other Expense 3,577,545 3,575,043 2, % 13,923,674 (10,346,129) -74.3% 20. Interest Income (445,872) (245,657) (200,215) 81.5% 19,239 (465,111) % 21. Total Nonoperating Expense (Income) 3,131,673 3,329,386 (197,713) -5.9% 13,942,913 (10,811,240) -77.5% 22. Income Before Contributions 2,809,636 (913,587) 3,723, % (12,276,879) 15,086, % CONTRIBUTED CAPITAL 23. Contributed Capital Received 46, ,320 (60,978) -56.8% 51,739 (5,397) -10.4% 24. Contributed Capital Used (46,342) (107,320) 60, % (51,739) 5, % 25. Net Contributed Capital CHANGE IN NET POSITION $2,809,636 ($913,587) $3,723, % ($12,276,879) $15,086, % Page 1

5 REVENUE & EXPENSE STATEMENT DECEMBER 2018 YEAR-TO-DATE VARIANCE FROM LAST YEAR VARIANCE FROM DESCRIPTION YEAR TO DATE YEAR TO DATE BUDGET YEAR TO DATE LAST YEAR ACTUAL BUDGET AMOUNT % ACTUAL AMOUNT % OPERATING REVENUES 1. Retail $275,719,203 $273,242,307 $2,476, % $267,817,933 $7,901, % 2. Wholesale 42,267,362 33,238,414 9,028, % 38,947,437 3,319, % 3. Other Revenue 7,636,258 6,684, , % 7,477, , % 4. City Dividend 7,478,264 7,512,140 (33,876) -0.5% 7,307, , % 5. Total Operating Revenues 333,101, ,677,552 12,423, % 321,549,672 (5,796,378) 3.6% OPERATING EXPENSES 6. Purchased Power 70,380,380 74,436,173 (4,055,793) -5.4% 82,079,576 (11,699,196) -14.3% 7. Produced Power 59,360,199 62,560,299 (3,200,100) -5.1% 64,415,171 (5,054,972) -7.8% 8. Operations 20,593,627 30,177,917 (9,584,290) -31.8% 22,368,660 (1,775,033) -7.9% 9. Maintenance 7,940,505 8,732,079 (791,574) -9.1% 7,732, , % 10. Administrative & General 41,613,233 46,265,793 (4,652,560) -10.1% 40,101,888 1,511, % 11. Depreciation 51,349,398 51,221, , % 50,953, , % 12. Total Operating Expenses 251,237, ,393,500 (22,156,158) -8.1% 267,651,708 (16,414,366) -6.1% 13. OPERATING INCOME 81,863,745 47,284,052 34,579, % 53,897,964 27,965, % NONOPERATING EXPENSES (INCOME) 14. Interest Expense 25,205,330 25,321,729 (116,399) -0.5% 23,062,052 2,143, % 15. Capitalized Interest (1,806,065) (2,052,417) 246, % (673,061) (1,133,004) 168.3% 16. Payments in Lieu of Taxes 12,661,721 13,467,830 (806,109) -6.0% 13,009,332 (347,611) -2.7% 17. City Dividend Expense 7,519,504 7,519, % 7,364, , % 18. Other (1,149) 0 (1,149) ,502,473 (10,503,622) % 19. Total Other Expense 43,579,341 44,256,642 (677,301) -1.5% 53,265,638 (9,686,297) -18.2% 20. Interest Income (3,644,554) (2,849,870) (794,684) 27.9% (1,456,413) (2,188,141) 150.2% 21. Total Nonoperating Expense (Income) 39,934,787 41,406,772 (1,471,985) -3.6% 51,809,225 (11,874,438) -22.9% 22. Income Before Contributions 41,928,958 5,877,280 36,051, % 2,088,739 39,840, % CONTRIBUTED CAPITAL 23. Contributed Capital Received 906,721 1,287,807 (381,086) -29.6% 935,929 (29,208) -3.1% 24. Contributed Capital Used (906,721) (1,287,807) 381, % (935,929) 29, % 25. Net Contributed Capital CHANGE IN NET POSITION $41,928,958 $5,877,280 $36,051, % $2,088,739 $39,840, % Page 2

6 REVENUES, ENERGY & CUSTOMERS DECEMBER 2018 CURRENT MONTH CURRENT CURRENT VARIANCE FROM LAST YEAR VARIANCE FROM DESCRIPTION MONTH MONTH BUDGET MONTH LAST YEAR ACTUAL BUDGET AMOUNT % ACTUAL AMOUNT % REVENUE 1. Residential $9,239,699 $9,040,703 $198, % $8,095,142 $1,144, % 2. Commercial (a) 8,122,535 8,682,009 (559,474) -6.4% 8,023,081 99, % 3. Industrial 2,319,668 2,563,365 (243,697) -9.5% 2,410,534 (90,866) -3.8% 4. Street Light 199, ,148 5, % 194,478 5, % 5. Total Billed 19,881,482 20,480,225 (598,743) -2.9% 18,723,235 1,158, % 6. Unbilled Change 1,730, ,348 1,337, % 1,740,323 (9,479) 0.0% 7. Total Retail 21,612,326 20,873, , % 20,463,558 1,148, % 8. SPP Sales 2,319,023 1,920, , % 2,082, , % 9. Contract Sales 1,368,846 1,389,446 (20,600) -1.5% 1,174, , % 10. Total Wholesale 3,687,869 3,310, , % 3,256, , % 11. Total $25,300,195 $24,183,920 $1,116, % $23,720,212 $1,579, % ENERGY (Megawatt-Hours) 12. Residential 107, ,417 2, % 92,080 15, % 13. Commercial (a) 112, ,484 (8,868) -7.3% 111,352 1, % 14. Industrial 34,601 39,208 (4,607) -11.8% 36,245 (1,644) -4.5% 15. Street Light 1,531 1,756 (225) -12.8% 1,746 (215) -12.3% 16. Total Billed 255, ,865 (10,940) -4.1% 241,423 14, % 17. Unbilled Change 27,685 8,838 18, % 26,440 1, % 18. Total Retail 283, ,703 7, % 267,863 15, % 19. SPP Sales 103,159 81,920 21, % 85,173 17, % 20. Contract Sales 55,298 54,237 1, % 35,033 20, % 21. Total Wholesale 158, ,157 22, % 120,206 38, % 22. Total 442, ,860 30, % 388,069 53, % CUSTOMERS 23. Residential 123, , % 122,210 1, % 24. Commercial (a) 16,964 16, % 16, % 25. Industrial % 177 (1) -0.6% 26. Street Light % % 27. Total Retail 140, , % 139,194 1, % 28. Wholesale % % 29. Total 140, , % 139,201 1, % Page 3

7 REVENUES, ENERGY & CUSTOMERS DECEMBER 2018 YEAR-TO-DATE VARIANCE FROM LAST YEAR VARIANCE FROM DESCRIPTION YEAR TO DATE YEAR TO DATE BUDGET YEAR TO DATE LAST YEAR ACTUAL BUDGET AMOUNT % ACTUAL AMOUNT % REVENUE 1. Residential $125,460,251 $120,124,090 $5,336, % $117,303,463 $8,156, % 2. Commercial (a) 115,407, ,123,887 (716,341) -0.6% 113,751,166 1,656, % 3. Industrial 31,487,360 33,213,718 (1,726,358) -5.2% 32,153,969 (666,609) -2.1% 4. Street Light 2,529,622 2,332, , % 2,318, , % 5. Total Billed 274,884, ,794,681 3,090, % 265,527,188 9,357, % 6. Unbilled Change 834,424 1,447,626 (613,202) 0.0% 2,290,745 (1,456,321) 0.0% 7. Total Retail 275,719, ,242,307 2,476, % 267,817,933 7,901, % 8. SPP Sales 25,595,296 17,113,014 8,482, % 24,012,723 1,582, % 9. Contract Sales 16,672,066 16,125, , % 14,934,714 1,737, % 10. Total Wholesale 42,267,362 33,238,414 9,028, % 38,947,437 3,319, % 11. Total $317,986,565 $306,480,721 $11,505, % $306,765,370 $11,221, % ENERGY (Megawatt-Hours) 12. Residential 1,308,303 1,229,019 79, % 1,196, , % 13. Commercial (a) 1,504,735 1,522,147 (17,412) -1.1% 1,477,742 26, % 14. Industrial 453, ,221 (41,528) -8.4% 470,520 (16,827) -3.6% 15. Street Light 20,482 21,138 (656) -3.1% 21,159 (677) -3.2% 16. Total Billed 3,287,213 3,267,525 19, % 3,166, , % 17. Unbilled Change 12,052 16,998 (4,946) 0.0% 28,594 (16,542) 0.0% 18. Total Retail 3,299,265 3,284,523 14, % 3,194, , % 19. SPP Sales 1,040, , , % 907, , % 20. Contract Sales 607, ,805 50, % 473, , % 21. Total Wholesale 1,648,037 1,258, , % 1,380, , % 22. Total 4,947,302 4,543, , % 4,574, , % CUSTOMERS 23. Residential 122, , % 121,614 1, % 24. Commercial (a) 16,906 16, % 16, % 25. Industrial % % 26. Street Light % % 27. Total Retail 140, , % 138,482 1, % 28. Wholesale % % 29. Total 140, , % 138,489 1, % Page 4

8 OPERATING EXPENSE STATEMENT DECEMBER 2018 CURRENT MONTH CURRENT CURRENT VARIANCE FROM LAST YEAR VARIANCE FROM DESCRIPTION MONTH MONTH BUDGET MONTH LAST YEAR ACTUAL BUDGET AMOUNT % ACTUAL AMOUNT % POWER COST 1. SPP Purchased Power $577,656 $556,650 $21, % $445,812 $131, % 2. Non-Owned Asset Power 5,373,136 5,620,774 (247,638) -4.4% 6,935,197 (1,562,061) -22.5% 3. Total Purchased Power 5,950,792 6,177,424 (226,632) -3.7% 7,381,009 (1,430,217) -19.4% 4. Produced Power 5,268,432 5,456,357 (187,925) -3.4% 6,985,749 (1,717,317) -24.6% 5. Total Power Cost 11,219,224 11,633,781 (414,557) -3.6% 14,366,758 (3,147,534) -21.9% OPERATION & MAINTENANCE (O&M) 6. Energy Delivery 1,679,922 1,841,104 (161,182) -8.8% 1,612,874 67, % 7. Transmission 558,771 1,271,310 (712,539) -56.0% 399, , % 8. Total O & M Expense 2,238,693 3,112,414 (873,721) -28.1% 2,012, , % ADMINISTRATIVE & GENERAL (A&G) 9. Administration 139, ,749 (77,674) -35.8% 166,245 (27,170) -16.3% 10. Communication & Corporate Records 134, ,320 (51,330) -27.5% 187,041 (52,051) -27.8% 11. Corporate Operations 151, ,626 (259,132) -63.1% (695,874) 847, % 12. Customer Services 805,438 1,031,162 (225,724) -21.9% 493, , % 13. Financial Services 270, ,929 (45,742) -14.5% 292,798 (22,611) -7.7% 14. Power Supply 297, ,943 (35,209) -10.6% 339,861 (42,127) -12.4% 15. Technology Services 1,170,566 1,292,382 (121,816) -9.4% 1,820,298 (649,732) -35.7% 16. Total A & G Expense 2,969,484 3,786,111 (816,627) -21.6% 2,604, , % 17. DEPRECIATION 4,293,211 4,340,151 (46,940) -1.1% 4,312,949 (19,738) -0.5% 18. TOTAL OPERATING EXPENSE $20,720,612 $22,872,457 ($2,151,845) -9.4% $23,296,563 ($2,575,951) -11.1% Page 5

9 OPERATING EXPENSE STATEMENT DECEMBER 2018 YEAR-TO-DATE VARIANCE FROM LAST YEAR VARIANCE FROM DESCRIPTION YEAR TO DATE YEAR TO DATE BUDGET YEAR TO DATE LAST YEAR ACTUAL BUDGET AMOUNT % ACTUAL AMOUNT % POWER COST 1. SPP Purchased Power $7,667,135 $9,666,618 ($1,999,483) -20.7% $4,998,257 $2,668, % 2. Non-Owned Asset Power 62,713,245 64,769,555 (2,056,310) -3.2% 77,081,319 (14,368,074) -18.6% 3. Total Purchased Power 70,380,380 74,436,173 (4,055,793) -5.4% 82,079,576 (11,699,196) -14.3% 4. Produced Power 59,360,199 62,560,299 (3,200,100) -5.1% 64,415,171 (5,054,972) -7.8% 5. Total Power Cost 129,740, ,996,472 (7,255,893) -5.3% 146,494,747 (16,754,168) -11.4% OPERATION & MAINTENANCE (O&M) 6. Energy Delivery 21,813,168 24,066,225 (2,253,057) -9.4% 18,479,169 3,333, % 7. Transmission 6,720,964 14,843,771 (8,122,807) -54.7% 11,621,973 (4,901,009) -42.2% 8. Total O & M Expense 28,534,132 38,909,996 (10,375,864) -26.7% 30,101,142 (1,567,010) -5.2% ADMINISTRATIVE & GENERAL (A&G) 9. Administration 2,273,991 2,456,125 (182,134) -7.4% 2,279,650 (5,659) -0.2% 10. Communication & Corporate Records 2,161,705 2,863,070 (701,365) -24.5% 1,950, , % 11. Corporate Operations 5,556,268 5,643,331 (87,063) -1.5% 4,371,169 1,185, % 12. Customer Services 10,145,574 12,051,953 (1,906,379) -15.8% 10,708,620 (563,046) -5.3% 13. Financial Services 3,641,839 4,020,725 (378,886) -9.4% 3,551,652 90, % 14. Power Supply 3,792,402 4,050,518 (258,116) -6.4% 3,950,739 (158,337) -4.0% 15. Technology Services 14,041,454 15,180,071 (1,138,617) -7.5% 13,289, , % 16. Total A & G Expense 41,613,233 46,265,793 (4,652,560) -10.1% 40,101,888 1,511, % 17. DEPRECIATION 51,349,398 51,221, , % 50,953, , % 18. TOTAL OPERATING EXPENSE $251,237,342 $273,393,500 ($22,156,158) -8.1% $267,651,708 ($16,414,366) -6.1% Page 6

10 BALANCE SHEET DECEMBER 2018 ASSETS & DEFERRED OUTFLOWS OF RESOURCES LIABILITIES AND NET POSITION END OF VARIANCE END OF VARIANCE DESCRIPTION MONTH SINCE DESCRIPTION MONTH SINCE BALANCE JANUARY 1 BALANCE JANUARY 1 CURRENT ASSETS: CURRENT LIABILITIES: 1. Revenue Fund (including CDFUO) $124,318,278 $67,338,884 OTHER LIABILITIES 2. Payments in Lieu of Taxes Fund $12,134,953 $361, Accounts Payable $24,771,961 $3,263, Rate Stabilization Fund 34,453, , Accrued Payments in Lieu of Taxes 13,096,246 (239,718) 4. Bond Principal & Interest Funds 17,306,081 2,726, City Dividend for Utility Ownership Payable 2,541,348 52, Other Restricted/Designated Funds 2,864,398 (110,726) 4. Commercial Paper Notes 65,500,000 (30,000,000) 6. Restricted/Designated Funds Total 54,623,558 3,238, Accrued Liabilities 12,977,425 1,064, Total Current Asset Funds 191,076,789 70,938, MBPP-BNSF-STB Settlement Receivables Less Uncollectible Allowance 20,427, , Total Other Liabilities 118,886,980 (25,860,230) 9. Unbilled Revenue 14,921, ,425 CURRENT LIABILITIES - RESTRICTED ASSETS 10. Accrued Interest Receivable 1,176, , Current Portion of Long-Term Debt 22,750,000 3,270, Materials, Supplies & Fuel Inventory 13,812,536 1,085, Accrued Interest 9,900,406 1,673, Plant Operation Assets 12,696,133 (4,306,018) 10. Other Current Liabilities 1,479,469 81, Other Current Assets 2,844, , Total Current Liabilities - Restricted Assets 34,129,875 5,024, Total Current Assets 256,954,904 70,127, Total Current Liabilities 153,016,855 (20,835,528) NONCURRENT ASSETS: NONCURRENT LIABILITIES: 15. Bond Reserve Funds 19,324,238 2,591, Bonds 1,150, Self Funded Benefits Reserve Fund (IBNP) 541,521 9, A Bonds 217,020, Segregated Funds 650, Bonds 75,525, Restricted Fund Total 20,516,248 2,600, A Bonds 167,800, Unamortized Debt Expense 2,827, , Bonds 80,095,000 (19,480,000) 20. Other Noncurrent Assets 3,426, , Bonds 121,205, ,205, Total Noncurrent Assets 26,770,664 4,136, Total Revenue Bonds 662,795, ,725, Less Current Maturities 22,750,000 3,270,000 CAPITAL ASSETS: 21. Less Unamortized Discounts/Premiums (67,262,348) (13,367,525) 22. Utility Plant in Service 1,568,868,738 47,101, Note Purchase Agreement 1,500,000 1,500, Accumulated Depreciation & Amortization (777,209,099) (42,663,705) 23. Revolving Credit Agreement 0 (30,000,000) 24. Construction Work in Progress 142,932,835 27,828, Net Long Term Debt 708,807,348 83,322, Total Capital Assets 934,592,474 32,266, Liabilities Payable from Segregated Funds 646, Other Noncurrent Liabilities 532,436 0 DEFERRED OUTFLOWS OF RESOURCES: 27. Total Liabilities 863,002,776 62,486, Deferred Loss on Refunded Debt 13,339,677 (2,114,944) NET POSITION: 28. Net Investment in Capital Assets 171,423,966 (52,121,388) 29. Restricted for Debt Service 7,579,707 1,195, Restricted for Employee Health Insurance Claims 529,927 (405,124) 31. Unrestricted 189,121,343 93,260, Total Net Position 368,654,943 41,928, TOTAL ASSETS & DEFERRED OUTFLOWS OF RESOURCES $1,231,657,719 $104,415, TOTAL LIABILITIES & NET POSITION $1,231,657,719 $104,415,955 Page 7

11 STATEMENT OF CASH FLOWS DECEMBER 2018 CURRENT MONTH YEAR-TO-DATE CASH FLOW FROM OPERATING ACTIVITIES: 1. Received from Sales to Customers and Users $28,419,895 $350,438, Paid to Suppliers for Goods & Services (8,667,848) (178,171,856) 3. Paid to Employees for Services (2,695,591) (33,599,599) 4. Cash Flow from Operating Activities (a) 17,056, ,666,895 CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES: 5. Payments in Lieu of Taxes 0 (12,901,441) 6. City Dividend for Utility Ownership Payments 0 (7,467,232) 7. Other Cash Flow from (used for) Non-capital Financing Activities 0 (20,368,672) CASH FLOWS FROM INVESTING ACTIVITIES: 9. Net (Purchases) Sales of Investments 6,662,702 (69,565,104) 10. Interest Income 402,405 2,543, Cash Flow from (used for) Investing Activities 7,065,107 (67,022,060) CASH FLOWS FROM CAPITAL FINANCING ACTIVITIES: 12. Acquisition and Construction of Capital Assets (12,534,843) (82,232,105) 13. Salvage on Retirement of Plant 1, , Cost of Removal of Property Retired (184,136) (2,033,623) 15. Debt Issuance Cost Paid 0 (872,230) 16. Debt Premiums Collected 0 19,612, Net Capital Contributions 46, , Net Proceeds form Issuance of Long-Term Debt 0 122,705, Principal Payments on Long-Term Debt 0 (79,480,000) 20. Interest Payments on Long-Term Debt (3,357) (26,743,418) 21. Cash Flow from (used for) Capital Financing Activities (12,674,311) (47,578,241) 22. Net Increase (Decrease) in Cash and Cash Equivalents 11,447,252 3,697, Cash and Cash Equivalent Beginning of Period 15,692,857 23,442, Cash and Cash Equivalent End of Period (b) $27,140,109 $27,140,109 STATEMENT OF CASH FLOW FOOTNOTES (a) Reconciliation of operating income to cash flows from operating activities 1. Net Operating Revenue $5,941,309 $81,863, Noncash items included in operating income 4,382,926 52,438, Changes in Assets & Liabilities Increase/(Decrease) 6,732,221 4,364, Net cash flows from operating activities $17,056,456 $138,666,895 (b) Cash and cash equivalents are defined as cash and investments with original maturities of three months or less. Page 8

12 DEBT SERVICE COVERAGE DECEMBER CURRENT MONTH YEAR-TO-DATE DESCRIPTION ACTUAL BUDGET ACTUAL ACTUAL BUDGET ACTUAL THIS YEAR THIS YEAR LAST YEAR THIS YEAR THIS YEAR LAST YEAR 1. Total Operating Revenues $26,661,921 $25,288,256 $24,962,597 $333,101,087 $320,677,552 $321,549, Total Operating Expenses 20,720,612 22,872,457 23,296, ,237, ,393, ,651, Less Depreciation (4,293,211) (4,340,151) (4,312,949) (51,349,398) (51,221,239) (50,953,931) 4. Operating Expense Net of Depreciation 16,427,401 18,532,306 18,983, ,887, ,172, ,697, Net Operating Revenue for Debt Service 10,234,520 6,755,950 5,978, ,213,143 98,505, ,851, Interest Income (a) 386, ,248 45,793 2,958,680 2,412,918 1,214, Other Income Rate Stabilization Fund AVAILABLE FOR DEBT SERVICE 10,620,895 6,965,198 6,024, ,171, ,918, ,066, DEBT SERVICE (b) 4,324,651 4,430,034 3,643,886 47,477,490 47,900,645 42,688, DEBT SERVICE COVERAGE (a) Excludes interest from Rate Stabilization Fund. (b) Includes Bond Principal & Interest only. Page 9

13 INVESTMENT REPORT DECEMBER 2018 PURCHASE MATURITY CPN/DCNT (a) CASH PAR FUND / INVESTMENT DATE DATE RATE YIELD EQUIVALENTS SECURITIES VALUE CASH - REVENUE FUND / WORKING FUND $282,402 $282,402 SHORT TERM FEDERAL INVESTMENT TRUST (STFIT) 17,593,600 17,593,600 REVENUE FUND Federated Treasury Obligations Fund * 1.940% 144, ,451 Korea Development Bank Commercial Paper 06/28/ /04/ % 2.462% 7,403,813 7,500,000 Shinhan Bank NY Branch Commercial Paper 06/28/ /22/ % 2.697% 7,368,052 7,500,000 U.S. Treasury Note 06/28/ /15/ % 2.220% 7,435,425 7,500,000 Banco Santander SA/NY Commercial Paper 07/26/ /01/ % 2.648% 7,482,967 7,620,000 ING (U.S.) Funding LLC Commercial Paper 07/10/ /05/ % 2.579% 4,988,869 5,085,000 U.S. Treasury Note 06/28/ /30/ % 2.301% 7,434,750 7,500,000 U.S. Treasury Note 06/28/ /15/ % 2.311% 7,552,800 7,500,000 Societe Generale Commercial Paper 08/27/ /24/ % 2.621% 7,497,643 7,645,000 Bedford Row Funding Corp Commercial Paper 08/28/ /24/ % 2.589% 3,433,572 3,500,000 China Construction Bank Corp Commercial Paper 11/20/ /24/ % 3.037% 4,923,174 5,000,000 Bank of China (Hong Kong) Commercial Paper 09/21/ /18/ % 2.735% 5,761,812 5,880,000 Federal Home Loan Banks Bond 06/29/ /21/ % 2.350% 7,411,692 7,500,000 Agricultural Bank of China Ltd. Commercial Paper 10/10/ /05/ % 2.860% 7,461,165 7,620,000 U.S. Treasury Note 06/28/ /15/ % 2.345% 7,376,979 7,500,000 Banco del Estado de Chile Commercial Paper 10/22/ /19/ % 2.860% 7,499,140 7,660,000 Glencove Funding LLC Commercial Paper 11/02/ /19/ % 2.858% 5,105,047 5,210,000 Discount \ (Premium) 160,925 Total Revenue Fund 144, ,297, ,864,451 PILOT FUND Federated Treasury Obligations Fund * 1.940% 11,996 11,996 MUFG Bank, Ltd., NY Branch Commercial Paper 04/20/ /14/ % 2.444% 864, ,000 J.P. Morgan Securities Commercial Paper 05/18/ /11/ % 2.496% 962, ,000 J.P. Morgan Securities Commercial Paper 06/20/ /15/ % 2.579% 946, ,000 Natixis, New York Branch Commercial Paper 07/20/ /05/ % 2.525% 1,119,660 1,140,000 Federal Home Loan Banks Bond 03/22/ /08/ % 2.120% 990,029 1,000,000 Glencove Funding LLC Commercial Paper 11/20/ /18/ % 2.741% 978, ,000 Canadian Imperial Holdings Inc Commercial Paper 08/20/ /26/ % 2.482% 1,445,191 1,470,000 Bayerische Landesbank, NY Commercial Paper 10/19/ /26/ % 2.677% 1,375,665 1,395,000 Credit Agricole CIB Commercial Paper 12/20/ /26/ % 2.746% 935, ,000 Bedford Row Funding Corp Commercial Paper 09/28/ /29/ % 2.548% 1,408,763 1,430,000 U.S. Treasury Note 02/20/ /30/ % 2.105% 1,083,869 1,090,000 Discount \ (Premium) 11,849 Total PILOT Fund $11,996 $12,122,957 $12,296,996 (a) Cash and cash equivalents are defined as cash & investments with original maturities of three months or less. * Interest rate as of end of month. Page 10a

14 INVESTMENT REPORT DECEMBER 2018 PURCHASE MATURITY CPN/DCNT (a) CASH PAR FUND / INVESTMENT DATE DATE RATE YIELD EQUIVALENTS SECURITIES VALUE BOND RESERVE FUNDS Federated Treasury Obligations Fund * 1.940% $99,971 $99,971 Federal National Mortgage Association Bond 05/28/ /01/ % 1.650% 1,416,805 1,505,000 Federal Home Loan Mortgage Corporation Bond 06/28/ /15/ % 2.400% 2,916,449 2,950,000 Federal National Mortgage Association Bond 09/01/ /28/ % 1.150% 355, ,000 Federal Home Loan Banks Bond 08/28/ /21/ % 2.630% 2,344,766 2,345,000 Federal National Mortgage Association Bond 09/01/ /28/ % 1.400% 1,400,000 1,400,000 Federal National Mortgage Association Bond 09/01/ /28/ % 1.400% 2,340,000 2,340,000 Federal Home Loan Banks Bond 03/14/ /28/ % 2.400% 3,750,000 3,750,000 Federal National Mortgage Association Bond 06/28/ /28/ % 2.800% 4,600,000 4,600,000 Discount \ (Premium) 101,247 Total Bond Reserve Funds 99,971 19,224,267 19,344,971 BOND PRINCIPAL & INTEREST FUNDS Federated Treasury Obligations Fund * 1.940% 5,916 5,916 ERP Operating LP Commercial Paper 10/31/ /07/ % 2.690% 2,436,974 2,455,000 Bayerische Landesbank, NY Commercial Paper 09/28/ /25/ % 2.557% 2,399,436 2,425,000 Cigna Corporation Commercial Paper 11/30/ /25/ % 3.042% 2,432,119 2,450,000 CNPC Finance HK Ltd. Commercial Paper 12/28/ /26/ % 3.066% 2,442,520 2,455,000 CNPC Finance HK Ltd. Commercial Paper 12/28/ /08/ % 3.068% 1,938,435 1,950,000 JP Morgan Securities LLC Commercial Paper 10/31/ /26/ % 2.964% 1,878,549 1,920,000 International Bank for Reconstruction and Dev Note 09/28/ /15/ % 2.610% 1,866,569 1,895,000 Glencove Funding LLC Commercial Paper 11/30/ /26/ % 3.016% 1,897,236 1,940,000 Discount \ (Premium) 8,326 Total Bond Principal & Interest Funds 6,818,990 10,487,090 17,495,916 RATE STABILIZATION FUND Federated Treasury Obligations Fund * 1.940% 7,965 7,965 Federal Farm Credit Banks Bond 06/29/ /12/ % 1.391% 5,048,485 5,050,000 Federal National Mortgage Association Bond 12/11/ /26/ % 1.820% 1,729,662 1,732,000 Federal Home Loan Mortgage Corporation Bond 01/30/ /27/ % 2.150% 8,091,809 8,150,000 Federal Farm Credit Banks Bond 12/20/ /12/ % 1.916% 5,135,888 5,140,000 Federal Farm Credit Banks Bond 01/12/ /10/ % 1.970% 2,549,006 2,550,000 Federal Farm Credit Banks Bond 06/29/ /11/ % 2.580% 5,197,014 5,200,000 Federal Home Loan Banks Bond 12/17/ /18/ % 2.860% 6,658,002 6,665,000 Discount \ (Premium) 35,249 Total Rate Stabilization Fund $7,965 $34,445,115 $34,494,965 (a) Cash and cash equivalents are defined as cash & investments with original maturities of three months or less. * Interest rate as of end of month. Page 10b

15 INVESTMENT REPORT DECEMBER 2018 PURCHASE MATURITY CPN/DCNT (a) CASH PAR FUND / INVESTMENT DATE DATE RATE YIELD EQUIVALENTS SECURITIES VALUE SELF-FUNDED HEALTH & DENTAL CLAIMS FUND Federated Treasury Obligations Fund * 1.940% $1,393,352 $1,393,352 Discount \ (Premium) Total Self-Funded Health & Dental Claims Fund 1,393, ,393,352 SELF-FUNDED HEALTH & DENTAL RESERVE FUND (INCURRED BUT NOT PRESENTED) Federated Treasury Obligations Fund * 1.940% 541, ,521 Discount \ (Premium) Total Self-Funded Health & Dental Reserve Fund 541, ,521 SEGREGATED ACCOUNT Federated Treasury Obligations Fund * 1.940% 245, ,861 U.S. Treasury Bill 06/29/ /20/ % 2.300% 1,271,321 1,300,000 Federal National Mortgage Association Bond 12/17/ /17/ % 2.701% 197, ,000 U.S. Treasury Note 09/17/ /31/ % 2.661% 405, ,000 Discount \ (Premium) 1,026 Total Segregated Account 245,861 1,875,674 2,155,861 TOTAL $27,140,109 $184,452,928 $213,464,035 (a) Cash and cash equivalents are defined as cash & investments with original maturities of three months or less. * Interest rate as of end of month. Page 10c

16 December 2018 Year to Date Financial Update Headline: December Financials reflect strong positive financial performance due primarily to lower net power and transmission costs paired with higher than budgeted revenues. Laura L. Kapustka Vice President & CFO Administrative Board January 18, 2019 LES.com 1

17 Retail sales ending year at $275M only slightly above budget of $272M Dollars in Millions $120 $100 $80 $60 $40 Budget, $120.1 Actual $125.5 Last Year, $117.3 Budget, $116.1 Actual $115.4 Last Year, $113.8 $20 $0 Budget Actual $31.5 Last Year Actual $2.5 Residential Commercial Industrial Streetlight Excludes Unbilled Revenue LES.com 2

18 Average Annual Residential Use Per Customer (KWh) Residential Energy Use Per Customer an anomaly?

19 Year-end Capital projected to be below budget by $8.5M (Budget was $91M) Dollars in Thousands $3,000 $2,000 $1,000 $0 -$1,000 -$2,000 -$3,000 -$4,000 -$5,000 LES Operations Center $29.4M $2,242 Employee tours & punch list walk throughs have been a 4 th qtr. focus. Support staff will settle in early in Feb. Over budget position due to moving ahead with Phase 2 footings & foundations. Laramie River Station $17.6M Updated cashflow reflects reduced costs for SCR project -$4,311 SE Lincoln Reliability Project $6.4M Lower construction costs -$1,739 Underground Projects $13.3M Less activity due to weather and delayed county project -$2,254 Balance of Budget $24.3M Acceleration and delay of Substation and Technology Service projects -$2,460 *Does not include potential year-end adjustments. LES.com 4

20 Below Budget net power costs and transmission costs key to year-end Debt service coverage 2018 Budget = 2.11 Increases to DSC.34 Net Power Cost: Increased wholesale revenue (greater sales to SPP) ($9.0M), lower purchased power ($4.0M) expenses & lower maintenance costs at LRS ($2.7M), other produced power savings ($0.6M). Lower SPP Transmission Expense.32 Operations & Maintenance / Administrative & General: lower transmission costs ($8.1M), lower SEP participation ($1.5M) and various other expense categories under budget ($5.2M)..05 Retail Revenue: Increased use per customer ($2.5M)..04 Other: Lower debt service & expenses in other categories ($1.9M). Decreases to DSC.03 Net Position: Transfer of SEP Funds from General Fund to Rate Stabilization Fund ($1.5M)..03 Administrative & General: True-up of Sick Leave liability balance ($1.5M) Forecast =

21 What does 2.80 Debt Service Coverage mean to LES customers? Eliminated $70M long-term borrowing next borrowing 2025 (based on current projections) Interest expense reduction of over $45M ($90M when include coverage impact) 1% rate increase eliminated (permanently) Days Cash on Hand $20.5M Borrowing $50M Borrowing 0 Jan-18 Feb-18 Mar-18 Apr-18 May-18 Jun-18 Jul-18 Aug-18 Sep-18 Oct-18 Nov-18 Dec-18 Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19 Jan-20 Feb-20 Mar-20 Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20 Nov-20 Dec-20 As of Dec 2018 As of Jan 2018 Target LES.com 6

22 Not quite 2018 is over right? Will it ever be? Today s presentation are preliminary results Working on the 13 th Period Unique & non-routine adjustments are separated from December operations Timeliness of reporting Period 13 results in unaudited financials Period (just kidding) BKD s review results in audited financials Annual report presented to Board at end of April (That s when the fat lady sings and 2018 is in the history books!) LES.com 7