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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) August 2, 2016

WESTAR ENERGY, INC.

(Exact name of registrant as specified in its charter)

KANSAS
 
1-3523
 
48-0290150
(State or other jurisdiction of incorporation or organization)
 
(Commission File Number)
 
(IRS Employer Identification No.)
 
 
 
 
 
818 South Kansas Avenue, Topeka, Kansas
 
66612
(Address of principal executive offices)
 
(Zip Code)

Registrant's telephone number, including area code
 (785) 575-6300



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:

o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))





WESTAR ENERGY, INC.

Item 2.02. Results of Operations and Financial Condition.

On August 2, 2016, we issued a press release announcing our earnings for the period ended June 30, 2016. A copy of our August 2, 2016 press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference. We are also including our 2016 Second Quarter Earnings package, which is attached hereto as Exhibit 99.2 and is incorporated herein by reference. The information furnished pursuant to this Item 2.02, including Exhibits 99.1 and 99.2, will not be incorporated by reference into any registration statement filed by us under the Securities Act of 1933, as amended, unless specifically identified therein as being incorporated by reference.


Item 9.01. Financial Statements and Exhibits.

Exhibit 99.1
Press Release dated August 2, 2016
Exhibit 99.2
2016 Second Quarter Earnings Package







SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 
 
 
 
WESTAR ENERGY, INC.
 
 
 
 
 
 
 
Date:
 
August 2, 2016
 
By:
 
/s/ Larry D. Irick
 
 
 
 
Name:
 
Larry D. Irick
 
 
 
 
Title:
 
Vice President, General Counsel and Corporate Secretary







EXHIBIT INDEX

Exhibit Number
 
Description of Exhibit
Exhibit 99.1
 
Press Release dated August 2, 2016
Exhibit 99.2
 
2016 Second Quarter Earnings Package




Exhibit
Exhibit 99.1


Westar Energy announces 2nd quarter 2016 results.
TOPEKA, Kan., Aug. 2, 2016 - Westar Energy, Inc. (NYSE:WR) today announced earnings of $72 million, or $0.51 per share, for the second quarter 2016 compared with earnings of $64 million, or $0.47 per share, for the second quarter 2015. Earnings for the six months ended June 30, 2016 were $138 million, or $0.97 per share, compared with $115 million, or $0.85 per share, for the same period in 2015.

Higher net income for the second quarter, compared with last year, was driven by the impact of regulatory rate review that concluded in late 2015, higher sales due to warmer spring weather, and lower interest expense. The higher revenue was partially offset by a decrease of corporate owned life insurance benefit and merger-related expenses.
    
Net income for the six months ended June 30, 2016 also increased primarily from impact of regulatory rate review that concluded in late 2015 and lower interest expense. The higher revenue was partially offset by merger related-expenses, a decrease in corporate owned life insurance benefit, and lower sales due to unusually mild winter weather.

Earnings Guidance
    
The company affirmed its 2016 earnings guidance of $2.38 to $2.53 per share. The
earnings guidance drivers are located under Supplemental Materials within the investor section
of the company website at www.WestarEnergy.com.

Conference Call and Additional Company Information

Westar Energy management will host a conference call Wednesday, Aug. 3 with the investment community at 10:00 a.m. ET (9:00 a.m. CT). Investors, media and the public may listen to the conference call by dialing 844-646-4526, conference ID 45090870. A webcast of the live conference call will be available at www.WestarEnergy.com.

Members of the media are invited to listen to the conference call and then contact Gina Penzig with any follow-up questions.

This earnings announcement, a package of detailed second-quarter financial information, the company's quarterly report on Form 10-Q for the period ended June 30, 2016 and other filings the company has made with the Securities and Exchange Commission are available on the company's website at www.WestarEnergy.com.
- 30 -


WESTAR ENERGY NEWS RELEASE    Page 1 of 3
Westar Energy announces 2nd quarter results

Westar Energy, Inc. (NYSE: WR) is Kansas' largest electric utility. For more than a century, we have provided Kansans the safe, reliable electricity needed to power their businesses and homes. Every day our team of professionals takes on projects to generate and deliver electricity, protect the environment and provide excellent service to our nearly 700,000 customers. Westar has 7,200 MW of electric generation capacity fueled by coal, uranium, natural gas, wind and landfill gas. We are also a leader in electric transmission in Kansas. Our innovative customer service programs include mobile-enabled customer care, digital meters and paving the way for electric vehicle adoption. Our employees live, volunteer and work in the communities we serve.

For more information about Westar Energy, visit us on the Internet at http://www.WestarEnergy.com. Westar Energy is on Facebook: www.Facebook.com/westarenergy and Twitter: www.Twitter.com/WestarEnergy.


Forward-looking statements: Certain matters discussed in this news release are “forward-looking statements.” The Private Securities Litigation Reform Act of 1995 has established that these statements qualify for safe harbors from liability. Forward-looking statements may include words like “believe,” “anticipate,” “target,” “expect,” “pro forma,” “estimate,” “intend,” “guidance” or words of similar meaning. Forward-looking statements describe future plans, objectives, expectations or goals. Although Westar Energy believes that its expectations are based on reasonable assumptions, all forward-looking statements involve risk and uncertainty. The factors that could cause actual results to differ materially from these forward-looking statements include those discussed herein as well as (1) those discussed in the company's Annual Report on Form 10-K for the year ended Dec. 31, 2015 (a) under the heading, “Forward-Looking Statements,” (b) in ITEM 1. Business, (c) in ITEM 1A. Risk Factors, (d) in ITEM 7. Management's Discussion and Analysis of Financial Condition and Results of Operations, and (e) in ITEM 8. Financial Statements and Supplementary Data: Notes 13 and 15; (2) those discussed in the company's Quarterly Report on Form 10-Q filed Aug. 2, 2016, (a) under the heading "Forward-Looking Statements." (b) in ITEM 2. Management's Discussion and Analysis of Financial Condition and Results of Operations, (c) in Part I, Financial Information, ITEM 1. Financial Statements: Notes 3, 11 and 12, and (d) ITEM 1A. Risk Factors; and (3) other factors discussed in the company's filings with the Securities and Exchange Commission. Any forward-looking statement speaks only as of the date such statement was made, and the company does not undertake any obligation to update any forward-looking statement to reflect events or circumstances after the date on which such statement was made.


Media Contact:
Gina Penzig
Media Relations Manager
Phone: 785-575-8089
Gina.Penzig@westarenergy.com
Media line: 888-613-0003

Investor Contact:
Cody VandeVelde
Director, Investor Relations
Phone: 785-575-8227
Cody.VandeVelde@westarenergy.com


WESTAR ENERGY NEWS RELEASE    Page 2 of 3
Westar Energy announces 2nd quarter results

Westar Energy, Inc.
Condensed Consolidated Statements of Income
(Unaudited)
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2016
 
2015
 
Change
 
% Change
 
2016
 
2015
 
Change
 
% Change
 
(Dollars In Thousands, Except Per Share Amounts)
REVENUES:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Residential
$
202,838

 
$
173,677

 
$
29,161

 
16.8

 
$
382,128

 
$
354,970

 
$
27,158

 
7.7

Commercial
188,197

 
175,994

 
12,203

 
6.9

 
353,870

 
337,300

 
16,570

 
4.9

Industrial
108,004

 
103,151

 
4,853

 
4.7

 
208,702

 
199,630

 
9,072

 
4.5

Other retail
(16,502
)
 
(7,660
)
 
(8,842
)
 
(115.4
)
 
(30,884
)
 
(7,122
)
 
(23,762
)
 
(333.6
)
Total Retail Revenues
482,537

 
445,162

 
37,375

 
8.4

 
913,816

 
884,778

 
29,038

 
3.3

Wholesale
66,687

 
74,828

 
(8,141
)
 
(10.9
)
 
134,099

 
161,584

 
(27,485
)
 
(17.0
)
Transmission
66,620

 
61,295

 
5,325

 
8.7

 
130,535

 
119,880

 
10,655

 
8.9

Other
5,604

 
8,278

 
(2,674
)
 
(32.3
)
 
12,448

 
14,128

 
(1,680
)
 
(11.9
)
Total Revenues
621,448

 
589,563

 
31,885

 
5.4

 
1,190,898

 
1,180,370

 
10,528

 
0.9

OPERATING EXPENSES:
 
 
 
 
 
 
 
 
 
 
 
 
 
 


Fuel and purchased power
118,630

 
140,080

 
(21,450
)
 
(15.3
)
 
218,688

 
295,561

 
(76,873
)
 
(26.0
)
SPP network transmission costs
55,227

 
57,352

 
(2,125
)
 
(3.7
)
 
115,987

 
114,164

 
1,823

 
1.6

Operating and maintenance
85,619

 
82,739

 
2,880

 
3.5

 
163,377

 
167,819

 
(4,442
)
 
(2.6
)
Depreciation and amortization
84,226

 
76,759

 
7,467

 
9.7

 
167,866

 
151,345

 
16,521

 
10.9

Selling, general and administrative
75,724

 
63,663

 
12,061

 
18.9

 
132,179

 
119,082

 
13,097

 
11.0

Taxes other than income tax
48,407

 
37,494

 
10,913

 
29.1

 
97,375

 
75,365

 
22,010

 
29.2

Total Operating Expenses
467,833

 
458,087

 
9,746

 
2.1

 
895,472

 
923,336

 
(27,864
)
 
(3.0
)
INCOME FROM OPERATIONS
153,615

 
131,476

 
22,139

 
16.8

 
295,426

 
257,034

 
38,392

 
14.9

OTHER INCOME (EXPENSE):
 
 
 
 
 
 
 
 
 
 
 
 
 
 


Investment earnings
2,280

 
1,634

 
646

 
39.5

 
4,296

 
4,113

 
183

 
4.4

Other income
3,382

 
15,121

 
(11,739
)
 
(77.6
)
 
12,860

 
17,935

 
(5,075
)
 
(28.3
)
Other expense
(2,908
)
 
(2,633
)
 
(275
)
 
(10.4
)
 
(8,451
)
 
(8,345
)
 
(106
)
 
(1.3
)
Total Other Income
2,754

 
14,122

 
(11,368
)
 
(80.5
)
 
8,705

 
13,703

 
(4,998
)
 
(36.5
)
Interest expense
39,683

 
45,516

 
(5,833
)
 
(12.8
)
 
80,114

 
89,814

 
(9,700
)
 
(10.8
)
INCOME BEFORE INCOME TAXES
116,686

 
100,082

 
16,604

 
16.6

 
224,017

 
180,923

 
43,094

 
23.8

Income tax expense
40,542

 
33,839

 
6,703

 
19.8

 
79,165

 
61,517

 
17,648

 
28.7

NET INCOME
76,144

 
66,243

 
9,901

 
14.9

 
144,852

 
119,406

 
25,446

 
21.3

Less: Net income attributable to noncontrolling interests
3,804

 
2,533

 
1,271

 
50.2

 
6,927

 
4,716

 
2,211

 
46.9

NET INCOME ATTRIBUTABLE TO WESTAR ENERGY, INC.
$
72,340

 
$
63,710

 
$
8,630

 
13.5

 
$
137,925

 
$
114,690

 
$
23,235

 
20.3

BASIC AND DILUTED EARNINGS PER AVERAGE COMMON SHARE OUTSTANDING ATTRIBUTABLE TO WESTAR ENERGY, INC. (See 10-Q Note 2):
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic earnings per common share
$
0.51

 
$
0.47

 
$
0.04

 
8.5

 
$
0.97

 
$
0.85

 
$
0.12

 
14.1

Diluted earnings per common share
$
0.51

 
$
0.46

 
$
0.05

 
10.9

 
$
0.97

 
$
0.84

 
$
0.13

 
15.5

AVERAGE EQUIVALENT COMMON SHARES OUTSTANDING (in thousands):
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic
142,034

 
135,939

 
6,095

 
4.5

 
142,013

 
134,177

 
7,836

 
5.8

Diluted
142,497

 
137,412

 
5,085

 
3.7

 
142,361

 
136,330

 
6,031

 
4.4

DIVIDENDS DECLARED PER COMMON SHARE
$
0.38

 
$
0.36

 
$
0.02

 
5.6

 
$
0.76

 
$
0.72

 
$
0.04

 
5.6

Effective income tax rate
35
%
 
34
%
 
 
 
 
 
35
%
 
34
%
 
 
 
 


WESTAR ENERGY NEWS RELEASE    Page 3 of 3
Exhibit


Exhibit 99.2
Westar Energy, Inc.
Second Quarter 2016 Earnings
Released August 2, 2016





Contents
Page
 
 











Cody VandeVelde
Director Investor Relations
785-575-8227
Cody.VandeVelde@WestarEnergy.com



NOTE:
The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q for the period ended June 30, 2016 should be read in conjunction with this financial information. The enclosed statements have been prepared for the purpose of providing information concerning the Company and not in connection with any sale, offer for sale, or solicitation to buy any securities.





Westar Energy, Inc.
Condensed Consolidated Statements of Income
(Unaudited)

 
Three Months Ended June 30,
 
2016
 
2015
 
Change
 
% Change
 
(Dollars in Thousands, Except Per Share Amounts)
REVENUES:
 
 
 
 
 
 
 
Residential
$
202,838

 
$
173,677

 
$
29,161

 
16.8

Commercial
188,197

 
175,994

 
12,203

 
6.9

Industrial
108,004

 
103,151

 
4,853

 
4.7

Other retail
(16,502
)
 
(7,660
)
 
(8,842
)
 
(115.4
)
Total Retail Revenues
482,537

 
445,162

 
37,375

 
8.4

Wholesale
66,687

 
74,828

 
(8,141
)
 
(10.9
)
Transmission
66,620

 
61,295

 
5,325

 
8.7

Other
5,604

 
8,278

 
(2,674
)
 
(32.3
)
Total Revenues
621,448

 
589,563

 
31,885

 
5.4

OPERATING EXPENSES:
 
 
 
 
 
 
 
Fuel and purchased power
118,630

 
140,080

 
(21,450
)
 
(15.3
)
SPP network transmission costs
55,227

 
57,352

 
(2,125
)
 
(3.7
)
Operating and maintenance
85,619

 
82,739

 
2,880

 
3.5

Depreciation and amortization
84,226

 
76,759

 
7,467

 
9.7

Selling, general and administrative
75,724

 
63,663

 
12,061

 
18.9

Taxes other than income tax
48,407

 
37,494

 
10,913

 
29.1

Total Operating Expenses
467,833

 
458,087

 
9,746

 
2.1

INCOME FROM OPERATIONS
153,615

 
131,476

 
22,139

 
16.8

OTHER INCOME (EXPENSE):
 
 
 
 
 
 
 
Investment earnings
2,280

 
1,634

 
646

 
39.5

Other income
3,382

 
15,121

 
(11,739
)
 
(77.6
)
Other expense
(2,908
)
 
(2,633
)
 
(275
)
 
(10.4
)
Total Other Income
2,754

 
14,122

 
(11,368
)
 
(80.5
)
Interest expense
39,683

 
45,516

 
(5,833
)
 
(12.8
)
INCOME BEFORE INCOME TAXES
116,686

 
100,082

 
16,604

 
16.6

Income tax expense
40,542

 
33,839

 
6,703

 
19.8

NET INCOME
76,144

 
66,243

 
9,901

 
14.9

Less: Net income attributable to noncontrolling interests
3,804

 
2,533

 
1,271

 
50.2

NET INCOME ATTRIBUTABLE TO WESTAR ENERGY, INC.
$
72,340

 
$
63,710

 
$
8,630

 
13.5

BASIC AND DILUTED EARNINGS PER AVERAGE COMMON SHARE OUTSTANDING ATTRIBUTABLE TO WESTAR ENERGY, INC. (See 10-Q Note 2):
 
 
 
 
 
 
 
Basic earnings per common share
$
0.51

 
$
0.47

 
$
0.04

 
8.5

Diluted earnings per common share
$
0.51

 
$
0.46

 
$
0.05

 
10.9

AVERAGE EQUIVALENT COMMON SHARES OUTSTANDING (in thousands):
 
 
 
 
 
 
 
Basic
142,034

 
135,939

 
6,095

 
4.5

Diluted
142,497

 
137,412

 
5,085

 
3.7

DIVIDENDS DECLARED PER COMMON SHARE
$
0.38

 
$
0.36

 
$
0.02

 
5.6

Effective income tax rate
35
%
 
34
%
 
 
 
 
 
 
 
 
 
 
 
 


The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2016 should be read in conjunction with this financial information.
Page 1




Westar Energy, Inc.
Condensed Consolidated Statements of Income
(Unaudited)

 
Six Months Ended June 30,
 
2016
 
2015
 
Change
 
% Change
 
(Dollars in Thousands, Except Per Share Amounts)
REVENUES:
 
 
 
 
 
 
 
Residential
$
382,128

 
$
354,970

 
$
27,158

 
7.7

Commercial
353,870

 
337,300

 
16,570

 
4.9

Industrial
208,702

 
199,630

 
9,072

 
4.5

Other retail
(30,884
)
 
(7,122
)
 
(23,762
)
 
(333.6
)
Total Retail Revenues
913,816

 
884,778

 
29,038

 
3.3

Wholesale
134,099

 
161,584

 
(27,485
)
 
(17.0
)
Transmission
130,535

 
119,880

 
10,655

 
8.9

Other
12,448

 
14,128

 
(1,680
)
 
(11.9
)
Total Revenues
1,190,898

 
1,180,370

 
10,528

 
0.9

OPERATING EXPENSES:
 
 
 
 
 
 
 
Fuel and purchased power
218,688

 
295,561

 
(76,873
)
 
(26.0
)
SPP network transmission costs
115,987

 
114,164

 
1,823

 
1.6

Operating and maintenance
163,377

 
167,819

 
(4,442
)
 
(2.6
)
Depreciation and amortization
167,866

 
151,345

 
16,521

 
10.9

Selling, general and administrative
132,179

 
119,082

 
13,097

 
11.0

Taxes other than income tax
97,375

 
75,365

 
22,010

 
29.2

Total Operating Expenses
895,472

 
923,336

 
(27,864
)
 
(3.0
)
INCOME FROM OPERATIONS
295,426

 
257,034

 
38,392

 
14.9

OTHER INCOME (EXPENSE):
 
 
 
 
 
 
 
Investment earnings
4,296

 
4,113

 
183

 
4.4

Other income
12,860

 
17,935

 
(5,075
)
 
(28.3
)
Other expense
(8,451
)
 
(8,345
)
 
(106
)
 
(1.3
)
Total Other Income
8,705

 
13,703

 
(4,998
)
 
(36.5
)
Interest expense
80,114

 
89,814

 
(9,700
)
 
(10.8
)
INCOME BEFORE INCOME TAXES
224,017

 
180,923

 
43,094

 
23.8

Income tax expense
79,165

 
61,517

 
17,648

 
28.7

NET INCOME
144,852

 
119,406

 
25,446

 
21.3

Less: Net income attributable to noncontrolling interests
6,927

 
4,716

 
2,211

 
46.9

NET INCOME ATTRIBUTABLE TO WESTAR ENERGY, INC.
$
137,925

 
$
114,690

 
$
23,235

 
20.3

BASIC AND DILUTED EARNINGS PER AVERAGE COMMON SHARE OUTSTANDING ATTRIBUTABLE TO WESTAR ENERGY, INC. (See 10-Q Note 2):
 
 
 
 
 
 
 
Basic earnings per common share
$
0.97

 
$
0.85

 
$
0.12

 
14.1

Diluted earnings per common share
$
0.97

 
$
0.84

 
$
0.13

 
15.5

AVERAGE EQUIVALENT COMMON SHARES OUTSTANDING (in thousands):
 
 
 
 
 
 
 
Basic
142,013

 
134,177

 
7,836

 
5.8

Diluted
142,361

 
136,330

 
6,031

 
4.4

DIVIDENDS DECLARED PER COMMON SHARE
$
0.76

 
$
0.72

 
$
0.04

 
5.6

Effective income tax rate
35
%
 
34
%
 
 
 
 
 
 
 
 
 
 
 
 


The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2016 should be read in conjunction with this financial information.
Page 2


Westar Energy, Inc.
Condensed Consolidated Balance Sheets
(Dollars in Thousands, Except Par Values)
(Unaudited)

 
June 30, 2016
 
December 31, 2015
ASSETS
 
 
 
CURRENT ASSETS:
 
 
 
Cash and cash equivalents
$
5,213

 
$
3,231

Accounts receivable, net of allowance for doubtful accounts of $5,093 and $5,294, respectively
298,841

 
258,286

Fuel inventory and supplies
299,465

 
301,294

Prepaid expenses
17,994

 
16,864

Regulatory assets
87,256

 
109,606

Other
33,099

 
27,860

Total Current Assets
741,868

 
717,141

PROPERTY, PLANT AND EQUIPMENT, NET
8,800,698

 
8,524,902

PROPERTY, PLANT AND EQUIPMENT OF VARIABLE INTEREST ENTITIES, NET
263,072

 
268,239

OTHER ASSETS:
 
 
 
Regulatory assets
734,844

 
751,312

Nuclear decommissioning trust
189,179

 
184,057

Other
241,081

 
260,015

Total Other Assets
1,165,104

 
1,195,384

TOTAL ASSETS
$
10,970,742

 
$
10,705,666

LIABILITIES AND EQUITY
 
 
 
CURRENT LIABILITIES:
 
 
 
Current maturities of long-term debt
$
125,000

 
$
—

Current maturities of long-term debt of variable interest entities
26,842

 
28,309

Short-term debt
177,000

 
250,300

Accounts payable
178,374

 
220,969

Accrued dividends
52,767

 
49,829

Accrued taxes
95,084

 
83,773

Accrued interest
41,969

 
71,426

Regulatory liabilities
33,634

 
25,697

Other
90,841

 
106,632

Total Current Liabilities
821,511

 
836,935

LONG-TERM LIABILITIES:
 
 
 
Long-term debt, net
3,387,696

 
3,163,950

Long-term debt of variable interest entities, net
111,230

 
138,097

Deferred income taxes
1,655,825

 
1,591,430

Unamortized investment tax credits
208,318

 
209,763

Regulatory liabilities
247,916

 
267,114

Accrued employee benefits
455,923

 
462,304

Asset retirement obligations
280,507

 
275,285

Other
87,065

 
88,825

Total Long-Term Liabilities
6,434,480

 
6,196,768

COMMITMENTS AND CONTINGENCIES (See 10-Q Notes 4, 11 and 12)
 
 
 
EQUITY:
 
 
 
Westar Energy, Inc. Shareholders’ Equity:
 
 
 
Common stock, par value $5 per share; authorized 275,000,000 shares; issued and outstanding 141,691,017 shares and 141,353,426 shares, respective to each date
708,455

 
706,767

Paid-in capital
2,008,491

 
2,004,124

Retained earnings
978,187

 
945,830

Total Westar Energy, Inc. Shareholders’ Equity
3,695,133

 
3,656,721

Noncontrolling Interests
19,618

 
15,242

Total Equity
3,714,751

 
3,671,963

TOTAL LIABILITIES AND EQUITY
$
10,970,742

 
$
10,705,666


The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2016 should be read in conjunction with this financial information.
Page 3


Westar Energy, Inc.
Condensed Consolidated Statements of Cash Flows
(In Thousands)
(Unaudited)

 
Six Months Ended June 30,
 
2016
 
2015
CASH FLOWS FROM (USED IN) OPERATING ACTIVITIES:
 
 
 
Net income
$
144,852

 
$
119,406

Adjustments to reconcile net income to net cash provided by operating activities:
 
 
 
Depreciation and amortization
167,866

 
151,345

Amortization of nuclear fuel
16,831

 
10,085

Amortization of deferred regulatory gain from sale leaseback
(2,748
)
 
(2,748
)
Amortization of corporate-owned life insurance
8,819

 
9,042

Non-cash compensation
4,778

 
4,241

Net deferred income taxes and credits
75,334

 
54,740

Allowance for equity funds used during construction
(5,247
)
 
(2,041
)
Changes in working capital items:
 
 
 
Accounts receivable
(40,555
)
 
998

Fuel inventory and supplies
2,140

 
(31,307
)
Prepaid expenses and other
7,126

 
(40,195
)
Accounts payable
(21,364
)
 
(2,873
)
Accrued taxes
16,272

 
16,893

Other current liabilities
(62,434
)
 
(65,908
)
Changes in other assets
1,848

 
(9,712
)
Changes in other liabilities
15,163

 
21,046

Cash Flows from Operating Activities
328,681

 
233,012

CASH FLOWS FROM (USED IN) INVESTING ACTIVITIES:
 
 
 
Additions to property, plant and equipment
(503,631
)
 
(334,905
)
Purchase of securities - trusts
(39,603
)
 
(9,980
)
Sale of securities - trusts
41,201

 
10,263

Investment in corporate-owned life insurance
(14,648
)
 
(14,845
)
Proceeds from investment in corporate-owned life insurance
24,171

 
1,192

Investment in affiliated company
(655
)
 
—

Other investing activities
(2,798
)
 
(653
)
Cash Flows used in Investing Activities
(495,963
)
 
(348,928
)
CASH FLOWS FROM (USED IN) FINANCING ACTIVITIES:
 
 
 
Short-term debt, net
(73,300
)
 
49,500

Proceeds from long-term debt
396,577

 
—

Proceeds from long-term debt of variable interest entities
162,048

 
—

Retirements of long-term debt
(50,000
)
 
(125,000
)
Retirements of long-term debt of variable interest entities
(190,355
)
 
(27,925
)
Repayment of capital leases
(401
)
 
(1,721
)
Borrowings against cash surrender value of corporate-owned life insurance
54,910

 
56,622

Repayment of borrowings against cash surrender value of corporate-owned life insurance
(22,921
)
 
(899
)
Issuance of common stock
1,354

 
256,394

Distributions to shareholders of noncontrolling interests
(2,551
)
 
(1,076
)
Cash dividends paid
(101,137
)
 
(89,035
)
Other financing activities
(4,960
)
 
(3,234
)
Cash Flows from Financing Activities
169,264

 
113,626

NET CHANGE IN CASH AND CASH EQUIVALENTS
1,982

 
(2,290
)
CASH AND CASH EQUIVALENTS:
 
 
 
Beginning of period
3,231

 
4,556

End of period
$
5,213

 
$
2,266


The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2016 should be read in conjunction with this financial information.
Page 4


Westar Energy, Inc.
2nd Quarter 2016 vs. 2015
Earnings Variances
 
 
 
 
 
 
 
 
 
 
 
 
 
Change
 
 
 
 
 
 
 
($ per share)
 
(Dollars in Thousands)
 
 
 
($ per share)
June 30, 2015 basic earnings attributable to common stock
 
 
 
$
63,710

 
 
 
$
0.47

 
 
 
 
 
 
 
 
 
 
 
 
 
Favorable/(Unfavorable)
 
 
 
 
 
 
 
 
 
 
 
Gross Margin
 
 
 
55,460

 
A
 
 
 
Operating and maintenance
 
 
 
(2,880
)
 
B
 
 
 
Depreciation and amortization
 
 
 
(7,467
)
 
C
 
 
 
Selling, general and administrative
 
 
 
(12,061
)
 
D
 
 
 
Taxes other than income tax
 
 
 
(10,913
)
 
E
 
 
 
Other income (expense)
 
 
 
(11,368
)
 
F
 
 
 
Interest expense
 
 
 
5,833

 
G
 
 
 
Income tax expense
 
 
 
(6,703
)
 
H
 
 
 
Net income attributable to noncontrolling interests
 
 
 
(1,271
)
 
 
 
 
 
Change in shares outstanding
 
(0.02
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
June 30, 2016 basic earnings attributable to common stock
 
 
 
$
72,340

 
 
 
$
0.51

 
 
 
 
 
 
 
 
 
 
 
Major factors influencing the period to period change in EPS -- Favorable/(Unfavorable)
 
 
A
Due primarily to: general rate case increase of $78.0M (annual); estimated annual transmission margin
increase of $22.0M; and 2.7% increase in retail MWh sales due to warm weather

 
 
 
 
 
 
 
 
 
 
B
Due primarily to: higher operating and maintenance expense at coal fired plants due to schedule outages -- ($5.2M); partially offset by decrease in operating and maintenance expenses resulting from power plant retirements in late 2015 -- $1.7M
 
 
 
 
 
 
 
 
 
 
C
Due principally to property additions
 
 
 
 
 
 
 
 
 
 
D
Due primarily to: merger-related expenses -- ($7.8M); and higher employee benefit costs -- $(1.7M)
 
 
 
 
 
 
 
 
 
 
E
Due primarily to higher property tax expense that is largely offset by increased prices -- ($11.2M)
 
 
 
 
 
 
 
 
 
 
F
Due primarily to: lower COLI benefit -- ($13.8M); partially offset by an increase in equity AFUDC -- $2.7M

 
 
 
 
 
 
 
 
 
 
G
Due primarily to: decrease in interest expense of long-term debt due to refinancing -- $3.1M; increase in debt AFUDC -- $1.8M; and decrease in interest expense of long-term debt of VIEs due to refinancing -- $1.5M
 
 
 
 
 
 
 
 
 
 
H
Due primarily to higher income before income taxes


The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2016 should be read in conjunction with this financial information.
Page 5


Westar Energy, Inc.
YTD June 2016 vs. 2015
Earnings Variances
 
 
 
 
 
 
 
 
 
 
 
 
 
Change
 
 
 
 
 
 
 
($ per share)
 
(Dollars in Thousands)
 
 
 
($ per share)
June 30, 2015 basic earnings attributable to common stock
 
 
 
$
114,690

 
 
 
$
0.85

 
 
 
 
 
 
 
 
 
 
 
 
 
Favorable/(Unfavorable)
 
 
 
 
 
 
 
 
 
 
 
Gross Margin
 
 
 
85,578

 
A
 
 
 
Operating and maintenance
 
 
 
4,442

 
B
 
 
 
Depreciation and amortization
 
 
 
(16,521
)
 
C
 
 
 
Selling, general and administrative
 
 
 
(13,097
)
 
D
 
 
 
Taxes other than income tax
 
 
 
(22,010
)
 
E
 
 
 
Other income (expense)
 
 
 
(4,998
)
 
F
 
 
 
Interest expense
 
 
 
9,700

 
G
 
 
 
Income tax expense
 
 
 
(17,648
)
 
H
 
 
 
Net income attributable to noncontrolling interests
 
 
 
(2,211
)
 
 
 
 
 
Change in shares outstanding
 
(0.05
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
June 30, 2016 basic earnings attributable to common stock
 
 
 
$
137,925

 
 
 
$
0.97

 
 
 
 
 
 
 
 
 
 
 
Major factors influencing the period to period change in EPS -- Favorable/(Unfavorable)
 
 
A
Due primarily to: general rate case increase of $78.0M (annual); estimated annual transmission margin
increase of $22.0M; partially offset by 1.3% decrease in retail MWh sales principally due to extremely mild
winter weather

 
 
 
 
 
 
 
 
 
 
B
Due primarily to: lower distribution maintenance expense -- $4.0M; decrease operating and maintenance
expenses resulting from power plant retirements in late 2015 -- $3.7M; partially offset by higher operating and maintenance costs at coal fire plants due to scheduled outage -- ($5.0M)

 
 
 
 
 
 
 
 
 
 
C
Due principally to property additions
 
 
 
 
 
 
 
 
 
 
D
Due primarily to: merger-related expenses -- ($7.8M); and an increase in outside services costs primarily related to technology services -- $(2.1M)

 
 
 
 
 
 
 
 
 
 
E
Due primarily to higher property tax expense that is largely offset by increased prices -- ($22.7M)

 
 
 
 
 
 
 
 
 
 
F
Due primarily to lower COLI benefit -- ($7.3M); partially offset by an increase in equity AFUDC -- $3.2M


 
 
 
 
 
 
 
 
 
 
G
Due primarily to: decrease in interest expense of long-term debt due to refinancing -- $6.6M; decrease in interest expense of long-term debt of VIEs due to refinancing -- $2.6M; and increase in debt AFUDC -- $1.8M



 
 
 
 
 
 
 
 
 
 
H
Due primarily to higher income before income taxes



 
 
 
 
 
 
 
 
 
 


The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2016 should be read in conjunction with this financial information.
Page 6


Westar Energy, Inc.
Revenue, Sales and Energy Supply
Supplemental Data
Three Months Ended June 30,
 
2016
 
2015
 
Change
 
% Change
Revenues
(Dollars In Thousands)
Residential
$
202,838

 
$
173,677

 
$
29,161

 
16.8

Commercial
188,197

 
175,994

 
12,203

 
6.9

Industrial
108,004

 
103,151

 
4,853

 
4.7

Other retail
4,013

 
3,503

 
510

 
14.6

Provision for rate refunds
(20,515
)
 
(11,163
)
 
(9,352
)
 
(83.8
)
Total Retail Revenues
482,537

 
445,162

 
37,375

 
8.4

Tariff-based wholesale
56,260

 
56,688

 
(428
)
 
(0.8
)
Market-based wholesale
10,427

 
18,140

 
(7,713
)
 
(42.5
)
Transmission
66,620

 
61,295

 
5,325

 
8.7

Other
5,604

 
8,278

 
(2,674
)
 
(32.3
)
Total Revenues
$
621,448

 
$
589,563

 
$
31,885

 
5.4

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Electricity Sales
(Thousands of MWh)
Residential
1,492

 
1,386

 
106

 
7.6

Commercial
1,875

 
1,835

 
40

 
2.2

Industrial
1,391

 
1,408

 
(17
)
 
(1.2
)
Other retail
19

 
22

 
(3
)
 
(13.6
)
Total Retail
4,777

 
4,651

 
126

 
2.7

Tariff-based wholesale
915

 
1,097

 
(182
)
 
(16.6
)
Market-based wholesale
781

 
949

 
(168
)
 
(17.7
)
Total wholesale
1,696

 
2,046

 
(350
)
 
(17.1
)
Total Electricity Sales
6,473

 
6,697

 
(224
)
 
(3.3
)
 
 
 
 
 
 
 
 
 
(Dollars per MWh)
Total retail
$
101.01

 
$
95.71

 
$
5.30

 
5.5

Tariff-based wholesale
$
61.49

 
$
51.68

 
$
9.81

 
19.0

Market-based wholesale
$
13.35

 
$
19.11

 
$
(5.76
)
 
(30.1
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fuel and Purchased Power
(Dollars In Thousands)
Fuel used for generation
$
91,980

 
$
106,169

 
$
(14,189
)
 
(13.4
)
Purchased power
34,071

 
33,514

 
557

 
1.7

Subtotal
126,051

 
139,683

 
(13,632
)
 
(9.8
)
RECA recovery and other
(7,421
)
 
397

 
(7,818
)
 
nm

Total fuel and purchased power expense
$
118,630

 
$
140,080

 
$
(21,450
)
 
(15.3
)
 
 
 
 
 
 
 
 
Electricity Supply
(Thousands of MWh)
Generated - Gas
472

 
237

 
235

 
99.2

                    Coal
3,373

 
4,542

 
(1,169
)
 
(25.7
)
                    Nuclear
1,242

 
756

 
486

 
64.3

                    Wind
100

 
105

 
(5
)
 
(4.8
)
Subtotal electricity generated
5,187

 
5,640

 
(453
)
 
(8.0
)
Purchased
1,455

 
1,318

 
137

 
10.4

Total Electricity Supply
6,642

 
6,958

 
(316
)
 
(4.5
)
 
 
 
 
 
 
 
 
 
(Dollars per MWh)
Average cost of fuel used for generation
$
17.73

 
$
18.82

 
$
(1.09
)
 
(5.8
)
Average cost of purchased power
$
23.42

 
$
25.43

 
$
(2.01
)
 
(7.9
)
Average cost of fuel and purchased power
$
18.98

 
$
20.08

 
$
(1.10
)
 
(5.5
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Degree Days
 
 
2015/
 
 
 
 
 
2016
 
20 yr Avg
 
 Change
 
 % Change
Cooling
 
 
 
 
 
 
 
Actual compared to last year
592

 
537

 
55

 
10.2

Actual compared to 20 year average
592

 
456

 
136

 
29.8

Heating
 
 
 
 
 
 


Actual compared to last year
285

 
270

 
15

 
5.6

Actual compared to 20 year average
285

 
385

 
(100
)
 
(26.0
)
nm - not meaningful
 
 
 
 
 
 
 


The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2016 should be read in conjunction with this financial information.
Page 7


Westar Energy, Inc.
Revenue, Sales and Energy Supply
Supplemental Data
Six Months Ended June 30,
 
2016
 
2015
 
Change
 
% Change
Revenues
(Dollars In Thousands)
Residential
$
382,128

 
$
354,970

 
$
27,158

 
7.7

Commercial
353,870

 
337,300

 
16,570

 
4.9

Industrial
208,702

 
199,630

 
9,072

 
4.5

Other retail
7,854


7,006

 
848

 
12.1

Provision for rate refunds
(38,738
)
 
(14,128
)
 
(24,610
)
 
(174.2
)
Total Retail Revenues
913,816

 
884,778

 
29,038

 
3.3

Tariff-based wholesale
115,280

 
117,023

 
(1,743
)
 
(1.5
)
Market-based wholesale
18,819

 
44,561

 
(25,742
)
 
(57.8
)
Transmission
130,535

 
119,880

 
10,655

 
8.9

Other
12,448

 
14,128

 
(1,680
)
 
(11.9
)
Total Revenues
$
1,190,898

 
$
1,180,370

 
$
10,528

 
0.9

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Electricity Sales
(Thousands of MWh)
Residential
2,889

 
2,940

 
(51
)
 
(1.7
)
Commercial
3,533

 
3,567

 
(34
)
 
(1.0
)
Industrial
2,693

 
2,732

 
(39
)
 
(1.4
)
Other retail
40

 
41

 
(1
)
 
(2.4
)
Total Retail
9,155

 
9,280

 
(125
)
 
(1.3
)
Tariff-based wholesale
1,910

 
2,381

 
(471
)
 
(19.8
)
Market-based wholesale
1,660

 
2,235

 
(575
)
 
(25.7
)
Total wholesale
3,570

 
4,616

 
(1,046
)
 
(22.7
)
Total Electricity Sales
12,725

 
13,896

 
(1,171
)
 
(8.4
)
 
 
 
 
 
 
 
 
 
(Dollars per MWh)
Total retail
$
99.82

 
$
95.34

 
$
4.48

 
4.7

Tariff-based wholesale
$
60.36

 
$
49.15

 
$
11.21

 
22.8

Market-based wholesale
$
11.34

 
$
19.94

 
$
(8.60
)
 
(43.1
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Fuel and Purchased Power
(Dollars In Thousands)
Fuel used for generation
$
173,619

 
$
214,418

 
$
(40,799
)
 
(19.0
)
Purchased power
72,901

 
79,041

 
(6,140
)
 
(7.8
)
Subtotal
246,520

 
293,459

 
(46,939
)
 
(16.0
)
RECA recovery and other
(27,832
)
 
2,102

 
(29,934
)
 
(1,424.1
)
Total fuel and purchased power expense
$
218,688

 
$
295,561

 
$
(76,873
)
 
(26.0
)
 
 
 
 
 
 
 
 
Electricity Supply
(Thousands of MWh)
Generated - Gas
697

 
550

 
147

 
26.7

                    Coal
6,661

 
8,994

 
(2,333
)
 
(25.9
)
                    Nuclear
2,494

 
1,550

 
944

 
60.9

                    Wind
222

 
211

 
11

 
5.2

Subtotal electricity generated
10,074

 
11,305

 
(1,231
)
 
(10.9
)
Purchased
3,011

 
2,941

 
70

 
2.4

Total Electricity Supply
13,085

 
14,246

 
(1,161
)
 
(8.1
)
 
 
 
 
 
 
 
 
 
(Dollars per MWh)
Average cost of fuel used for generation
$
17.23

 
$
18.97

 
$
(1.74
)
 
(9.2
)
Average cost of purchased power
$
24.21

 
$
26.88

 
$
(2.67
)
 
(9.9
)
Average cost of fuel and purchased power
$
18.84

 
$
20.60

 
$
(1.76
)
 
(8.5
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Degree Days
 
 
2015/
 
 
 
 
 
2016
 
20 yr Avg
 
 Change
 
 % Change
Cooling
 
 
 
 
 
 
 
Actual compared to last year
596

 
538

 
58

 
10.8

Actual compared to 20 year average
596

 
460

 
136

 
29.6

Heating
 
 
 
 
 
 
 
Actual compared to last year
2,367

 
2,702

 
(335
)
 
(12.4
)
Actual compared to 20 year average
2,367

 
2,814

 
(447
)
 
(15.9
)
 

The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2016 should be read in conjunction with this financial information.
Page 8


Westar Energy, Inc.
Capitalization
 
 
June 30, 2016
 
 
 
December 31, 2015
 
 
 
 
(Dollars in Thousands)
 
 
Current maturities of long-term debt
 
$
125,000

 
 
 
$
—

 
 
Current maturities of long-term debt of VIEs
 
26,842

 
 
 
28,309

 
 
Long-term debt, net
 
3,387,696

 
 
 
3,163,950

 
 
Long-term debt of variable interest entities, net
 
111,230

 
 
 
138,097

 
 
Total long-term debt
 
3,650,768

 
49.5
%
 
3,330,356

 
47.6
%
Common equity
 
3,695,133

 
50.2
%
 
3,656,721

 
52.2
%
Noncontrolling interests
 
19,618

 
0.3
%
 
15,242

 
0.2
%
Total capitalization
 
$
7,365,519

 
100.0
%
 
$
7,002,319

 
100.0
%
 
 
 
 
 
 
 
 
 
GAAP Book value per share
 
$
26.08

 
 
 
$
25.87

 


Period end shares outstanding (in thousands)
 
141,691

 
 
 
141,353

 
 
 
 
 
 
 
 
 
 
 
Outstanding Long-Term Debt
 
 
 
 
 
 
 
 
 
 
CUSIP
June 30, 2016
 
 
 
December 31, 2015
 
 
Westar Energy:
 
(Dollars in Thousands)
 
 
First Mortgage Bond series:
 
 
 
 
 
 
 
 
5.15% Series due January 2017
95709TAB6
$
125,000

 
 
 
$
125,000

 
 
5.10% Series due July 2020
95709TAD2
250,000

 
 
 
250,000

 
 
4.125% Series due March 2042
95709TAH3
550,000

 
 
 
550,000

 
 
4.10% Series due April 2043
95709TAJ9
430,000

 
 
 
430,000

 
 
4.625% Series due September 2043
95709TAK6
250,000

 
 
 
250,000

 
 
3.25% Series due December 2025
95709TAL4
250,000

 
 
 
250,000

 
 
4.25% Series due December 2045
95709TAM2
300,000

 
 
 
300,000

 
 
2.55% Series due July 2026
95709TAN0
350,000

 
 
 
—

 
 
 
 
2,505,000

 
 
 
2,155,000

 
 
Pollution control bond series:
 
 
 
 
 
 
 
 
Variable series due April 2032 (Wamego)
933623BN9
30,500

 
 
 
30,500

 
 
Variable series due April 2032 (St Marys)
792609AF6
45,000

 
 
 
45,000

 
 
 
 
75,500

 
 
 
75,500

 
 
Total Westar Energy
 
2,580,500

 
 
 
2,230,500

 
 
 
 
 
 
 
 
 
 
 
KGE
 
 
 
 
 
 
 
 
First mortgage bond series:
 
 
 
 
 
 
 
 
6.70% Series due June 2019
485260BL6
300,000

 
 
 
300,000

 
 
6.15% Series due May 2023
485260B@1
50,000

 
 
 
50,000

 
 
6.53% Series due December 2037
485260BJ1
175,000

 
 
 
175,000

 
 
6.64% Series due May 2038
485260B#9
100,000

 
 
 
100,000

 
 
4.30% Series due July 2044
485260BM4
250,000

 
 
 
250,000

 
 
 
 
875,000

 
 
 
875,000

 
 
Pollution control bond series:
 
 
 
 
 
 
 
 
Variable rate series due April 2027 (LaCygne)
502828AJ5
21,940

 
 
 
21,940

 
 
4.85% Series due June 2031
121825CB7
—

 
 
 
50,000

 
 
2.50% Series due June 2031
N/A
50,000

 
 
 
—

 
 
Variable rate series due April 2032 (St Marys)
792609AE9
14,500

 
 
 
14,500

 
 
Variable rate series due April 2032 (Wamego)
933623BM1
10,000

 
 
 
10,000

 
 
 
 
96,440

 
 

96,440

 
 
Total KGE
 
971,440

 
 
 
971,440

 
 
 
 
 
 
 
 
 
 
 
Total long-term debt
 
3,551,940

 
 
 
3,201,940

 
 
Unamortized debt discount
 
(10,625
)
 
 
 
(10,374
)
 
 
Unamortized debt issuance expense
 
(28,619
)
 
 
 
(27,616
)
 
 
Long-term debt due within one year
 
(125,000
)
 
 
 
—

 
 
Total long-term debt, net
 
$
3,387,696

 
 
 
$
3,163,950

 
 

The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2016 should be read in conjunction with this financial information.
Page 9


Westar Energy, Inc.
GAAP to Non-GAAP Reconciliation

Fuel and purchased power costs fluctuate with electricity sales and unit costs. As permitted by regulators, prices are adjusted to reflect changes in the costs of fuel and purchased power. Fuel and purchased power costs for wholesale customers are recovered at prevailing market prices or based on a predetermined formula with a price adjustment approved by FERC. As a result, changes in fuel and purchased power costs are offset in revenues with minimal impact on net income. For this reason, Westar management believes that gross margin is useful for understanding and analyzing changes in operating performance from one period to the next. Gross margin is calculated as total revenues, including transmission revenues, less the sum of fuel and purchased power costs and amounts billed by the SPP for network transmission costs (SPP NITS). Accordingly, gross margin reflects transmission revenues and costs on a net basis.

The calculations of gross margin for the three and six months ended June 30, 2016 and 2015 are shown in the table below. The table also includes a reconciliation of gross margin to income from operations for both periods. Income from operations is the GAAP financial measure most directly comparable to gross margin.
 
Three Months Ended June 30,
 
Six Months Ended June 30,
 
2016
 
2015
 
Change
 
2016
 
2015
 
Change
 
(Dollars in Thousands)
Revenues
$
621,448

 
$
589,563


$
31,885


$
1,190,898


$
1,180,370


$
10,528

Less: Fuel and purchased power expense
118,630

 
140,080

 
(21,450
)
 
218,688

 
295,561

 
(76,873
)
 SPP network transmission costs
55,227

 
57,352

 
(2,125
)
 
115,987

 
114,164

 
1,823

Gross Margin
$
447,591


$
392,131


$
55,460


$
856,223


$
770,645


$
85,578

 
 
 
 
 
 
 
 
 
 
 
 
Gross margin
$
447,591

 
$
392,131

 
$
55,460

 
$
856,223

 
$
770,645

 
$
85,578

Less: Operating and maintenance expense
85,619

 
82,739

 
2,880

 
163,377

 
167,819

 
(4,442
)
Depreciation and amortization expense
84,226

 
76,759

 
7,467

 
167,866

 
151,345

 
16,521

Selling, general and administrative expense
75,724

 
63,663

 
12,061

 
132,179

 
119,082

 
13,097

Taxes other than income tax
48,407

 
37,494

 
10,913

 
97,375

 
75,365

 
22,010

Income from operations
$
153,615

 
$
131,476


$
22,139


$
295,426


$
257,034


$
38,392

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 


The Notes to the Condensed Consolidated Financial Statements in the company's Quarterly Report on Form 10-Q
for the period ended June 30, 2016 should be read in conjunction with this financial information.
Page 10