FPL Group Inc. Q3 2008 Earnings Call Transcript

| About: FPL Group (FPL-OLD)

FPL Group Inc. (FPL-OLD) Q3 2008 Earnings Call October 27, 2008 9:00 AM ET


Lewis Hay – Chief Executive Officer

Armando Pimental – Chief Financial Officer


John Kiani – Deutsche Bank

Greg Gordon – Citigroup

Dan Eggers – Credit Suisse

[Steve Fleishman – Capital Management]

[Annie Chow – Alliance Bernstein]

Paul Patterson – Glenrock Associates


(Operator Instructions) Welcome to the FPL Group's third quarter 2008 earnings release conference call. At this time for opening remarks, I would like to turn the conference over to your host, [Jim Vaughn Reitman.]

[Jim Vaughn Reitman]

Welcome to our third quarter 2008 earnings conference call. Lewis Hay, FPL Group's Chairman and Chief Executive Officer will provide general comments on recent market events, our quarterly performance and discuss our earnings expectations. Lewis will be followed by our Armando Pimental, our Chief Financial Officer who will discuss the specifics of our financial performance. Also joining us this morning are Jim Robo, President and Chief Operating Officer of FPL Group, Armando Ollivera, President and CEO of Florida Power and Light Company and Mitch Davidson, President and CEO of FPL Energy. Following our prepared remarks, our senior management team will be able to take your questions.

Let me remind you that our comments today will include forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Any statements made here about future operating results or other future events are forward-looking statements under the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995.

Actual results may differ materially from such forward-looking statements. A discussion of factors that could cause actual results or events to vary is contained in the appendix to our presentation and in our SEC filings. And now, I would like to turn the call over to Lewis Hay.

Lewis Hay

I'm going to begin with a quick overview of FPL Group's results for the quarter before turning my attention to the larger economic climate in which we find ourselves operating these days.

I'm please to be able to report solid performance by FPL Group for the third quarter of 2008. Despite some powerful economic undercurrents and adverse weather conditions at both businesses, our adjusted earnings increased about 2% year over year. Despite some poor weather, FPL Energy had another strong quarter with adjusted earnings per share growing on a year over year basis by 18%.

Underlying the results were contributions from new wind and our Point Beach nuclear facility as well as our Nepal assets and Ercott fossil assets. We remain confident that 2008 will be another record year for FPL Energy in terms of adjusted earnings and correspondingly, another record year for FPL Group.

For its part, Florida Power and Light held up well in the midst of Florida's continued housing and economic slowdown. Florida Power and Light's EPS contribution decreased about 4% year over year which was mainly attributable to lower consumption by our customers both weather and usage related.

In the short term, we expect little customer growth and lower customer usage compared with our historical results. Over the longer term, we remain extremely bullish on Florida's growth prospects.

Now somewhat paradoxically, the current economic disruption in Florida which is primarily driven by an excess inventory of new homes makes us more confident of Florida's long term growth prospects. While economists have continued to forecast extremely strong long term growth for Florida, our big concern was whether Florida's real estate prices had reached such a level that retiring baby boomers would choose to go elsewhere. With the major readjustment of housing prices, this is pretty much a non-issue going forward.

Despite a number of negative factors including some that are a direct result of the financial crisis affecting Wall Street, we continue to believe that our 2008 earnings will be within the range we initially provided on the third quarter 2007 earnings call. We expect adjusted earnings per share to come in at the lower end of the $3.83 to $3.93 expectations given normal weather and no further material decline in the Florida economy. A full list of our earnings assumptions is contained in the appendix to these slides.

As has been the case for a number of quarters now, better than expected results at FPL Energy are offsetting the negative effects of the Florida economic slowdown. With that, I'd like to spend a few minutes providing a broader perspective on the unprecedented financial events of the past few months.

As a survey what's taken place in the world markets recently, I'm reminded of the old Chinese curse. "May you live in interesting times." What began as a low rumble in a corner of the U.S. housing market exploded into a credit crisis that shook the foundations of our economic system, and my sense is that we will be feeling the tremors for some time to come.

I must say however, that we believe that we will be feeling them less at FPL Group than elsewhere. Our long term focus has always been on maintaining financial strength and discipline which our strong balance sheet demonstrates. FPL Group is one of the most highly rated debt issuers in the sector, carrying an A rating from all three credit rating agencies.

In aggregate, our credit facilities are the second largest in the industry at $6.75 billion and we have manageable amounts of outstanding debt maturing in 2009 and 2010. Moreover, we have moderately reduced our planned capital expenditures for 2009 and we have plans in place to make additional reductions if conditions deteriorate further.

In short, we believe we are well positioned to withstand the current market environment. We are no less equipped to prosper over the long run. As I've said numerous times, our environmental profile puts us in an enviable position for our carbon constrained world. Just this month, FPL Group was recognized by the Environmental Protection Agency as one of the seven companies to reach its goal under the agency's climate leaders program, in our case, by reducing our greenhouse gas emissions rate by 21% per kilowatt hour from 2001 to 2007.

While undoubtedly climate legislation will be taking a back seat to actions required to shore up our economy, the issues of global warming and energy security are not going away. Just last week, the leaders of the Democratic Party reaffirmed environmental legislation for 2009. While this date could flip, I strongly believe the United States will have legislation in place to coincide with the expiration of the Kiyoto Agreement in 2012.

A big part of FPL's success in establishing a low emissions profile is attributable to our decision to invest in significantly cleaner, more efficient generation in Florida, everything from plant modernizations to nuclear upgrades to the first commercial scale solar project in the state. These investments not only reduce greenhouse gas emissions, but enhance our energy security. Just as impressive, we have been able to build the cleanest generation fleet in Florida while also keeping our customer rates among the lowest among all electric utilities in the state.

Two other factors give me confidence in FPL Group's long term growth prospects. The first is what I expect will be a period of tightening reserve margins. In our industry, whenever there is a credit contraction or economic downturn, new generation projects grind to a halt. This phenomenon will be more pronounced given uncertainty on the environmental front which in turn will result in a stronger rebound in power prices and spark spreads. When population growth and energy usage once again prompt the need for development, FPL Group will be poised to take advantage of those opportunities.

The other is my belief that over the long run, America will reassess its relationship with the internal combustion engine and embrace plug in hybrids as a principal form of transportation. If this turns out to be the case, the implications for the electric power industry, not to mention the environment and our balance of trade will be significant.

With all of that said, FPL Group faces some near term challenges that we can not ignore. The biggest is the Florida economy. FPL actually experiences a small net reduction in the number of customers in the third quarter and the rising number of inactive meters and very low usage customers indicate that many Florida homes are sitting empty.

The good news is that history tells us these negative trends are not sustainable. In time, we believe Florida will resume its role as a magnet for many in the country just as it has after the previous economic difficulty. Moreover, we are just at the beginning of the retirement of the baby boomers.

We don't know when the turn will come, however we believe the economic and demographic fundamentals indicate that it will. And in the meantime, we are taking actions to reduce operations and maintenance expenses and capital expenditures in areas that do not impact the company's ability to deliver safe, reliable electric service to our customers.

FPL reduced its third quarter O&M expenses by $22 million from the prior year's comparable quarter and has reduced its capital expenditures for the full year 2008 by $475 million versus its original plan. In addition, FPL plans to reduce 2009 capital expenditures by approximately $400 million for projects associated with system growth that is no longer expected.

At FPL Energy, we face a different set of financial issues. Although our project pipeline remains very attractive, we are not immune to the credit crisis affecting the markets. We expect that the banks and other financial institutions that have been terrific partners in financing our growth that FPL energy may need some to recover from the recent turmoil and although we believe that both public and private financing for good projects will continue to be available, it appears that the number of financial intermediaries with the appropriate risk appetite for project financing has declined in the short term.

Until confidence returns to the credit markets, we believe financing will be available for only the best projects, and even for those, the cost of credit will be higher than we have seen in the recent past. As such, we are reassessing our growth plans for FPL Energy for 2009. Given current market conditions, we are prudently analyzing which projects will move forward.

Our goal is to maintain our financial strength even under the most adverse economic conditions and that includes adjustments to capital expenditures where appropriate. We have previously indicated that we would build more than 1,500 megawatts of wind projects in 2009, but today our base case plans call for revising that number downward to approximately 1,100 megawatts.

The revised plan will reduce our forecast wind capital expenditures for next year by close to $1 billion. The plan is to remain quite flexible as we move through the end of 2008 and into 2009 and we will endeavor to maintain all options that allow us to quickly increase or decrease the number or amount of future investments.

Do these changes reflect a loss of confidence in the renewable energy business? Not at all. As I mentioned previously, our country's desire to address climate change will not disappear simply because America suffers some economic downturn. Over the long term, we expect to see tremendous demand for renewable energy and we intend to be the company best positioned to meet that demand.

Moreover, one of the reasons we want to be vigilant on capital expenditures is to be in a position to seize market opportunities should they arise. The fact is, some of the weaker competitors in the renewal energy space are likely to face great difficulties. They will not only have trouble accessing the capital markets which will drive up their costs, but they will also have trouble finding buyers for their products given the uncertainty they will likely face in bringing projects to completion. This will leave competitively stronger companies well positioned to potentially pick up market share.

In short, we are prudently modifying our short term plans to reflect the current economic realities. We have contingency plans in place in case the situation worsens. Nothing we are doing will have a material impact on our long term growth prospects of which we remain very optimistic.

With that, I'll turn the call over to Armando Pimental and I'll come back at the end to provide some additional comments.

Armando Pimental

The third quarter of 2008 FPL Group's net income was $774 million or $1.92 per share compared to $533 million or $1.33 per share during the 2007 third quarter. FPL Group's adjusted 2008 third quarter net income and EPS were $506 million and $1.25 per share respectively, up approximately 2% from last year's $494 million and $1.23 per share in the comparable quarter.

The difference between the reported results and the adjusted results is the positive mark in our non-qualified hedge category which I will discuss in more detail later in the call, and the exclusion of other than temporary impairments or OTTI, that affect FPL Energy's results.

Please refer to the appendix of the presentation for a complete reconciliation of GAAP results to adjusted earnings. FPL Group's management uses adjusted earnings internally for financial planning, for analysis of performance, for reporting results to the Board of Directors and its input into determining whether certain performance targets are met for performance based compensation under the company's employee incentive compensation plan.

FPL Group also uses earnings expressed in this fashion in communicating its earnings outlook at analysts and investors. FPL Group management believes that adjusted earnings provide a more meaningful representation of FPL Group's fundamental earnings power.

Overall, the third quarter of Florida Power and Light was challenging as the company continues to be affected by Florida's economic slowdown. We entered 2008 with significant uncertainty on the revenue front owing to slower customer growth and lower usage patterns. For the first three quarters of this year, the slowdown in both has been more pronounced than we had originally expected and the risk has increased that the slowdown could last longer than we had originally anticipated. I'll discuss these in more detail later.

On the cost front, O&M expenses were lower than last year's comparable quarter and also less than our plan. We indicated on the first quarter call that we were taking action to curtail our costs given the reduced revenue outlook. Cost cutting and reevaluating the timing of some of our spending programs have helped. Despite this, incremental short term O&M savings will not be enough to fully offset the revenue shortfall that we expect this year.

We have also been successful in removing approximately $475 million from our non generation capital expenditures for this year as a result of slower than planned growth in our service territory. In addition, we are taking action as a result of the slowing growth in 2009 as Lew mentioned earlier.

Continuing capital expenditures at FPL are needed to ensure that we are able to deliver important benefits to existing customers such as increased fuel efficiency and reduced emissions in the short term and enhanced fuel diversity over the longer term. These investments will also ensure that we are well positioned to meet the needs of our customers for affordable, safe and reliable energy when Florida's growth profile again accelerates. I will have more to say on this and how we are progressing in just a minute.

For the third quarter, Florida Power and Light reported net income of $314 million compared with $326 million in last year's third quarter. The corresponding contributions to EPS were $0.78 this year compared to $0.81 last year.

I would now like to spend a few minutes updating you on what we are seeing in terms of customer metrics. Let's look at the two graphs on the accompanying slides starting with the right hand side first. As I indicated earlier, customer growth remains roughly flat and while our customer count is at a level last seen in July 2007, a bit of perspective is in order.

The percentage of inactive and low usage customers continues to increase. Low usage customers are defined as residential customers with less that 200 kilowatt hours per month. Low inactive accounts are those where a meter is installed but there is no customer name or account associated with that meter.

As you can see in the accompanying chart, since year end 2007 the number of inactive accounts has increased by 44,000 to 288,000. While customer movements into and out of our service territory naturally cause a nominal amount of low usage and inactive accounts, the increases we have experienced over the last year in both of these metrics are indicative of the deteriorating housing situation.

If the number of inactive accounts for the quarter was closer to our historical averages, FPL's EPS results would have been higher by about $0.03. Inactive accounts are not included in our total customer count of roughly 4.5 million.

We believe Florida Power and Light's customer growth continues to be significantly affected by the housing slump. Florida housing starts in August were 8% below their August 2007 level versus a 35% decline nationally. Housing starts in Broward County increased 45% due to an increase in multi-family starts while the decline in starts in Miami-Dade and Sarasota Counties surpassed the national rate.

As for existing home sales, which is shown here, August home sales suggested the rate of decline in existing home sales was slowing, although the rate of decline varied by location. Median single family home prices have dropped 12% to 27% at South Florida's largest counties since August of last year which as we previously mentioned, is a positive sign in terms of affordability.

The table on the accompanying slide summarizes the drivers of retail kilowatt hours sales growth at Florida Power and Light which were down 4.3% versus last years third quarter. Usage growth associated with weather decreased 1.5% quarter over quarter. We have also experienced a decline in retail usage per customers when compared to the third quarter of 2007.

For the quarter, underlying usage decline 2.8% and year to date, it is 1.7% below last year. We believe this decline may be related to two fundamental drivers. First, worsening economic conditions have led customers to seek ways to trim their expenditures including their electric bills. Secondly, we may be experiencing the impact of longer lasting efficiency actions taken by our customers, including the installation of more efficient appliances.

Our analysis of customer usage trends among our revenue classes support our view that the downturn is primarily residential and likely housing and economic related. While we have experienced the slowing in the growth of commercial customers, it remains positive through September and weather normalized usage is essentially flat to last year.

Over the longer term, economists at the University of Florida support annual population growth in Florida of 1% to 1.5% and we would expect to see the growth in underlying customers and sales rise commensurately with the population increases.

Before moving on, let me address the topic of our bad debt and accounts receivable exposure. While certain credit metrics have deteriorated since last year, our days of billed sales and customer receivables remain roughly consistent with the prior year's metric. Our account receivable greater than 60 days past due have increased about 17% compared to last year's comparable quarter that only represents an increase of about $4 million of customer receivables.

As we've indicated in the past, our net write offs as a percentage of revenue is the lowest of the utilities. We remain very focused on this issue and have added additional resources and processes to actively manage accounts receivable.

In the last two months, FPL has received several regulatory decisions that will help position the company for the future. In early September the Florida Public Service Commission approved our need for determination for the new West County Center Unit Number Three as well as the modernization of the Cape Canaveral and Riviera Plant.

This approval allows us to add approximately 3,650 megawatts of highly efficient generation at a cost of $3.4 billion. The addition of these three facilities to our portfolio will be beneficial both to customers and to shareholders with a slight increase in base rate largely offset by the fuel savings arising from the incremental efficiency of the new units.

In mid October the Florida PSC also approved our first position in the annual cycle of the nuclear cost recovery rule. Among other things, the Commission approved key items related to actual and estimated recovery of reconstruction costs for our upgrade program and new nuclear expansion plans. In early 2007 this rule was adopted by the Florida PSC for recovering prudently incurred nuclear costs.

As a reminder, under Florida's nuclear cost recovery rule, allowed a cash recovery of all pre-construction costs and subject to annual prudency reviews of the constructions costs as they are incurred, a base rate increase when the new capacity comes into service by way of a simplified procedure.

We are entitled to earn a return on equity on these investments through the capacity clause currently set at 11.75%. In mid July the PSC improved cost recovery eligibility for our proposed 110 megawatt solar generation which should be in service by year end 2010. The total cost of the three solar projects is expected to be approximately $700 million. Through the environmental clause, we will a return on equity on this investment which is currently set at 11.75%.

We continue to make good progress with our West County Energy Center generation expansion. Two identical natural gas units of approximately 1,220 megawatts each are currently under construction. Both facilities are expected to be placed in service in 2009, the first in June and the second in November.

These units will be among the lowest emitting and most efficient fossil units anywhere in the world, and will have the effect of displacing older, less efficient generation capacity as well as supporting expectations for service territory growth over the long term. As a reminder, the revenue requirement associated with these two facilities falls into the application of the generation based rate adjustment or GEBRA which subject to a streamlined administrative review, allows FPL to increase base rates for the cost of the approved new generation facilities placed into service prior to the end of our current rate in 2009.

We are focusing our efforts on wholesale opportunities. Historically we have not been a participant in the wholesale markets. In fact, in 2007 our wholesale revenues were less than 1% of our total revenue. In 2007 we entered into an agreement with the Lee County Electric Coop which is one of the largest coop's in the State of Florida, serving about 190,000 customers.

We have two contracts with Lee County. One is a transition contract that provides for up to 300 megawatts of power from 2010 through 20103, and the second contract which begins in 2014, we provide the full generating requirements of Lee County which will have an average peak load over the life of the contract of over 1,000 megawatts. The contract is structured so that fuel is a direct pass through, and it has a negotiated return on equity set to 11.75% for the life of the contract.

FPL also recently entered into a seven year wholesale power sales agreement with a Florida load serving entity. This 200 megawatt transaction will begin in 2014 and represents an additional step in growing the wholesale power business in Florida.

And finally, as we finalize our 2009 budget, we are mindful that 2009 also corresponds with the termination of the current rate agreement. While there is much regulatory work ahead of us over the next few months, we believe that having the lowest rates of any investor owned utility in the state, is a good position to be in.

The table on the accompanying chart summarizing some of the drivers of earnings growth for Florida Power and Light which netted to a decrease of $0.03 per share. In the interest of time, I will not read each number to you. For those of you without immediate access to the slides, they are available in the investor section of our website at www.fplgroup.com.

To summarize, Florida Power and Light's earnings were largely where we expected them to be after taking into consideration the trends that I've just discussed. Let me now turn to FPL Energy.

FPL Energy had a very strong quarter driven primarily by contributions from new assets, both new wind projects and the September 2007 acquisition of the Point Beach facility as well as strong contributions from our Nepal assets and our Ercott fossil assets. The net weather impact in the quarter was poor. Although on the one hand we had good hydro conditions for our main unit, the wind resource in virtually all of our regions was poor.

In fact, it was the lowest recorded wind source in our data base dating back to 1973. As for the wind build for all of 2008, we expect to add approximately 1,300 megawatts. We are well hedged for 2009 and 2010. For 2009, we are essentially fully hedged the first order impacts of natural gas prices and are significantly hedged against other price movements including spark spreads.

90% of FPL Energy's 2009 expected gross margin for existing assets is protected against price movements. The equivalent figure for 2010 is 88%. I will discuss more on the characteristics of our revenue on FPL Energy is a couple of minutes. During the quarter, Congress extended the production tax credit for wind investments through 2009 and passed an eight year extension of the solar investment tax credit.

FPL Energy's 2008 third quarter GAAP earnings were $483 million or $1.20 per share compared to $220 million or $0.55 per share in last year's third quarter. Adjusted earnings which exclude the effect of non-qualifying hedges and other than temporary impairments or OTTI, were $215 million or $0.53 per share compared to $181 million or [inaudible] per share last year which is approximately 18% increase from last year's comparable adjusted EPS.

The after tax impact of the qualifying hedge category was an after tax gain of $285 million primarily as a result of declining power and natural gas prices which positively affected the value of the derivatives that we use to hedge our power output. As always, we have provided more detail on these hedges in the appendix, and we continue to believe that FPL Energy's current period performance is best understood by excluding these amounts, whether gains or losses from consideration. Additionally, gains or loss in this category will turn around in future periods as the underlying contracts go to delivery.

Our adjusted earnings also include an adjustment to GAAP results for the affect of other than temporary impairment losses on our investment in nuclear decommissioning funds at FPL Energy. Continued losses in these funds' performance as a result of large decline in equity prices during the quarter, required us to record $17 million in net losses.

FPL Energy's quarter adjusted EPS contribution increased $0.08 when compared to last year's comparable period. New investments, primarily new wind projects and the addition of Point Beach, accounted for a $0.14 improvement in the quarterly results. The majority of the incremental EPS incremental improvement came from Point Beach.

As we have previously discussed, the nature of our contract on this facility produces a disproportionate of earnings in the third quarter. During or after the third quarter of last year, we have added about 1,455 megawatts of new wind generation. The poor wind resource that I mentioned earlier, resulted in lower earnings on our new wind projects compared to our plan of approximately $0.04 in adjusted EPS.

Contributions from various segments in the existing portfolio were mixed. Overall, the existing portfolio lost $0.04 per share relative to a year ago. The existing wind portfolio came in below last year's comparable quarter owing primarily to a lower wind resource in Ercott and in the mid west. Had the wind resource come in as expected, the contribution from existing wind assets would have increased adjusted EPS by about $0.05.

Our existing Nepal and Ercott merchant assets benefited from market conditions. Specifically, our Nepal fleet experienced a combination of better pricing and improved hydro resources with [inaudible] nuclear facility contributing roughly one-half of the improved results in the market. We had good hydro resources for the quarter which increased adjusted EPS by $0.02 compared to our plan. Our Ercott fossil assets also performed well. Our retail business, [Jeksa] lost $0.01 a share incrementally.

On a combined basis, our existing Ercott assets were about $0.03 per share better than what we had planned for the quarter excluding the poor wind resource that I mentioned earlier. As a reminder, we look at our entire Ercott operations under a single portfolio and we were quite pleased with their overall contribution.

Contributions from our existing non wind contracted fleet declined $0.03 per share compared to last year's comparable period, but there is nothing there that is remarkable to point out to you.

Certain market conditions and opportunities for our physical assets were beneficial to our wholesale marketing and trading operations. The contribution of this business increased by $0.03 per share compared to the prior year's quarter. As a reminder, we try to manage these elements of FPL Energy's business to grow roughly in line with overall income growth of the entire portfolio.

Our marketing and trading group's primary focus is on optimizing revenues and fuel costs for FPL Energy's merchant portfolio and high volatility experienced during the current quarter provided a number of significant opportunities particularly in Ercott.

All other factors had a negative $0.05 impact on the quarter comparison. This was primarily due to increased spending to support future growth which impacted results by $0.03 with the balance for incremental interest expense associated with the growth of the asset base.

During the quarter we saw continued volatility in commodity prices. As this chart shows, the 10 year natural gas drip declined about $3.00 per mm btu since the end of the second quarter which is consistent with the gain in the non-qualifying hedge category that I mentioned earlier. We are well insulated from commodity price movement with our expected gross margin highly hedged in 2009 and 2010.

Although the short term trend in commodity prices has been negative, with a ten year strip correcting to levels seen at the beginning of the year, we continue to like the inherent long term position of the FPL Energy portfolio relative to natural gas and spark spreads in New England and Texas.

Our clean portfolio renewable and highly efficient gas plant is well positioned to prosper from higher natural gas prices. Our market liquidity through 2009 has generally been unaffected by the recent financial turmoil. The number of transactions being cleared through [ice] and [Nimac] however, appears to be increasing and that could be a result of concerns over counter party credit exposure, and I will have more to say on counter party credit exposure in a minute.

In the past we have discussed our wind index in great detail with you. You may recall that we've said that the wind index was a reasonable approximation of the underlying resource available to our projects based on easily verifiable data from public reference towers, but that the correlation between the [inaudible] and the actual output of the portfolio was not perfect.

We have endeavored to refine our thinking to provide you with a better tool for determining contributions from our wind portfolio and have created the wind resource performance report which is what we show here on this slide. Simply put, the slide is a weighted average of what we actually produced during the period versus what we expected to produce based on long term expected averages.

As I indicated a few moments ago, the wind resource was the worst it has been in 35 years. We will replace the current wind index with this data in future earnings calls as well as update our website monthly with the data.

To summarize the third quarter, on an adjusted basis, FPL contributed $0.78, FPL Energy contributed $0.53 and corporate and other was a negative $0.06 contribution. That is a total of $1.25 per share and approximate 2% increase over last year's third quarter results.

The market turmoil has brought questions about our industry's liquidity, credit and counter party risk, cash flow and earnings sensitivities. I will provide greater detail in each of these topics that will lay out our strong credit position, strength and financial discipline.

Let me first begin by saying FPL Group has one of the strongest balance sheets and liquidity positions in the industry. We are anchored by two mature businesses that provide consistent cash flow, have continued access to the commercial paper markets, A1P1 issuer and have available $6.5 billion of credit facilities that for the most part, mature in April 2013.

In addition the FPL Group companies have some of the highest long term debt ratings in the industry which have afforded us continued capital markets access. For the nine months ended September 30, 2008, FPL Group produced about $2.4 billion in operating cash flow. In April of this year, we extended our five year $6.5 billion corporate facility an additional year to 2013.

We have been told that our credit facility is one of the largest in the industry and has the greatest number of banks participating. Of the total, $2.5 billion is dedicated [inaudible] and $4 billion is dedicated to FPL Group capital. 38 banks participate in our credit facility with no bank providing more than 8% of the total credit facility.

In addition to our $6.5 billion syndicated credit facility, we also maintain a $250 million credit agreement through FPL that goes through May of 2011, further supporting the utility's needs. Specific details on the credit facilities can be found in the appendix of this presentation.

We believe our maturities in 2009 and 2010 are manageable. In 2009 excluding amortizing principal payments, we have approximately $950 million due consisting of $225 million of Florida Power and Light first mortgage bonds and $725 million of FPL Group capital debt. In 2010, we have approximately $200 million due other than scheduled principal amortization payments. The average maturity of our outstanding debt is over 15 years.

At the end of the third quarter our available liquidity was approximately $4.9 billion. The accompanying liquidity table provides a breakdown of how we calculate our liquidity position. The letters of credit we have issued in support of certain activities at FPL Group capital, reduce our liquidity position but only modestly.

To facilitate daily cash needs, FPL Group maintains commercial paper programs for its two main businesses, FPL and FPL Energy by was of FPL capital. Both of these issuing entities are rated A1, E1, F1 by S&P, Moody's and Fitch respectively. As the commercial paper markets have tightened during the current credit crisis, both companies have had continued access to the commercial paper market.

Management has always believed that maintaining a strong balance sheet is important in our industry and the current credit crisis supports this position. While we have had continuous access to commercial paper markets, we have seen a demand by investors for shorter maturities and an increase in short term rates.

As of Sept 30, the average maturity of FPL's commercial paper in short term notes was approximately $23 days with a weighted average interest rate of approximately 2.83%, and FPL Group Capital's commercial paper had an average maturity of approximately 30 days with a weighted average interest rate of approximately 3.2%.

In addition, we have taken the added precaution of building short term investment balances to offset any effects from further deterioration of the commercial paper markets. As of September 30, 2008, FPL had $1.6 billion in commercial paper and short term notes offset by short term investments of $808 million for a net short term debt balance of $742 million.

FPL Group Capital had $1.5 billion in commercial paper and short term notes outstanding as of September 30, with short term investments of about $690 million for a net short term debt of approximately $800 million. The majority of these short term investments are included in the cash and cash equivalents section of our balance sheet.

Approximately 93% of short term investments are either in Treasury backed repurchase agreements or Treasury backed money market funds. Carrying this additional cash during the third quarter resulted in a negative interest spread over our short term borrowing rate. Including that negative carry, the credit turmoil had totally estimated impacts on our company primarily as a result of investment losses recorded in adjusted earnings of approximately $0.01 a share.

We believe that our strong balance sheet supported by a large and diversified credit facility positions FPL Group to meet the current credit challenges. We continue to monitor the situation closely and will take the necessary steps as appropriate to maintain the financial strength of the company.

Approximately 93% of our potential exposure at FPL Energy's power marketing business is within investment grade counter parties. The breakdown of our counter parties can be seen on this slide. That said, we manage our exposure on a daily basis and are constantly evaluating our counter party credit exposures.

When we identify our counter parties' credit as a concern, we take pro-active steps to neutralize our positions. Virtually all of the non investment grade exposure that you see here is associated with one domestic rate regulated electric utility that is BB plus and with which we are comfortable with our exposure.

In his opening remarks, Lew mentioned some potential revisions to our CapEx plans for 2009 and I'd like to take a moment to summarize these. At FPL we have taken actions to reduce CapEx by approximately $400 million from our original estimates. These reductions are in projects primarily associated with system growth [inaudible]. For reasons that Lew already mentioned, our generation CapEx at FPL has not been revised.

At FPL Energy, we have reduced our original CapEx plans for 2009 by about $1.3 billion. Besides the wind CapEx that Lew mentioned, the reduction includes a number of projects that we can defer without significantly diluting our earnings estimates. Our revised plan is to reduce our original CapEx plans for 2009 for the two companies from approximately $7 billion to approximately to $5.3 billion.

Our comments today obviously raise the question of our commitment to add between 7,000 and 9,000 megawatts of wind from 2008 to 2012. Although we have a pipeline of approximately 29,000 megawatts at very attractive wind projects, our guiding principal has always been to build only those projects that make economic sense and that can be market financed.

We have always demanded that before a project can be internally approved, that we are confident that it will pass the market test; that is, that it can be third party financed at terms that are accretive to our shareholders. We have not and will not build for the sake of building or protecting market share. At this time we are not adjusting our target to add between 7,000 to 9,000 megawatts of wind from 2008 to 2012, but will continue to monitor the market and will update you on our fourth quarter earnings call.

Before turning the call back to Lew, I want to spend just a minute discussing the earnings profile of FPL Group. 46% of FPL Group's EBITDA comes from FPL. As for FPL Energy, at times when I speak with investors, I am struck by the fact that our FPL Energy business risk position is not always well understood.

Importantly, our risk profile is very different from some of our merchant peers. In 2009, we expect that 24% of our consolidated EBITDA will be attributable to earnings associated with assets that are under long term power purchase agreements at FPL Energy. The weighted average remaining contract to term of those assets is approximately 15 years, and in many cases those contracts have escalating revenue adjustments.

In addition, 17% of 2009 EBITDA at FPL Group is expected to come from FPL Energy assets whose revenue is hedged with either bi-lateral agreements with investment grade counter parties or with forwards from a regulated exchange. This portion of our EBITDA includes Seabrook and our main hydro plant as well as our wind assets that are not under long term power purchase contracts.

The remaining FPL Energy generation based EBITDA is almost entirely related to sparks spread sensitive assets. In the hedging tables that we provide you on a quarterly basis, you can readily determine the prospective gross margin that is hedged on those assets which are primarily in Nepal and Ercott.

As we've indicated before, although we are comfortable with the long natural gas exposure that most of our assets possess, we endeavor to hedge a significant amount of our expected gross margin at least two years out. Investors have told us that they like some certainty in near terms earnings and we would agree that it serves us very well.

The remaining EBITDA is associated with other portions of our business which I haven't specifically discussed.

So in summary, 46% of FPL Group's EBITDA comes from Florida Power and Light and FPL Energy nearly 80% of FPL Energy's EBITDA comes from long term contracted wind, gas and nuclear assets. These earnings are arguably less risky than even a regulated utility as they are diversified across companies and geographies and they are not subject to rate case risk.

So in total, approximately 87% of FPL Group's EBITDA is coming from businesses that have a conservative business risk position. This business mix did not come about by accident. We have been very disciplined in what businesses we choose to be in and in what proportions. We have always been and always will be very mindful of the mix of business we undertake at FPL Group.

Our previous 2009 and 2010 adjusted EPS target range of $4.05 to $.25 and $4.50 to $4.90 respectively remain unchanged. Although our plans for CapEx next year are now less than originally planned, we remain comfortable with our earnings expectations.

I'd also like to provide a quick comment on our goal of providing for an average adjusted EPS growth of at least 10% through 2012 from a 2006 base year. As you will recall, our 2006 adjusted EPS was $3.04. While we do not promise that the earnings growth would follow a smooth path year by year, simple math would suggest that our earnings for 2010 would be in the ball park of $4.44 per share if we were to be on track to meet out 10% plus growth in EPS.

Based on our current plan taking into account the earnings assumptions that are included in the appendix, we continue to feel comfortable with that earnings trend. As for years 2011 and 2012, we remain optimistic about achieving our targeted growth. We have a very strong and attractive pipeline of projects at both FPL and FPL Energy. Those projects along with long term forecasts of economic activity provide us a path to meet our longer term financial goals.

However, much will depend on how long and severe the current economic and credit situations last, particularly by a company with essentially inaccessible credit markets. And now, I would like to turn the call back over to Lew who will provide some additional comments.

Lewis Hay

I'll take just a few moments to provide some additional perspective. There's no denying we're in the midst of a difficult economy that may be with us for awhile. We believe that FPL Group is well positioned to withstand the current market. We have always been a company that focuses on ensuring our fundamentals stay healthy and that is no different today.

We are controlling costs and analyzing our investment opportunities with extreme diligence and preserving our strong balance sheet. We are very mindful that in the current environment, our plans may have to change quickly depending on any number of events. As such, we have contingency plans to deal with several economic scenarios that may play out during the next 18 months or so.

While we are comfortable with the plans we have discussed with you today, we are diligently monitoring our situation and may have more to report to you in our fourth quarter earnings call. What will not change is our disciplined approach and our commitment to investing where we see good opportunities that made economic sense. Economic times such as these present both risks and opportunities and we are keeping our eyes open to both.

We also remain optimistic that despite current market conditions, over the long run the country remains committed to a clean energy future. There are not other sustainable alternatives. In order to address global climate change, policy makers will eventually have to put a price on carbon and few companies are better positioned for that outcome than FPL Group.

As you know, FPL Group has a long history of building shareholder value. We do not believe that the recent turmoil in the market should obscure FPL Group's ability to continue to deliver exceptional shareholder value over the long term. Through financial discipline, superior execution and strategic investments, we maintain our commitment to delivering long term shareholder value.

I want to thank you for joining us today and your continued interest in FPL Group. With that, I'll turn the call over for questions.

Question-and-Answer Session


(Operator Instructions) Your first question comes from John Kiani – Deutsche Bank.

John Kiani – Deutsche Bank

Can you talk us through some of the offsets that allow you to maintain or reiterate 2009 guidance with the capital spending cuts specifically more on the FPL Energy side?

Armando Pimental

For the most part as has been the case for the last couple of years, when we build new wind plants at FPL Energy, many of those wind plants come into service late in the year so this year we have built our total goal of 1,300 megawatts as an example, 499 of that is in service at the end of the third quarter.

So you can see a large amount of that would equate to service in the fourth quarter 2008. 2009 is very similar to that, so as you push back or reduce your CapEx for wind at FPL Energy, it does not significantly affect the EPS for that year.

John Kiani – Deutsche Bank

I also meant 2010 guidance.

Armando Pimental

So for 2010 the difference between what we were going to build which is 1,500 and what we currently announce of 1,300 continues to place us in the range of $4.50 to $4.90 that we have provided. You can take that a couple of ways. You can say that we were much more comfortable with the higher end of those ranges for 2010 than we are now. That's not what I'm saying.

But we feel comfortable based on the scenario analysis that we've run with different sizes of CapEx. At $4.50 to $4.90 for 2010 remains very reasonable.

John Kiani – Deutsche Bank

It sound like your conservatism is what you're saying allows you to stay within that range not necessarily in any particular area of the range?

Armando Pimental

For FPL Energy the fact that we're going to put in approximately 1,100, and by the way as Lew mentioned, those plans can go up or down depending on what happens particularly with the credit markets, but our plan right now for 1,100 megawatts for 2009 makes us feel very comfortable with '09 and 2010 guidance.

The other part of this which I'm sure you know at Florida Power and Light, although they've got some reduced customer usage trends here in the last year, the fact that we've got those two gas plants that are going up in 2009 and we've got solar, nuclear upgrades for which we get 11.75% returns on, all things that are very, very good for our customers and also very good for our shareholders.

You should also know that although not mentioned specifically, we are planning to reduce and have already put plans in to reduce some expenses so that we can make sure that what we're doing internally on the expense front matches what we see on the CapEx front.

John Kiani – Deutsche Bank

Does the $1.7 billion CapEx reduction for '09 mean that you won't need equity financing as originally planned for 2009?

Armando Pimental

Clearly when you bring down the amount of CapEx it certainly changes the mix that we have planned. As I've said before, the last time this company announced issuing equity was 2002 and that equity was issued [inaudible]. The company has grown quite a bit since that time. At some point in the future in order for us to maintain our ratings which are from today's message, hopefully that remains very clear; that's very important to us; we will issue equity or equity like instruments again.

Whether that's this year, next year, 2010 will remain to be seen. Obviously we're cognizant of the fact that with our share price trading at what it is today, issuing equity is not necessarily in the short term best interest of our shareholders, but anytime that we look at CapEx plans, we look at what's available and the cost of what's available in the market. We dial that in.


Your next question comes from Greg Gordon – Citigroup.

Greg Gordon – Citigroup

When you look at building the wind plants, you talk about looking at a capital markets test. Given the cost of capital as you see it today on the 1,100 megawatts that you're planning to build next year, is it still reasonable to presume that historically, that you earn about $0.015 per share on 1,100 megawatts project if you can successfully build?

Armando Pimental

A couple of points. One is, we've said $0.01 to $0.015 not $0.015 and we've said that in the first full year of operations which would be 12 months, just for others on the call so there's not any confusion.

Having said that, our expectations would be a little less than that at this point if in fact what we're seeing in the current credit environment plays itself out over a long period of time. As I've mentioned to others, although internally we've done a bunch of scenario planning to make sure we understand what's reasonable for the next 12 to 18 months, it's very difficult to put together a long term plan based on what's happening in the credit markets over the last four to six weeks.

I wouldn't say it's $0.01 to $0.015 for the first full 12 months of operation at this point. We will update you on that in the future, but I wouldn't necessarily say it's much less than $0.01 at this point either if you're looking at long term fundamentals.

Greg Gordon – Citigroup]

On the regulated side of the business {SP&L] the surveillance filings that you file every month at the commission and ROE's obviously given the economic earned ROE's on a regulatory basis given the backdrop of declining, last time I checked it was up 11%. Can you give us an update on what the surveillance reports show your LTM regulatory ROE's are and if that is the assumption that you're building in for the rate case.

Armando Pimental

The rolling last 12 months, remember 2008 our ROE is 11.2%. Certainly there's an expectation for that to go down. I wouldn't expect that number to go down significantly for the rest of this year, and by significantly I mean as you remember, our rate agreement indicates that if it goes down below 10%, we have the opportunity to go back in and re-discuss our situation with the commission.

I certainly don't expect that this year. Next year we are going to be filing paperwork as you know for a new rate agreement starting in 2010. That does not necessarily preclude us from going in and discussing just 2009 and we see significant difficulties in 2009.

But the reality is that probably won't be the case unless it's just really, really, bad time which that happens on the issues to deal with. And by that I don't mean at the company, I mean world wide.

Greg Gordon – Citigroup

The good news is that rate base is growing quite rapidly given the commitments that you've made with the regulators in the state to add infrastructure. I guess the question is, what's the presumption you're making in terms of an expected return on equity on that in your 2009 guidance.

Armando Pimental

We have not provided to outsiders what we are expecting in the new rate agreement. The commission and the staff have been very fair in their dealings with us. I think if you go back historically you could see that as all the Florida utilities have done very well both on a range of ROE and agreements with the commission and also more importantly, what they've actually realized.

I think if you go back and look at what's happened over the last 12 months, you can see that the regulatory ROE's have hovered around the mid 10's and maybe a little higher. I would expect that the conditions over the last six to eight weeks that those number might go up, but that's just a suggestion based on what I see.


Your next question comes from Dan Eggers – Credit Suisse.

Dan Eggers – Credit Suisse

We've had two fairly significant M&A activities attempt to occur in the sector over the last quarter. Can you share some thoughts on how you looked at those transactions and two, how are you thinking about prioritizing capital between some of these businesses on sale relative to reinvesting in some of your internal projects?

Lewis Hay

First and foremost as a policy comment on specific M&A transactions, we don't. I'll leave that at that. But as I indicated in my remarks, it wouldn't surprise us that there could be some interesting opportunities coming down the pike. As always, they would have to pass the strategic test. They have to fit with out strategy and business mix that we're shooting for.

Secondly, I would suspect that most of the things we would find interesting would be at the asset level as opposed to the company level, but I'm not going to rule out anything. You know our history, and we know all too well the difficulties of getting large businesses approved and integrated and all that kind of stuff, whereas we've had quite a successful track record on assets.

I'd also comment when we look at business type deals, we look at skills that we would be acquiring relative to skills that we think we need and I think I can say for the whole senior team, we're pretty comfortable with the full range of skills that we have at this point. There's not a lot of things that we're looking at where we see any kind of deficit that we need to fill or could be filled through a corporate type transaction

Having said all that, these are truly unprecedented times and preserving your financial strength and preserving liquidity are of paramount importance when we look at things. Now would not be the time to stretch our balance sheet, risk our credit situation in order to do something that is financially or strategically interesting.

We'll be opportunistic but we're also going to be mindful of what I just said.

Dan Eggers – Credit Suisse

When we look at the wind development pipeline, because you're probably going to one of the people who have the financial flexibility to build in much scale for next year, are you able to get better deals or better terms on contracts today as you go back to people offering projects or as you choose which projects win. Can we think of IRS going up in that business?

Lewis Hay

I think it's too soon to tell. If you question is do we think our businesses are going to do better because there's less competition, less people financially able to projects next year, this gets back to the comment of what's the profitability the first year of a wind project. Clearly our decisions are based a lot more on what the first year profitability would be.

Without a doubt we're raising the bar in terms of the financial hurdles that we're going to be looking at for approving projects. We've made that clear to our developers who in turn will be making it clear to counter parties and customers and that sort of thing.

We're looking at every element of the cost structure to see if there's ways that we can reduce the cost whether it's capital cost or ongoing operating costs. It's too soon to say how all those will balance out, but I'm confident that we'll be able to find some opportunities there.


Your next question comes from [Steve Fleishman – Capital Management].

[Steve Fleishman – Capital Management]

On you balance sheet the debt to capital is around 60% and the adjusted is about 48% up from 42%. Where do you want to have that number or what have you told the rating agencies that number should be in the range of?

Armando Pimental

You're referring to a schedule that's attached to our earnings release. There are two calculations on it. One is a GAAP balance sheet and the other one is an adjusted balance sheet. What we try to do on the adjusted front is based on direction that we get from S&P and from Moody's and from Fitch, we try to put together an adjusted column.

The adjusted column should one of those other rating agencies put it together. Some may be the same, some may be a little better, some a little bit worse. What we actually do is we gauge all three of them. I can tell you that the adjusted column that's sitting right now at 48% for September of 2008 is right around the ball park of where we would want to be.

I'd say somewhere between 46% and 50%. It's nice and it's important to look at the GAAP one which is sitting a little bit higher now but it's really important to look at the adjusted one, and the main difference there is project debt which has been so essential to our growth in the past and will be essential to our growth in the future. So I'd say 46% to 50% on adjusted is where we'd like to be.

[Steve Fleishman – Capital Management]

One other question on the wind resource, I know you're talking about changing the metrics you use now, but the metrics you used to use for wind resource at least for the first two months was above average and then the production ended up being the lowest in 35 years. Could you better explain why that difference and is there something going on between resource measures and actual production from the wind project that is causing a disconnect?

Lewis Hay

The answer to the later part of your question is no. The former is yes, I will explain. For the last, maybe since I've gotten here and I've looked at the wind index, I think what we tried to before was the right thing to do. We wanted to make it easy for investors to be able to go on the web, find reference towers and airports that were kind of close to our prospects and they'd get that public information and then we provide what the correlation is between what the public information and our wind towers are.

We just continued to have difficulties with our wind index. The reference towers that you could find publicly are just not right by our wind plant. They are at a different height than our wind plant. We have better data. We actually have anemometers at our plants. We actually know what's flowing at our wind sites.

Especially after the last quarter, I sat down and said, "Look, if we can't give investors a wind index that they can actually do something with; in other words, if the wind index is 107 and that doesn't actually mean it's a 7% improvement from what our results would have been, or if it's at 97 that we should see a 6% reduction from what we had planned, then we need to find a better metric."

And now the metric is pretty simple. The metric is, this is how the wind did, and this is how we planned for it to do, and we're going to give that information to you on a monthly basis on our web site. And there at the bottom of the slide, we've actually provided a metric that should the wind blow more or less than what we had expected, that the results or RPS results would be different. So I actually believe this is a huge improvement in the data that we're giving investors.


Your next questions comes from [Annie Chow – Alliance Bernstein].

[Annie Chow – Alliance Bernstein]

I just want to clarify when you talk about [inaudible] on the short term average maturity, you think it's 2.8% to 3% interest rate and in the commercial papers 3.2%, is that right?

Armando Pimental

You're referring to the average interest rate for Florida Power and Light commercial paper which is the lower number and the higher number 3.2% was FPL Group Capital. Those were the numbers at September 30.

[Annie Chow – Alliance Bernstein]

Does that mean then that you have to refinance at the current rate which is going to much higher then? Should we assume that for '09?

Armando Pimental

Let me give you based on what we have seen as of last week. That number for Florida Power and Light commercial paper had actually gone down a little bit and the number for FPL Group Capital had actually gone up a little bit. This is just a short term commercial paper market and at least our view would be that over the next several months, as some of these programs that the government has put in place finally start to get some traction, that you'll actually see the short term commercial paper market rates come back down to where they were over the last four to six weeks.

I can tell you right now that at Florida Power and Light that the utilities, the rates that we are seeing as of last week were essentially the same commercial paper rates that we were seeing before this latest credit turmoil. The FPL Group Capital rates are a little higher but the Florida Power and Light rates are right back to where they were before the last four to six weeks.

[Annie Chow – Alliance Bernstein]

On your 2009 EBITDA contribution, can you elaborate the 5% other?

Armando Pimental

The 5% other really includes other other. It includes corporate and other. It includes all the other FPL energy businesses. So as an example it includes our wholesale marketing and trading operations and it includes our fiber net operations which is a very small piece of that. It includes a lot of long term contracts.


Your next question comes from Paul Patterson – Glenrock Associates.

Paul Patterson – Glenrock Associates

The 2010, what is the outlook with that? Are you assuming a recession in that or in general how should we think about what the impact of a recession might be?

Lewis Hay

We've done scenario planning in house. I think it would be inappropriate at this point to point out how long we believe the current economic slowdown is going to last. I feel comfortable though in saying that we believe it will at least last through the later parts of 2009.

Paul Patterson – Glenrock Associates

In terms of the 2010 guidance, just to make sure I understand the impact of the CapEx change, I guess it's because of the conservative nature of your guidance, the O&M reductions and approval projects, that's what's helping you overcome the impact of lower CapEx in 2010?

Armando Pimental

It's that, but it's also what I mentioned earlier. Our wind build at FPL Energy, most of that wind build actually goes in towards the latter part of the year. The example I gave was 2008 this year, although we expect to add about 1,300 megawatts of wind, we only have 499 that have been added up to this point. So a large amount of that goes in towards the last part.

And since you have such a large part going in towards the last part the CapEx reductions, you mentioned specifically wind for 2009 would not significantly affect our 2009 guidance.

Paul Patterson – Glenrock Associates

But for 2010, is that basically because it's diverted into the early part of 2010 – the $1.3 billion?

Lewis Hay

Our 2009 wind build which would normally have some impact on 2010, we're cutting it back at this point in time by 400 megawatts. Call it a $0.01 to $0.015 per 100 megawatts, you're talking about $0.04 to $0.05 range that [inaudible] $0.40 or $0.50 but it was a fairly big range. It's just not that big of a deal.

It has virtually zero impact on '09 since these projects tend to come in at the later part of the year and will have an incredible modest impact on 2010. I want to point out that these are not projects that are being sold. We're going to continue developing projects. We're going to be putting them up on a shelf, building a backlog of good projects for when conditions improve, which they will.

Armando Pimental

I mentioned this earlier, we need to keep in mind Florida Power and Light, although we are expecting reduced numbers for 2009, the fact that we are getting those two gas plants up and running in 2009 as part of our generation based rate adjustment, that's adding significantly to our revenue in 2009, as are the solar projects in 2010 that I also mentioned, and the nuclear upgrade projects that I also mentioned.

It's almost a gloomier forecast when we talk about customers for Florida Power and Light, but we need to keep in mind here that what we've been doing for several years is doing great things for customers, absolutely terrific things for our customers and good things for our shareholders.

We're shifting the [inaudible] to rate based so it's good really for both. So although we're talking about FPL Energy and wind and certainly that's part of the story, let's keep in mind that at Florida Power and Light there's a lot of good things going on.

Lewis Hay

Thank you everyone for joining us today.

Copyright policy: All transcripts on this site are the copyright of Seeking Alpha. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of financial information on the Internet. (Until now investors have had to pay thousands of dollars in subscription fees for transcripts.) So our reproduction policy is as follows: You may quote up to 400 words of any transcript on the condition that you attribute the transcript to Seeking Alpha and either link to the original transcript or to www.SeekingAlpha.com. All other use is prohibited.


If you have any additional questions about our online transcripts, please contact us at: transcripts@seekingalpha.com. Thank you!

About this article:

Error in this transcript? Let us know.
Contact us to add your company to our coverage or use transcripts in your business.
Learn more about Seeking Alpha transcripts here.