Nisource Inc 10-Q for FY2020 Q1

Nisource Inc. (NI)

10-Q 2020-05-06 For: 2020-03-31

Added on April 07, 2026

About this 10-Q

Nisource Inc filed this 10-Q on May 6, 2020, covering the quarter ended March 31, 2020 (FY2020 Q1).

Headline figures

Quarter ended March 31, 2020, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $1.61B; down 14.1% from $1.87B a year earlier
Net income: $75.6M; down 65.5% from net income of $218.9M a year earlier
Diluted EPS: $0.16; down 70.9% from $0.55 a year earlier

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DE		35-2108964
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

801 East 86th Avenue
Merrillville,	IN	46410
(Address of principal executive offices)		(Zip Code)



Title of Each Class	Trading Symbol(s)	Name of Each Exchange on Which Registered
Common Stock, par value $0.01 per share	NI	NYSE
Depositary Shares, each representing a 1/1,000th ownership interest in a share of 6.50% Series B	NI PR B	NYSE
Fixed-Rate Reset Cumulative Redeemable Perpetual Preferred Stock, par value $0.01 per share, liquidation preference $25,000 per share and a 1/1,000th ownership interest in a share of Series B-1 Preferred Stock, par value $0.01 per share, liquidation preference $0.01 per share	NI PR B	NYSE



			Page

	Defined Terms		3

PART I	FINANCIAL INFORMATION

	Item 1.	Financial Statements - unaudited

		Condensed Statements of Consolidated Income (unaudited)	7

		Condensed Statements of Consolidated Comprehensive Income (Loss) (unaudited)	8

		Condensed Consolidated Balance Sheets (unaudited)	9

		Condensed Statements of Consolidated Cash Flows (unaudited)	11

		Condensed Statements of Consolidated Equity (unaudited)	12

		Notes to Condensed Consolidated Financial Statements (unaudited)	14

	Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	38

	Item 3.	Quantitative and Qualitative Disclosures About Market Risk	54

	Item 4.	Controls and Procedures	54

PART II	OTHER INFORMATION

	Item 1.	Legal Proceedings	55

	Item 1A.	Risk Factors	55

	Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	55

	Item 3.	Defaults Upon Senior Securities	55

	Item 4.	Mine Safety Disclosures	55

	Item 5.	Other Information	55

	Item 6.	Exhibits	56

	Signature		57



DEFINED TERMS
The following is a list of frequently used abbreviations or acronyms that are found in this report:

NiSource Subsidiaries, Affiliates and Former Subsidiaries
Columbia of Kentucky	Columbia Gas of Kentucky, Inc.
Columbia of Maryland	Columbia Gas of Maryland, Inc.
Columbia of Massachusetts	Bay State Gas Company
Columbia of Ohio	Columbia Gas of Ohio, Inc.
Columbia of Pennsylvania	Columbia Gas of Pennsylvania, Inc.
Columbia of Virginia	Columbia Gas of Virginia, Inc.
NIPSCO	Northern Indiana Public Service Company LLC
NiSource ("we," "us" or “our”)	NiSource Inc.

Abbreviations and Other
ACE	Affordable Clean Energy
AFUDC	Allowance for funds used during construction
AOCI	Accumulated Other Comprehensive Income (Loss)
ASC	Accounting Standards Codification
ASU	Accounting Standards Update
ATM	At-the-market
BTA	Build-transfer agreement
CARES Act	The Coronavirus Aid, Relief and Economic Security Act provides more than $2 trillion to battle COVID-19 and its economic effects, including various types of economic relief for impacted business and industries.
CCRs	Coal Combustion Residuals
CEP	Capital Expenditure Program
CERCLA	Comprehensive Environmental Response Compensation and Liability Act (also known as Superfund)
COVID-19	Novel Coronavirus 2019
DSIC	Distribution System Improvement Charge
DPU	Department of Public Utilities
ELG	Effluent limitations guidelines
EPA	United States Environmental Protection Agency
EPS	Earnings per share
FAC	Fuel adjustment clause
FASB	Financial Accounting Standards Board
FERC	Federal Energy Regulatory Commission
FMCA	Federally Mandated Cost Adjustment
GAAP	Generally Accepted Accounting Principles
GCA	Gas cost adjustment
GCR	Gas cost recovery
GHG	Greenhouse gases
GSEP	Gas System Enhancement Program
GWh	Gigawatt hours
IRP	Infrastructure Replacement Program
IURC	Indiana Utility Regulatory Commission
LIBOR	London InterBank Offered Rate



DEFINED TERMS
MA DOR	Massachusetts Department of Revenue
Massachusetts Business	All of the assets being sold to, and liabilities being assumed by, Eversource pursuant to the Asset Purchase Agreement
MGP	Manufactured Gas Plant
MISO	Midcontinent Independent System Operator
MMDth	Million dekatherms
MW	Megawatts
NTSB	National Transportation Safety Board
NYMEX	New York Mercantile Exchange
OPEB	Other Postretirement Benefits
PHMSA	Pipeline and Hazardous Materials Safety Administration
PPA	Power Purchase Agreement
PTC	Production tax credit
RCRA	Resource Conservation and Recovery Act
RFP	Request for proposals
SAVE	Steps to Advance Virginia's Energy Plan
SEC	Securities and Exchange Commission
SMRP	Safety Modification and Replacement Program
STRIDE	Strategic Infrastructure Development Enhancement
TCJA	An Act to provide for reconciliation pursuant to titles II and V of the concurrent resolution on the budget for fiscal year 2018 (commonly known as the Tax Cuts and Jobs Act of 2017)
TDSIC	Transmission, Distribution and Storage System Improvement Charge



Index	Page
Condensed Statements of Consolidated Income (unaudited)	7
Condensed Statements of Consolidated Comprehensive Income (Loss) (unaudited)	8
Condensed Consolidated Balance Sheets (unaudited)	9
Condensed Statements of Consolidated Cash Flows (unaudited)	11
Condensed Statements of Consolidated Equity (unaudited)	12
Notes to Condensed Consolidated Financial Statements (unaudited)	14
1. Basis of Accounting Presentation	14
2. Recent Accounting Pronouncements	15
3. Revenue Recognition	16
4. Earnings Per Share	18
5. Equity	18
6. Gas in Storage	19
7. Assets and Liabilities Held For Sale	19
8. Asset Retirement Obligations	20
9. Regulatory Matters	20
10. Risk Management Activities	22
11. Fair Value	23
12. Transfers of Financial Assets	26
13. Goodwill	26
14. Income Taxes	27
15. Pension and Other Postretirement Benefits	27
16. Long-Term Debt	28
17. Short-Term Borrowings	28
18. Other Commitments and Contingencies	29
19. Accumulated Other Comprehensive Loss	36
20. Other, Net	36
21. Business Segment Information	36



	Three Months Ended March 31,
(in millions, except per share amounts)	2020			2019
Operating Revenues
Customer revenues	$	1,525.9		$	1,834.5
Other revenues	79.6			35.3
Total Operating Revenues	1,605.5			1,869.8
Operating Expenses
Cost of sales (excluding depreciation and amortization)	462.4			680.3
Operation and maintenance	444.6			552.4
Depreciation and amortization	184.3			175.1
Loss on classification as held for sale	280.2			—
Loss (gain) on sale of fixed assets and impairments, net	(0.1		)	0.2
Other taxes	85.9			87.6
Total Operating Expenses	1,457.3			1,495.6
Operating Income	148.2			374.2
Other Income (Deductions)
Interest expense, net	(92.9		)	(95.6		)
Other, net	5.4			(0.7		)
Total Other Deductions, Net	(87.5		)	(96.3		)
Income before Income Taxes	60.7			277.9
Income Taxes	(14.9		)	59.0
Net Income	75.6			218.9
Preferred dividends	(13.8		)	(13.8		)
Net Income Available to Common Shareholders	61.8			205.1
Earnings Per Share
Basic Earnings Per Share	$	0.16		$	0.55
Diluted Earnings Per Share	$	0.16		$	0.55
Basic Average Common Shares Outstanding	383.1			373.4
Diluted Average Common Shares	384.1			374.7



	Three Months Ended March 31,
(in millions, net of taxes)	2020			2019
Net Income	$	75.6		$	218.9
Other comprehensive income (loss):
Net unrealized gain (loss) on available-for-sale debt securities⁽¹⁾	(5.4		)	2.8
Net unrealized gain (loss) on cash flow hedges⁽²⁾	(133.3		)	(19.3		)
Unrecognized pension and OPEB benefit⁽³⁾	0.7			0.9
Total other comprehensive income (loss)	(138.0		)	(15.6		)
Comprehensive Income (Loss)	$	(62.4	)	$	203.3

NiSource Inc. Condensed Consolidated Balance Sheets (unaudited)

(in millions)	March 31, 2020			December 31, 2019
ASSETS
Property, Plant and Equipment
Utility plant	$	22,862.3		$	24,502.6
Accumulated depreciation and amortization	(7,293.7		)	(7,609.3		)
Net utility plant	15,568.6			16,893.3
Other property, at cost, less accumulated depreciation	18.6			18.9
Net Property, Plant and Equipment	15,587.2			16,912.2
Investments and Other Assets
Unconsolidated affiliates	1.3			1.3
Available-for-sale debt securities (amortized cost of $148.4 and $150.1, allowance for credit losses of $1.2 and $0, respectively)	144.6			154.2
Other investments	66.1			74.7
Total Investments and Other Assets	212.0			230.2
Current Assets
Cash and cash equivalents	203.8			139.3
Restricted cash	9.2			9.1
Accounts receivable	736.8			876.1
Allowance for credit losses	(20.3		)	(19.2		)
Accounts receivable, net	716.5			856.9
Gas inventory	59.9			250.9
Materials and supplies, at average cost	130.9			120.2
Electric production fuel, at average cost	63.2			53.6
Exchange gas receivable	39.0			48.5
Assets held for sale	1,655.8			—
Regulatory assets	164.3			225.7
Prepayments and other	182.8			149.7
Total Current Assets	3,225.4			1,853.9
Other Assets
Regulatory assets	1,922.0			2,013.9
Goodwill	1,485.9			1,485.9
Deferred charges and other	160.2			163.7
Total Other Assets	3,568.1			3,663.5
Total Assets	$	22,592.7		$	22,659.8

NiSource Inc. Condensed Consolidated Balance Sheets (unaudited) (continued)

(in millions, except share amounts)	March 31, 2020			December 31, 2019
CAPITALIZATION AND LIABILITIES
Capitalization
Stockholders’ Equity
Common stock - $0.01 par value, 600,000,000 shares authorized; 382,694,308 and 382,135,680 shares outstanding, respectively	$	3.8		$	3.8
Preferred stock - $0.01 par value, 20,000,000 shares authorized; 440,000 shares outstanding	880.0			880.0
Treasury stock	(99.9		)	(99.9		)
Additional paid-in capital	6,671.5			6,666.2
Retained deficit	(1,483.4		)	(1,370.8		)
Accumulated other comprehensive loss	(230.6		)	(92.6		)
Total Stockholders’ Equity	5,741.4			5,986.7
Long-term debt, excluding amounts due within one year	7,817.9			7,856.2
Total Capitalization	13,559.3			13,842.9
Current Liabilities
Current portion of long-term debt	7.9			13.4
Short-term borrowings	2,046.4			1,773.2
Accounts payable	505.6			666.0
Dividends payable - common stock	80.4			—
Dividends payable - preferred stock	19.4			—
Customer deposits and credits	163.2			256.4
Taxes accrued	223.8			231.6
Interest accrued	95.1			99.4
Exchange gas payable	18.5			59.7
Regulatory liabilities	177.9			160.2
Liabilities held for sale	470.9			—
Legal and environmental	17.5			20.1
Accrued compensation and employee benefits	129.4			156.3
Claims accrued	24.9			165.4
Other accruals	180.9			144.1
Total Current Liabilities	4,161.8			3,745.8
Other Liabilities
Risk management liabilities	312.1			134.0
Deferred income taxes	1,451.3			1,485.3
Deferred investment tax credits	9.4			9.7
Accrued insurance liabilities	82.4			81.5
Accrued liability for postretirement and postemployment benefits	359.4			373.2
Regulatory liabilities	2,033.8			2,352.0
Asset retirement obligations	435.9			416.9
Other noncurrent liabilities	187.3			218.5
Total Other Liabilities	4,871.6			5,071.1
Commitments and Contingencies (Refer to Note 18, "Other Commitments and Contingencies")	—			—
Total Capitalization and Liabilities	$	22,592.7		$	22,659.8

NiSource Inc. Condensed Statements of Consolidated Cash Flows (unaudited)

Three Months Ended March 31, (in millions)	2020			2019
Operating Activities
Net Income	$	75.6		$	218.9
Adjustments to Reconcile Net Income to Net Cash from Operating Activities:
Depreciation and amortization	184.3			175.1
Deferred income taxes and investment tax credits	(19.9		)	51.6
Loss on classification as held for sale	280.2			—
Other adjustments	7.9			6.5
Changes in Assets and Liabilities:
Components of working capital	(147.1		)	(27.2		)
Regulatory assets/liabilities	12.9			0.4
Deferred charges and other noncurrent assets	(12.1		)	(58.3		)
Other noncurrent liabilities	(11.9		)	32.1
Net Cash Flows from Operating Activities	369.9			399.1
Investing Activities
Capital expenditures	(452.1		)	(353.7		)
Cost of removal	(34.5		)	(25.3		)
Purchases of available-for-sale securities	(43.5		)	(25.7		)
Sales of available-for-sale securities	45.4			29.3
Other investing activities	0.1			—
Net Cash Flows used for Investing Activities	(484.6		)	(375.4		)
Financing Activities
Repayments of long-term debt and finance lease obligations	(4.1		)	(2.3		)
Issuance of short-term debt (maturity > 90 days)	500.0			—
Repayment of short-term debt (maturity > 90 days)	—			(350.0		)
Change in short-term borrowings, net (maturity ≤ 90 days)	(226.8		)	452.8
Issuance of common stock, net of issuance costs	3.7			3.1
Equity costs, premiums and other debt related costs	(5.1		)	(4.0		)
Dividends paid - common stock	(80.3		)	(74.5		)
Dividends paid - preferred stock	(8.1		)	(9.1		)
Net Cash Flows from Financing Activities	179.3			16.0
Change in cash, cash equivalents and restricted cash	64.6			39.7
Cash, cash equivalents and restricted cash at beginning of period	148.4			121.1
Cash, Cash Equivalents and Restricted Cash at End of Period	$	213.0		$	160.8



(in millions)	Common Stock		Preferred Stock⁽¹⁾		Treasury Stock			Additional Paid-In Capital			Retained Deficit			Accumulated Other Comprehensive Loss			Total
Balance as of January 1, 2020	$	3.8	$	880.0	$	(99.9	)	$	6,666.2		$	(1,370.8	)	$	(92.6	)	$	5,986.7
Comprehensive Income:
Net income	—		—		—			—			75.6			—			75.6
Other comprehensive loss, net of tax	—		—		—			—			—			(138.0		)	(138.0		)
Dividends:
Common stock ($0.42 per share)	—		—		—			—			(160.7		)	—			(160.7		)
Preferred stock (See Note 5)	—		—		—			—			(27.5		)	—			(27.5		)
Stock issuances:
Employee stock purchase plan	—		—		—			1.3			—			—			1.3
Long-term incentive plan	—		—		—			(0.5		)	—			—			(0.5		)
401(k) and profit sharing	—		—		—			4.5			—			—			4.5
Balance as of March 31, 2020	$	3.8	$	880.0	$	(99.9	)	$	6,671.5		$	(1,483.4	)	$	(230.6	)	$	5,741.4
⁽¹⁾Series A and Series B shares have an aggregate liquidation preference of $400M and $500M, respectively. See Note 5, "Equity" for additional information.

(in millions)	Common Stock		Preferred Stock⁽¹⁾		Treasury Stock			Additional Paid-In Capital			Retained Deficit			Accumulated Other Comprehensive Loss			Total
Balance as of January 1, 2019	$	3.8	$	880.0	$	(99.9	)	$	6,403.5		$	(1,399.3	)	$	(37.2	)	$	5,750.9
Comprehensive Income:
Net income	—		—		—			—			218.9			—			218.9
Other comprehensive loss, net of tax	—		—		—			—			—			(15.6		)	(15.6		)
Dividends:
Common stock ($0.40 per share)	—		—		—			—			(149.1		)	—			(149.1		)
Preferred stock (See Note 5)	—		—		—			—			(28.5		)	—			(28.5		)
Stock issuances:
Employee stock purchase plan	—		—		—			1.3			—			—			1.3
Long-term incentive plan	—		—		—			(2.7		)	—			—			(2.7		)
401(k) and profit sharing	—		—		—			4.4			—			—			4.4
Balance as of March 31, 2019	$	3.8	$	880.0	$	(99.9	)	$	6,406.5		$	(1,358.0	)	$	(52.8	)	$	5,779.6



	Preferred	Common
Shares (in thousands)	Shares	Shares	Treasury		Outstanding
Balance as of January 1, 2020	440	386,099	(3,963	)	382,136
Issued:
Employee stock purchase plan	—	46	—		46
Long-term incentive plan	—	347	—		347
401(k) and profit sharing	—	165	—		165
Balance as of March 31, 2020	440	386,657	(3,963	)	382,694

	Preferred	Common
Shares (in thousands)	Shares	Shares	Treasury		Outstanding
Balance as of January 1, 2019	420	376,326	(3,963	)	372,363
Issued:
Preferred stock	20	—	—		—
Employee stock purchase plan	—	50	—		50
Long-term incentive plan	—	426	—		426
401(k) and profit sharing	—	164	—		164
Balance as of March 31, 2019	440	376,966	(3,963	)	373,003



Standard	Description	Effective Date	Effect on the financial statements or other significant matters
ASU 2018-14, Compensation—Retirement Benefits—Defined Benefit Plans—General (Subtopic 715-20): Disclosure Framework—Changes to the Disclosure Requirements for Defined Benefit Plans	This pronouncement modifies the disclosure requirements for defined benefit pension or other postretirement benefit plans. The guidance removes disclosures that are no longer considered cost beneficial, clarifies the specific requirements of disclosures and adds disclosure requirements identified as relevant. The modifications affect annual period disclosures and must be applied on a retrospective basis to all periods presented.	Annual periods ending after December 15, 2020. Early adoption is permitted.	We are currently in discussions with our third-party specialist to evaluate the effects of this pronouncement on our Notes to Condensed Consolidated Financial Statements (unaudited). We expect to adopt this ASU on its effective date.
ASU 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes	This pronouncement simplifies the accounting for income taxes by eliminating certain exceptions to the general principles in ASC 740, income taxes. It also improves consistency of application for other areas of the guidance by clarifying and amending existing guidance.	Annual periods beginning after December 15, 2020 Early adoption is permitted.	We are currently evaluating the effects of this pronouncement on our Condensed Consolidated Financial Statements (unaudited) and Notes to Condensed Consolidated Financial Statements (unaudited). The most relevant amendment requires that an entity recognize a franchise tax (or similar tax) that is partially based on income as an income-based tax and account for any incremental amount incurred as a non-income-based tax. For NiSource, these taxes may include franchise taxes based on gross receipts, commercial activity taxes and utilities receipts taxes. We expect to adopt this ASU on its effective date.
ASU 2020-04, Reference Rate Reform (Topic 848): Facilitation of the Effects of Reference Rate Reform on Financial Statements	This pronouncement provides temporary optional expedients and exceptions for applying GAAP principles to contract modifications and hedging relationships to ease the financial reporting burdens of the expected market transition from LIBOR and other interbank offered rates to alternative reference rates.	Upon issuance on March 12, 2020, and will apply though December 31, 2022.	We are currently evaluating the temporary expedients and options available under this guidance, and the effects of this pronouncement on our Condensed Consolidated Financial Statements (unaudited) and Notes to Condensed Consolidated Financial Statements (unaudited). As of March 31, 2020, we have not applied any expedients and options available under this ASU.



Standard	Adoption
ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivatives and Hedging, and Topic 825, Financial Instruments	In June 2016, the FASB issued ASU 2016-13, Measurement of Credit Losses on Financial Instruments (ASC 326). ASC 326 revised the GAAP guidance on the impairment of most financial assets and certain other instruments that are not measured at fair value through net income. ASC 326 introduces the current expected credit loss (CECL) model that is based on expected losses for instruments measured at amortized cost rather than incurred losses. It also requires entities to record an allowance for available-for-sale debt securities rather than impair the carrying amount of the securities. Subsequent improvements to the estimated credit losses of available-for-sale debt securities will be recognized immediately in earnings, instead of over-time as they would under historic guidance. In 2019, the FASB issued ASU 2019-04, Codification Improvements to Topic 326, Financial Instruments-Credit Losses, Topic 815, Derivative and Hedging, and Topic 825, Financial Instruments. This pronouncement clarified and improved certain areas of guidance related to the recently issued standards on credit losses, hedging, and recognition and measurement. We adopted ASC 326 effective January 1, 2020, using a modified retrospective method. Adoption of this standard did not have material impact on our Condensed Consolidated Financial Statements (unaudited). No adjustments were made to the January 1, 2020 opening balances as a result of this adoption. As required under the modified retrospective method of adoption, results for the reporting periods beginning after January 1, 2020 are presented under ASC 326, while prior period amounts are not adjusted. See Note 3, "Revenue Recognition," and Note 11, "Fair Value," for our discussion of the implementing these standards.
ASU 2016-13, Financial Instruments-Credit Losses (Topic 326)



(in millions)	Customer Accounts Receivable, Billed (less reserve)			Customer Accounts Receivable, Unbilled (less reserve)
Balance as of December 31, 2019	$	466.6		$	346.6
Balance as of March 31, 2020	449.9			233.5
Decrease	$	(16.7	)	$	(113.1	)



(in millions)
Company	Requested Incremental Revenue		Approved or Settled Incremental Revenue			Filed	Status	Rates Effective
NIPSCO - Electric⁽¹⁾	$	21.4	$	(53.5	)	October 31, 2018	Approved December 4, 2019	January 2020
Columbia of Pennsylvania	$	100.4	in process			April 24, 2020	Order Expected January 2021	January 2021



(in millions)	March 31, 2020		December 31, 2019
Risk Management Assets - Current⁽¹⁾
Interest rate risk programs	$	—	$	—
Commodity price risk programs	17.3		0.6
Total	$	17.3	$	0.6
Risk Management Assets - Noncurrent⁽²⁾
Interest rate risk programs	$	—	$	—
Commodity price risk programs	10.9		3.8
Total	$	10.9	$	3.8
Risk Management Liabilities - Current⁽³⁾
Interest rate risk programs	$	—	$	—
Commodity price risk programs	14.5		12.6
Total	$	14.5	$	12.6
Risk Management Liabilities - Noncurrent
Interest rate risk programs	$	253.7	$	76.2
Commodity price risk programs	58.4		57.8
Total	$	312.1	$	134.0



(in millions)	March 31, 2020		December 31, 2019
Gross Receivables	$	593.2	$	569.1
Less: Receivables not transferred	133.8		215.9
Net receivables transferred	$	459.4	$	353.2
Short-term debt due to asset securitization	$	459.4	$	353.2



Three Months Ended March 31, 2020 (in millions)	Gas Distribution Operations		Electric Operations		Corporate and Other		Total
Customer Revenues⁽¹⁾
Residential	$	796.5	$	119.2	$	—	$	915.7
Commercial	269.4		120.2		—		389.6
Industrial	74.2		109.1		—		183.3
Off-system	18.7		—		—		18.7
Miscellaneous	12.5		5.9		0.2		18.6
Total Customer Revenues	$	1,171.3	$	354.4	$	0.2	$	1,525.9
Other Revenues	56.7		22.9		—		79.6
Total Operating Revenues	$	1,228.0	$	377.3	$	0.2	$	1,605.5



Three Months Ended March 31, 2019 (in millions)	Gas Distribution Operations		Electric Operations		Corporate and Other		Total
Customer Revenues⁽¹⁾
Residential	$	975.3	$	118.8	$	—	$	1,094.1
Commercial	330.5		119.3		—		449.8
Industrial	82.9		163.3		—		246.2
Off-system	20.1		—		—		20.1
Miscellaneous	17.2		6.9		0.2		24.3
Total Customer Revenues	$	1,426.0	$	408.3	$	0.2	$	1,834.5
Other Revenues	12.8		22.5		—		35.3
Total Operating Revenues	$	1,438.8	$	430.8	$	0.2	$	1,869.8
⁽¹⁾ Customer revenue amounts exclude intersegment revenues. See Note 21, "Business Segment Information," for discussion of intersegment revenues.



	Three Months Ended
	March 31,
(in thousands)	2020	2019
Denominator
Basic average common shares outstanding	383,062	373,356
Dilutive potential common shares:
Shares contingently issuable under employee stock plans	845	1,062
Shares restricted under employee stock plans	207	133
Forward Agreements	—	105
Diluted Average Common Shares	384,114	374,656



				Quarter Ended March 31, 2020		Quarter Ended March 31, 2019	March 31, 2020		December 31, 2019
(in millions except shares and per share amounts)	Liquidation Preference Per Share		Shares	Dividends Declared Per Share			Outstanding
5.650% Series A	$	1,000.00	400,000	$	28.25	28.25	$	393.9	$	393.9
6.500% Series B	$	25,000.00	20,000	$	812.50	862.15	$	486.1	$	486.1



(in millions)
Company	Program	Incremental Revenue		Incremental Capital Investment	Investment Period	Filed	Status	Rates Effective
Columbia of Ohio	IRP - 2020	32.9		234.4	1/19-12/19	February 28, 2020	Approved April 22, 2020	May 2020
Columbia of Ohio	CEP - 2019	15.0		121.7	1/18-12/18	February 28, 2019	Approved August 28, 2019	September 2019
Columbia of Ohio	CEP - 2020	18.1		185.1	1/19-12/19	February 28, 2020	Order Expected August 2020	September 2020
NIPSCO - Gas	TDSIC 10⁽¹⁾	1.6		12.4	7/18-4/19	June 25, 2019	Approved October 16, 2019	November 2019
NIPSCO - Gas	TDSIC 11⁽²⁾	(1.7	)	38.7	5/19-12/19	February 25, 2020	Order Expected June 2020	July 2020
NIPSCO - Gas	FMCA 3⁽³⁾	0.3		43.0	4/19-9/19	November 26, 2019	Approved March 31, 2020	April 2020
Columbia of Massachusetts	GSEP - 2020⁽³⁾⁽⁴⁾	0.9		37.5	1/20-12/20	October 31, 2019	Approved April 30, 2020	May 2020
Columbia of Virginia	SAVE - 2020	3.8		50.0	1/20-12/20	August 15, 2019	Approved December 6, 2019	January 2020
Columbia of Kentucky	SMRP - 2020	4.2		40.4	1/20-12/20	October 15, 2019	Approved December 20, 2019	January 2020
Columbia of Maryland	STRIDE - 2020	1.3		15.0	1/20-12/20	January 29, 2020	Approved February 19, 2020	February 2020
NIPSCO - Electric	TDSIC - 6	28.1		131.1	12/18-6/19	August 21, 2019	Approved December 18, 2019	January 2020
NIPSCO - Electric	FMCA - 12⁽³⁾	1.6		4.7	3/19-8/19	October 18, 2019	Approved January 29, 2020	February 2020
NIPSCO - Electric	FMCA - 13⁽³⁾⁽⁵⁾	(1.2	)	—	9/19-2/20	April 15, 2020	Order Expected July 2020	August 2020
Columbia of Pennsylvania	DSIC 2020	0.9		28.2	12/19-2/20	April 27, 2020	Approved May 4, 2020	May 2020



Recurring Fair Value Measurements March 31, 2020 (in millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Balance as of March 31, 2020
Assets
Risk management assets	$	—	$	28.2	$	—	$	28.2
Available-for-sale debt securities	—		144.6		—		144.6
Total	$	—	$	172.8	$	—	$	172.8
Liabilities
Risk management liabilities	$	—	$	326.6	$	—	$	326.6
Total	$	—	$	326.6	$	—	$	326.6



Recurring Fair Value Measurements December 31, 2019 (in millions)	Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)		Balance as of December 31, 2019
Assets
Risk management assets	$	—	$	4.4	$	—	$	4.4
Available-for-sale debt securities	—		154.2		—		154.2
Total	$	—	$	158.6	$	—	$	158.6
Liabilities
Risk management liabilities	$	—	$	146.6	$	—	$	146.6
Total	$	—	$	146.6	$	—	$	146.6



March 31, 2020 (in millions)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses⁽¹⁾			Allowance for Credit Losses			Fair Value
Available-for-sale debt securities
U.S. Treasury debt securities	$	26.7	$	0.7	$	—		$	—		$	27.4
Corporate/Other debt securities	121.7		2.2		(5.5		)	(1.2		)	117.2
Total	$	148.4	$	2.9	$	(5.5	)	$	(1.2	)	$	144.6

December 31, 2019 (in millions)	Amortized Cost		Gross Unrealized Gains		Gross Unrealized Losses⁽²⁾			Allowance for Credit Losses			Fair Value
Available-for-sale debt securities
U.S. Treasury debt securities	$	31.4	$	0.1	$	(0.1	)	$	—		$	31.4
Corporate/Other debt securities	118.7		4.2		(0.1		)	—			122.8
Total	$	150.1	$	4.3	$	(0.2	)	$	—		$	154.2



(in millions)	Carrying Amount as of March 31, 2020		Estimated Fair Value as of March 31, 2020		Carrying Amount as of Dec. 31, 2019		Estimated Fair Value as of Dec. 31, 2019
Long-term debt (including current portion)	$	7,825.8	$	8,381.1	$	7,869.6	$	8,764.4



	Pension Benefits						Other Postretirement Benefits
Three Months Ended March 31, (in millions)	2020			2019			2020			2019
Components of Net Periodic Benefit Cost⁽¹⁾
Service cost	$	8.0		$	7.3		$	1.6		$	1.3
Interest cost	13.5			18.2			3.9			4.8
Expected return on assets	(28.4		)	(27.2		)	(3.6		)	(3.3		)
Amortization of prior service credit	0.2			—			(0.5		)	(0.8		)
Recognized actuarial loss	8.7			11.4			1.3			0.5
Total Net Periodic Benefit Cost	$	2.0		$	9.7		$	2.7		$	2.5



	Total Costs Incurred through			Costs Incurred during the Three Months Ended
(in millions)	December 31, 2019			March 31, 2020		Incident to Date
Third-party claims	$	1,041		$	—	$	1,041
Other incident-related costs	420			9		429
Total	1,461			9		1,470
Insurance recoveries recorded	(800		)	—		(800		)
Total costs incurred	$	661		$	9	$	670



(in millions)	Gains and Losses on Securities⁽¹⁾			Gains and Losses on Cash Flow Hedges⁽¹⁾			Pension and OPEB Items⁽¹⁾			Accumulated Other Comprehensive Loss⁽¹⁾
Balance as of January 1, 2020	$	3.3		$	(77.2	)	$	(18.7	)	$	(92.6	)
Other comprehensive income (loss) before reclassifications	(5.2		)	(133.3		)	0.4			(138.1		)
Amounts reclassified from accumulated other comprehensive income (loss)	(0.2		)	—			0.3			0.1
Net current-period other comprehensive income (loss)	(5.4		)	(133.3		)	0.7			(138.0		)
Balance as of March 31, 2020	$	(2.1	)	$	(210.5	)	$	(18.0	)	$	(230.6	)



Index	Page
Executive Summary	39
Summary of Consolidated Financial Results	42
Results and Discussion of Segment Operations	44
Gas Distribution Operations	45
Electric Operations	48
Liquidity and Capital Resources	51
Off Balance Sheet Arrangements	53
Market Risk Disclosures	53
Other Information	53


•	A potential reduction in labor availability and productivity due to the health impact COVID-19 could have on our employees and contractors.


•	An anticipated increase in bad debt and a decrease in cash flows resulting from the suspension of shutoffs and the potential inability of our customers to pay for their gas and electric service due to job loss or other factors, partially offset by any potential regulatory recovery.


•	An expected decline in revenue due to higher customer attrition rates, as well as lower revenue growth if customer additions slow due to a prolonged economic downturn.


•	An anticipated decline in revenue due to the suspension of late payment charges. The impact of suspending late payment charges was not material in the first quarter.


•	An anticipated delay in cash flows as customers utilize the more flexible payment plans.


•	A potential increase in cost of materials, supplies and contract services. The incremental costs related to the safety measures described above were not material in the first quarter. While we continue to incur costs for those safety measures, the impact of these costs is dependent upon the extent and duration of the pandemic.


•	An anticipated increase in internal labor costs from sequestrations and higher future overtime costs.