XML 101 R11.htm IDEA: XBRL DOCUMENT v2.4.0.6
Segment Information
 12 Months Ended
Dec. 31, 2012
Segment Reporting [Abstract]  
Segment Information
Segment Information
The following segment presentation is based on the methodology that management uses for making operating decisions and assessing performance of its various business activities. A reconciliation of the segment presentation to the GAAP financial statements is provided.
PNM
PNM includes the retail electric utility operations of PNM that are subject to traditional rate regulation by the NMPRC. PNM provides integrated electricity services that include the generation, transmission, and distribution of electricity for retail electric customers in New Mexico. PNM also includes the generation and sale of electricity into the wholesale market, as well as providing transmission services to third parties. The sale of electricity includes the asset optimization of PNM’s jurisdictional assets as well as the capacity excluded from retail rates. FERC has jurisdiction over wholesale and transmission rates.
TNMP
TNMP is an electric utility providing regulated transmission and distribution services in Texas under the TECA. TNMP’s operations are subject to traditional rate regulation by the PUCT.
First Choice
First Choice, which was sold by PNMR on November 1, 2011 (Note 2), operated as a certified retail electric provider in Texas. First Choice provided electricity to residential, small commercial, and governmental customers. Although First Choice was regulated in certain respects by the PUCT, it was not subject to traditional rate regulation.
Optim Energy
Optim Energy was considered a separate segment for PNMR. PNMR’s investment in Optim Energy was held in the Corporate and Other segment Optim Energy’s revenues and expenses are not included in PNMR’s consolidated revenues and expenses or the following tables. See Note 21.
Corporate and Other
The Corporate and Other segment includes PNMR holding company activities, primarily related to corporate level debt and PNMR Services Company.

The following tables present summarized financial information for PNMR by segment. PNM and TNMP each operate in only one segment. Therefore, tabular segment information is not presented for PNM and TNMP.
PNMR SEGMENT INFORMATION
 
2012
PNM
 
TNMP
 
Corporate
and Other
 
Consolidated
 
(In thousands)
Electric operating revenues
$
1,092,264

 
$
250,140

 
$
(1
)
 
$
1,342,403

Cost of energy
353,649

 
46,201

 
—

 
399,850

Margin
738,615

 
203,939

 
(1
)
 
942,553

Other operating expenses
435,442

 
87,079

 
(17,862
)
 
504,659

Depreciation and amortization
97,291

 
49,340

 
17,542

 
164,173

Operating income
205,882

 
67,520

 
319

 
273,721

Interest income
13,243

 
1

 
(172
)
 
13,072

Gain on sale of First Choice
—

 
—

 
1,012

 
1,012

Other income (deductions)
13,290

 
2,739

 
(7,954
)
 
8,075

Net interest charges
(76,101
)
 
(28,161
)
 
(16,583
)
 
(120,845
)
Earnings (loss) before income taxes
156,314

 
42,099

 
(23,378
)
 
175,035

Income taxes
50,713

 
15,352

 
(11,155
)
 
54,910

Earnings (loss) from continuing operations
105,601

 
26,747

 
(12,223
)
 
120,125

Valencia non-controlling interest
(14,050
)
 
—

 
—

 
(14,050
)
Subsidiary preferred stock dividends
(528
)
 
—

 
—

 
(528
)
Segment earnings (loss) from continuing operations attributable to PNMR
$
91,023

 
$
26,747

 
$
(12,223
)
 
$
105,547

Gross property additions
$
196,800

 
$
92,973

 
$
19,136

 
$
308,909

At December 31, 2012:
 
 
 
 
 
 
 
Total Assets
$
4,163,907

 
$
1,086,229

 
$
122,447

 
$
5,372,583

Goodwill
$
51,632

 
$
226,665

 
$
—

 
$
278,297

Additions to utility plant and non-utility plant included in accounts payable
$
7,083

 
$
1,987

 
$
6,602

 
$
15,672

2011
PNM
 
TNMP
 
First
Choice
 
Corporate
and Other
 
Consolidated
 
 
 
 
 
(In thousands)
 
 
 
 
Operating revenues
$
1,057,289

 
$
204,045

 
$
439,450

 
$
(165
)
 
$
1,700,619

Intersegment revenues
—

 
33,813

 
—

 
(33,813
)
 
—

Total revenues
1,057,289

 
237,858

 
439,450

 
(33,978
)
 
1,700,619

Cost of energy
362,237

 
41,166

 
323,331

 
(33,812
)
 
692,922

Margin
695,052

 
196,692

 
116,119

 
(166
)
 
1,007,697

Other operating expenses
438,822

 
88,234

 
75,966

 
(9,671
)
 
593,351

Depreciation and amortization
94,787

 
44,616

 
1,098

 
16,546

 
157,047

Operating income (loss)
161,443

 
63,842

 
39,055

 
(7,041
)
 
257,299

Interest income
15,562

 
2

 
64

 
(113
)
 
15,515

Gain on sale of First Choice
—

 
—

 
—

 
174,925

 
174,925

Other income (deductions)
4,309

 
1,580

 
(650
)
 
(15,660
)
 
(10,421
)
Net interest charges
(75,349
)
 
(29,286
)
 
(581
)
 
(19,633
)
 
(124,849
)
Earnings (loss) before income taxes
105,965

 
36,138

 
37,888

 
132,478

 
312,469

Income taxes (benefit)
37,427

 
13,881

 
13,772

 
56,455

 
121,535

Earnings (loss) from continuing operations
68,538

 
22,257

 
24,116

 
76,023

 
190,934

Valencia non-controlling interest
(14,047
)
 
—

 
—

 
—

 
(14,047
)
Subsidiary preferred stock dividends
(528
)
 
—

 
—

 
—

 
(528
)
Segment earnings (loss) from continuing operations attributable to PNMR
$
53,963

 
$
22,257

 
$
24,116

 
$
76,023

 
$
176,359

Gross property additions
$
251,345

 
$
67,407

 
$
2,089

 
$
6,090

 
$
326,931

At December 31, 2011:
 
 
 
 
 
 
 
 
 
Total Assets
$
4,095,287

 
$
1,037,445

 
$
—

 
$
71,881

 
$
5,204,613

Goodwill
$
51,632

 
$
226,665

 
$
—

 
$
—

 
$
278,297

Additions to utility plant and non-utility plant included in accounts payable
$
26,815

 
$
4,736

 
$
—

 
$
2,104

 
$
33,655


2010
PNM
 
TNMP
 
First
Choice
 
Corporate
and Other
 
Consolidated
 
 
 
 
 
(In thousands)
 
 
 
 
Operating revenues
$
1,017,128

 
$
173,504

 
$
483,203

 
$
(318
)
 
$
1,673,517

Intersegment revenues
—

 
39,084

 
—

 
(39,084
)
 
—

Total revenues
1,017,128

 
212,588

 
483,203

 
(39,402
)
 
1,673,517

Cost of energy
352,270

 
37,064

 
350,476

 
(39,083
)
 
700,727

Margin
664,858

 
175,524

 
132,727

 
(319
)
 
972,790

Other operating expenses
424,455

 
77,387

 
92,077

 
(12,285
)
 
581,634

Depreciation and amortization
92,281

 
41,726

 
864

 
16,833

 
151,704

Operating income (loss)
148,122

 
56,411

 
39,786

 
(4,867
)
 
239,452

Interest income
18,854

 
1

 
18

 
23

 
18,896

Equity in net earnings (loss) of Optim Energy
—

 
—

 
—

 
(203,399
)
 
(203,399
)
Other income (deductions)
12,712

 
771

 
(411
)
 
(6,027
)
 
7,045

Net interest charges
(72,400
)
 
(31,157
)
 
(1,268
)
 
(20,548
)
 
(125,373
)
Earnings (loss) before income taxes
107,288

 
26,026

 
38,125

 
(234,818
)
 
(63,379
)
Income taxes (benefit)
36,427

 
10,044

 
14,064

 
(92,790
)
 
(32,255
)
Earnings (loss) from continuing operations
70,861

 
15,982

 
24,061

 
(142,028
)
 
(31,124
)
Valencia non-controlling interest
(13,563
)
 
—

 
—

 
—

 
(13,563
)
Subsidiary preferred stock dividends
(528
)
 
—

 
—

 
—

 
(528
)
Segment earnings (loss) from continuing operations attributable to PNMR
$
56,770

 
$
15,982

 
$
24,061

 
$
(142,028
)
 
$
(45,215
)
Gross property additions
$
226,766

 
$
41,018

 
$
3,046

 
$
10,658

 
$
281,488

At December 31, 2010:
 
 
 
 
 
 
 
 
 
Total Assets
$
3,875,573

 
$
1,010,957

 
$
218,411

 
$
120,142

 
$
5,225,083

Goodwill
$
51,632

 
$
226,665

 
$
43,013

 
$
—

 
$
321,310

Major Customers
No individual customer accounted for more than 10% of the operating revenues of PNMR or PNM. The acquirer of First Choice, including the former First Choice operations, accounted for 19% of TNMP's revenues in 2012. Two other unaffiliated customers of TNMP accounted for operating revenues of 17% in 2012, 19% in 2011, and 19% in 2010 and 10% in 2012, 12% in 2011, and 13% in 2010. First Choice accounted for operating revenues of 17% in 2011 and 18% in 2010.