• Priorities & commitments of ongoing business review are unchanged including commitment to current dividend
• Fully regulated Coastal Virginia Offshore Wind (CVOW) project on time and on budget; company in advanced stages of process to assume a noncontrolling equity financing partner – final strategic step outstanding in business review
• Company to conclude review upon completion of CVOW partnership decision; expected by year-end 2023 or early 2024
• Cove Point and gas utilities accounted for as discontinued operations; removed from operating earnings
• Third-quarter 2023 GAAP net income of $0.17 per share; operating earnings (non-GAAP) of $0.77 per share
• Company initiates fourth-quarter 2023 operating earnings (non-GAAP) guidance of $0.35 per share

RICHMOND, Va., Nov. 3, 2023 /PRNewswire/ -- Dominion Energy, Inc. (NYSE: D), today provided an update on its comprehensive business review and announced third-quarter 2023 earnings.

Business review update
Chair, President, and Chief Executive Officer Robert M. Blue, said:

"We have made significant progress in our business review, which is focused on repositioning the company to create maximum long-term value for shareholders, employees, customers, and other stakeholders. Our guiding priorities and commitments are unchanged, and we are rapidly nearing a comprehensive review conclusion.

"In the past 12 months, we have (1) enhanced the durability of our Virginia regulatory model, (2) committed to our current dividend, (3) committed to and improved earnings quality, (4) announced asset sales that will significantly strengthen our credit metrics, (5) continued our disciplined approach to O&M cost control, and (6) followed best practices related to executive compensation and board refreshment to maintain strong corporate governance, all while providing the reliable, affordable, and increasingly clean energy that powers our customers every day.

"Our fully regulated offshore wind project is on time and on budget and is expected to save customers more than $3 billion in fuel costs over the first 10 years of operation, while creating hundreds of jobs and millions of dollars of local economic benefit.

"We are in the advanced stages of a process to identify a noncontrolling equity financing partner in the project. The process has driven considerable interest from attractive and high-quality potential counterparties. A properly structured partnership with the right counterparty is an attractive option, but only if the terms of a potential transaction make sense for our customers and shareholders.

"We will conclude the business review when we have made a final decision regarding whether to bring on an offshore wind project partner. This is the final strategic step outstanding in the business review and it is in the long-term best interests of our customers and shareholders that we make the right, not just the expedient, decision. We expect a decision by year-end 2023 or in early 2024.

"As we near the review's conclusion, I am more confident than I have ever been about the future of Dominion Energy. We have always had great assets, operated at best-in-class levels by an industry-leading workforce of dedicated employees. Upon completion of the review, we expect to host an investor meeting to discuss the company's repositioned strategic and financial outlook. We expect to have a solid long-term financial foundation that matches the remarkable quality of our assets and people."

Third-quarter 2023 financial results
The company reported unaudited net income determined in accordance with Generally Accepted Accounting Principles (GAAP, or reported earnings) for the three months ended Sept. 30, 2023, of $163 million ($0.17 per share) compared with net income of $778 million ($0.91 per share) for the same period in 2022.

Operating earnings (non-GAAP) for the three months ended Sept. 30, 2023, were $667 million ($0.77 per share), compared to operating earnings of $847 million ($0.99 per share) for the same period in 2022.

Differences between GAAP and operating earnings for the period include a net gain from discontinued operations associated with the sale of remaining noncontrolling interest in Cove Point and gas distribution operations, deferred taxes associated with the sale of gas distribution operations, the gains and losses on nuclear decommissioning trust funds, mark-to-market impact of economic hedging activities, and other adjustments. Details of operating earnings as compared to prior periods, business segment results and detailed descriptions of items included in reported earnings but excluded from operating earnings can be found on Schedules 1, 2, 3 and 4 of this release.

Guidance
Dominion Energy expects fourth-quarter operating earnings of approximately $0.35 per share based on normal weather in its utility service areas.

Additional Information
As previously reported on Sept. 5, 2023, Dominion Energy announced agreements to sell its gas distribution companies to Enbridge (TSX: ENB) (NYSE: ENB). In addition, Dominion Energy completed the sale in September 2023 of its remaining 50% noncontrolling partnership interest in Cove Point to Berkshire Hathaway Energy under the agreement entered in July 2023. These operations have been reclassified as discontinued operations and held for sale in Dominion Energy's GAAP reporting and excluded from operating earnings. Subsequently in September 2023, Dominion Energy revised its primary operating segments, and its renewable natural gas businesses will be reported in Contracted Energy, formerly the Contracted Assets operating segment. Dominion Energy's GAAP reporting and operating earnings have been recast to reflect these changes in presentation, which excludes any potential impact from the use of expected sales proceeds.

Business review investor event
Dominion Energy expects to host an investor event upon conclusion of the company's business review to discuss the Company's repositioned strategic and financial outlook. During the investor event, management will review Dominion Energy's overall strategy, provide comprehensive and multi-year financial and capital investment guidance, and participate in Q&A.

Webcast today
The company will host its third-quarter 2023 earnings call at 10 a.m. ET on Friday, Nov. 3, 2023. Management will discuss matters of interest to financial and other stakeholders including recent financial results.

A live webcast of the conference call, including accompanying slides and other financial information, will be available on the investor information pages at investors.dominionenergy.com.

For individuals who prefer to join via telephone, domestic callers should dial 1-800-343-1703 and international callers should dial 1-785-424-1226. The passcode for the telephonic earnings call is 80455. Participants should dial in 10 to 15 minutes prior to the scheduled start time.

A replay of the webcast will be available on the investor information pages by the end of the day Nov. 3. A telephonic replay of the earnings call will be available beginning at about 1 p.m. ET on Nov. 3. Domestic callers may access the recording by dialing 1-800-839-5493. International callers should dial 1-402-220-2552. The PIN for the replay is 80455.

Important note to investors regarding operating, reported earnings
Dominion Energy uses operating earnings (non-GAAP) as the primary performance measurement of its earnings guidance and results for public communications with analysts and investors. Operating earnings are defined as reported earnings adjusted for certain items. Dominion Energy also uses operating earnings internally for budgeting, for reporting to the board of directors, for the company's incentive compensation plans, and for its targeted dividend payouts and other purposes. Dominion Energy management believes operating earnings provide a more meaningful representation of the company's fundamental earnings power.

In providing its operating earnings guidance, the company notes that there could be differences between expected reported earnings and estimated operating earnings for matters such as, but not limited to, the mark-to-market impact of economic hedging activities, gains and losses on nuclear decommissioning trust funds, acquisitions, divestitures, or extreme weather events and other natural disasters. Dominion Energy management is not able to estimate the aggregate impact of these items on future period reported earnings.

About Dominion Energy
About 7 million customers in 15 states energize their homes and businesses with electricity or natural gas from Dominion Energy (NYSE: D), headquartered in Richmond, Va. The company is committed to providing reliable, affordable, and increasingly clean energy every day and to achieving Net Zero emissions by 2050. Please visit DominionEnergy.com to learn more.

This release contains certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including forecasted operating earnings for the fourth-quarter 2023 that are subject to various risks and uncertainties. Factors that could cause actual results to differ include, but are not limited to: the direct and indirect impacts of implementing recommendations resulting from the business review announced in November 2022; unusual weather conditions and their effect on energy sales to customers and energy commodity prices; extreme weather events and other natural disasters; extraordinary external events, such as the current pandemic health event resulting from COVID-19; federal, state and local legislative and regulatory developments; changes to regulated rates collected by Dominion Energy; timing and receipt of regulatory approvals necessary for planned construction or expansion projects and compliance with conditions associated with such regulatory approvals; the inability to complete planned construction projects within time frames initially anticipated; risks and uncertainties that may impact the ability to develop and construct the Coastal Virginia Offshore Wind (CVOW) Commercial Project within the currently proposed timeline, or at all, and consistent with current cost estimates along with the ability to recover such costs from customers; changes to federal, state and local environmental laws and regulations, including those related to climate change; cost of environmental strategy and compliance, including cost related to climate change; changes in implementation and enforcement practices of regulators relating to environmental standards and litigation exposure for remedial activities; changes in operating, maintenance and construction costs; additional competition in Dominion Energy's industries; changes in demand for Dominion Energy's services; receipt of approvals for, and timing of, closing dates for acquisitions and divestitures; impacts of acquisitions, divestitures, transfers of assets by Dominion Energy to joint ventures, and retirements of assets based on asset portfolio reviews; the expected timing and likelihood of the completion of the proposed sales of The East Ohio Gas Company, Public Service Company of North Carolina, Incorporated, Questar Gas Company, and Wexpro Company, and their consolidated subsidiaries and related entities, as applicable, including the ability to obtain the requisite regulatory approvals and the terms and conditions of such approvals; adverse outcomes in litigation matters or regulatory proceedings; fluctuations in interest rates; the effectiveness to which existing economic hedging instruments mitigate fluctuations in currency exchange rates of the Euro and Danish Krone associated with certain fixed price contracts for the major offshore construction and equipment components of the CVOW Commercial Project; changes in rating agency requirements or credit ratings and their effect on availability and cost of capital; and capital market conditions, including the availability of credit and the ability to obtain financing on reasonable terms. Other risk factors are detailed from time to time in Dominion Energy's quarterly reports on Form 10-Q and most recent annual report on Form 10-K filed with the U.S. Securities and Exchange Commission.

Schedule 2 - Reconciliation of 2023 Reported Earnings to Operating Earnings
2023 Earnings (Nine Months Ended September 30, 2023)

The $1.7 billion pre-tax net income of the adjustments included in 2023 reported earnings, but excluded from operating earnings, is primarily related to the following items:

• $1.2 billion of net benefit from discontinued operations, primarily related to $722 million associated with the sale of the remaining noncontrolling interest in Cove Point (including $626 million net gain on sale), and $519 million associated with the gas distribution operations expected to be sold to Enbridge.
• $800 million net market benefit primarily associated with $183 million from nuclear decommissioning trusts (NDT) and $617 million in economic hedging activities.
• $219 million of regulated asset retirements and other charges primarily associated with the settlement of Virginia Power's 2021 triennial review.

Schedule 3 - Reconciliation of 2022 Reported Earnings to Operating Earnings
2022 Earnings (Twelve months ended December 31, 2022)

The $2.2 billion pre-tax net loss of the adjustments included in 2022 reported earnings, but excluded from operating earnings, is primarily related to the following items:

• $1.2 billion of net benefit from discontinued operations, primarily related to $436 million associated with the sale of the remaining noncontrolling interest in Cove Point and $745 million associated with the gas distribution operations expected to be sold to Enbridge.
• $282 million net market loss associated with $559 million from nuclear decommissioning trusts offset by $277 million in economic hedging activities.
• $1.5 billion charge associated with the impairment of certain nonregulated solar generation facilities.
• $830 million of regulated asset retirements and other charges, including $404 million of charges for certain Virginia Power fuel and Regional Greenhouse Gas Initiative (RGGI) compliance costs deemed recovered through base rates, $243 million associated with the settlement of Virginia Power's 2021 triennial review and $167 million for dismantling costs associated with the early retirement of certain Virginia Power fossil-fuel generation facilities.
• $649 million loss associated with the sale of Kewaunee nuclear power station.
• $125 million of storm damage and restoration costs.

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SOURCE Dominion Energy