NiSource Inc (NI) 2009 Q4 法說會逐字稿

Good day, ladies and gentlemen, and welcome to the Q4 2009 NiSource earnings conference call. My name is Janita and I will be your operator for today. At this time, all participants are in a listen only mode. We will conduct a question and answer session towards the end of this conference.

(Operator Instructions). As a reminder, this conference is being recorded for replay purposes.

I would now like to turn the call over to your host for today, Glen Kettering, Senior Vice President of Corporate Affairs. Please proceed.

Thank you, and good morning. On behalf of NiSource, I'd like to welcome you to our quarterly analyst call. Joining me this morning are Bob Skaggs, President and Chief Executive Officer, Steve Smith, Executive Vice President and Chief Financial Officer, and Randy Hullen, Director of Investor Relations. As you know, the focus of today's call is to review our Fourth Quarter and year-end 2009 financial performance, share key accomplishments by our teams during 2009, and provide you with some insight on the upcoming year. We'll then open the call to your questions.

At times during the call we will refer to the supplemental slides available on our website at NiSource.com.

I'd like to remind all of you that some of the statements made on this call will be forward-looking statements within the meaning of the Safe Harbor Provisions of the U.S. Federal Securities laws. These forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially from those expressed in the forward-looking statements. Information concerning factors that could cause actual results to differ materially is included in the Management's Discussion and Analysis section of our Form 10-Q quarterly report for the third quarter of 2009, which was filed October 30, 2009 with the SEC. Our annual Form 10-K will be filed in late January. And now I'd like to turn the call over to Bob Skaggs.

Thanks, Glen. Good morning and thank you for joining us. We have several important matters to address this morning, after which we'll open the call to your questions. In my prepared remarks, I'll be addressing NiSource's fourth quarter and full year 2009 earnings, a number of highlights and key accomplishments across our businesses during 2009, and finally, our earnings outlook for 2010.

Let's start with NiSource's 2009 financial results which were solidly in line with our full-year operating earnings outlook of $1 to $1.10 per share. I'd add that year-over-year cash flows from operating activities increased by more than $1 billion and short-term borrowings at year-end 2009 were more than $1 billion lower than at year-end 2008. We'll touch more on our liquidity position in a few moments. Given the unprecedented dislocations in the financial markets and challenging economic environment across our markets, by virtually any measure, NiSource not only weathered the storm during 2009, we emerged as a stronger and more robust Company.

For 2009 we achieved non-GAAP net operating earnings of approximately $295 million or $1.07 per share. Operating earnings for the year were approximately $880 million. For the fourth quarter, our net operating earnings, again non-GAAP, were approximately $99 million or $0.35 per share. I'd submit that our team's ability to deliver on our financial commitments in the face of the great recession underscores the resilience of our core regulated businesses and is a testament to the team's disciplined execution.

In addition to aggressive cost management across all our business units during 2009, we increased net revenues in both our gas distribution and gas transmission and storage businesses. At NiSource Gas Distribution, net revenues, excluding regulatory trackers, increased about $70 million during 2009, primarily attributable to the team's extensive array of regulatory initiatives. In our gas transmission and storage unit, the team delivered approximately $56 million and increased net revenues excluding regulatory trackers, resulting from growth projects, short-term transportation and storage services and mineral rights leasing.

Increased pension expense, reduced electric industrial demand, and incremental interest expense. With respect to pension expense, we experienced an increase of $85 million over 2008 levels. This increase is net of the impact of the deferral of about $11 million in pension expense by Columbia Gas of Ohio, which we've discussed in prior earnings updates.

Although we saw a modest uptick in electric industrial demand in the fourth quarter, for the year, electric industrial demand was lower by 17% compared to 2008 levels. As for interest costs, they increased by about $24 million over 2008 , primarily resulting from the pre-funding of debt maturities under our liquidity plan. So to wrap up, despite a tough economic climate across our markets, the NiSource team delivered a strong earnings performance in 2009, one that we'll build on as we move forward in 2010.

Now, let me turn to our liquidity and refinancing activities. Throughout 2009, we emphasized that maintaining adequate liquidity and successfully managing upcoming debt maturities were key priorities. We outlined an aggressive and comprehensive liquidity plan and our business units and our finance team did an outstanding job of executing that plan. Capital expenditure levels were recalibrated. Operating expenses and working capital were managed aggressively, and we successfully completed approximately $2 billion in debt refinancing with a capstone being our $500 million long term debt issuance during the fourth quarter.

As a result of those efforts, we've now addressed our long-term financing needs through 2011 and we enter 2010 with a significantly stronger liquidity profile. As shown on the supplemental slides, NiSource closed 2009 with excess liquidity of more than $1 billion, and we expect to have excess liquidity of more than $500 million at year-end 2010. Plus you'll recall, that we have a $1.5 billion revolving credit facility that extends to July 2011. All of these activities were essential elements of NiSource's commitment to maintaining our investment-grade credit rating in a manner that also preserves shareholder value.

And on that front we are pleased when in December, Moody's acknowledged the significant progress the team has made over the course of the last few years by affirming NiSource's investment-grade credit rating and raising its outlook to stable. A few weeks later, Fitch affirmed its rating of BBB- with a stable outlook. We now have stable investment-grade ratings from each of the three rating agencies, and we're committed to maintaining and strengthening those ratings over time in a manner that also enhances shareholder value.

Now, let me turn to our business update, and look at how the team is delivering our balanced strategy for delivering long term sustainable growth. Our four part strategy continues to center on the expansion and commercial growth in our natural gas pipeline and storage business, regulatory and commercial initiatives at our utilities and the strong financial process and expense management across the Corporation.

First, let me turn to our gas distribution business where we continue to see strong results from our regulatory and infrastructure investment initiatives. During the fourth quarter, Bay State Gas Company received a favorable rate case order from the Massachusetts Department of Public Utilities, authorizing an increase in annual base revenues of approximately $19 million, or 3.7%. Also approved was a revenue decoupling mechanism, the first of its kind in Massachusetts, along with the tracking mechanism to recover costs associated with Bay State's infrastructure replacement program. Truly, a breakthrough effort by the Bay State team.

Columbia Gas Kentucky also received approval from the Kentucky Public Service Commission of the unanimous rate case settlement during 2009. The settlement provided for overall annual increase in revenues of approximately $6 million or 3.7%, while authorizing an increase to the monthly customer charge, the implementation of an accelerated main replacement program tracker, and the introduction of a residential energy efficiency program.

Also, Columbia Gas of Virginia received approval from the State Corporation Commission for its Conservation and Rate Making Efficiency or CARE plan for a three year period through 2012. The CARE plan, which became effective last month, establishes a decoupled rate mechanism, along with customer energy conservation incentives.

And late last week, Columbia Gas of Pennsylvania filed a base rate increase request with the Pennsylvania Public Utility Commission. That filing proposes new home energy efficiency programs and a more progressive rate design, along with an increase in base rates of $32 million annually that reflects our ongoing infrastructure replacement program. The case also reflects a tracker proposal in the event enabling legislation is enacted. New rates in Pennsylvania are expected in the fourth quarter of 2010.

And last but certainly not least as we indicated on prior calls, our northern Indiana utility, NIPSCO, plans to file a natural gas rate case, the Company's first since 1987 as early as March of this year, with new rates anticipated in late 2010.

From an earnings standpoint, our gas distribution businesses reported 2009 operating earnings of about $329 million, slightly above its $328 million in operating earnings for 2008. As I mentioned earlier, net revenues, excluding the impact of regulatory and tax trackers, increased about $70 million. Those gains include offsets from decreased customer usage and lower off system sales revenues.

Operating expenses, excluding trackers, were up about $69 million for the year reflecting higher employee and administrative costs depreciation costs and uncollectible accounts. The higher employee and administrative costs were primarily due to increases in pension expense of almost $32 million net of the Columbia Gas of Ohio deferral I mentioned earlier. Throughout 2009 our gas distribution teams continued to build on their excellent track record of execution. This ongoing progress is a testament to our commitment to building creative and collaborative regulatory solutions that benefit customers and ensure a safe and reliable distribution system.

Turning to our gas transmission and storage business, the team is continuing to make significant progress in maximizing the value of our strategically positioned pipeline and storage assets, with a particular focus on advancing projects that support the unprecedented supply growth taking place in the Marcellus Shale play in Appalachia. The NGT&S team is working closely with key natural gas producers, processors and other industry players to develop the infrastructure needed to bring Marcellus supplies to market.

By the close of the year, NGT&S was advancing more than $155 million of projects in the Marcellus Shale region, with the potential to provide an additional 700,000 decatherms per day of market access. And as we move forward in 2010, we'll be announcing additional expansion projects in the Marcellus area.

One of our key Marcellus projects in 2009 was the Appalachian Expansion Project which was placed into service in the second half of the year. The project leveraged our existing infrastructure to provide about 100,000 decatherms per day of new transportation service to three key Appalachian producers.

Another important Marcellus initiative launched by the NGT&S team in 2009 is the Majorsville project that's located in the southwestern Pennsylvania, West Virginia region, a Marcellus sweet spot. Over the next several years, this project will be providing gathering, processing, and transmission services to several leading Marcellus producers anchoring the project. NGT&S is partnering with Mark West Energy Partners, which is making significant investments to provide mid stream services for those Marcellus producers.

And yet another 2009 highlight was the Ohio Storage expansion project, which increased market area storage capacity by almost 7 billion cubic feet. Notably, NGT&S received FERC authorization for market-based rates for the project, the first time we've received such approval for our traditionally cost-based storage operations. With our strategic NGT&S footprint, our system capabilities, and our disciplined investment strategy, NiSource is capitalizing on the unprecedented producer investment in the Marcellus region as well as additional new storage and transportation business opportunities across our system.

From an earnings standpoint, gas transmission and storage reported operating earnings of $408.8 million in 2009, compared to $376.7 million in 2008. The increase resulted primarily from the $56 million in increased net revenues I mentioned earlier. Those revenues were primarily attributable to increases in firm capacity reservation fees from growth projects and new Appalachian supply contracts as well as increases in shorter term transportation and storage services and mineral rights leasing revenues.

Equity earnings were up $3.7 million, attributable to increased earnings from the Millennium Pipeline. Those increased earnings more than offset an $8.1 million reduction in equity earnings resulting from interest rate hedges related to Millennium's decision to delay permanent financing until 2010. Operating expenses increased by about $28 million excluding trackers due to higher capacity lease costs, employee and administrative costs, maintenance costs, and environmental expenses. In addition, 2008 operating expenses were favorably impacted by the reduction of legal reserves.

Now, let's turn to our Electric operations. As I noted earlier, our Northern Indiana Electric market has been under continuing pressure from the economic downturn. In face of those challenges, NIPSCO has nevertheless continued to make steady progress on its aggressive regulatory and business agenda. Notably, our operational efforts have been gaining traction. In particular, I'd note that NIPSCO's Electric generation reliability metrics improved significantly during 2009, and for the year, were above industry average levels.

Regulatory-wise, as you know throughout 2009 our NIPSCO teams continued to advance the Company's 2008 electric rate case. Parties to the case completed the briefing process last month, and the Indiana Utility Regulatory Commission, or IURC, is expected to issue an order in the case during the first half of this year. And as previously announced, NIPSCO intends to file a subsequent electric base rate case during 2010. The filing will reflect the effect of increased pension expense as well as demand levels based on more recent market conditions. New rates from this case are expected to be effective in 2011.

From an earnings standpoint, electric operations reported operating earnings of about $162 million for 2009 compared to about $220 million in 2008. Lower net revenues and higher operating expenses both contributed to the lower operating earnings. Excluding regulatory trackers, net revenues, as mentioned previously, decreased by $17 million, primarily as a result of lower industrial usage, off system sales, emission allowance sales and Sugar Creek revenues. These revenue decreases were partially offset by lower non-recoverable purchase power costs.

Operating expenses increased by $40.7 million, excluding trackers, due primarily to higher pension expense of $42.6 million. Although 2009 was a challenging year for NIPSCO, as we look forward to 2010 and beyond, I'm convinced we have a solid regulatory and business plan to restore NIPSCO's earnings base and position it for sustainable long-term growth. Executing on that plan is a key priority for NiSource this year.

Interest expense, as I noted earlier, increased by about $24 million, primarily due to the issuance of $700 million of long-term debt in May of 2008, $600 million of long-term debt in March of 2009 and a $385 million two-year term loan issued in April of 2009.

Those increases were partially offset by our $100 million open market debt repurchase in January, our $250 million tender offer debt repurchase in April, and by lower short-term interest rates. Our effective tax rate was 38.6%, compared to 35.8% for the same period in 2008. The 2009 tax rate is higher due to deferred income tax adjustments, related primarily to State income tax apportionment changes and an increase in tax expense related to AFUDC equity.

On a GAAP basis, NiSource reported income from continuing operations for 2009 of $231.2 million or $0.84 per share, compared with $370.6 million or $1.35 per share in 2008. Operating income was $801.9 million for 2009, versus $918.7 million in the year-ago period. Schedules one and two to our earnings release list items included in GAAP income from continuing operations, but excluded from net operating earnings for NiSource and each of the segments reported today. As you'll see, weather adjustments and restructuring costs at our NGT&S operations are the primary reconciling items.

Turning to our 2010 earnings outlook, as noted in this morning's release, we expect to deliver sustainable earnings growth of 3% to 5% on a long-term basis, driven by our core strategy of synchronizing ongoing infrastructure investments with appropriate regulatory and commercial activities. If you refer to the key marker slide included in our supplemental materials, you'll see the key points of execution for our companies over the course of 2010. In general, we'll be focusing on three areas. First, advancing growth projects in our gas transmission and storage business; second, executing on our infrastructure replacement programs and related regulatory initiatives at our gas distribution unit; and third, completing the NIPSCO repositioning process. In terms of financial performance for 2010, we're projecting non-GAAP net operating earnings to be within a range of $1.10 to $1.20 per share.

Some of the key drivers for our outlook are reflected in the first slide of the supplemental materials. Among other things you'll note that the outlook assumes a gradual and modest pace of economic recovery across the markets we serve, building on the trend we experienced during the latter half of 2009.

I also note that thanks to the successful execution of our liquidity plan during 2009 and our deep inventory of revenue producing investment opportunities, we're increasing our capital expenditure level to $900 million in 2010. That's about $100 million increase over the 2009 level, but below the $1.3 billion plus level of 2008 which you'll recall included our $330 million purchase of the Sugar Creek gas fired generating plant in Indiana.

We're certainly pleased that we're in a position to begin increasing our capital investment program this year; however, as I've mentioned in the past, I believe that the optimal CapEx level for NiSource is about $1 billion annually given the array of attractive investments available to our business. To achieve that investment level on a sustainable basis as well as maintain our dividend and our commitment to our investment-grade credit rating will require continued execution of our business plan and ongoing strengthening of our balance sheet.

To wrap up, NiSource's overall business and financial performance remains squarely in line with our business plan and although we have much more to accomplish, our teams continue to demonstrate their commitment and ability to execute on that plan. The landscape we face today is much more stable and less treacherous than the one we encountered a year ago. That said, 2010 will undoubtedly present its share of challenges. As we confront those challenges and continue the work of building and growing NiSource, I'm convinced that we do so as a stronger Company, one with a business plan that's compelling, balanced and tested.

As always, we remain committed to communicating with our investors in a transparent and timely manner regarding these and all of our efforts. Ongoing updates will be provided through our Analyst calls and news releases posted on NiSource.com. Thank you for participating today, and for your continued interest and support of NiSource. At this point, I'd like to open the call to

(Operator Instructions). Your first question comes from the line of Paul Ridzon with KeyBanc. Please proceed.

Good morning Bob, how are you?

Hi, Paul, we're doing good. And you?

Fine, thanks, congratulations on a solid quarter. Just you talked about a $1 billion of optimal CapEx. Where do you see the trajectory as to when you could get there again?

Well, Paul, we're going to be measured. Certainly we believe that we have a pipeline of promising opportunities at all of the business units but to begin stepping towards $1 billion we're going to have to do it on a measured base. We're going to have to ensure that the investments are worthy investments; they are going to have to meet the test of being accretive. They are going to have to meet the test of being treated favorably in the regulatory environment. And we're going to have to have the balance sheet to support those sorts of investments. So again we're going to do it on a measured basis; we're going to do it mindful of our commitment to the dividend, mindful of our commitment to investment grade and mindful that we want to insure that we create shareholder value. So again it's going to be on a measured basis.

And then your 3% to 5% EPS growth, it seems like a bit of a deviation from prior language of look for flattish for the next few years. Is that 3% to 5% going to be lumpy at all or can we just think more or less kind of smooth 3% to 5%?

Yes, the goal is smooth 3% to 5%. And again we believe we put in place the regulatory and commercial pillars to support that.

And then what's your outlook for when in 2011 you could possibly get new Indiana Electric rates?

Yes, Paul, assuming we file the Electric rate case mid year 2010, we certainly believe the case is going to take 12 months. It could possibly take 18 months. Hopefully it's going to go at a faster clip than the current case. But I would say 12 to 18 months is when we expect an outcome.

And then on your GAAP reconciliation there's some reference to non-regulated marketing. Can you just give some background as to what that is?

Hi, Paul, this is Steve. That is the dollars associated with our unregulated marketing subsidiary that we're moving out of.

Okay, so it's kind of discontinued ops?

Yes, more or less.

Okay, thank you very much.

Yes, thanks, Paul.

And your next question comes from the line of Natalie Burkhart with Allstate. Please proceed.

Good morning, Natalie.

Hi, how are you doing?

Doing good.

I have a couple questions. Have you begun negotiations with the banks to extend out the revolver yet?

Hi, Natalie, this is Steve, how are you?

Good, how are you doing?

Fine, thanks. We are very happy with our revolver; as you know it doesn't expire until July of 2011, so we haven't officially started talking to the banks that are in that facility but we are mindful of any opportunities that might present themselves between now and then to work with them and perhaps extending that prior to the actual expiration date.

But do you feel like there shouldn't be too many issues to be able to keep the facility at the size you have it at right now?

Well I think as the market moves forward month after month we've seen the credit market get stronger and it appears as though rolling over a working capital facility shouldn't be too challenging. The question is do you need the full $1.5 billion or not and we're in the process of working through the analysis there to just make sure that the facility is the right size for our needs going forward.

Okay, and then on the balance sheet you have the current maturities of -- column of 700 for the November notes. And then with the December issuance -- I just want to make sure this is right that because the revolver is down close to $1 billion from last year that you basically use the December proceeds to keep the balance low on the revolver?

That's right. That's exactly right, Natalie. We basically took all of the spare liquidity we had generated through the balance of 2009 and paid down the revolver and you'll see in the 2009 balance sheet we were only carrying a borrowed position of around $100 million, so we paid off a significant amount of what was outstanding on that revolver.

And that cash typically comes back in in like second quarter?

Yes, I mean it flows in over the course of the year. Our biggest quarters from an earnings perspective are the first quarter and the fourth quarter, so we'll start to see dollars flow in as a result of people burning gas in the winter and getting bills and paying those bills here in the first and second quarter.

Okay, and just last question, if you can kind of just comment on industrial in the fourth quarter and then what trends you saw, just again in this kind of maybe put this into perspective with just looking at what happened in Florida and the rate case there, there's the concern that for them clearly the issues with the rate cases down in Florida were based on a challenging economy down there and we know that northern Indiana is not quite doing well, so if you can kind of just talk about the trends in industrial and how you see that potentially if anything has changed at all that could negatively impact the rate case if we're still waiting on that.

Yes, I would just say on the industrial side, we have just seen a very, very modest uptick during the fourth quarter particularly in northwest Indiana and speaking to the steel and steel related loads, just a very marginal improvement, fourth quarter over third quarter. And as I mentioned the outlook assumes just very, very modest recovery, so we just don't see a lot yet, Natalie.

Some of the key indicators in the steel industry would suggest improvement but again we haven't seen that. And a couple of the indicators I would cite were lower inventories, some firming of pricing, that sort of thing, but again we just haven't seen it translate into a significant upward movement in demand.

How that might impact the regulatory process, at this point, the record is closed on the first case in Indiana. We know that the Commission will deliberate very carefully and do their diligence on the record but we believe that the Commission will proceed based on the record that we presented to them. I would observe from afar, and this is very much from afar, that the process in Florida has been politicized to a great extent. Again we believe that the Indiana Commission is balanced, measured and they will make a reasoned decision based on the record.

Okay, thanks so much.

Thank you.

Your next question comes from the line of Jay Dobson, please proceed.

Good morning.

Hi, Jay.

A quick question or a couple actually. First on the NGTS business, Bob, in your comments you mentioned that you were I think ending the year at something like $155 million or so of CapEx going into 2010 and then you mentioned additional projects. Should we interpret that as some upward bias to the $300 million you're showing as CapEx for the NGTS business on slide seven?

Well, number one, the $155 million I mentioned were Marcellus related projects that are in process, so some of those dollars were being spent last year, some of those dollars continue on and clearly the intent was to show you we are very active in the Marcellus region and we expect to be, and again I mentioned that we will be announcing additional Marcellus projects as the year unfolds. At the moment, we see the $300 million as being good for 2010. Clearly though it's a competitive business, projects do surface, opportunities do arise that could move that number up. But it's very situational and again we'll be disciplined and thoughtful when we look at those opportunities.

Got you, but so I completely understand those additional projects you're talking about, some of them have a placeholder in there so we shouldn't assume you announce a new project that necessarily 300 goes up, there may be some place holders in there that's situational around what the exact dollars may be?

That's accurate.

Okay, great. And as you're thinking about all of those projects I know on the last call you mentioned that I think to use the term you did, the MLP was off the table temporarily as a result of valuations. We've seen those valuations snap back as you look at the Marcellus and the opportunities up there for the NGTS business. Your current thinking on MLP?

Yes, we clearly are observing the recovery of that market. Clearly, we've noted what Williams has done, so we continue to look at that as a potential tool. It might augment, supplement, enhance some of the things that we're doing. We haven't made a decision to go in that direction yet. We'll continue to watch it very carefully and insure that we do the right thing.

How would you have us think about that opportunity? Is that driven by increasing opportunities in Marcellus or NGTS that we would have to see $300 million start to go up further, that would drive your decision on the MLP, or is it simply just the economics of the market around MLPs and the like?

Yes, I think it's a broad set of considerations. I think frankly though the last point you mentioned is probably one of the key points but there are many, many other points. Again, I've talked about our commitment to enhance shareholder value but also the commitment to improve the balance sheet. Clearly, MLPs impact those commitments differently, and there's certainly also an element of governance that's involved. So a broad array of considerations, I think probably the last one you mentioned, the cost of capital, the ease of financing, those are points that weigh heavily.

Perfect. And then two other questions, first on your slide three, the walk across 2009 to 2010. You have a $0.05 negative of other. I didn't know if there was some granularity in there; I'm sure there's a bunch of nits and gnats, but if you could give us any visibility into those figures?

Yes, Jay, this is Steve. The bulk of that $0.05 -- $0.03 to $0.04 is pension expense.

Got you, perfect. And then Steve, while I've got you, I noticed that tax rate ticked up in the fourth quarter and ended up pushing up the full year to almost 38.5%. Where would you have that be for 2010?

I would say a bit lower than 38%.

Got you, approaching in on the 36% you had last year?

Yes, I would say that's a good estimate.

Great. Thanks very much.

Thank you.

Appreciate it.

The next question comes from the line of Carl Kirst with BMO Capital. Please proceed.

Hi, good morning, everybody.

Good morning, Carl.

Actually most of my questions hit, but maybe just a couple of clarifications if I could on the 2010 guidance, and understanding you can't really say much with respect to NIPSCO, but just to be clear, is there an assumption of this NIPSCO rate case baked into the regulatory initiatives into the 2010 guidance, or are we treating that as a separate item to be addressed once it's resolved?

No, we've attempted to reflect that in the guidance. We have consistently said that the outcome we're modeling is "middle of the road", so nominal impact on 2010, but it's not separate and apart from the guidance we're giving you.

Okay, appreciate that. And then the second just also on that walk across the 2010, the other question and you may have already mentioned this as I was taking down notes but the negative $0.10 from what looks like depreciation and other taxes?

Right.

What is specifically driving that? I mean, is that coming from CapEx?

Yes, that's exactly what it is. It just reflects the increased CapEx spending that we've been incurring.

Fair enough. Just want to make sure I understood. Thanks, guys.

Yes.

Your next question comes from the line of Tom O'Neill with Green Arrow. Please proceed.

Good morning.

Hi, Tom.

Good morning, Tom.

Just a couple questions on 2010 just in terms of what's assumed. Is it possible just to lay out what industrial sales level you're assuming and then what GT&S optimization you're assuming versus the $56 million in 2009?

Yes, I won't go into detail, Tom, at this point, but let me just reiterate that the industrial load just reflects a very, very modest recovery, or improvement year-over-year; and when I say modest, I mean modest, and the other part of the question was?

The GT&S for 2009.

It reflects a solid year, not as strong as last year, but certainly a solid year.

Okay, more in line with history prior to this year?

A bit closer.

Okay. Thank you.

Ladies and gentlemen, this concludes all the time we have for questions on today. I would now like to turn the call back over to Mr. Bob Skaggs for closing remarks.

Thank you, Janita, and again we want to thank everybody for your participation in this morning's call, your interest in NiSource and your support of our Company. We appreciate it, have a good day. Thanks.

Ladies and gentlemen, this concludes the presentation for today's conference. You may disconnect and have a wonderful day.