Category Archives: WGL Holdings Inc

WGL Holdings – Latest Company News

ACI adds Open Account Manager to its Global Trade suite
04 Oct 2007

Global Trade Manager can be implemented in a hub and spoke model to service branches and customers globally. Branch personnel can request financing on-line on behalf of bank customers, or customers can request financing themselves through the bank’s trade front end. Document images can be uploaded to Global Trade Manager’s regional image hub which automates the routing and workflow associated with the full range of trade transactions. Banks can also electronically image and warehouse all trade documents.

Global Trade Manager supports the full range of traditional trade products such as letters of credit and collections and guarantees, integrated into ACI’s online banking solution Enterprise Banker. In combination with Open Account Manager, it provides the full range of financing needed by today’s corporate clients. Open Account Manager is able to fully support end-to-end processing for open accounts with messaging through SWIFTNet TSU.

The Bank of New York Mellon adopts ACI payments hub
03 Oct 2007

The bank is leveraging the ACI money transfer system for SWIFT, The clearing house interbank payments system (CHIPS) processing and as an interface to the US Federal Reserve Bank Fedwire system. Future phases will interface to additional central banking systems, messaging systems, net settlement systems and clearing houses, such as Fed Book Entry Securities and Telex. In addition, the bank is leveraging the scalability of ACI solution to centrally manage large-scale liquidity transactions and enhance monitoring capabilities.

The ACI Global Payments Hub provides a consolidated, enterprise payments solution for internal and external financial message switching. The solution is a gateway to various financial networks such as SWIFT, telex, and a number of real time gross settlement (RTGS) systems. By replacing several messaging gateways with a single message hub, the bank will achieve greater efficiencies and consistency across all operations and products.

ACI and IBM team up to support core payment systems
12 Sep 2007

Base24-eps was the subject of an IBM Redbook in 2006, providing detailed information about how the software is deployed on IBM’s z/OS platform. IBM has now published a supporting Redpaper that details the considerations to be taken into account by customers as they plan for when and how to undertake a migration to Base24-eps as their engine for consumer payments processing.

The combination of Base24-eps on IBM system z offers a secure and powerful high-availability solution for supporting business growth while taking advantage of modern software architectures and the reliability and stability of IBM’s hardware and software platform. In addition, Base24-eps complements ACI payments manager on system z to automate back office functions and leverage IBM’s virtualization strategy to lower operating cost.

ACI Worldwide launches fraud reduction calculator for banks
21 Aug 2007

The new solution enables organizations to determine the scope for improved performance by detecting the improvement in the percentage of fraud recorded.

Derren Jones, director of fraud and risk management at ACI, said: “Existing solutions often ignore the most important metric of the model, the point of detection. By ignoring this measure, people can get a seriously misleading indication of actual performance. If the point of detection is lowered, fraud will be found earlier, which results in lower losses. Ultimately, the best way to measure the success is to have a balance of three elements: point of detection, false positive rates and finally the detection rate.”

ACI Worldwide to modernize Partecis payments platform
06 Jun 2007

The deployment will facilitate and secure payment transactions across the Partecis platform. Partecis (Partnership for European Card Information System) is the unified transaction and payment platform jointly developed and owned by BNP Paribas and Natixis Paiements.

Partecis has been established specifically to support international transactions as a uniform, multilingual, multi-format payment offering to support retail and corporate clients of both banks across Europe, and will be particularly suited for Sepa. Sepa is a European initiative to create an environment where all electronic payments are considered domestic, and where a difference between national and international payments does not exist, thus improving the efficiency of cross border payments.

BASE24-eps is an integrated software solution designed to acquire, authenticate, route, switch and authorize payments across multiple channels. It can also support new transaction methods such as mobile commerce and internet banking, in addition to traditional payment transactions such as debit and credit at the ATM and point of sale, branch banking and telephone banking.

Steve Wright, president of ACI Worldwide EMEA, said: “This milestone demonstrates ACI’s commitment to the French market with an offering that helps banks and retailers to authorize and authenticate large transaction volumes across the entire range of payment methods.”

ACI to launch EMEA-specific online banking software
17 Apr 2007

ACI Enterprise Banker is already in use in the Americas and in Asia Pacific. The software enables financial institutions to offer corporate and retail customers a range of cash management services, as well as providing support for custodial and trade services.

The cash management services provided by Enterprise Banker will offer in the Europe, Middle East and Africa (EMEA) region, domestic and international payments initiation, SEPA credit transfer and SEPA direct debit payments initiation, intra-company transfers, and balance and transaction reporting.

Enterprise Banker provides direct support for SEPA payments and enables end-to-end straight-through processing by linking directly to a bank’s payment hub.

“ACI Enterprise Banker is a new version of an existing online banking solution designed specifically to meet the needs of our EMEA customers,” commented Steve Wright, president of ACI Worldwide EMEA. “This proven online banking solution combined with our knowledge, support and expertise in this field means that banks will be able to provide customers with a comprehensive cash management offering.”

Descartes extends cross-border compliance service
16 Feb 2007

On January 12, the Canada Border Services Agency (CBSA) announced a revised Advance Commercial Information (ACI) e-Manifest initiative, which mandates that CBSA receives advance electronic notification of cargo shipments arriving in Canada by highway. Descartes has extended its Global Logistics Network Compliance Service to help the international carrier community comply with this e-Manifest initiative.

Descartes’ Global Logistics Network Compliance Service was initially created to help marine and air carriers file electronic manifests to comply with US Customs and Border Protection’s (CBP) Automated Commercial Environment (ACE) e-Manifest initiative for cargo entering the US from Canada and Mexico.

The service evolved to help customers meet the regulatory requirements established by CBSA for air and marine shipments into Canada from points worldwide. The service was recently extended to address the US ACE e-manifest initiative covering ground transportation. Now, Descartes is extending the service to address the ACI initiative for vehicles entering Canada.

WGL Holdings – Locations and Subsidiaries

Head Office

WGL Holdings, Inc.

101 Constitution Avenue North West

Washington

District of Columbia 20080

USA

P:1 703 750 2000

F:1 202 624 6277

http://www.wglholdings.com

Other Locations and Subsidiaries

Shenandoah Gas Division

Washington Gas Energy Services

350 Hillandale Lane

13865 Sunrise Valley Drive

Winchester

Suite 200

Virginia 22602

Herndon

USA

Virginia 20171

USA

Frederick Gas Division

Washington Gas

1800 N Market Street

6801 Industrial Road

Frederick

Springfield

Maryland 21701

Virginia 22151

USA

USA

WGL Holdings – Company View

To Our Shareholders:
2006 was a solid year for WGL Holdings, Inc. We continued to rely on our proven strategy for producing lasting results and positioning the company for growth. At the same time, we introduced several initiatives to deliver continued corporate progress and successes. As we discuss our fiscal year highlights, we urge you to read the report with the following, familiar words in mind: WGL Holdings works continuously to be the retail energy company of choice by achieving excellence for customers, investors and employees.

Each year, we discuss the steps that we have taken over the preceding 12 months to deliver on our vision.This year, we offer a look not only at where we have been, but also share what we have done to leverage our enduring strength and to reinforce our stable foundation as we look toward the future.

As we begin this discussion, please note that we have taken a new and different approach to annual reporting this year. This document, our 2006 Corporate Financial Report, presents an overview of this year’s results and our outlook for the year ahead. Also included in this publication is our Annual Report on Form 10-K as filed with the Securities and Exchange Commission and a summary supplement of key financial and operating statistics.

Separately, we are introducing a new publication—the 2006 Corporate Performance Report. We are taking the opportunity to improve upon our already transparent look into how we work and how we benefit our various constituents. The 2006 Corporate Performance Report is available online at wglholdings.com.

Producing Results: Our vision is to be the retail energy company of choice by achieving excellence for customers, investors and employees.

Fiscal Year 2006 in Summary Our financial results for the 2006 fiscal year reflect our efforts to achieve stable earnings growth and to remove the volatility in earnings that results from fluctuations in customer usage and weather conditions. Our weather protection products allowed us to neutralize the impact of a warmer-than-normal winter in the District of Columbia and Virginia. We even had a slight benefit due to a period of cold weather that preceded the coverage period. In addition, we neutralized the impact of weather and price-induced conservation in Maryland by implementing a new regulatory mechanism at the beginning of the fiscal year.

These positive steps helped ease the downward tug on earnings associated with higher customer conservation and, to a lesser extent, increasing overhead costs. Although we expect softening natural gas prices to mitigate some of the price-related customer conservation, we expect that the pressures on our expenses will remain with us into 2007. We have adopted several initiatives, also discussed below, to lessen the influence of these factors on the business.

In keeping with our objective to grow profitable energyrelated businesses, we made the strategic decision to sell American Combustion Industries (ACI), one of WGL Holdings’ two commercial heating, ventilating and air conditioning businesses.

For our continuing operations, 2006 fiscal year’s results reflected:

  • Income totaling $94.7 million, or $1.94 per share, for the year. Although our results declined compared with 2005, several indicators suggest strong positioning for future growth.
  • Increased normalized utility earnings compared with last year. We added $0.10 per share, a performance driven in part by the addition of 19,811 new customers, timely recovery of carrying costs on higher storage gas inventory balances, and the introduction of a revenue normalization adjustment (RNA) in Maryland that allows us to protect 40% of our revenues when customers conserve energy, causing usage to decline from normalized levels. The mechanism also protects our Maryland customers when usage increases above normalized levels. The phrase “normalized utility earnings” refers to a non-GAAP attribute. See page 4 of this report for a discussion of our non-GAAP measures.
  • Lower customer usage in the District of Columbia and Virginia, which decreased earnings by $0.14 per share.
  • Reduced reported earnings to $0.27 per share from our retail energy-marketing business. The underlying strong performance of this business unit was tempered somewhat by mark-to-market valuations and unusual items. For a complete discussion of our financial results, see Management’s Discussion and Analysis contained in the Annual Report on Form 10-K, which begins on page 7.

The Year Ahead
During our 2007 fiscal year, we will take several steps to produce long-term success and continue meeting the needs of our customers, investors and employees. We expect to see continued benefit from robust economic growth and new home construction and anticipate adding new customers at a rate that exceeds industry averages. This year, we will enhance our utility growth strategy by focusing greater attention on residential conversions.

We also will work closely with regulators in all of our jurisdictions as we invite them to rethink the way that customers pay for the gas they use. Virginia regulators currently are considering our proposal to implement a new rate-making formula for our customers in the jurisdiction. This will help us achieve full and timely recovery of the cost to deliver natural gas safely and reliably. Our rate increase application included an RNA proposal designed to deliver benefits similar to those currently in effect in Maryland. We also proposed a performance-based rate structure that will provide a regulatory mechanism to encourage continuing performance improvements and share these benefits in a timely manner between customers and investors. We are evaluating the need to file similar plans in the District of Columbia and will propose a rate-making formula in Maryland this spring that would deliver these desired outcomes.

Our education and outreach efforts continue as we encourage customers to use energy more efficiently. Natural gas supply and demand remain in a tight balance, and this approach represents sound, responsible energy policy. Our RNA proposal appropriately aligns advocacy for energy efficiency with providing a reasonable opportunity to earn timely recovery of and return on our costs of serving utility customers. This balanced approach clearly benefits customers and investors.

We also are uniquely positioned to move this agenda forward through our leadership roles with national policy organizations, such as the American Gas Association and the Alliance to Save Energy.

The Quest for Excellence
WGL Holdings continues to pursue operational excellence by improving processes, reducing operating and maintenance costs and maintaining or improving service delivery. We are considering the potential benefits of outsourcing as a means of meeting these objectives. For more than a decade, outsourcing has driven dramatic reductions in our costs to add new customers. We also have seen significant process improvements in targeted areas of our operations. In hopes of achieving similar efficiencies in other portions of our business, we are evaluating proposals to provide business process outsourcing services in information technology, human resources, customer service and certain financial functions.We expect to complete our review and determine an appropriate course of action by the spring of 2007.

In addition to our work to enhance internal processes and service delivery, we continue our efforts to foster a high-performance culture—a workplace that rewards and inspires excellence by offering challenge, support and growth. The most recent employee opinion survey confirmed that we have achieved a level of workforce engagement that compares favorably with national norms.

Successful Results—Ten Years and Counting
2006 marked a major milestone for Washington Gas Energy Services (WGES), our energy-marketing arm, which celebrated a decade of service in July. WGES, a substantive contributor to net income, is well positioned to win customers in new electric markets.Through a timely promotion to customers in the District, Maryland and Delaware last summer, WGES increased its electricity patronage by 75%. We will report on the financial benefits from adding these new customers in future periods as their consumption becomes more significant.

System Integrity, Supply Diversity
As our multiyear replacement and rehabilitation project continued in Prince George’s County, Md., our operations leaders developed a remediation approach based on the root cause of the initial problem. We launched this project in 2005 to stem an unusual pattern of leaks caused by the introduction of gas from the Cove Point liquefied natural gas (LNG) terminal in southern Maryland. This gas has a different chemical composition than what traditionally flows through most of our pipes and has been identified by research as the principal cause of premature failure of certain pipe couplings.

Based on the results of scientific testing, we constructed and are operating a facility that conditions gas from Cove Point to make it compatible with the composition of gas that has normally flowed through our system. Results to date are promising, and we continue monitoring our progress. With continued success, we may be able to modify the scope and cost of the repair and rehabilitation project and achieve our goals for maintaining the safety and integrity of our system.

We continue to pursue authorization to construct an LNG storage facility on company property, which previously housed natural gas storage tanks. Upon its construction, the LNG storage facility would serve customers on the coldest days and give our company greater ability to manage the costs of natural gas delivery. Our single storage tank facility will cost roughly $148.6 million to construct and would be ready for the winter of 2011–2012.

Building for the Long-Term
We see challenge, promise and opportunity in the year ahead. With our new fiscal year underway, we expect to build on our well-established foundation. We will advance national energy policy and state regulatory proposals that benefit customers and investors.We will continue long-term, large-scale projects that will allow us to serve the region’s natural gas customers safely and reliably and at a reasonable cost. We will work to continue strong growth by adding newly constructed homes and by converting more existing homes to natural gas. And, we will continue to build on our opportunities for growth in our non-utility subsidiaries.

Of course, the knowledge, support and dedication of the men and women of WGL Holdings drive our ability to realize our goals, and again, we extend our gratitude for all that they do in support of the company and our customers.

WGL Holdings – Top Competitors

The following companies are the major competitors of WGL Holdings, Inc.

  • Nicor Inc.
  • Allegheny Energy, Inc.
  • National Fuel Gas Company
  • KeySpan Corporation
  • Pepco Holdings
  • Atmos Energy Corporation
  • AmeriGas Partners, L.P.
  • AGL Resources Inc.
  • Piedmont Natural Gas Company, Inc.
  • UniSource Energy Corporation
  • New Jersey Resources Corporation
  • Northwest Natural Gas Company
  • EnergySouth, Inc

WGL Holdings – Major Products and Services

WGL Holdings is a holding company that delivers gas and electricity to customers through its subsidiaries. The company’s products and services include the following:

Products:

  • Electricity
  • Energy related products
  • Natural gas

Services:

  • Consumer financing
  • Retail energy marketing
  • HVAC Services (Design, Installation, Renovation)