2016 Q1 Form 10-Q Financial Statement

#000093634016000312 Filed on April 26, 2016

View on sec.gov

Income Statement

Concept 2016 Q1 2015 Q1
Revenue $2.566B $2.984B
YoY Change -14.01% -24.07%
Cost Of Revenue
YoY Change
Gross Profit
YoY Change
Gross Profit Margin
Selling, General & Admin
YoY Change
% of Gross Profit
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization $229.0M $209.0M
YoY Change 9.57% -25.36%
% of Gross Profit
Operating Expenses $2.226B $2.512B
YoY Change -11.39% -25.92%
Operating Profit $381.0M $461.0M
YoY Change -17.35% -17.68%
Interest Expense $113.0M $110.0M
YoY Change 2.73% 0.0%
% of Operating Profit 29.66% 23.86%
Other Income/Expense, Net -$58.00M -$65.00M
YoY Change -10.77% -13.33%
Pretax Income $323.0M $396.0M
YoY Change -18.43% -18.35%
Income Tax $83.00M $122.0M
% Of Pretax Income 25.7% 30.81%
Net Earnings $247.0M $273.0M
YoY Change -9.52% -16.26%
Net Earnings / Revenue 9.63% 9.15%
Basic Earnings Per Share $1.38 $1.53
Diluted Earnings Per Share $1.37 $1.53
COMMON SHARES
Basic Shares Outstanding 179.0M shares 178.0M shares
Diluted Shares Outstanding 180.0M shares 178.0M shares

Balance Sheet

Concept 2016 Q1 2015 Q1
SHORT-TERM ASSETS
Cash & Short-Term Investments $35.00M $99.00M
YoY Change -64.65% 1.02%
Cash & Equivalents $35.00M $99.00M
Short-Term Investments
Other Short-Term Assets $234.0M $312.0M
YoY Change -25.0% 75.28%
Inventory $660.0M $633.0M
Prepaid Expenses
Receivables $1.185B $1.534B
Other Receivables $80.00M $73.00M
Total Short-Term Assets $2.362B $2.788B
YoY Change -15.28% -6.22%
LONG-TERM ASSETS
Property, Plant & Equipment $18.13B $17.24B
YoY Change 5.18% 7.82%
Goodwill $2.018B $2.018B
YoY Change 0.0% 0.0%
Intangibles $110.0M
YoY Change -16.03%
Long-Term Investments $542.0M $1.951B
YoY Change -72.22% 7.91%
Other Assets $157.0M $245.0M
YoY Change -35.92% 26.94%
Total Long-Term Assets $6.096B $6.134B
YoY Change -0.62% 13.34%
TOTAL ASSETS
Total Short-Term Assets $2.362B $2.788B
Total Long-Term Assets $6.096B $6.134B
Total Assets $28.56B $28.07B
YoY Change 1.77% 7.29%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable $649.0M $825.0M
YoY Change -21.33% -12.7%
Accrued Expenses $119.0M $116.0M
YoY Change 2.59% -1.69%
Deferred Revenue
YoY Change
Short-Term Debt $365.0M $0.00
YoY Change -100.0%
Long-Term Debt Due $462.0M $166.0M
YoY Change 178.31% -84.47%
Total Short-Term Liabilities $2.209B $1.839B
YoY Change 20.12% -48.47%
LONG-TERM LIABILITIES
Long-Term Debt $8.266B $8.348B
YoY Change -0.98% 29.67%
Other Long-Term Liabilities $205.0M $247.0M
YoY Change -17.0% -7.14%
Total Long-Term Liabilities $8.687B $8.713B
YoY Change -0.3% 15.68%
TOTAL LIABILITIES
Total Short-Term Liabilities $2.209B $1.839B
Total Long-Term Liabilities $8.687B $8.713B
Total Liabilities $10.90B $10.55B
YoY Change 3.26% -4.95%
SHAREHOLDERS EQUITY
Retained Earnings $4.909B $4.727B
YoY Change 3.85% 8.42%
Common Stock $4.118B $4.093B
YoY Change 0.61% 5.11%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $8.887B $8.665B
YoY Change
Total Liabilities & Shareholders Equity $28.56B $28.07B
YoY Change 1.77% 7.29%

Cashflow Statement

Concept 2016 Q1 2015 Q1
OPERATING ACTIVITIES
Net Income $247.0M $273.0M
YoY Change -9.52% -16.26%
Depreciation, Depletion And Amortization $229.0M $209.0M
YoY Change 9.57% -25.36%
Cash From Operating Activities $745.0M $747.0M
YoY Change -0.27% 40.41%
INVESTING ACTIVITIES
Capital Expenditures -$424.0M -$405.0M
YoY Change 4.69% -18.51%
Acquisitions
YoY Change
Other Investing Activities -$12.00M -$3.000M
YoY Change 300.0% -130.0%
Cash From Investing Activities -$437.0M -$556.0M
YoY Change -21.4% 25.79%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net $33.00M -$9.000M
YoY Change -466.67% -118.0%
Debt Paid & Issued, Net $11.00M $117.0M
YoY Change -90.6% 1.74%
Cash From Financing Activities -$310.0M -$140.0M
YoY Change 121.43% 218.18%
NET CHANGE
Cash From Operating Activities $745.0M $747.0M
Cash From Investing Activities -$437.0M -$556.0M
Cash From Financing Activities -$310.0M -$140.0M
Net Change In Cash -$2.000M $51.00M
YoY Change -103.92% 10.87%
FREE CASH FLOW
Cash From Operating Activities $745.0M $747.0M
Capital Expenditures -$424.0M -$405.0M
Free Cash Flow $1.169B $1.152B
YoY Change 1.48% 11.95%

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CY2016Q1 us-gaap Fair Value Net Derivative Asset Liability Measured On Recurring Basis Unobservable Inputs Reconciliation Transfers Into Level3
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CY2015Q1 us-gaap Fair Value Net Derivative Asset Liability Measured On Recurring Basis Unobservable Inputs Reconciliation Transfers Out Of Level3
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CY2016Q1 us-gaap Fair Value Net Derivative Asset Liability Measured On Recurring Basis Unobservable Inputs Reconciliation Transfers Out Of Level3
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CY2015Q1 us-gaap Fair Value Net Derivative Asset Liability Measured On Recurring Basis With Unobservable Inputs
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CY2016Q1 us-gaap Fair Value Net Derivative Asset Liability Measured On Recurring Basis With Unobservable Inputs
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CY2016Q1 us-gaap Net Income Loss Attributable To Noncontrolling Interest
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CY2016Q1 us-gaap Other Comprehensive Income Loss Foreign Currency Transaction And Translation Adjustment Net Of Tax
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CY2016Q1 us-gaap Other Comprehensive Income Loss Net Of Tax
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CY2016Q1 us-gaap Other Comprehensive Income Loss Pension And Other Postretirement Benefit Plans Adjustment Net Of Tax
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CY2015Q1 us-gaap Other Comprehensive Income Loss Pension And Other Postretirement Benefit Plans Tax
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CY2016Q1 us-gaap Other Liabilities Current
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CY2016Q1 us-gaap Other Liabilities Noncurrent
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CY2015Q4 us-gaap Other Long Term Investments
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CY2016Q1 us-gaap Other Long Term Investments
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CY2015Q1 us-gaap Other Nonoperating Expense
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CY2016Q1 us-gaap Other Nonoperating Expense
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CY2016Q1 us-gaap Other Nonoperating Income
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CY2016Q1 us-gaap Other Postretirement Defined Benefit Plan Liabilities Noncurrent
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CY2016Q1 us-gaap Other Receivables Net Current
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CY2015Q1 us-gaap Payments For Proceeds From Other Investing Activities
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CY2016Q1 us-gaap Payments For Proceeds From Other Investing Activities
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CY2015Q1 us-gaap Payments For Repurchase Of Common Stock
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CY2016Q1 us-gaap Payments For Repurchase Of Common Stock
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CY2015Q1 us-gaap Payments Of Dividends Common Stock
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CY2016Q1 us-gaap Payments Of Dividends Common Stock
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CY2015Q1 us-gaap Payments To Acquire Businesses Gross
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240000000 USD
CY2016Q1 us-gaap Payments To Acquire Businesses Gross
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CY2015Q1 us-gaap Payments To Acquire Equity Method Investments
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CY2016Q1 us-gaap Payments To Acquire Equity Method Investments
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CY2015Q1 us-gaap Payments To Acquire Other Investments
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250000000 USD
CY2016Q1 us-gaap Payments To Acquire Other Investments
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CY2015Q1 us-gaap Proceeds From Equity Method Investment Dividends Or Distributions Return Of Capital
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CY2016Q1 us-gaap Proceeds From Equity Method Investment Dividends Or Distributions Return Of Capital
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CY2015Q1 us-gaap Proceeds From Issuance Of Common Stock
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CY2016Q1 us-gaap Proceeds From Issuance Of Common Stock
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CY2015Q1 us-gaap Proceeds From Issuance Of Long Term Debt
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CY2016Q1 us-gaap Proceeds From Issuance Of Long Term Debt
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CY2015Q1 us-gaap Proceeds From Payments For Other Financing Activities
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CY2016Q1 us-gaap Proceeds From Payments For Other Financing Activities
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CY2015Q1 us-gaap Proceeds From Repayments Of Short Term Debt
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CY2016Q1 us-gaap Proceeds From Repayments Of Short Term Debt
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CY2015Q1 us-gaap Proceeds From Sale And Maturity Of Other Investments
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CY2016Q1 us-gaap Proceeds From Sale And Maturity Of Other Investments
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CY2015Q1 us-gaap Proceeds From Sale Of Other Productive Assets
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CY2016Q1 us-gaap Proceeds From Sale Of Other Productive Assets
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CY2015Q1 us-gaap Profit Loss
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CY2016Q1 us-gaap Profit Loss
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240000000 USD
CY2015Q4 us-gaap Property Plant And Equipment Gross
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CY2016Q1 us-gaap Property Plant And Equipment Gross
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CY2015Q4 us-gaap Property Plant And Equipment Net
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CY2016Q1 us-gaap Property Plant And Equipment Net
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CY2015Q1 us-gaap Public Utilities Allowance For Funds Used During Construction Capitalized Cost Of Equity
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CY2016Q1 us-gaap Public Utilities Allowance For Funds Used During Construction Capitalized Cost Of Equity
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CY2015Q1 us-gaap Regulated Operating Revenue
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CY2016Q1 us-gaap Regulated Operating Revenue
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CY2016Q1 us-gaap Regulatory Assets Current
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CY2016Q1 us-gaap Regulatory Assets Noncurrent
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CY2016Q1 us-gaap Regulatory Liability Current
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CY2016Q1 us-gaap Regulatory Liability Noncurrent
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CY2015Q1 us-gaap Repayments Of Long Term Debt
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CY2016Q1 us-gaap Repayments Of Long Term Debt
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CY2015Q4 us-gaap Restricted Cash And Cash Equivalents At Carrying Value
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CY2016Q1 us-gaap Restricted Cash And Cash Equivalents At Carrying Value
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CY2016Q1 us-gaap Retained Earnings Accumulated Deficit
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CY2015Q1 us-gaap Revenues
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CY2016Q1 us-gaap Stockholders Equity
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CY2016Q1 us-gaap Stockholders Equity Including Portion Attributable To Noncontrolling Interest
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CY2016Q1 us-gaap Variable Interest Entity Entity Maximum Loss Exposure Amount
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CY2016Q1 us-gaap Weighted Average Number Of Diluted Shares Outstanding
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CY2015Q1 us-gaap Weighted Average Number Of Shares Outstanding Basic
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CY2016Q1 us-gaap Weighted Average Number Of Shares Outstanding Basic
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CY2016Q1 us-gaap Derivatives Methods Of Accounting Nonhedging Derivatives
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<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Revenues and energy costs related to trading contracts are presented on a net basis in DTE Energy's Consolidated Statements of Operations. Commodity derivatives used for trading purposes, and financial non-trading commodity derivatives, are accounted for using the MTM method with unrealized and realized gains and losses recorded in Operating Revenues &#8212; Non-utility operations. Non-trading physical commodity sale and purchase derivative contracts are generally accounted for using the MTM method with unrealized and realized gains and losses for sales recorded in Operating Revenues &#8212; Non-utility operations and purchases recorded in Fuel, purchased power, and gas &#8212; non-utility.</font></div></div>
CY2016Q1 us-gaap Derivatives Reporting Of Derivative Activity
DerivativesReportingOfDerivativeActivity
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:16px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Derivative Assets and Liabilities</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Derivative assets and liabilities are comprised of physical and financial derivative contracts, including futures, forwards, options, and swaps that are both exchange-traded and over-the-counter traded contracts. Various inputs are used to value derivatives depending on the type of contract and availability of market data. Exchange-traded derivative contracts are valued using quoted prices in active markets. The Registrants consider the following criteria in determining whether a market is considered active: frequency in which pricing information is updated, variability in pricing between sources or over time, and the availability of public information. Other derivative contracts are valued based upon a variety of inputs including commodity market prices, broker quotes, interest rates, credit ratings, default rates, market-based seasonality, and basis differential factors. The Registrants monitor the prices that are supplied by brokers and pricing services and may use a supplemental price source or change the primary price source of an index if prices become unavailable or another price source is determined to be more representative of fair value. The Registrants have obtained an understanding of how these prices are derived. Additionally, the Registrants selectively corroborate the fair value of their transactions by comparison of market-based price sources. Mathematical valuation models are used for derivatives for which external market data is not readily observable, such as contracts which extend beyond the actively traded reporting period. The Registrants have established a Risk Management Committee whose responsibilities include directly or indirectly ensuring all valuation methods are applied in accordance with predefined policies. The development and maintenance of the Registrants' forward price curves has been assigned to DTE Energy's Risk Management Department, which is separate and distinct from the trading functions within DTE Energy.</font></div></div>
CY2016Q1 us-gaap Description Of New Accounting Pronouncements Not Yet Adopted
DescriptionOfNewAccountingPronouncementsNotYetAdopted
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:12px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-weight:bold;"></font><font style="font-family:inherit;font-size:10pt;font-weight:bold;">NEW ACCOUNTING PRONOUNCEMENTS</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:16px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Recently Adopted Pronouncements</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In February 2015, the FASB issued ASU No. 2015-02, </font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Amendments to the Consolidation Analysis</font><font style="font-family:inherit;font-size:10pt;">, which changes the analysis that a reporting entity must perform to determine whether it should consolidate certain types of legal entities. The ASU affects (1) limited partnerships and similar legal entities, (2) evaluating fees paid to a decision maker or a service provider as a variable interest, (3) the effect of fee arrangements on the primary beneficiary determination, (4) the effect of related parties on the primary beneficiary determination, and (5) certain investment funds. It is effective for the Registrants for the first interim period within annual reporting periods beginning after December 15, 2015. The Registrants adopted this ASU at January 1, 2016. The implementation of this guidance is reflected in </font><font style="font-family:inherit;font-size:10pt;">Note 1</font><font style="font-family:inherit;font-size:10pt;"> of the Consolidated Financial Statements, "</font><font style="font-family:inherit;font-size:10pt;">Organization and Basis of Presentation</font><font style="font-family:inherit;font-size:10pt;">." Certain entities are now deemed to be VIEs and are included in DTE Energy's non-consolidated VIE table. This implementation did not have a significant impact on the Registrants' Consolidated Financial Statements.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In April 2015, the FASB issued ASU No. 2015-03, </font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Simplifying the Presentation of Debt Issuance Costs</font><font style="font-family:inherit;font-size:10pt;">. This ASU requires that debt issuance costs related to a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of that debt liability, consistent with debt discounts. This ASU is effective for reporting periods beginning after December 15, 2015, and interim periods therein. It is to be applied retrospectively. The Registrants adopted this ASU at January 1, 2016. The effect of the adoption decreased assets and liabilities on DTE Energy&#8217;s and DTE Electric&#8217;s Consolidated Statements of Financial Position by </font><font style="font-family:inherit;font-size:10pt;">$75 million</font><font style="font-family:inherit;font-size:10pt;"> and </font><font style="font-family:inherit;font-size:10pt;">$36 million</font><font style="font-family:inherit;font-size:10pt;">, respectively, at December 31, 2015.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In May 2015, the FASB issued ASU 2015-07,</font><font style="font-family:inherit;font-size:10pt;font-style:italic;"> Fair Value Measurement (Topic 820): Disclosures for Investments in Certain Entities That Calculate Net Asset Value per Share (or Its Equivalent). </font><font style="font-family:inherit;font-size:10pt;">This guidance removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the net asset value per share (or its equivalent) practical expedient. The guidance applies to investments for which there is not a readily determinable fair value (market quote) or the investment is in a mutual fund without a publicly available net asset value. It is effective for the Registrants for the first interim period within annual reporting periods beginning after December 15, 2015. It is to be applied retrospectively. The Registrants adopted this ASU at January 1, 2016. The implementation of this guidance is reflected in </font><font style="font-family:inherit;font-size:10pt;">Note 6</font><font style="font-family:inherit;font-size:10pt;"> of the Consolidated Financial Statements, "</font><font style="font-family:inherit;font-size:10pt;">Fair Value</font><font style="font-family:inherit;font-size:10pt;">." This implementation did not have a significant impact on the Registrants' Consolidated Financial Statements.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:16px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Recently Issued Pronouncements</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In May 2014, the FASB issued ASU No. 2014-09, </font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Revenue from Contracts with Customers.</font><font style="font-family:inherit;font-size:10pt;"> The objectives of this ASU are to improve upon revenue recognition requirements by providing a single comprehensive model to determine the measurement of revenue and timing of recognition. The core principle is that an entity will recognize revenue to depict the transfer of goods or services to customers at an amount that the entity expects to be entitled to in exchange for those goods or services. This ASU also requires expanded qualitative and quantitative disclosures regarding the nature, amount, timing, and uncertainty of revenues and cash flows arising from contracts with customers. In July 2015, the FASB deferred implementation of the revenue standard to be effective for the first interim period within annual reporting periods beginning after December 15, 2017. The standard is to be applied retrospectively and early adoption is permitted in the preceding year. In March 2016, the FASB issued an ASU that amends and clarifies the implementation guidance on principal versus agent considerations for reporting revenue gross rather than net.</font><font style="font-family:inherit;font-size:10pt;color:#252525;"> In April 2016, the FASB issued an ASU that amends and clarifies the identification of performance obligations and accounting for licenses of intellectual property. Both ASUs issued in 2016 have the same deferred effective date. </font><font style="font-family:inherit;font-size:10pt;">The Registrants are currently assessing the impact of these ASUs on their Consolidated Financial Statements.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In July 2015, the FASB issued ASU No. 2015-11,</font><font style="font-family:inherit;font-size:10pt;font-style:italic;"> Inventory (Topic 330), Simplifying the Measurement of Inventory</font><font style="font-family:inherit;font-size:10pt;">. The ASU replaces the current lower of cost or market test with a lower of cost or net realizable value test when cost is determined on a first-in, first-out or average cost basis. The standard is effective for public entities for annual reporting periods beginning after December 15, 2016, and interim periods therein. It is to be applied prospectively and early adoption is permitted. The ASU will not have a significant impact on the Registrants' Consolidated Financial Statements.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In January 2016, the FASB issued ASU No. 2016-01, </font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Financial Instruments </font><font style="font-family:inherit;font-size:10pt;">&#8212; </font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Overall: </font><font style="font-family:inherit;font-size:10pt;color:#252525;font-style:italic;">Recognition and Measurement of Financial Assets and Financial Liabilities. </font><font style="font-family:inherit;font-size:10pt;">The new guidance is intended to improve the recognition and measurement of financial instruments. The ASU primarily impacts accounting for equity investments in unconsolidated entities (other than those accounted for using the equity method of accounting) and financial liabilities under the fair value option. Under the new guidance, equity investments will generally be measured at fair value, with subsequent changes in fair value recognized in net income. The ASU is effective for fiscal years and interim periods within those years beginning after December 15, 2017. Upon adoption, entities will be required to make a cumulative-effect adjustment to the Statements of Financial Position as of the beginning of the first reporting period in which the guidance is effective. Changes to the accounting for equity securities without a readily determinable fair value will be applied prospectively. The Registrants are currently assessing the impact of this ASU on their Consolidated Financial Statements.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">In February 2016, the FASB issued ASU No. 2016-02, </font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Leases (Topic 842), </font><font style="font-family:inherit;font-size:10pt;">a replacement of </font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Leases (Topic 840)</font><font style="font-family:inherit;font-size:10pt;">. This guidance requires a lessee to account for leases as finance or operating leases. Both leases will result in the lessee recognizing a right-of-use asset and a corresponding lease liability on its balance sheet, with differing methodology for income statement recognition. For lessors, the standard modifies the classification criteria and the accounting for sales-type and direct financing leases. Entities will classify leases to determine how to recognize lease-related revenue and expense. This ASU is effective for public entities for fiscal years, and interim periods within those years, beginning after December&#160;15, 2018, and early adoption is permitted. A modified retrospective approach is required for leases existing or entered into after the beginning of the earliest comparative period in the Consolidated Financial Statements. The Registrants are currently assessing the impact of this ASU on their Consolidated Financial Statements.</font></div><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:30px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;color:#252525;">In March 2016, the FASB issued ASU No. 2016-09, </font><font style="font-family:inherit;font-size:10pt;color:#252525;font-style:italic;">Compensation</font><font style="font-family:inherit;font-size:10pt;font-style:italic;"> </font><font style="font-family:inherit;font-size:10pt;">&#8212; </font><font style="font-family:inherit;font-size:10pt;font-style:italic;">Stock Compensation (Topic 718): </font><font style="font-family:inherit;font-size:10pt;color:#252525;font-style:italic;">Improvements to Employee Share-Based Payment Accounting.</font><font style="font-family:inherit;font-size:10pt;color:#252525;"> The ASU simplifies several aspects of the accounting for share-based payment transactions, including the income tax consequences, classification of awards as either equity or liabilities, and classification on the Statements of Cash Flows. Under the new standard, income tax benefits and deficiencies are to be recognized in the income statement and the tax effects of exercised or vested awards should be treated as discrete items in the reporting period in which they occur. This provision is to be applied prospectively. Excess tax benefits should be recognized regardless of whether the benefit reduces taxes payable in the current period, along with any valuation allowance, on a modified retrospective basis as a cumulative-effect adjustment to the retained earnings as of the date of adoption. Excess tax benefits should be classified along with other income tax cash flows as an operating activity. This provision can be applied prospectively or retrospectively for all periods presented. </font><font style="font-family:inherit;font-size:10pt;">The standard is effective for public entities for annual reporting periods beginning after December 15, 2016, and interim periods therein. Early adoption is permitted. DTE Energy is currently assessing the impact of this ASU on its Consolidated Financial Statements.</font></div></div>
CY2016Q1 us-gaap Prior Period Reclassification Adjustment Description
PriorPeriodReclassificationAdjustmentDescription
<div style="font-family:Times New Roman;font-size:10pt;"><div style="line-height:120%;padding-top:12px;text-align:left;text-indent:32px;font-size:10pt;"><font style="font-family:inherit;font-size:10pt;">Certain prior year balances for the Registrants were reclassified to match the current year's Consolidated Financial Statements presentation. Such revisions include amounts reclassified to separate Operating Revenues and Fuel, purchased power, and gas between Utility operations and Non-utility operations and from Operations and maintenance to Fuel, purchased power, and gas &#8212; non-utility related to the Power and Industrial Projects segment. The reclassifications did not affect DTE Energy's Net Income for the prior periods, as such, they are not deemed material to the previously issued Consolidated Financial Statements.</font></div></div>

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