COC IDA_RBC_Note_2009_08_06_2Q09.pdf

PRICE TARGET REVISION | COMMENT
AUGUST 6, 2009
IDACORP, Inc.(NYSE: IDA)
Strong quarter from improved regulatory framework
Sector Perform
Above Average Risk
Price:27.79
Shares O/S (MM):45.2
Dividend:1.20
NAVPS:33.00
Debt to Cap:51%
Price Target:33.00 ­30.00
Implied All-In Return:23%
Market Cap (MM):1,256
Yield:4.3%
P/NAVPS:0.8x
Priced at market close August 6, 2009 ET.
IDA reported 2Q09 adjusted EPS of $0.58 vs. our estimate
of $0.32 and consensus of $0.45
Raising CNAV and target price to $33 from $30. Maintaining SP rating.
Favorable hydrology, the pilot decoupling program and the recent rate case have
kept IDA performing in line with its peers. While the Langley Gulch project
could provide growth in the near term, other significant growth projects remain
on the drawing board. We look for more clarity on the longer term picture for
IDA with its upcoming IRP filing.
Regulatory changes impair comparability with 2008 results
Year-over-year, IDA realized a ~$0.11 positive impact due to the timing of PCA
cost recovery allocation. As in 1Q09 while notable for the quarter, this timing
issue should not affect annual results. Additionally, IDA recorded a net ~$0.10
positive impact from the deferral of OR excess net power costs from May 1 –
December 31, 2007. Backing these out, the quarter was slightly above 2Q08 at
$0.37 vs. $0.35. The recent rate case and favorable hydrology largely offset
weaker demand for the quarter.
Order expected in 3Q09 for Langley Gulch project
The 330MW proposed CCGT plant is expected to cost $427MM and could be in
service by 2012. IDA will only proceed with the project if the Certificate of
Public Convenience and Necessity is granted and provides assurances of
construction cost recovery. Without these assurances it is doubtful that IDA could
obtain financing for the plant with acceptable terms. Approval of this plant would
provide a reasonable growth profile in the near term while the 2 large-scale
transmission projects continue to face permitting challenges.
OR rate case filed
IDA requested a 22.6% rate increase totaling $7.3MM annually. The rate case
uses a 2009 test year, included $110.8MM in rate base and requested an 11.25%
ROE. Rates would be effective starting in May 2010. After successful
implementation of a power cost adjustment for the OR territory, this rate case
represents the next step in IDA's regulatory improvement efforts. The company
actually earned a (-4%) ROE in OR last year, thus reinforcing the desperate need
for a rate increase.
Adjusting estimates to reflect 2Q09 results and hydrology
2009E to $2.19 from $2.12, 2010E $2.35 from $2.33, 2011E $2.37 from $2.38.
Priced as of prior trading day's market close, EST (unless otherwise noted).
RBC Capital Markets Corp.
Lasan Johong (Analyst)
[phone]; [e-mail]
Emily Christy (Associate)
[phone]; [e-mail]
Ella Vuernick (Associate)
[phone]; [e-mail]
FY Dec 2007A 2008A 2009E 2010E
Adj EPS - FD 1.86 2.16 2.19 2.35
Prev.2.12 2.33
P/AEPS 14.9x 12.9x 12.7x 11.8x
Adj CFPS - FD 1.77 3.59 5.60 4.43
Prev.4.98 4.40
P/ACFPS 15.7x 7.7x 5.0x 6.3x
EBITDA (MM) 262.0 292.0 322.0 382.0
Prev.338.0 372.0
FCFPS - FD (2.63) (2.51) 1.57 0.30
Prev.0.88 (0.35)
P/FCF NM NM 17.7x NM
Adj EPS - FD Q1 Q2 Q3 Q4
2007 0.56A 0.42A 0.65A 0.23A
2008 0.48A 0.35A 1.14A 0.19A
2009 0.40A 0.58A 0.98E 0.22E
Prev.0.32E 1.09E 0.31E
Adj CFPS - FD
2007 0.98A 0.30A 0.50A 0.00A
2008 1.02A 1.08A 1.19A 0.33A
2009 1.74A 1.65A 1.48E 0.73E
Prev.0.84E 1.59E 0.81E
EBITDA (MM)
2007 70.0A 62.0A 76.0A 54.0A
2008 71.0A 66.0A 112.0A 42.0A
2009 69.0A 78.0A 111.0E 64.0E
Prev.72.0E 127.0E 71.0E
All values in USD unless otherwise noted.
For Required Conflicts Disclosures, see Page 5.
2
Details
Lower demand cushioned by regulatory framework, favorable hydrology
IDA generated 2,976 MWh from its hydroelectric assets as compared to 2,077 MWh in 2Q08. The 2009 forecast has been tightened to
7.5-8.5 from 6.5-8.5 MM MWh of hydroelectric generation. This lowers the need for more expensive fossil fuel generation and
purchased power. Although the sharing mechanism has been improved to lessen the impact to shareholders, strong hydrology leads to
favorable results. This generation profile, combined with higher rates from its most recent regulatory filings, largely offset the 8%
reduction in sales volumes. The weakest demand stemmed from irrigation customers due to high precipitation levels in ID.
Equity issuances for 2009 and 2010 are unlikely
Given the revised demand forecast and capital spending expectations, the company believes that it can fund its investments through
2010 with its operating cash flows and existing sources of liquidity without the need to access equity capital markets. In 2008 the
company issued approximately $50MM under its shelf registration.
Favorable regulatory outcomes in 2Q09:
•Fully approved IDA's requested $5.2MM increase in FCA true-up
•Approved the energy efficiency rider increase to 4.75% from 2.5%, resulting in expected rider earnings of $27.3MM in 2009 and
$33.2MM in 2010.
•Approved annual recovery of $10.5MM starting in June 2009 for the Advanced Metering Initiative through year-end 2009,
reflecting investments to date. IDA had requested an increase of $11.2MM based on a forward test year.
•Fully approved IDA's requested $84.3MM revenue increase from the PCA using the new formula
•Fully approved IDA's requested $3.9MM revenue increase in OR for the PCA
Advanced Metering Initiative could receive Stimulus Funds
IDA submitted a grant application to the DOE requested $45MM in stimulus funds under the "Integrated and/or Crosscutting Systems"
program. Funds would be used to invest in a Smart Grid and could support incremental projects if granted.
Valuation
Our target price and our calculated net-asset-value (CNAV) is $33. We determine our CNAV based on a full discounted cash flow
model using an average of Free Cash Flow to the Firm and Free Cash Flow to Equity. We apply a multistage growth rate with a
terminal multiple of 12.4x based on a dynamic WACC with an initial rate of 7.34%. The terminal value is calculated approximately 25
years forward.
As a pure-play electric utility with a significant hydroelectric generation fleet, IDA operates in a heavily regulated environment.
Considering the risk management policies of IDA, the Idaho regulatory structure, solid operations and the above-average population
growth for the service territory, the company continues to perform as expected.
Price Target Impediment
Volatile hydrology, unfavorable regulatory decisions, poor growth project selections, operational setbacks, changes in credit ratings,
environmental regulations, cost overruns with the capex projects, access to capital markets, and weather.
Company Description
IDACORP is a holding company for the following subsidiaries: Idaho Power Company, IDACORP Financial, and Ida-West Energy.
Idaho Power Company (IPC) is a regulated utility serving approximately 472,000 customers in Idaho and western Oregon. Through its
regulated operations, IPC generates, purchases, transmits, distributes, and sells electric power. Through its 17 hydroelectric power
plants, IPC is one of few utilities with a predominant hydro generating base. The company also owns and operates coal and natural
gas-fired plants to round out its approximately 3,300MW power portfolio. Additionally, IPC has 4,600 miles of transmission lines and
26,000 miles of distribution lines. IDACORP Financial is an investment company with a focus on affordable housing and historic
preservation projects. Ida-West Energy is an independent power project development company with 44.6MW of combined interest in
nine hydroelectric power plants in California and Idaho.
IDACORP, Inc.August 6, 2009
3
Ticker Symbol IDA
Year Quarter EPS Oper. CF EBITDA FCF EFCF Capital Type Amount %Type % of Total
Assumptions Rate 06/2009 ($MM)
2008 1 $0.48 $1.02 $71 ($0.63)$0.24 Equity Capital $1,326.4 49%Equity 5.22%
DCF Start Year 2009 2008 2 $0.35 $1.08 $66 ($0.02)$0.36 Preferred Stock $0.0 0%Preferred 0.00%
DCF Start Month 7 2008 3 $1.14 $1.19 $112 $0.64 $3.85 Total Debt $1,367.1 51%Debt 2.12%
Current Beta of Company 0.80 2008 4 $0.19 $0.33 $42 ($2.47)($4.20) Total $2,693.5 100% WACC 7.34%
Static or Variable Beta (S/V)V Total 5 $2.16 $3.59 $292 ($2.51)$0.17
Normalized Long-Term Risk-free Rate 5.00%
Market Return 12.00%2009 1 $0.40 $1.74 $69 $0.43 $2.00 Terminal Value Multiple Terminal Value Multiple
Current Equity Discount Rate 10.60%2009 2 $0.58 $1.65 $78 $0.64 ($1.31)Multiple of FCF 12.4 x Multiple of EFCF 11.3 x
Current Cost of Preferred Stock 0.00%2009E 3 $0.98 $1.48 $111 $0.63 $0.49
Current Cost of Debt Capital 6.44%2009E 4 $0.22 $0.73 $64 ($0.12)$0.30 Term. Val. in Months 288 Term. Val. in Months 288
Current WACC 7.34% Total 5 $2.19 $5.60 $322 $1.57 $1.48
Basic Shares Outstanding (MM) 47.0 Category Valuation Category Valuation
Diluted Shares Outstanding (MM)47.0 06/2009
Assumed Tax Rate 35%Calc. Ent. Value $2,833.4 Equity FCF Value $1,562.7
Assumed Inflation Rate 3.50%Preferred Stock $0.0 Cash Balance @ Start
Minimum Cash Balance Required $25 2010E Total Debt ($1,351.1) of Valuation $16.0
Revolver Overflow Alert Total 5 $2.35 $4.43 $382 $0.30 $1.19 Equity Value $1,482.4 Equity Value $1,578.7
Current Stock Price of IDA ($/Sh.)$27.79 Shares NAV Average Shares NAV
Current Book Value per Share $28.24 Basic $31.57 $32.59 Basic $33.62
Current Price-to-Book Ratio 1.0 x Diluted $31.56 $32.58 Diluted $33.61
Current Market Cap ($MM)$1,305.0 2011E
Current Market Ent. Value ($MM)$2,672.0 Total 5 $2.37 $4.52 $399 $0.55 $1.19 Ratios P/NAV P/NAV Ratios P/NAV
Per Share Estimates Capital Structure Cost of Capital
Net Asset Value Cash Flow Valuation
Current Market Ent. Value Per Sh. $56.90 Basic 0.9 x 0.9 x Basic 0.8 x
Current Book Ent. Value ($MM)$2,693.5 Diluted 0.9 x 0.9 x Diluted 0.8 x
Current Book Ent. Value Per Sh.$57.36
Ratios P/Book
Names of Regions Name Basic 1.0 x
Region 1 Idaho Power Company (IPC)
Region 2 Idacorp Financial Services (IFS)Criteria Multiple 2010ERow #Multiple Analysis
Region 3 Idacorp Energy (IE)Ratios
Region 4 Other Year P/EP/Oper. CFEV/EBITDA EV/FCF P/EFCF Net Debt per Share N/A $40.43 497 N/A
Basic Shares Out N/A 47.0 166 N/A
2008 12.9 x 7.7 x 9.1 x N/M 164.8 x P/E 14.0 x $2.35 174 $33.00
2009E 12.7 x 5.0 x 8.3 x 36.2 x 18.8 x P/CF 7.5 x $4.43 363 $33.00
2010E 11.8 x 6.3 x 7.0 x 192.3 x 23.3 x EV/EBITDA 9.0 x $8.14 190 $33.00
2011E 11.7 x 6.1 x 6.7 x 104.4 x 23.3 x Average $33.00
Sources: Company reports; RBC Capital Markets estimates; Lasan Johong [phone] [e-mail]; Emily Christy [phone], [e-mail]; Ella Vuernick [phone], [e-mail]
IDACORP, Inc.August 6, 2009
4
IDA 2007 2008 2008 2008 2008 2008 2009 2009 2009 2009 2009 2010 2011
SUMMARY FINANCIALS ($ Millions)2007 Q1A Q2A Q3A Q4A 2008 Q1A Q2A Q3E Q4E 2009E 2010E 2011E
GENERATION (MWh)13,548.0 3,642.0 3,493.3 4,035.0 3,201.1 14,371.3 3,549.6 4,119.8 3,442.9 3,140.4 14,252.6 13,781.4 13,866.6
INCOME STATEMENT
TOTAL NET REVENUE $879.4 $213.4 $230.2 $299.7 $217.0 $960.4 $229.1 $243.6 $249.5 $181.4 $903.6 $928.8 $1,067.1
DOC (Incl. Cost of Fuel and Plant O&M)$312.2 $95.9 $103.8 $110.0 $107.4 $417.0 $129.4 $137.5 $110.2 $107.5 $484.7 $460.5 $515.5
Other Direct Operating Costs $307.1 $50.1 $54.9 $84.3 $60.9 $250.2 $37.9 $30.2 $26.0 $14.9 $109.0 $107.1 $174.2
General & Administrative Expenses $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0
DIRECT OPERATING COSTS $619.3 $146.0 $158.7 $194.3 $168.3 $667.2 $167.3 $167.6 $136.2 $122.5 $593.6 $567.6 $689.7
GROSS PROFIT $260.1 $67.5 $71.5 $105.4 $48.8 $293.2 $61.8 $76.0 $113.2 $58.9 $309.9 $361.3 $377.4
Depreciation, Amortization and Expl. Exp.$103.1 $25.8 $26.6 $25.7 $24.0 $102.1 $26.0 $26.8 $26.6 $26.8 $106.2 $109.7 $114.3
Other Operating Costs $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0
TOTAL OPERATING COSTS $722.4 $171.7 $185.3 $220.0 $192.3 $769.3 $193.3 $194.5 $162.8 $149.3 $699.8 $677.3 $804.0
OPERATING INCOME $157.0 $41.7 $44.9 $79.7 $24.7 $191.1 $35.8 $49.2 $86.7 $32.1 $203.8 $251.5 $263.1
Non-Operating Expenses ($7.3)($0.0)($1.0)($4.5)$5.5 ($0.0)($6.6)($0.6)$2.6 ($5.5)($10.0)($21.2)($21.7)
EARNINGS BEFORE INTEREST & TAXES $164.3 $41.7 $45.9 $84.2 $19.2 $191.1 $42.4 $49.7 $84.0 $37.6 $213.7 $272.7 $284.8
Net Interest Expense, Incl. TCP Dividend $63.3 $17.5 $17.1 $18.5 $20.0 $73.1 $17.5 $18.2 $23.3 $24.0 $82.9 $102.0 $112.9
PRE-TAX INCOME $100.9 $24.3 $28.9 $65.7 ($0.7)$118.0 $24.9 $31.6 $60.7 $13.6 $130.8 $170.7 $171.9
Income Tax Expense $13.7 $5.6 $6.9 $15.8 ($9.1)$19.2 $6.8 $5.2 $14.6 $3.3 $29.8 $59.7 $60.2
Minority Interest, Pref. Dividend & Other $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 ($0.2)$0.1 $0.1 $0.1 $0.1 $0.4 $0.4
NET INCOME PRE-X-ITEMS $82.3 $21.7 $15.7 $51.7 $8.9 $98.0 $18.9 $27.5 $46.0 $10.3 $102.7 $110.6 $111.4
Extraordinary Items & Other $0.0 $0.0 ($1.8)$0.0 $1.4 ($0.4)$0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0
NET INCOME $82.3 $21.7 $17.5 $51.7 $7.4 $98.4 $18.9 $27.5 $46.0 $10.3 $102.7 $110.6 $111.4
NET INCOME PRE-X-ITEMS PER SHARE $1.86 $0.48 $0.35 $1.14 $0.19 $2.16 $0.40 $0.58 $0.98 $0.22 $2.19 $2.35 $2.37
Extraordinary Items & Other $0.00 $0.00 ($0.04)$0.00 $0.03 ($0.01)$0.00 $0.00 $0.00 $0.00 $0.00 $0.00 $0.00
NET INCOME PER SHARE $1.86 $0.48 $0.39 $1.14 $0.16 $2.17 $0.40 $0.58 $0.98 $0.22 $2.19 $2.35 $2.37
CASH FLOW STATEMENT
Adjustments to Revenue and Income ($6.3)$0.0 $0.0 ($3.8)($3.7)($7.4)$0.0 $9.9 $0.0 $0.0 $9.9 $0.0 $0.0
Depreciation, Amortization and Expl. Exp.$120.4 $30.8 $32.5 $29.9 $29.2 $122.4 $31.2 $24.3 $26.6 $26.8 $108.8 $109.7 $114.3
Deferred Income Taxes $11.0 $12.6 $4.2 ($0.7)($11.4)$4.7 $14.7 ($7.1)$4.0 $4.0 $15.5 $16.0 $16.0
Other Operating Cash Flow Items ($129.0)($19.4)($5.7)($23.6)($6.5)($55.1)$16.8 $23.0 ($6.9)($6.9)$26.0 ($28.4)($29.1)
Changes in Working Capital $2.1 ($24.8)($15.9)$8.3 $6.0 ($26.4)($37.0)($11.3)$0.0 $0.0 ($48.3)$0.0 $0.0
OPERATING CASH FLOW $80.6 $20.9 $32.6 $61.9 $21.1 $136.5 $44.6 $66.2 $69.7 $34.2 $214.6 $207.9 $212.6
Cap. Ex., Acquisitions, Investments ($294.2)($65.1)($57.2)($51.9)($37.4)($211.6)($50.4)($59.3)($56.4)($56.4)($222.6)($254.0)($257.7)
Proceeds from Sales $27.1 $0.0 $6.5 $2.2 $0.1 $8.8 $9.8 $3.7 $0.0 $0.0 $13.6 $0.0 $0.0
Other Investing Cash Flow Items $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 ($1.4)($1.4)($2.8)($6.0)($2.3)
INVESTING CASH FLOW ($267.1)($65.1)($50.7)($49.7)($37.3)($202.8)($40.6)($55.6)($57.8)($57.8)($211.8)($260.0)($260.0)
Net Equity Financing $37.2 $2.2 $1.8 $8.2 $38.3 $50.6 $1.1 $2.5 $0.0 $0.0 $3.5 $0.0 $0.0
Net Debt Capital & Other Financing $202.4 $55.3 $31.4 $163.2 ($176.4)$73.5 $90.7 ($71.6)$11.2 $37.8 $68.1 $108.4 $103.8
Financing Costs $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0
Common and Preferred Dividends ($53.0)($13.5)($13.5)($13.5)($13.7)($54.2)($14.4)($13.9)($14.1)($14.1)($56.4)($56.3)($56.3)
Other Financing Cash Flow Items ($2.0)($0.4)($0.0)($1.3)($0.9)($2.6)($0.9)($0.8)$0.0 $0.0 ($1.7)$0.0 $0.0
FINANCING CASH FLOW $184.6 $43.6 $19.7 $156.6 ($152.7)$67.2 $76.6 ($83.8)($2.9)$23.7 $13.5 $52.1 $47.4
CHANGE IN CASH ($1.9)($0.6)$1.5 $168.8 ($168.9)$0.9 $80.3 ($73.1)$9.0 $0.0 $16.2 $0.0 $0.0
OP. CF BEFORE W/C PER SHARE $1.77 $1.02 $1.08 $1.19 $0.33 $3.59 $1.74 $1.65 $1.48 $0.73 $5.60 $4.43 $4.52
BALANCE SHEET
Cash and Equivalents $8.0 $7.4 $8.9 $57.7 $8.8 $8.8 $89.1 $16.0 $25.0 $25.0 $25.0 $25.0 $25.0
Accounts Receivables $74.7 $74.4 $74.7 $83.7 $91.6 $91.6 $84.5 $83.9 $83.9 $83.9 $83.9 $83.9 $83.9
Inventory, Fuels and Materials $60.5 $64.4 $74.0 $75.7 $67.0 $67.0 $66.7 $74.6 $74.6 $74.6 $74.6 $74.6 $74.6
Other Current Assets $324.5 $323.1 $308.7 $299.4 $297.5 $297.5 $264.6 $274.6 $274.6 $274.6 $274.6 $274.6 $274.6
TOTAL CURRENT ASSETS $467.8 $469.4 $466.3 $516.5 $464.8 $464.8 $505.0 $449.1 $458.1 $458.1 $458.1 $458.1 $458.1
TOTAL PP&E $2,616.6 $2,649.0 $2,687.8 $2,717.2 $2,758.2 $2,758.2 $2,768.8 $2,794.5 $2,822.8 $2,850.9 $2,850.9 $3,001.2 $3,146.9
Other Long-term Assets $569.0 $591.1 $594.5 $617.7 $799.8 $799.8 $795.9 $799.1 $809.0 $818.9 $818.9 $847.7 $877.2
TOTAL ASSETS $3,653.3 $3,709.5 $3,748.6 $3,851.3 $4,022.8 $4,022.8 $4,069.7 $4,042.7 $4,089.9 $4,127.9 $4,127.9 $4,306.9 $4,482.1
Accounts Payables $271.6 $302.0 $348.1 $270.1 $248.0 $248.0 $203.7 $145.1 $145.1 $145.1 $145.1 $145.1 $145.1
Short-term Debt & Current Portions $11.5 $11.3 $8.6 $7.8 $86.5 $86.5 $81.5 $83.5 $119.1 $79.1 $79.1 $199.1 $209.7
Other Current Liabilities $92.3 $100.5 $95.2 $108.5 $61.1 $61.1 $75.6 $62.0 $62.0 $62.0 $62.0 $62.0 $62.0
TOTAL CURRENT LIABILITIES $375.3 $413.9 $452.0 $386.5 $395.7 $395.7 $360.8 $290.6 $326.2 $286.2 $286.2 $406.2 $416.8
Long-term Debt and Other Obligations $1,156.9 $1,155.3 $1,153.5 $1,273.0 $1,183.5 $1,183.5 $1,279.5 $1,283.6 $1,331.8 $1,409.6 $1,409.6 $1,398.0 $1,491.2
Deferred Income Taxes $466.2 $479.6 $468.9 $473.8 $515.7 $515.7 $511.3 $513.0 $517.0 $521.0 $521.0 $537.0 $553.0
Other Long-term Liabilities $447.6 $443.2 $449.6 $447.3 $625.6 $625.6 $605.4 $625.0 $552.3 $552.3 $552.3 $552.3 $552.3
TOTAL LONG-TERM LIABILITIES $2,070.7 $2,078.1 $2,072.0 $2,194.1 $2,324.7 $2,324.7 $2,396.2 $2,421.6 $2,401.1 $2,482.9 $2,482.9 $2,487.3 $2,596.5
Long-term Financings $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $4.0 $4.1 $4.2 $4.3 $4.3 $4.7 $5.0
TOTAL LIABILITIES $2,446.0 $2,492.0 $2,523.9 $2,580.6 $2,720.4 $2,720.4 $2,761.0 $2,716.3 $2,731.5 $2,773.4 $2,773.4 $2,898.2 $3,018.4
Equity and Additional Paid-in Capital $675.8 $678.7 $682.1 $691.2 $729.6 $729.6 $731.8 $734.9 $734.9 $734.9 $734.9 $734.9 $734.9
Retained Earnings $537.7 $545.9 $549.8 $588.0 $581.6 $581.6 $586.4 $599.7 $631.7 $627.9 $627.9 $682.1 $737.1
Other Stockholders' Equity ($6.2)($7.2)($7.3)($8.5)($8.7)($8.7)($9.5)($8.2)($8.2)($8.2)($8.2)($8.2)($8.2)
TOTAL STOCKHOLDERS' EQUITY $1,207.3 $1,217.5 $1,224.6 $1,270.7 $1,302.4 $1,302.4 $1,308.7 $1,326.4 $1,358.4 $1,354.5 $1,354.5 $1,408.8 $1,463.8
TOTAL LIABILITIES & EQUITY $3,653.3 $3,709.5 $3,748.6 $3,851.3 $4,022.8 $4,022.8 $4,069.7 $4,042.7 $4,089.9 $4,127.9 $4,127.9 $4,306.9 $4,482.1
Sources: Company reports; RBC Capital Markets estimates. Lasan Johong - [phone]; [e-mail]
IDACORP, Inc.August 6, 2009
5
Required Disclosures
Conflicts Disclosures
The analyst(s) responsible for preparing this research report received compensation that is based upon various factors, including total
revenues of the member companies of RBC Capital Markets and its affiliates, a portion of which are or have been generated by
investment banking activities of the member companies of RBC Capital Markets and its affiliates.
A member company of RBC Capital Markets or one of its affiliates received compensation for products or services other than
investment banking services from IDACORP, Inc. during the past 12 months. During this time, a member company of RBC Capital
Markets or one of its affiliates provided non-securities services to IDACORP, Inc.
RBC Capital Markets is currently providing IDACORP, Inc. with non-securities services.
RBC Capital Markets has provided IDACORP, Inc. with non-securities services in the past 12 months.
The author is employed by RBC Capital Markets Corp., a securities broker-dealer with principal offices located in New York, USA.
Explanation of RBC Capital Markets Equity Rating System
An analyst's 'sector' is the universe of companies for which the analyst provides research coverage. Accordingly, the rating assigned to
a particular stock represents solely the analyst's view of how that stock will perform over the next 12 months relative to the analyst's
sector average.
Ratings
Top Pick (TP):Represents best in Outperform category; analyst's best ideas; expected to significantly outperform the sector over 12
months; provides best risk-reward ratio; approximately 10% of analyst's recommendations.
Outperform (O):Expected to materially outperform sector average over 12 months.
Sector Perform (SP):Returns expected to be in line with sector average over 12 months.
Underperform (U):Returns expected to be materially below sector average over 12 months.
Risk Qualifiers (any of the following criteria may be present):
Average Risk (Avg):Volatility and risk expected to be comparable to sector; average revenue and earnings predictability; no
significant cash flow/financing concerns over coming 12-24 months; fairly liquid.
Above Average Risk (AA):Volatility and risk expected to be above sector; below average revenue and earnings predictability; may
not be suitable for a significant class of individual equity investors; may have negative cash flow; low market cap or float.
Speculative (Spec):Risk consistent with venture capital; low public float; potential balance sheet concerns; risk of being delisted.
Distribution of Ratings
For the purpose of ratings distributions, regulatory rules require member firms to assign ratings to one of three rating categories - Buy,
Hold/Neutral, or Sell - regardless of a firm's own rating categories. Although RBC Capital Markets' ratings of Top Pick/Outperform,
Sector Perform and Underperform most closely correspond to Buy, Hold/Neutral and Sell, respectively, the meanings are not the same
because our ratings are determined on a relative basis (as described above).
Distribution of Ratings
RBC Capital Markets, Equity Research
Investment Banking
Serv./Past 12 Mos.
Rating Count Percent Count Percent
BUY[TP/O] 522 46.20 121 23.18
HOLD[SP] 528 46.80 87 16.48
SELL[U] 79 7.00 5 6.33
IDACORP, Inc.August 6, 2009
6
References to a Recommended List in the recommendation history chart may include one or more recommended lists or model
portfolios maintained by a business unit of the Wealth Management Division of RBC Capital Markets Corporation. These
Recommended Lists include the Prime Opportunity List (RL 3), a former list called the Private Client Prime Portfolio (RL 4), the
Prime Income List (RL 6), the Guided Portfolio: Large Cap (RL 7), and the Guided Portfolio: Dividend Growth (RL 8). The
abbreviation 'RL On' means the date a security was placed on a Recommended List. The abbreviation 'RL Off' means the date a
security was removed from a Recommended List.
Conflicts Policy
RBC Capital Markets Policy for Managing Conflicts of Interest in Relation to Investment Research is available from us on request. To
access our current policy, clients should refer to
http://www.rbccm.com/cm/file/0,,63022,00.pdf
or send a request to RBC CM Research Publishing, P.O. Box 50, 200 Bay Street, Royal Bank Plaza, 29th Floor, South Tower,
Toronto, Ontario M5J 2W7. We reserve the right to amend or supplement this policy at any time.
Dissemination of Research and Short-Term Trading Calls
RBC Capital Markets endeavours to make all reasonable efforts to provide research simultaneously to all eligible clients, having
regard to local time zones in overseas jurisdictions. RBC Capital Markets' research is posted to our proprietary websites to ensure
eligible clients receive coverage initiations and changes in rating, targets and opinions in a timely manner. Additional distribution may
be done by the sales personnel via email, fax or regular mail. Clients may also receive our research via third party vendors. Please
contact your investment advisor or institutional salesperson for more information regarding RBC Capital Markets research.
RBC Capital Markets also provides eligible clients with access to a database which may contain Short-Term trading calls on certain of
the subject companies for which it currently provides equity research coverage. The database may be accessed via the following
hyperlink https://www2.rbccm.com/cmonline/index.html. The information regarding Short-Term trading calls accessible through the
database does not constitute a research report. These Short-Term trading calls are not formal ratings and reflect the research analyst's
views with respect to market and trading events in the coming days or weeks and, as such, may differ from the price targets and
recommendations in our published research reports reflecting the research analyst's views of the longer-term (one year) prospects of
the subject company. Thus, it is possible that a subject company's common equity that is considered a long-term 'sector perform' or
even an 'underperform' might be a Short-Term buying opportunity as a result of temporary selling pressure in the market; conversely, a
subject company's common equity rated a long-term 'outperform' could be considered susceptible to a Short-Term downward price
correction.
Analyst Certification
All of the views expressed in this report accurately reflect the personal views of the responsible analyst(s) about any and all of the
subject securities or issuers. No part of the compensation of the responsible analyst(s) named herein is, or will be, directly or
indirectly, related to the specific recommendations or views expressed by the responsible analyst(s) in this report.
Disclaimer
RBC Capital Markets is the business name used by certain subsidiaries of Royal Bank of Canada, including RBC Dominion Securities Inc., RBC Capital Markets
Corporation, Royal Bank of Canada Europe Limited and Royal Bank of Canada - Sydney Branch. The information contained in this report has been compiled by RBC
IDACORP, Inc.August 6, 2009
7
Capital Markets from sources believed to be reliable, but no representation or warranty, express or implied, is made by Royal Bank of Canada, RBC Capital Markets, its
affiliates or any other person as to its accuracy, completeness or correctness. All opinions and estimates contained in this report constitute RBC Capital Markets'
judgement as of the date of this report, are subject to change without notice and are provided in good faith but without legal responsibility. Nothing in this report
constitutes legal, accounting or tax advice or individually tailored investment advice. This material is prepared for general circulation to clients and has been prepared
without regard to the individual financial circumstances and objectives of persons who receive it. The investments or services contained in this report may not be
suitable for you and it is recommended that you consult an independent investment advisor if you are in doubt about the suitability of such investments or services. This
report is not an offer to sell or a solicitation of an offer to buy any securities. Past performance is not a guide to future performance, future returns are not guaranteed,
and a loss of original capital may occur. RBC Capital Markets research analyst compensation is based in part on the overall profitability of RBC Capital Markets, which
includes profits attributable to investment banking revenues. Every province in Canada, state in the U.S., and most countries throughout the world have their own laws
regulating the types of securities and other investment products which may be offered to their residents, as well as the process for doing so. As a result, the securities
discussed in this report may not be eligible for sale in some jurisdictions. This report is not, and under no circumstances should be construed as, a solicitation to act as
securities broker or dealer in any jurisdiction by any person or company that is not legally permitted to carry on the business of a securities broker or dealer in that
jurisdiction. To the full extent permitted by law neither RBC Capital Markets nor any of its affiliates, nor any other person, accepts any liability whatsoever for any
direct or consequential loss arising from any use of this report or the information contained herein. No matter contained in this document may be reproduced or copied
by any means without the prior consent of RBC Capital Markets.
Additional information is available on request.
To U.S. Residents:
This publication has been approved by RBC Capital Markets Corporation (member FINRA, NYSE), which is a U.S. registered broker-dealer and which accepts
responsibility for this report and its dissemination in the United States. Any U.S. recipient of this report that is not a registered broker-dealer or a bank acting in a broker
or dealer capacity and that wishes further information regarding, or to effect any transaction in, any of the securities discussed in this report, should contact and place
orders with RBC Capital Markets Corporation.
To Canadian Residents:
This publication has been approved by RBC Dominion Securities Inc.(member IIROC). Any Canadian recipient of this report that is not a Designated Institution in
Ontario, an Accredited Investor in British Columbia or Alberta or a Sophisticated Purchaser in Quebec (or similar permitted purchaser in any other province) and that
wishes further information regarding, or to effect any transaction in, any of the securities discussed in this report should contact and place orders with RBC Dominion
Securities Inc., which, without in any way limiting the foregoing, accepts responsibility for this report and its dissemination in Canada.
To U.K. Residents:
This publication has been approved by Royal Bank of Canada Europe Limited ('RBCEL') which is authorized and regulated by Financial ServicesAuthority ('FSA'), in
connection with its distribution in the United Kingdom. This material is not for general distribution in the United Kingdom to retail clients, as defined under the rules of
the FSA. However, targeted distribution may be made to selected retail clients of RBC and its affiliates. RBCEL accepts responsibility for this report and its
dissemination in the United Kingdom.
To Persons Receiving This Advice in Australia:
This material has been distributed in Australia by Royal Bank of Canada - Sydney Branch (ABN 86 076 940 880, AFSL No. 246521). This material has been prepared
for general circulation and does not take into account the objectives, financial situation or needs of any recipient. Accordingly, any recipient should, before acting on
this material, consider the appropriateness of this material having regard to their objectives, financial situation and needs. If this material relates to the acquisition or
possible acquisition of a particular financial product, a recipient in Australia should obtain any relevant disclosure document prepared in respect of that product and
consider that document before making any decision about whether to acquire the product.
To Hong Kong Residents:
This publication is distributed in Hong Kong by RBC Investment Services (Asia) Limited, a licensed corporation under the Securities and Futures Ordinance. This
material has been prepared for general circulation and does not take into account the objectives, financial situation, or needs of any recipient. Hong Kong persons
wishing to obtain further information on any of the securities mentioned in this publication should contact RBC Investment Services (Asia) Limited at 17/Floor, Cheung
Kong Center, 2 Queen's Road Central, Hong Kong (telephone number is 2848-1388).
To Singapore Residents:
This publication is distributed in Singapore by RBC (Singapore Branch), a registered entity granted offshore bank status by the Monetary Authority of Singapore. This
material has been prepared for general circulation and does not take into account the objectives, financial situation, or needs of any recipient. You are advised to seek
independent advice from a financial adviser before purchasing any product. If you do not obtain independent advice, you should consider whether the product is suitable
for you. Past performance is not indicative of future performance.
®Registered trademark of Royal Bank of Canada. RBC Capital Markets is a trademark of Royal Bank of Canada. Used under license.
Copyright © RBC Capital Markets Corporation 2009 - Member SIPC
Copyright © RBC Dominion Securities Inc. 2009 - Member CIPF
Copyright © Royal Bank of Canada Europe Limited 2009
Copyright © Royal Bank of Canada 2009
All rights reserved
IDACORP, Inc.August 6, 2009