Good day, and welcome to the NorthWestern Corporation Year-End 2013 Financial Results Conference Call. Today’s conference is being recorded. At this time, I’d like to turn the conference over to Travis Meyer. Please go ahead, sir.

Thank you, Melissa. Good afternoon and thank you for joining us for the NorthWestern Corporation financial results conference call and webcast for the year-ended December 31, 2013. NorthWestern’s results been released and the release is available on our website at www.northwesternenergy.com. We also filed our 10-K after the market closed, yesterday. My name is Travis Meyer; I’m the Director of Investor Relations and Corporate Planning. Also joining us on the call today are Bob Rowe, President and CEO; Brian Bird, Vice President and Chief Financial Officer; Heather Grahame, Vice President and General Counsel; Kendall Kliewer, Vice President and Controller; and John Hines, Vice President of Energy Supply. Before I turn the call over for us to begin, please note that the company’s press release, the presentation, comments by presenters and responses to your questions may contain forward-looking statements, as such I will remind you of our Safe Harbor language. During the course of this presentation, there will be forward-looking statements within the meaning of the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements often address our expected future business and financial performance and will often contain words such as expects, anticipates, intends, plans, believes, seeks, or will. The information in this presentation is based upon our current expectations as of the date unless otherwise noted. Our actual future business and financial performance may differ materially and adversely from our expectations expressed in any forward-looking statements. We undertake no obligation to revise or publicly update our forward-looking statements or this presentation for any reason. Although our expectations and beliefs are based on reasonable assumptions, actual results may differ materially. The factors that may affect our results are listed in certain of our press releases and disclosed in the company’s public filings with the SEC. Following our presentation today, those who are joining us by teleconference will be able to ask questions. The archived replay of today’s webcast will be available beginning at 06:00 pm Eastern Time today and can be found on our website at www.northwesternenergy.com, under the Our Company, Investor Relations, Presentations and Webcasts link. To access the audio replay of the call, dial 888-203-1112, then access code 9765306. Again, that’s 888-203-1112, access code 9765306. I’ll now turn it over to our President and CEO, Bob Rowe.

Good afternoon and thank you all very much for joining us. I hope you all had good holidays with your families. We’ve received some positive feedback to the change in the format of the presentation for these calls; and Travis gets primary credit for that. Also we enjoyed meeting with a number of you at our Analyst Day in December and the feedback after that as well. I will touch on a few of the highlights, will come back and discuss these then in more detail. Obviously the first and biggest bullet is our proposed hydro acquisition that we announced in September of 2013, $900 million purchase of 11 hydro facilities and a storage reservoir that will be dedicated to serve our Montana customers. Natural gas acquisition in December of 2013 and we’re very pleased with the way that is playing out for the benefit of our customers at this point. We placed the Aberdeen Generating Station into service for our South Dakota customers earlier in 2013. We received a natural gas delivery rate adjustment in Montana, effective on April 1, 2013. And we successfully accessed the capital markets to fund our investments project and extend our debt maturities including the sale of equity of almost $57 million last year, extending the maturity of our revolving credit through November of 2018 and issuing $100 million in 2015 of 30 year mortgage bonds in December last year. Already this year we’ve received an upgrade from Moody’s in January, very pleased with that of course. And then as you know the Board has now declared an increase in our quarterly stock dividend, payable March 31st, it’s a 5.3% increase from $0.38 to $0.40 per share. And now, I will turn the presentation over to the very best Chief Financial Officer in the sector, Brian Bird.

Wow Bob, thanks. Good afternoon. Next slide talking about summary financial results shows net income for the year of $94 million compared to $98.4 million the previous year, a reduction of $4.4 million; and on a diluted EPS basis, $2.46 per share this year versus $2.66 per share prior year. I’m going to get into each of these items in bit more detail at the following slide, so with that moving over to gross margin. From a gross margin perspective, effectively the same gross margin, approximately $675 million this year that we had in 2012. And typically when we all are excited about gross margin being exactly the same, but when you consider we had approximately $48 million benefit in our results last year as a result of the gain and CELP arbitration decision and that was actually a very, very good year in terms of gross margin for us in 2013. In fact, if you exclude the CELP arbitration, we had a $7.6 million increase in gross margin for the year. And that increase is primarily made up from increases in volumes in both our gas and electric business. You might recall 2012 was a very mild weather year for us. So, we did get some recovery in volumes this year. We did add natural gas production during the year and had a full year effect from some assets to be put in place the prior year. We did have a natural gas rate increase of $6.6 million attributed to that; had a full year benefit from Spion Kop this year, $5.6 million associated with that. We did not have as bigger impact if you will from the DGGS that we had last year, $5.1 million associated with that. And other growth in our electric transmission business and natural…

Thank you, Brian. On slide 13, this is the story of our investment actually since I joined the company in 2008 and we feel very good about what we’ve done for all of our stakeholders. And you’ll see at the top, the increases in rate base and these are company-wide figures inclusive of full year of 2013, so little different from what some of you’ve seen before. Over that period our investment in the rate base is dedicated to serve of our customers company-wide, again almost 13%. Our GAAP diluted EPS of almost 7%, 6.7%, but at the same time that we’ve been investing in the infrastructure that serves our customers we have been very thoughtfully I think managing the bill impacts to those customers. So you’ll see and again these are company-wide averages. The electric retail revenue on a megawatt hour basis for typical residential customer has only increased about 2.5% over this period and natural gas retail per Dekatherm has actually declined 6.1%. So we are investing our system where producing a return for our shareholders and they are managing the costs that are faced by our customers, up move through some of the subjects with that in some cases are monthly holding (inaudible) summer a little bit newer. The first issue of course is the long standing open issue we have at the federal energy regulatory commission concerning cost recovery on the federal portion, federally jurisdiction portion of Dave Gates Generating Station. As most of you know well, we've been, we have requested, reconsideration of a FERC administrative Law Judge decision, we have not yet received that decision. We are under FERC restrictions in terms of communications. With the commission there is no schedule, we do know that it is not on the FERC commissioner’s calendar for…

Thank you. (Operator instructions) And we will take our first question from Brian Russo.

Hi, good afternoon. Just assuming the hydro transaction is approved and you get a full year contribution base rate in ‘15, can you just remind us of your dividend policy and when might your -- and how should we view future dividend increases as earnings step up with hydro assets in rate base?

Hey Brian, it’s Brian. I tell you that we think seriously about our 60% to 70% payout, we think that’s an important payout to be competitive to track capital as we compete the capital with other utilities. And our expectation is we continue to provide a dividend of 60% to 70% payout basis with or without the hydro transaction.

Right. So assuming the hydro transaction is completed and should we kind of assume a February dividend of 2015 dividend announcements, kind of inline with your current announcement on the dividend?

Yes, I think that’s typically how we have done things Brian and that would be my expectation, my guess if there is an approval on a closing prior to that, there would be discussion at the October Board meeting but historically we’ve talked about dividend policy in February.

Okay, great. And then the CapEx table in the 10-K starts to moderate post 2016 and it seems that you guys are going to be in a positive free cash flow position after dividend. So, I was just curious what your thoughts for cash redeployment to back to shareholders or are there longer term investments that you can make at the utility that’s not reflected in the CapEx?

That’s good question, Brian. I think we try to point out in the disclosure there that there are certain projects that we continue to evaluate, particularly on the transmission side of the business, potentially on the energy supply side of the business. But particularly, when you get out in 2017, 2018 time period, we’re not sure exactly what those projects are yet and what the amounts are. So, until we identify what those projects are, you are going to see a tapering off our capital investment. It is our expectation though that on a going forward basis, when we get some idea what those projects should be, we could see those numbers increasing up once again.

Great.

And actually it goes to the point we were making to in terms of trying to manage our capital investment back in the infrastructure in ways that produce value for our customers and manage overall customer cost. But clearly, we will have a number of areas that we need to focus, again if we are successful in the hydro transaction. And that’s too really across the business.

One other thing Brian, I would point out and we’ve mentioned this before, if for instance we did get out in the 2017, 2018 period and we did what put ourselves back into pretty positive free cash flow position, we have been paying at the low end of that 60% to 70% band. And our expectation is we would probably move up within the 60%, 70% band again to return capital to shareholders, if it’s not necessary to invest in the business.

Okay, great. And then just curious that the $100 million of debt that you issued in December of ‘13, does that satisfy your debt issuances for ‘14 ?

It’s from our perspective, debt is primarily terming out to what we had in our revolving credit facility and to help fund our gas production investments during the year. We take a look at that on a year-to-year basis. Our expectation of primary debt capital that would be raised in 2014 is going to be associated with the hydro transaction again assuming an approval.

Understood. Thank you very much.

Thank you. (Operator Instructions) And we’ll take our next question from Jonathan Reeder from Wells Fargo.

Hey good afternoon gentlemen. Hey Brian, is it safe to interpret that the 7% to 10% total shareholder return expectation that you identified is affirmation of the 4% to 6% EPS growth target?

Yes I think even I understand that point, Jonathan it’s on a pre-hydro basis. Certainly our expectation is we’re going to be able to deliver that 4% to 6% quite easily. On a post-hydro basis again we talked about this at our Analyst Day, it will be hard to invest that much capital on a going forward basis to continue that growth rate, but our expectation is we should be able to achieve further lower into that range from the earnings perspective. But again in any case, we expect to be able to provide the 7% to 10% then I talked about in terms of total return. Obviously from a starting point today, if the hydro transaction would close because just of the size of that transaction, our expectation is we would be able to do quite better than that in the short-term.

Okay, got you. And then can you elaborate on just the reaction to the hydro transaction amongst your important constituents within Montana, I know it’s been a few months now there has been some hearings and everything, how is the reaction then?

Well, the reaction from customers has been just really overwhelming in a way that you don’t see very often over a utility matter. This by coincidence in January and February every year, we go out and hold community meetings in conjunction with the University of Montana. And we’re obviously talking a lot about the hydro transactions, customers are very, very positive. There was a (inaudible) truly when the facilities were sold in Montana there is a feeling that those are being restored and we’ll be rededicated to serving our Montana customers, prices based on cost. I think the reaction has been particularly strong in some of the communities that are near the facilities. We had a couple of community meetings in Great Falls, Montana now and those have been particularly positive. So in terms of I would say, we talked on the last call I believe about some of the reaction from legislator. So in terms of kind of the public reaction to it, it could not be really any more exciting. I have to say too that our employee response has been really tremendous because these were assets that our employees cared very, very deeply about as well. So that's been a [neat] part of it. And again, at this point I have to emphasize just how important the regulatory process is, how hard our employees involved in that effort are working, we all consider this to be maybe the most important than any of us will ever work on and that's the spirit that we’re all taking.

In the light of the kind of the regulator response, I know there was a hearing not too long ago where some of the commission there is kind of expressed some opinions, if you could I guess elaborate on what you are able to kind of gain from that?

And my answer really went to the public response that the process at the commission is serious, it’s complicated. I mentioned the size of our initial filing remember data request that we have responded to in one way or another, a couple of key milestones in a regulatory process. We did make a supplemental filing including some additional modeling runs and that filing, in our view certainly affirmed that we made the correct resource choice with the hydro acquisition. Last week there was an oral argument on our motion to really put some side boards in some discipline on what is already maybe an impersonator that would nearly unprecedented the scope of discovery to commission deliberated in an open work session on that yesterday and we were again recognizing these are important subject and we were pleased that where we stand right now, the proceeding will, I have to cover little bit more focused and disciplined than would have been the case otherwise, but directly it will be certainly very complete. I mentioned that this is -- for those of us working on it at the company this is one of the most important activities we’ll ever participate in and we think for our customers one of the very best things we can do over the long-term for I have to believe that the commissioners and staffs are taking a similar view on this really, really matters for our customers and matters a great deal and I think for the State of Montana as well. So it’s tough, it’s complicated as we expected going into front door, but we certainly are pleased that the commission is focusing on this and we think is managing the process forward.

And then from a timeline perspective I mean you believe September 16th is still a good date for final decision or just based on the complexity and the fact that you did need to make that supplemental filing to the record, do you believe the procedural schedule could get pushed out a bit?

We and ultimately it will be the commission’s decision. We have (inaudible) possible on our side to ensure that the procedural schedule is met and we’ve reached out to other parties in the commission staff to ensure that as well. And certainly from, I think very solid approach to determine is taking to managing this docket certainly appears that he is also committed to running a thorough but very professional process. So we are hopeful that the schedule will hold and that a decision will be timely.

Alright thanks for the additional info.

(Operator Instructions) And sir, there are no further questions in queue.

Okay. Well, thank you all very much for joining us today. Obviously there is a lot going on and we're very excited about it and committed to the work committee to get done before talking to many of you next quarter and some of you before then. Take care.

This concludes today's conference. Thank you for your participation.