Good day, ladies and gentlemen and welcome to the Black Hills Corporation 2012 Fourth Quarter and Full Year Earnings Conference Call. My name is Towanda and I will be your coordinator for today. At this time, all participants are in a listen-only mode. Following the prepared remarks, there will be a question-and-answer session. (Operator Instructions) In order to get as many questions answered as possible, we ask the participants re-enter the queue after asking one initial question and one follow-up question. (Operator Instructions) As a reminder, this conference is being recorded for replay purposes. I would now like to turn the presentation over to Mr. Jerome Nichols, Director of Investor Relations of Black Hills Corporation. Please proceed sir.

Thank you, Towanda. Good morning, everyone and welcome to the Black Hills Corporation 2012 fourth quarter and full year earnings call. With me today are David Emery, Chairman, President and Chief Executive Officer; and Tony Cleberg, Executive Vice President and Chief Financial Officer. Before I turn over the call, I need to remind you that during the course of this call, some of the comments we make may contain forward-looking statements as defined by the Securities and Exchange Commission and there are a number of uncertainties inherent in such comments. Although, we believe that our expectations and beliefs are based on reasonable assumptions, actual results may differ materially. We direct you to our earnings release Slide 2 of the investor presentation on our website and our most recent Form 10-K and Form 10-Q filed with the Securities and Exchange Commission for a list of some of the factors that could cause future results to differ materially from our expectations. I will now turn the call over to David Emery.

Thank you, Jerome. Good morning, everyone. Thanks for joining us. I will be speaking from our webcast presentation deck that was on the website. Those of you who don’t have it shouldn’t have any problem following along starting on Slide 3. Our discussion will be similar in format to previous quarters. I will cover highlights from the quarter and the year, Tony Cleberg, our CFO, will cover financial highlights for both the quarter and the year; and then I’ll have a discussion on forward strategic issues and objectives. Moving on to Slide 5, fourth quarter highlights. Several things of note, on the business environment front, little bit colder than normal weather in our utilities service territories this fall was helpful and continued low gas, natural gas prices, that’s been a persistent, consistent theme throughout the entire year and we'll talk more about that as we get into financials and other things. On the utility front, lots of highlights there, a lot of activity in the fourth quarter. Black Hills Power filed a request with the South Dakota PUC seeking approval for a construction financing rider for our Cheyenne Prairie Generating Station. In South Dakota, we're the first company to file for such a rider, and so we are working our way through that process very co-operatively with the South Dakota PUC staff. They did approve on January 17 interim rates related to that rider which will be effective April 1 subject to refund while we work our way through the process of getting a final approval for that rider. We hope to receive a final ruling from the commission sometime on or before the third quarter. Black Hills Power also filed a rate request with South Dakota PUC asking for about 9.94% or $13.7 million revenue increase related to increase…

Thank you, Dave. Good morning. As Dave described, we're very pleased with both the fourth quarter and the total year performance. Compared to 2011, our earnings from continuing operations as David said grew 48% in the fourth quarter and 24% for the total year. For the total year, our earnings finished in the upper end of our guidance range that we had updated, and this is a pleasing result after a very slow start that we have in the first quarter. Moving to Slide 13, we've reconciled our earnings from continuing operations on a GAAP basis to an earnings per share as adjusted, which is a non-GAAP measure. We feel by isolating special items, the earnings per share as adjusted better communicates our performance that is most relevant to our ongoing business. This slide displays the last five quarters of the total gear. During the fourth quarter, we had four special items. The first item was a reduction of $0.07 for non-capitalized, unrealized, mark-to-market gain on our $250 million of interest rate swaps. The gain reflected a slight increase in the long-term interest rates during the quarter. In total, for 2012, the gain was $0.03 compared to $0.68 loss in 2011. The second special item was a reduction for recognizing an additional gain on the sale of the Williston Basin asset. As you are aware, our oil and gas segment sold a large part of our Williston Basin properties, primarily oil assets in the third quarter. As we reconcile the post-close accounting for this sale, we recorded an additional $0.03 gain in the fourth quarter, bringing the total gain to $0.43 for the year. As a reminder, this transaction had a much larger impact on the $0.43 gain, because we received $228 million in cash and recorded a reduction of…

All right, thank you, Tony. Moving on to Slide 21 related to the core strategic objectives, we have five major objectives focused primarily on being an industry leader in nearly all we do. We want to be a leader in operational performance, earnings growth, our earnings upside opportunities created by our oil and gas subsidiary, and also our track record of annual dividend increases. In addition, we want to improve our credit rating. On Slide 26 related operational performance and that strategic objective, this slide illustrates exceptional operational performance in couple of areas; customer service O&M expense per customer, electrical reliability and safety, all excellent results. Slide 27 demonstrates our superior power plant availability and starting reliability. It also demonstrates that we have one in the most modern generation fleets in the country and that our power plant construction safety record is fantastic. Slide 28, we expect our strong earnings growth to be driven by capital spending, much of which is to meet customer needs in our utilities and also to grow our non-regulated energy business. Our capital spending for the next several years is projected to be far in excess of depreciation. Slide 29, this slide we dropped I think last quarter so its back by popular demand, provides more detail into our capital spending plans for the next several years and you can get a better idea of where specifically we’re deploying our capital, particularly in the electric utilities, little better break out there for investors. Slide 30, helping drive our future earnings growth is the Cheyenne Prairie Generating Station. Tony mentioned that and obviously 132 megawatt plant, it will be jointly owned by Black Hills Power and Cheyenne Light with construction cost of about $222 million, not including construction financing. We have received all permits, all the…

Thank you. (Operator Instructions) As a reminder, in order to get as many questions answered as possible, we ask that participants re-enter the queue after asking one initial question and one follow-up question. (Operator Instructions) Your first question comes from the line of Kevin Cole with Credit Suisse. Please proceed sir. Kevin Cole – Credit Suisse: Hi, good morning gentlemen.

Good morning, Kevin. Kevin Cole – Credit Suisse: I have a couple of high-level questions, I think will say the rest for next week, but I guess on the job spot between Geoffrey and Richard, is Jeff bring a new or different background or a focus to your strategy group?

Well, certainly when you make those changes, you always bring a different background and I would say Jeff’s background is different than Rich’s, and I think will be additive. I think in both situations, they're going to bring a fresh set of eyes and a fresh set of experiences to their new jobs, would certainly will help them developmentally as executives, key executives for us, that also I think will help the respective departments as well. Little different to look at things, little different way of looking at things and analyzing things and we're excited about both of those moves.

I would say Kevin both executives have a very in-depth knowledge of our business. And we can rely on that, we expect great performance out of both of them as we go forward. Kevin Cole – Credit Suisse: Is Jeff more of a regulated guy or more like an E&P guy?

Really both, he didn't come out of either specific sector. I mean, he basically came out of public accounting and has worked for us. So he has had a tremendous amount of exposure to each of our businesses and similarly with Rich Kinzley. Kevin Cole – Credit Suisse: Okay, thank you. And then generally I guess Tony, can you help me kind of understand the timing of future debt and equity needs to support the CapEx program in the phase of the cash you've received from the asset sales?

Well, we feel very comfortable that we can get through the next several years just on the debt side. And in our current outlook, it would be some time before we would need to issue equity unless we did something pretty special in terms of an acquisition or something like that, which is sort of our normal business. And we've talked about before our strategy on the Mancos to make sure that as we go forward, we're going to look at other ways to fund some of the capital through partnerships and bringing others in. So that continues to be our strategy. Kevin Cole – Credit Suisse: I guess this is right. So can you fund both debt and equity through used retained earnings? Is that right and so you don't need to be in debt market for 2013 as well?

Well, 2013 we will certainly look at putting out some more long-term debt and switching out of the short-term debt. So we still think that some place longer line interest rates are going to go up and so, we would like to make sure that we're as long-term as we possibly can before that starts to happen. Kevin Cole – Credit Suisse: Is the refinancing largely at the parent or at the utilities?

I would say mostly at the parent, we would certainly look at some of it at the utilities also. Kevin Cole – Credit Suisse: What rate are you seeing these days like 30 a paper?

The rates are low. Kevin Cole – Credit Suisse: Great. Thank you guys.

Thank you.

(Operator Instructions) Your next question comes from the line of Michael Bates with D.A. Davidson. Please proceed. Michael Bates – D.A. Davidson & Co.: Hey, good morning guys.

Good morning, Michael.

Good morning, Michael Michael Bates – D.A. Davidson & Co.: Just wanted to follow-up on your 2013 scorecard, one of your check boxes here points to evaluate in acquiring small, private and municipal gas distribution systems. Can you talk to us a little bit more in detail about the size of the potential opportunity there as well as where the assets would potentially be?

Yeah. We've completed, I don't know half a dozen or so little over the last few years and they are quite small. Typically less than a few hundred customers, but they’re adjacent to existing service territories typically the ones we've completed are really Iowa and Kansas, and most of them in Kansas. But we think it's an opportunity that given changes and pipeline regulations, security issues, cyber security issue everything else that some of these small municipal systems are going to be very expensive for cities to continue to operate as independent entity. And we've seen a little of that, but I think it's picking up steam and to the extent we can find some in and around our existing territories, we’re able to purchase those for very cost-effective numbers and then operationally it’s an advantage and that we get some customer growth in states that like Kansas and Ohio they’ve historically been fairly flat for us over the last few years from a customer account standpoint. And also spread our operating costs over a broader customer base. So the ones we’ve done so far we’re seeing pretty good advantages to us from those, but there no lot of money and we were producing a few hundred customers at a time. Michael Bates – D.A. Davidson & Co.: And is your expectation then with these small acquisitions are likely to accelerate going forward than what these new regulations?

Well let's put it this way, we hope they will. I think the forces are there that I think it makes sense for cities to look at devastating needs, especially some of these smaller accounts were you only have a few hundred customers. I guess I would be surprised if they did not continue to accelerate that trend. We really don't have any way to know that for certainty, but what we have seen so far has been encouraging and that's why we bother to mention it as we are looking at several more. Again, they're not a big needle mover from an income standpoint, but I do think that provides some customer growth and some longer term benefits to us on the operation side of just spreading our operating expenses over broader customer base and we do have a certainly a decent return on the investment it's just not a really big investment, enough to significantly move the needle for the gas utility. Michael Bates – D.A. Davidson & Co.: And the transactions that have taken place so far in general are those being initiated on your end, or the private systems, and municipalities out there looking for buyers?

Kind of all of the above, we've been proactive in some instances where we heard some of the municipal systems might be having problems. We’ve had situations where they’ve solicited alternatives for their system. We also have gotten recommendations like in Kansas from the Kansas Corporation Commission when some of these smaller utilities contact them about how they can comply with all these new rules and regulations. They in a couple of instances pointed those municipalities on our direction as well. Michael Bates – D.A. Davidson & Co.: Thank you.

You bet. Thank you.

(Operator Instructions) Your next question comes from the line of (inaudible). Please proceed.

Hey guys. Just wondering...

Good morning.

Hi, how are you? Just wondering when you initiated guidance in November, what your guidance was in terms of utility rate cases. And also as a follow-up just can you talk about what your expectation is for the year-over-year change in the gas utility earnings?

On the utility earning side, I mean we don't typically give guidance by segment. So our gas utility earnings expectation would be rolled into our overall earnings expectation. And also we typically don't give that.

Matt, we planned at normal weather.

Yeah.

Normal weather, okay.

Right. And the thing you have to remember is, from a segment standpoint, we spread our cost one of the factors is based on assets. So by lowering the cost basis in the oil and gas, some of that cost ends up in the other segment.

Corporate costs get redistributed if you will. Similarly, when we start building power generation facilities and things like that, those have a tendency to get allocated more cost as they increase the capital base in that particular subsidiary.

Okay. So just on the gas, it would be – the first quarter of 2012 would be impacted from the weather on the utilities side?

Primarily I mean that was the largest quarter by far on weather impact. Second and third quarter we don't typically make much money in our gas utilities anyway.

And we were okay in our third and fourth quarter in the gas utilities.

Okay. And then can you just touch on what your assumption was in November regarding the South Dakota rate case because I wasn’t sure if you were planning on filing any case or if you are planning on filing for rider or...

Yeah, when we put our guidance out, we typically have our regulatory strategy built into that. So we contemplated filing a case, we also contemplated when we thought we would have a decision. Similarly on the riders, we expected to file those. And so essentially, we are looking that using the financing riders in lieu of AFUDC for the year. Those were all part of our plan when we put out our guidance.

Okay, thank you.

You bet. Thank you.

(Operator Instructions) And with no further questions, I would now like to turn the conference over to Mr. David Emery for closing remarks.

Thank you. Thanks for your time and attention this morning everyone. We appreciate it as always. We are excited about 2013. We’ve had a great year in 2012 despite some very significant challenges. And excited about the future we’ve got a line of very exciting opportunities in front of us. And certainly with our dividend increase here this week and few other things, I think we’re after a great start for the year. So thank you all, have a great day.

Thank you for joining today’s conference. This concludes the presentation. You may now disconnect. Good day.