DALLAS, May 16, 2019 /PRNewswire/ -- Sharyland Utilities, L.L.C. (Sharyland) announced today that it has closed its transaction with Sempra Energy, whereby Sempra Energy now indirectly owns a 50 percent stake in the company.  In addition, Sharyland announced today that Stacey Doré has assumed the duties of President and CEO for Sharyland.

"Today marks a new beginning for Sharyland and for our commitment to supporting the critical transmission infrastructure needs of ERCOT," said Hunter Hunt, CEO of Hunt Consolidated Energy. "As a company, we are excited about the opportunities that this new partnership with Sempra Energy will bring."

Going forward, Sharyland will continue as an independent transmission utility, owned 50 percent by entities controlled by Hunter L. Hunt and other members of the family of Ray L. Hunt and 50 percent by entities controlled by Sempra Energy.  Sharyland will own transmission assets that it previously built in South Texas and will continue to seek development opportunities throughout the Electric Reliability Council of Texas (ERCOT) in partnership with Sempra Energy.

In addition, Stacey Doré has been named the new President and CEO of Sharyland Utilities.  Doré previously served as Senior Vice President and General Counsel of InfraREIT, Inc., and Hunt Utility Services, LLC (HUS), which was the external manager of InfraREIT, Inc. (NYSE: HIFR) (InfraREIT).  Doré will also serve as President of HUS, which will now provide external management services to Sharyland.  Prior to joining Hunt, Doré spent eight years with Energy Future Holdings Corp., serving the last four years as General Counsel and Chief Restructuring Officer.

"Stacey is the perfect person to lead our team going forward," said Hunt. "Stacey's creativity, judgment, and values have been essential in paving the way for a new chapter for Hunt and Sharyland.  She knows the utility industry extremely well, and she knows how to run Sharyland in a manner that will benefit both ERCOT and the communities where we will be operating."

Sharyland's transaction with Sempra Energy is part of a broader set of transactions that were initially announced in October 2018 and that included the $1.275B sale of InfraREIT, Inc. to Oncor Electric Delivery Company LLC (Oncor), which is majority-owned by Sempra Energy.  Over the past seven months, these transactions received all necessary regulatory approvals, including the final approval of the Public Utility Commission of Texas on May 9, 2019.

Now that all the transactions have closed, Oncor owns InfraREIT's electric transmission utility business, which Hunt developed, constructed, and grew to $2 billion in assets over the past two decades.  The InfraREIT business now owned by Oncor consists of all electric transmission assets previously owned by Sharyland and InfraREIT located in Central Texas, West Texas, and the Texas Panhandle and South Plains, including the Golden Spread Electric Cooperative interconnection, the Lubbock Power & Light interconnection project, and other ERCOT development projects outside of South Texas.  

Baker Botts acted as legal advisor to Sharyland and Hunt Consolidated, Inc. in the transaction. Morgan Stanley acted as exclusive financial advisor to Hunt Consolidated, Inc. in the transaction.

About Sharyland Utilities, L.L.C.
Sharyland Utilities, L.L.C. is a Texas-based electric transmission utility that is fully regulated by the Public Utility Commission of Texas. We are committed to providing safe, reliable, and efficient transmission and substation services, ensuring operational excellence, and investing to support infrastructure needs throughout the Electric Reliability Council of Texas grid. Sharyland Utilities is owned 50 percent by entities controlled by Hunter L. Hunt and other members of the family of Ray L. Hunt and 50 percent by entities controlled by Sempra Energy.  Additional information about Sharyland can be found at www.sharyland.com.

About Hunt Utility Services, LLC
Hunt Utility Services provides management and support services for Sharyland Utilities, L.L.C., and is part of a larger privately-owned group of companies managed by the Ray L. Hunt family that engages in oil and gas exploration, refining, power, real estate, ranching, and private equity investments.  Additional information about Hunt Utility Services can be found at www.huntutility.com.

About Sempra Energy
Sempra Energy's mission is to be North America's premier energy infrastructure company. With 2018 reported revenues of more than $11.6 billion, the San Diego-based company is the utility holding company with the largest U.S. customer base. The Sempra Energy companies' more than 20,000 employees are focused on delivering energy with purpose to approximately 40 million consumers worldwide. Sempra Energy has been consistently recognized for its leadership in diversity and inclusion, and social responsibility, and is a member of the S&P 500 Utilities Index and the Dow Jones Utility Index.

Contact: Paul Schulze
214-978-8534

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SOURCE Sharyland Utilities, L.L.C.

DALLAS and SAN DIEGO, May 9, 2019 /PRNewswire/ -- Today, Oncor Electric Delivery Company LLC (Oncor) and Sempra Energy (NYSE: SRE) announced that they have received approval from the Public Utility Commission of Texas (PUCT) for Oncor's acquisition of InfraREIT, Inc. (NYSE: HIFR) (InfraREIT), and, concurrently, Sempra Energy's acquisition of a 50% limited-partnership interest in a holding company that will own Sharyland Utilities, LP (Sharyland). PUCT approval was the final regulatory approval needed to complete the transactions.

"Texas is a great place to do business, and we are pleased that the Public Utility Commission approved another opportunity for Sempra Energy to invest in Oncor, and the state," said Jeffrey W. Martin, chairman and CEO of Sempra Energy. "We look forward to continuing to advance our growth strategy in Texas and the U.S. Gulf Coast region."

"Today is an exciting day for Oncor. When our acquisition of InfraREIT is complete, we will expand our transmission footprint and be better positioned to support the long-term needs of the ERCOT market," said Oncor CEO Allen Nye. "We want to thank the Commissioners, Commission staff, and all the stakeholders involved in this process for their hard work. We look forward to closing this transaction." 

"With the PUCT's approval to integrate the InfraREIT assets into Oncor's system, the Oncor team has engineered a great outcome that balances the needs of all stakeholders. We are proud to be a part of this team," said the owners of Texas Transmission Investment LLC, Oncor's minority owner.

The transaction required approvals by the PUCT, the Federal Energy Regulatory Commission, the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as well as other regulatory approvals. The transaction also required the approval of InfraREIT's shareholders, which was received in February 2019. In addition to these approvals, the transaction is subject to the satisfaction of various closing conditions.

On Oct. 18, 2018, Oncor and Sempra Energy announced that they entered into agreements whereby Oncor would acquire 100% of the equity interests of InfraREIT, including all the limited-partnership units in its subsidiary InfraREIT Partners, LP, for approximately $1.275 billion, or $21 per share (or partnership unit), excluding certain transaction costs, and, concurrently, Sempra Energy would acquire a 50% limited-partnership interest in a holding company that will own Sharyland for approximately $98 million. Oncor's acquisition of InfraREIT also includes InfraREIT's outstanding debt, which totaled approximately $946 million at March 31, 2019.

As part of the transaction, a subsidiary of InfraREIT will exchange certain assets with Sharyland, with the end result being that, after Oncor's acquisition of InfraREIT, Oncor will own all of InfraREIT's and Sharyland's electric transmission and distribution business in Central, North and West Texas, and Sharyland will own Sharyland and InfraREIT assets in South Texas.

If all remaining closing conditions are satisfied, Oncor and Sempra Energy expect to close the transaction by the end of the month.

Headquartered in Dallas, Oncor Electric Delivery Company LLC is a regulated electricity distribution and transmission business that uses superior asset management skills to provide reliable electricity delivery to consumers. Oncor operates the largest distribution and transmission system in Texas, delivering power to more than 3.6 million homes and businesses and operating more than 137,000 miles of transmission and distribution lines in Texas. While Oncor is owned by two investors (indirect majority owner, Sempra Energy, and minority owner, Texas Transmission Investment LLC), Oncor is managed by its Board of Directors, which is comprised of a majority of disinterested directors.

Sempra Energy's mission is to be North America's premier energy infrastructure company. With 2018 reported revenues of more than $11.6 billion, the San Diego- based company is the utility holding company with the largest U.S. customer base. The Sempra Energy companies' more than 20,000 employees are focused on delivering energy with purpose to approximately 40 million consumers worldwide. Sempra Energy has been consistently recognized for its leadership in diversity and inclusion, and social responsibility, and is a member of the S&P 500 Utilities Index and the Dow Jones Utility Index.

This press release contains statements that are not historical fact and constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by words such as "believes," "expects," "anticipates," "plans," "estimates," "projects," "forecasts," "contemplates," "assumes," "depends," "should," "could," "would," "will," "confident," "may," "can," "potential," "possible," "proposed," "target," "pursue," "outlook," "maintain," or similar expressions, or when  Oncor and Sempra Energy discuss their respective guidance, strategy, plans, goals, vision, mission, opportunities, projections, initiatives, objectives or intentions. Forward-looking statements are not guarantees of performance. They involve risks, uncertainties and assumptions. Future results may differ materially from those expressed in the forward-looking statements.

Such forward-looking statements include, but are not limited to, statements about the timing of the anticipated transactions contemplated by the proposed acquisition of InfraREIT, and any of the applicable parties' post-acquisition plans and intentions, and other statements that are not historical facts. The following important factors, among others, could cause actual results to differ materially from those set forth in the forward-looking statements: the satisfaction of conditions to closing the definitive agreements for the transactions; obtaining required governmental and regulatory approvals, which may delay the transactions or result in the imposition of conditions that could cause the parties to abandon the transactions or be onerous to Oncor or Sempra Energy; the expected timing to consummate the proposed transactions; the risk that the businesses will not be integrated successfully; the risk that any potential cost savings and any potential synergies from the transactions may not be fully realized or may take longer to realize than expected; and the diversion of management time and attention to issues related to the transactions.
Additional factors, among others, that could cause actual results and future actions of Oncor, Sempra Energy and/or their subsidiaries to differ materially from those described in any forward-looking statements include risks and uncertainties relating to: for Sempra Energy and its subsidiaries, the greater degree and prevalence of wildfires in California in recent years and the risk that Sempra Energy or its subsidiaries may be found liable for damages regardless of fault, such as where inverse condemnation applies, and risk that Sempra Energy or its subsidiaries may not be able to recover any such costs in rates from customers in California; actions and the timing of actions, including decisions, new regulations and issuances of authorizations by, as applicable, the California Public Utilities Commission, U.S. Department of Energy, California Department of Conservation's Division of Oil, Gas, and Geothermal Resources, Los Angeles County Department of Public Health, U.S. Environmental Protection Agency, Federal Energy Regulatory Commission, Pipeline and Hazardous Materials Safety Administration, Public Utility Commission of Texas, states, cities and counties, and other regulatory and governmental bodies in the U.S. and other countries in which Oncor, Sempra Energy and/or Sempra Energy's subsidiaries operate; the success of Sempra Energy's and its subsidiaries' business development efforts, construction projects, major acquisitions, divestitures and internal structural changes, including risks in (i) obtaining or maintaining authorizations; (ii) completing construction projects on schedule and budget; (iii) obtaining the consent of partners; (iv) counterparties' ability to fulfill contractual commitments; (v) winning competitively bid infrastructure projects; (vi) disruption caused by the announcement of contemplated acquisitions and/or divestitures or internal structural changes; (vii) the ability to complete contemplated acquisitions and/or divestitures; and (viii) the ability to realize anticipated benefits from any of these efforts once completed; the resolution of civil and criminal litigation and regulatory investigations and proceedings; actions by credit rating agencies to downgrade credit ratings of Oncor, Sempra Energy or those of their subsidiaries or to place those ratings on negative outlook and the ability of Oncor, Sempra Energy and their subsidiaries to borrow at favorable interest rates; deviations from regulatory precedent or practice that result in a reallocation of benefits or burdens among shareholders and/or ratepayers; denial of approvals of proposed settlements; delays in, or denial of, regulatory agency authorizations to recover costs in rates from customers or regulatory agency approval for projects required to enhance safety and reliability; for Sempra Energy and its subsidiaries, moves to reduce or eliminate reliance on natural gas; the availability of electric power and/or natural gas and natural gas storage capacity, including disruptions caused by failures in the transmission grid, limitations on the withdrawal or injection of natural gas from or into storage facilities, and equipment failures; risks posed by actions of third parties who control the operations of investments; weather conditions, natural disasters, accidents, equipment failures, computer system outages, explosions, terrorist attacks and other events that disrupt operations, damage facilities and systems, cause the release of harmful materials, cause fires and subject Oncor, Sempra Energy or their subsidiaries to third-party liability for property damage or personal injuries, fines and penalties, some of which may not be covered by insurance (including costs in excess of applicable policy limits), may be disputed by insurers or may otherwise not be recoverable through regulatory mechanisms or may impact the ability of Oncor, Sempra Energy or their subsidiaries to obtain satisfactory levels of affordable insurance; cybersecurity threats to the energy grid, storage and pipeline infrastructure, the information and systems used to operate the businesses of Oncor, Sempra Energy or their subsidiaries and the confidentiality of proprietary information of Oncor, Sempra Energy or their subsidiaries and the personal information of their customers and employees; actions of activist shareholders, which could impact the market price of Sempra Energy's securities and disrupt its operations as a result of, among other things, requiring significant time by management and its board of directors; changes in capital markets, energy markets and economic conditions, including the availability of credit; and volatility in currency exchange, interest and inflation rates and commodity prices and our ability to effectively hedge the risk of such volatility; the impact of federal or state tax reform and the companies' ability to mitigate adverse impacts; changes in foreign and domestic trade policies and laws, including border tariffs and revisions to or replacement of international trade agreements, such as the North American Free Trade Agreement or the United States-Mexico-Canada Agreement (subject to congressional approval), that may increase Sempra Energy's and its subsidiaries' costs or impair their ability to resolve trade disputes; expropriation of assets by foreign governments and title and other property disputes; the impact at San Diego Gas & Electric Company on competitive customer rates and reliability of electric transmission and distribution systems due to the growth in distributed and local power generation and from possible departing retail load resulting from customers transferring to Direct Access and Community Choice Aggregation or other forms of distributed and local power generation and the potential risk of nonrecovery for stranded assets and contractual obligations; Oncor's ability to eliminate or reduce its quarterly dividends due to regulatory capital requirements and other regulatory and governance commitments, including the determination by Oncor's board of directors, a majority of Oncor's independent directors or a minority member director to retain such amounts to meet future requirements; and other uncertainties, some of which may be difficult to predict and are beyond the control of Oncor and Sempra Energy and/or their subsidiaries.
These risks and uncertainties are further discussed in the reports that Sempra Energy and/or Oncor have filed with the U.S. Securities and Exchange Commission (SEC). These reports are available through the EDGAR system free-of-charge on the SEC's website, www.sec.gov. Investors should not rely unduly on any forward-looking statements. These forward-looking statements speak only as of the date hereof, and Sempra Energy and Oncor undertake no obligation to update or revise these forecasts or projections or other forward-looking statements, whether as a result of new information, future events or otherwise.

Sempra South American Utilities, Sempra North American Infrastructure, Sempra LNG, Sempra Renewables, Sempra Mexico, Sempra Texas Utility, Oncor Electric Delivery Company LLC (Oncor) and Infraestructura Energética Nova, S.A.B. de C.V. (IEnova) are not the same companies as the California utilities, San Diego Gas & Electric Company (SDG&E) or Southern California Gas Company (SoCalGas), and Sempra South American Utilities, Sempra North American Infrastructure, Sempra LNG, Sempra Renewables, Sempra Mexico, Sempra Texas Utility, Oncor and IEnova are not regulated by the California Public Utilities Commission.

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SOURCE Oncor Electric Delivery Company LLC

DALLAS, May 9, 2019 /PRNewswire/ -- InfraREIT, Inc. (NYSE: HIFR) ("InfraREIT" or the "Company") announced today that the Public Utility Commission of Texas ("PUCT") voted to approve the acquisition of InfraREIT by Oncor Electric Delivery Company LLC ("Oncor").

The approval by the PUCT marks the final regulatory approval required to close the pending transaction with Oncor pursuant to which InfraREIT will be acquired for $21.00 per share in cash, valued at approximately $1.275 billion, plus the assumption of approximately $940 million of InfraREIT's net debt as of March 31, 2019. The PUCT also approved the asset exchange between InfraREIT's regulated subsidiary, Sharyland Distribution & Transmission Services, L.L.C., and its tenant, Sharyland Utilities, L.P., and the other related transactions that are conditions to the closing of the sale of InfraREIT to Oncor.

"We appreciate the time and effort of all of the parties to the PUCT proceeding in jointly working toward the settlement that we presented to the Commission in April, and we thank the Commission for its thoughtful consideration of our transaction," said David A. Campbell, President and Chief Executive Officer of InfraREIT.

Following the approval by the PUCT, the InfraREIT board of directors declared a cash dividend of $0.002747 per share of common stock, per day, which represents a pro-rated quarterly dividend of $0.25 per share. The pro-rated dividend is intended to cover the period between March 29, 2019, which was the record date for the Company's first quarter dividend, and the closing of the sale to Oncor.

If the effective time of the merger with Oncor occurs before June 28, 2019, holders of record as of immediately prior to the effective time will receive a per-share amount equal to the actual number of days from the first quarter record date through the closing date, multiplied by $0.002747. The pro-rated dividend will be paid no later than six business days following the closing.

In the event that the closing has not occurred by June 28, 2019, the Company's regular $0.25 quarterly dividend will be payable on July 18, 2019 to holders of record on June 28, 2019, in accordance with InfraREIT's standard quarterly dividend schedule.

"It has been an immense honor to lead this organization, which will be remembered for its innovation and its commitment to serving all its stakeholders," continued Campbell. "We look forward to a successful closing in the coming weeks."

The Company anticipates closing the transaction by the end of the month.

Forward Looking Statements
This release contains forward-looking statements within the meaning of the federal securities laws that state the Company's or its management's intentions or expectations about future events. These statements include statements with respect to the consummation of the transaction with Oncor, the payment of the pro-rated dividend and the timing or amount of such payment. Factors that could cause actual results to differ materially from those contemplated above include, among others, the risks and uncertainties discussed from time to time in the Company's filings with the U.S. Securities and Exchange Commission.

Any forward-looking statement made by the Company in this release is based only on information currently available to the Company and speaks only as of the date on which it is made. The Company undertakes no obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, other than as required by applicable law.

About InfraREIT, Inc.
InfraREIT is engaged in owning and leasing rate-regulated electric transmission assets in the state of Texas and is structured as a real estate investment trust.  The Company is externally managed by Hunt Utility Services, LLC, an affiliate of Hunt Consolidated, Inc. (a diversified holding company based in Dallas, Texas and managed by the Ray L. Hunt family).  The Company's shares are traded on the New York Stock Exchange under the symbol "HIFR".  Additional information on InfraREIT is available at www.InfraREITInc.com.

For additional information, contact:

Brook Wootton
Vice President, Investor Relations
InfraREIT, Inc.
214-855-6748

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SOURCE InfraREIT, Inc.

DALLAS, May 7, 2019 /PRNewswire/ -- Oncor Electric Delivery Company LLC ("Oncor") today reported three months ended March 31, 2019 net income of $116 million.  Oncor's first quarter 2019 net income increased $27 million, up from $89 million in the first quarter of 2018. Financial and operational results are provided in Tables A, B, C and D below.

"From the Permian and Delaware Basins, to the Dallas-Ft. Worth metroplex, to the I-35 corridor, we continue to see robust and diverse growth across our service territory, and Oncor stands ready to power the growth here in Texas," said Allen Nye, chief executive of Oncor. "We are pleased with our financial results this quarter, and look forward to a strong and exciting year ahead in 2019 as we continue to deliver for our customers and our stakeholders."

Operating Highlights
In October 2018, Oncor announced its intent to acquire 100 percent of the equity interests of InfraREIT, Inc. (NYSE: HIFR) ("InfraREIT") and all of the limited-partnership units of its subsidiary, InfraREIT Partners, LP, for a purchase price of approximately $1.275 billion based on the number of shares and partnership units outstanding.  Oncor will also bear certain transaction costs incurred by InfraREIT. Sempra Energy (the holder of 80.25% of Oncor's equity interests) and certain indirect equity holders of Texas Transmission Investment LLC (the holder of 19.75% of Oncor's equity interests) have committed to provide their pro rata share of capital contributions to Oncor in an aggregate amount of up to $1.330 billion to fund the cash consideration payable by Oncor and the payment of certain fees and expenses relating to the transaction. The transaction also includes InfraREIT's outstanding debt, which totaled approximately $946 million at March 31, 2019. The transaction is subject to the satisfaction of certain closing conditions, including the approval of the Public Utility Commission of Texas ("PUCT").  If PUCT approval is received and all closing conditions are satisfied, Oncor expects to close the transaction in mid-2019.

Sempra Energy Internet Broadcast Today
Sempra Energy will broadcast a live discussion of its earnings results over the Internet today at 12 p.m. (Eastern Time) with senior management of Sempra Energy, which will include discussion of earnings and other information relating to Oncor. Access is available by logging on to Sempra Energy's website, www.sempra.com. An accompanying slide presentation will also be posted at sempra.com. For those unable to obtain access to the live webcast, it will be available on replay a few hours after its conclusion by dialing (888) 203-1112 and entering passcode 7994290.

Oncor's Quarterly Report on Form 10-Q for the period ended March 31, 2019 will be filed with the U.S. Securities and Exchange Commission after Sempra Energy's conference call

Headquartered in Dallas, Oncor Electric Delivery Company LLC is a regulated electricity distribution and transmission business that uses superior asset management skills to provide reliable electricity delivery to consumers. Oncor operates the largest distribution and transmission system in Texas, delivering power to more than 3.6 million homes and businesses and operating more than 137,000 miles of transmission and distribution lines in Texas. While Oncor is owned by a limited number of investors (including majority owner, Sempra Energy), Oncor is managed by its Board of Directors, which is comprised of a majority of disinterested directors.

Forward-Looking Statements

This press release contains forward-looking statements relating to Oncor within the meaning of the Private Securities Litigation Reform Act of 1995, which are subject to risks and uncertainties. All statements in this press release, other than statements of historical facts (often, but not always, through the use of words or phrases such as "expects," "intends," "plans," "will likely result," "are expected to," "will continue," "is anticipated," "estimated," "should," "projection," "target," "goal," "objective" and "outlook"), are forward-looking statements. They involve risks, uncertainties and assumptions. Further discussion of risks and uncertainties that could cause actual results to differ materially from management's current projections, forecasts, estimates and expectations is contained in filings made by Oncor with the U.S. Securities and Exchange Commission. Specifically, Oncor makes reference to the section entitled "Risk Factors" in its annual and quarterly reports. Any forward-looking statement speaks only as of the date on which it is made, and Oncor undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date on which it is made or to reflect the occurrence of unanticipated events.

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SOURCE Oncor Electric Delivery Company LLC

DALLAS, May 2, 2019 /PRNewswire/ -- InfraREIT, Inc. (NYSE: HIFR) ("InfraREIT" or the "Company") today reported financial results for the first quarter of 2019.

For the first quarter of 2019, InfraREIT reported the following financial highlights:

• Net income was $19.0 million
• Net income attributable to InfraREIT, Inc. common stockholders per share ("EPS") was $0.31 per share
• Non-GAAP earnings per share ("Non-GAAP EPS") was $0.32 per share
• Funds from operations ("FFO") was $31.2 million and FFO on an adjusted basis ("AFFO") was $31.6 million
• Quarterly dividend declared of $0.25 per share of common stock

Transaction Update:

• In March 2019, the pending sale of InfraREIT and related transactions were approved by the Committee on Foreign Investment in the United States ("CFIUS") and Federal Energy Regulatory Commission ("FERC").  As a result, Public Utility Commission of Texas ("PUCT") approval of the transactions is the final pending regulatory approval that is required to close the transactions.
• In April 2019, the parties to the Sale-Transfer-Merger ("STM") proceeding currently pending before the PUCT in Docket No. 48929 filed a Stipulation with the PUCT ("Settlement").  The Settlement is supported or unopposed by all parties to the STM but remains subject to review and approval by the PUCT.
• InfraREIT continues to expect the transactions to close by mid-2019.

Guidance:

• Expect to maintain the Company's quarterly cash dividend of $0.25 per share, including a pro-rated dividend for any partial quarter prior to closing the transaction
• InfraREIT expects to maintain its real estate investment trust ("REIT") status through the transaction close
• Footprint capital expenditures range of $30 million to $70 million for the period of 2019 through 2020

"We continue to advance the pending sale of InfraREIT as we received FERC and CFIUS approvals in the first quarter," said David A. Campbell, Chief Executive Officer of InfraREIT.  "The sale and related transactions remain subject to PUCT approval, and we appreciate the Commission's thoughtful review and consideration of our STM application and the Settlement that we reached with the parties in April," added Campbell.

First Quarter 2019 Results
Lease revenue, consisting of only base rent, increased 6 percent to $48.6 million for the three months ended March 31, 2019, compared to $45.7 million for the same period in 2018.  The increase in base rent was driven by the additional assets under lease.  There was no percentage rent recognized during the first quarter of 2019 or 2018 as Sharyland Utilities, L.P. ("Sharyland") year-to-date adjusted gross revenue did not exceed the annual specified breakpoints under the Company leases. The Company anticipates that revenue will grow over the year with little to no percentage rent recognized in the first and second quarters of each year, with the largest amounts recognized during the third and fourth quarters of each year.

Net income was $19.0 million in the first quarter of 2019, compared to net income of $17.8 million in the first quarter of 2018.  Net income attributable to InfraREIT, Inc. common stockholders was $0.31 per share during the first quarter of 2019 compared to $0.29 per share during the same period in 2018.  The increase in net income of $1.2 million between the two periods was attributable to a $2.9 million increase in lease revenue and $0.6 million decrease in interest expense, net partially offset by a $1.0 million increase in general and administrative expense, $0.6 million increase in depreciation expense and $0.7 million decrease in other income, net.  The increase in general and administrative expense was mainly due to a $1.5 million increase in transaction costs partially offset by a decrease of $0.2 million in management fees, $0.2 million for the evaluation of the Tax Cuts and Jobs Act in 2017 and $0.1 million in professional fees.  The increase in transaction costs represents the difference between the $1.7 million of professional services fees the Company incurred in the first quarter of 2019 related to the pending sale of InfraREIT and the $0.2 million of professional services fees incurred in the first quarter of 2018 related to the asset exchange transaction completed during the fourth quarter of 2017 ("2017 Asset Exchange Transaction").

Non-GAAP EPS was $0.32 per share for the first quarter of 2019 compared to $0.29 per share for the first quarter of 2018.  The increase in Non-GAAP EPS resulted from an increase in lease revenue of $2.9 million, a $0.6 million net decrease in general and administrative expense and a decrease of $0.6 million in interest expense, net partially offset by a $0.7 million decrease in other income, net, a $0.6 million increase in depreciation expense and a $1.1 million base rent adjustment reduction.  The decrease in general and administrative expense excludes $1.7 million of professional services fees related to the pending sale of InfraREIT in the first quarter of 2019 and $0.2 million of professional service fees related to the 2017 Asset Exchange Transaction during the first quarter of 2018.

FFO was $31.2 million for the first quarter of 2019, compared to $29.3 million for the same period in 2018, representing an increase of $1.9 million.  For the first quarter of 2019, AFFO was $31.6 million, compared to $28.6 million for the same period in 2018.

Liquidity and Capital Resources
As of March 31, 2019, the Company had $3.5 million of unrestricted cash and cash equivalents and $218.5 million of unused capacity under its revolving credit facilities.

Outlook and Guidance
InfraREIT expects to maintain the Company's current quarterly cash dividend of $0.25 per share through the transaction close, including a pro-rated dividend for any partial quarter prior to closing.  Additionally, InfraREIT will maintain its REIT status through the transaction close.

The Company estimates footprint capital expenditures in the following ranges over the next two years: $20 million to $35 million for 2019 and $10 million to $35 million for 2020.

The Company's consolidated debt profile continues to target debt as a percentage of total capitalization at or below 60 percent and AFFO-to-debt of at least 12 percent.

The guidance provided above constitutes forward-looking statements, which are based on current economic conditions and estimates, and the Company does not include other potential impacts, such as changes in accounting or unusual items.

Pending Sale of InfraREIT - Transaction Details
Asset Exchange:
As a condition to the closing of the sale to Oncor, Sharyland Distribution & Transmission Services, L.L.C. ("SDTS") will exchange its South Texas assets for Sharyland's Golden Spread Electric Cooperative interconnection ("Golden Spread Project") and other related assets.  The difference between the net book value of the exchanged assets will be paid in cash at closing.  Following the asset exchange, Sharyland will operate as an independent utility in South Texas. Additionally, SDTS and Sharyland have agreed to terminate their existing leases in connection with the asset exchange.

Oncor Merger:
After the completion of the asset exchange transaction with Sharyland, Oncor will acquire InfraREIT for $21.00 per share in cash.  Upon the close of the transaction, Oncor will own and operate all of SDTS's post-asset exchange assets, including the Golden Spread Project and Lubbock Power & Light interconnection.  Oncor plans to fund its acquisition of InfraREIT with capital contributions from its owners Sempra Energy and Texas Transmission Investment LLC.

The asset exchange and Oncor merger are mutually dependent on one another, and neither will become effective without the closing of the other.

Arrangements with Hunt:
InfraREIT is externally managed by Hunt Utility Services, LLC ("Hunt Manager") under its management agreement, which will be terminated upon the closing of the transactions.  Under the management agreement, Hunt Manager is entitled to the payment of a termination fee upon the termination or non-renewal of the management agreement.  The termination of the management agreement automatically triggers the termination of the development agreement between InfraREIT and Hunt.  InfraREIT has agreed to pay Hunt approximately $40.5 million at the closing of the transactions to terminate the management agreement, development agreement, leases with Sharyland, and all other existing agreements between InfraREIT or its subsidiaries with Hunt, Sharyland or their affiliates.  That amount is consistent with the termination fee that is contractually required under the management agreement.

Agreements among Hunt, Oncor and Sempra Energy:
Concurrently with the execution of the merger agreement and the asset exchange agreement, Sharyland and Sempra Energy entered into an agreement in which Sempra Energy will purchase a 50 percent limited partnership interest in Sharyland Holdings LP ("Sharyland Holdings"), which will own a 100 percent interest in Sharyland.  The closing of Sempra Energy's purchase is a requirement of the asset exchange agreement between SDTS and Sharyland.  Additionally, under a separate agreement with Sharyland, Oncor will operate all of Sharyland's assets following the closing of the transactions.

Transaction Approvals and Closing Conditions:
The closing of the transactions is dependent upon and is subject to several closing conditions, including:

• PUCT approval of the transactions, including:
• Exchange of assets with Sharyland;
• Acquisition of InfraREIT by Oncor; and
• Sempra Energy's 50 percent ownership of Sharyland Holdings;
• Other necessary regulatory approvals, including FERC approval, the expiration or termination of the waiting period under the Hart-Scott-Rodino Act ("HSR Act") and CFIUS clearance;
• Stockholder approval;
• Certain lenders consents; and
• Other customary closing conditions.

The early termination of the 30-day waiting period required by the HSR Act was received in December 2018.  In December 2018, certain of the Company's subsidiaries entered into amendments that, effective as of the closing, will satisfy the closing condition with respect to the lender consents.  Additionally, a special meeting of InfraREIT's stockholders was held on February 7, 2019, at which time the stockholders voted to approve the transactions. Furthermore, in March 2019, CFIUS clearance was received for the transactions and FERC issued an order approving the transactions.

SDTS, Sharyland, Oncor and Sempra Energy filed the STM application with the PUCT on November 30, 2018.  In April 2019, the parties to the STM proceeding filed the Settlement with the PUCT. On April 10, 2019, a hearing on the merits was held and the Settlement was discussed.  The 180-day deadline for the STM is May 29, 2019, although the PUCT is permitted to extend that deadline for an additional 60 days if necessary.

The Company continues to expect the transactions to close by mid-2019, subject to obtaining the PUCT approval and satisfaction of other customary closing conditions.  Additional information related to the transactions can be found in the Company's filings with the U.S. Securities and Exchange Commission ("SEC") and other documents on the SEC's Web site, www.sec.gov.

Dividends and Distributions
On February 26, 2019, InfraREIT's Board of Directors declared cash distributions and dividends of $0.25 per unit and share, respectively, to unitholders and stockholders of record on March 29, 2019, which were paid on April 18, 2019.

Non-GAAP Measures
This press release contains certain financial measures that are not recognized under generally accepted principles in the United States of America ("GAAP").  In particular, InfraREIT uses Non-GAAP EPS, FFO and AFFO as important supplemental measures of the Company's operating performance.  The Company presents non-GAAP performance measures because management believes they help investors understand InfraREIT's business, performance and ability to earn and distribute cash to its stockholders by providing perspectives not immediately apparent from net income.  Reporting on these measures in InfraREIT's public disclosures also ensures that this information is available to all of InfraREIT's investors.  The non-GAAP measures presented in this press release are not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

InfraREIT offers these measures to assist users in assessing the Company's operating performance under GAAP, but these measures are non-GAAP measures and should not be considered measures of liquidity, alternatives to net income or indicators of any other performance measures determined in accordance with GAAP, nor are they indicative of funds available to fund the Company's cash needs, including capital expenditures, make payments on the Company's indebtedness or make distributions.  In addition, InfraREIT's method of calculating these measures may be different from methods used by other companies and, accordingly, may not be comparable to similar measures as calculated by other companies.  Investors should not rely on these measures as a substitute for any GAAP measure, including net income, cash flows from operating activities or revenues.  Reconciliations of these measures to their most directly comparable GAAP measures are included in the Schedules to this press release.

About InfraREIT, Inc.
InfraREIT is engaged in owning and leasing rate-regulated electric transmission assets in the state of Texas and is structured as a real estate investment trust.  The Company is externally managed by Hunt Utility Services, LLC, an affiliate of Hunt Consolidated, Inc. (a diversified holding company based in Dallas, Texas, and managed by the Ray L. Hunt family).  The Company's shares are traded on the New York Stock Exchange under the symbol "HIFR."  Additional information on InfraREIT is available at www.InfraREITInc.com.

Forward Looking Statements
This release contains forward-looking statements within the meaning of the federal securities laws.  These statements give the current expectations of the Company's management.  Words such as "could," "will," "may," "assume," "forecast," "strategy," "guidance," "outlook," "target," "expect," "intend," "plan," "estimate," "anticipate," "believe," or "project" and similar expressions are used to identify forward-looking statements.  Without limiting the generality of the foregoing, forward-looking statements contained in this release include the Company's expectations regarding anticipated financial and operational performance, including projected or forecasted capital expenditures, distributions to stockholders, AFFO-to-debt ratios, capitalization matters and other forecasted metrics as well as the consummation of the transactions described herein.

Forward-looking statements can be affected by assumptions used or known or unknown risks or uncertainties.  Consequently, no forward-looking statements can be guaranteed and actual results may differ materially and adversely from those reflected in the forward-looking statements.  Factors that could cause actual results to differ materially from those indicated in the forward-looking statements include, among other things, (a) the following risks inherent in the transactions (in addition to others described elsewhere in this document and in the Company's filings with the SEC): (1) failure to obtain regulatory approval necessary to consummate the transactions or to obtain regulatory approvals on favorable terms and (2) delays in consummating the transactions or the failure to consummate the transactions and (b) other risks and uncertainties disclosed in the Company's filings with the SEC, including, among others, the following (1) decisions by regulators or changes in governmental policies or regulations with respect to the Company's organizational structure, lease arrangements, capitalization, acquisitions and dispositions of assets, recovery of investments, the Company's authorized rate of return and other regulatory parameters; (2) the Company's current reliance on its tenant for all of its revenues and, as a result, its dependency on the tenant's solvency and financial and operating performance; (3) the amount of available investment to grow the Company's rate base; (4) cyber breaches and weather conditions or other natural phenomena; (5) the Company's ability to negotiate future rent payments or to renew leases with its tenant; (6) insufficient cash available to meet distribution requirements; and (7) the effects of existing and future tax and other laws and governmental regulations.

Because the Company's forward-looking statements are based on estimates and assumptions that are subject to significant business, economic and competitive uncertainties, many of which are beyond the Company's control or are subject to change, actual results could be materially different and any or all of the Company's forward-looking statements may turn out to be wrong.  Forward-looking statements speak only as of the date made and can be affected by assumptions the Company might make or by known or unknown risk and uncertainties.  Many factors mentioned in this release and in the Company's annual and quarterly reports will be important in determining future results.  Consequently, the Company cannot assure you that the Company's expectations or forecasts expressed in such forward-looking statements will be achieved.

Schedule 1
InfraREIT, Inc.
Explanation and Reconciliation of Non-GAAP EPS

Non-GAAP EPS
InfraREIT defines non-GAAP net income as net income (loss) adjusted in a manner the Company believes is appropriate to show its core operational performance, which includes (a) an adjustment for the difference between the amount of base rent payments that the Company receives with respect to the applicable period and the amount of straight-line base rent recognized under GAAP; (b) adding back the transaction costs related to the pending sale of InfraREIT to Oncor and the asset exchange with Sharyland; (c) adding back the transaction costs related to the 2017 Asset Exchange Transaction; (d) adding back the professional services fee related to the 2018 franchise tax settlement with the state of Texas; and (e) removing the effect of the 2018 Texas franchise tax settlement.  The Company defines Non-GAAP EPS as non-GAAP net income (loss) divided by the weighted average shares outstanding calculated in the manner described in the footnotes below.

The following tables set forth a reconciliation of net income attributable to InfraREIT, Inc. per diluted share to Non-GAAP EPS:

Schedule 2
InfraREIT, Inc.
Explanation and Reconciliation of FFO and AFFO

FFO and AFFO
The National Association of Real Estate Investment Trusts ("NAREIT") defines FFO as net income (computed in accordance with GAAP), excluding gains and losses from sales of property (net) and impairments of depreciated real estate, plus real estate depreciation and amortization (excluding amortization of deferred financing costs) and after adjustments for unconsolidated partnerships and joint ventures.  Applying the NAREIT definition to the Company's consolidated financial statements, which is the basis for the FFO presented in this press release and the reconciliations below, results in FFO representing net income (loss) before depreciation, impairment of assets and gain (loss) on sale of assets.  FFO does not represent cash generated from operations as defined by GAAP and it is not indicative of cash available to fund all cash needs, including distributions.

AFFO is defined as FFO adjusted in a manner the Company believes is appropriate to show its core operational performance, including: (a) an adjustment for the difference between the amount of base rent payments that the Company receives with respect to the applicable period and the amount of straight-line base rent recognized under GAAP; (b) adjusting for other income (expense), net; (c) adding back the transaction costs related to the pending sale of InfraREIT to Oncor and the asset exchange with Sharyland; (d) adding back the transaction costs related to the 2017 Asset Exchange Transaction; (e) adding back the professional services fee related to the 2018 franchise tax settlement with the state of Texas; and (f) removing the effect of the 2018 Texas franchise tax settlement.

The following table sets forth a reconciliation of net income to FFO and AFFO:

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SOURCE InfraREIT, Inc.

DALLAS, Feb. 27, 2019 /PRNewswire/ -- InfraREIT, Inc. (NYSE: HIFR) ("InfraREIT" or the "Company") today reported financial results for the fourth quarter and full year of 2018.

For the fourth quarter of 2018, InfraREIT reported the following financial highlights:

• Net income was $23.7 million
• Net income attributable to InfraREIT, Inc. common stockholders per share ("EPS") was $0.39 per share
• Non-GAAP earnings per share ("Non-GAAP EPS") was $0.49 per share
• Funds from operations ("FFO") was $35.9 million and FFO on an adjusted basis ("AFFO") was $41.9 million
• Quarterly dividend declared of $0.25 per share of common stock, $1.00 per share annualized

Transaction Update:

• On February 7, 2019, InfraREIT's stockholders voted to adopt the Agreement and Plan of Merger dated October 18, 2018 ("Merger Agreement"), at a Special Meeting of Stockholders. The Merger Agreement includes the acquisition of InfraREIT by affiliates of Oncor Electric Delivery Company LLC, and other related transactions. The Company previously was granted early termination of the waiting period required with respect to the transactions under the Hart-Scott-Rodino Act ("HSR Act") and has obtained the lender consents required under the Merger Agreement. The transactions remain subject to the approval of the Public Utility Commission of Texas ("PUCT"), Federal Energy Regulatory Commission ("FERC") and the Committee on Foreign Investment in the United States ("CFIUS"), as well as other customary closing conditions.
• Upon completion of the merger, each share of the Company's common stock issued and outstanding (other than certain shares of common stock specified in the Merger Agreement) will be converted into the right to receive $21.00 in cash, without interest, and subject to deduction for any required withholding taxes. Subject to required regulatory approvals, the transaction is expected to close by mid-2019.

Guidance:

• Expect to maintain the Company's quarterly cash dividend of $0.25 per share, through the transaction close
• InfraREIT expects to maintain its real estate investment trust ("REIT") status through the transaction close
• Footprint capital expenditures range of $30 million to $70 million for the period of 2019 through 2020

"On February 7, 2019, the Company achieved a significant milestone as our stockholders voted overwhelmingly in favor of the Merger Agreement.  The stockholder approval is an important step in the process of completing the transaction," said David A. Campbell, Chief Executive Officer of InfraREIT.  "The transaction remains subject to regulatory approval, and we are working closely with key parties to advance the approval process at the Public Utility Commission of Texas.  We continue to believe that our transaction is the best path forward for all stakeholders," added Campbell.

Fourth Quarter 2018 Results
Lease revenue was $57.9 million for the three months ended December 31, 2018, compared to $58.7 million for the same period in 2017.  For the fourth quarter of 2018, base rent contributed $49.4 million and percentage rent contributed $8.5 million, compared to $42.9 million of base rent and $15.8 million of percentage rent for the fourth quarter of 2017.  When compared to 2017, 2018 base rent represents a higher proportion, and percentage rent represents a lower proportion, of total lease revenue as a result of the Permian lease renewal and the assets acquired in the asset exchange transaction completed during the fourth quarter of 2017 ("2017 Asset Exchange Transaction"), which were added to the CREZ lease, which have only base rent and not a percentage rent component.  This change in revenue allocation also results in an intra-year timing shift for revenue recognition since base rent, which was a higher proportion of total revenue in 2018 relative to 2017, is recognized on a straight-line basis and percentage rent is recognized only after Sharyland Utilities, L.P.'s ("Sharyland") revenue exceeds the annual specified breakpoint, which usually occurs in the third and fourth quarters of each year.  Additionally, 2018 percentage rent was impacted due to Sharyland's reduction in its wholesale transmission service rates during the first quarter of 2018 to reflect an income tax allowance at the 21 percent corporate federal income tax rate.  This reduction in rates has contributed to a reduction in Sharyland's revenues during 2018 as compared to 2017.

Net income was $23.7 million in the fourth quarter of 2018, compared to a net loss of $25.3 million in the fourth quarter of 2017.  Net income attributable to InfraREIT, Inc. common stockholders was $0.39 per share during the fourth quarter of 2018 compared to $(0.42) per share during the same period in 2017.  The increase in net income of $49.0 million between the two periods was mainly attributable to the non-cash $55.8 million Tax Cuts and Jobs Act regulatory adjustment in 2017.  The $55.8 million increase was partially offset by a net decrease of $6.8 million which is comprised of an $0.8 million decrease in lease revenue, $5.7 million increase in general and administrative expense, $0.4 million decrease in other income, net and the $0.3 million gain on the 2017 Asset Exchange Transaction partially offset by a $0.2 million decrease in interest expense, net.  The increase in general and administrative expense was mainly due to a $5.5 million increase in transaction costs and $0.3 million loss on distribution inventory partially offset by a decrease of $0.2 million in management fees.  The increase in transaction costs represents the difference between the $6.3 million of professional services fees the Company incurred in the fourth quarter of 2018 related to the pending sale of InfraREIT and the $0.8 million of professional services fees it incurred in the fourth quarter of 2017 related to the 2017 Asset Exchange Transaction.

Non-GAAP EPS was $0.49 per share for the fourth quarter of 2018 compared to $0.50 per share for the fourth quarter of 2017.  The decrease in Non-GAAP EPS resulted from a decrease in lease revenue of $0.8 million, a decrease of $0.4 million in other income, net and a $0.2 million increase in general and administrative expense partially offset by a $0.4 million base rent adjustment and a decrease of $0.2 million in interest expense, net.  The increase in general and administrative expense excludes $6.3 million of professional services fees related to the pending sale of InfraREIT in the fourth quarter of 2018 and $0.8 million of professional services fees related to the 2017 Asset Exchange Transaction during the fourth quarter of 2017.

FFO was $35.9 million for the fourth quarter of 2018, compared to $(13.1) million for the same period in 2017, representing an increase of $49.0 million.  The increase in FFO between the two periods was due to the non-cash reduction to revenue of $55.8 million from the Tax Cuts and Jobs Act regulatory adjustment recorded in 2017 partially offset by a $5.7 million increase in general and administrative expense.  For the fourth quarter of 2018, AFFO was $41.9 million, compared to $42.1 million for the same period in 2017.

2018 Performance
Lease revenue increased 5 percent to $200.4 million for the year ended December 31, 2018, compared to $190.3 million in 2017.  Base rent contributed $191.3 million and percentage rent contributed $9.1 million for 2018, compared to base rent of $165.2 million and percentage rent of $25.1 million for 2017.  The increase in lease revenue was driven by the change in the allocation of the total rent components between base and percentage rent and additional assets under lease.

Net income was $85.2 million for the year ended December 31, 2018, compared to net income of $17.1 million in 2017.  Net income attributable to InfraREIT, Inc. common stockholders was $1.40 per share for 2018 compared to $0.28 per share for 2017.  The $68.1 million increase in net income is mainly attributable to the non-cash $55.8 million Tax Cuts and Jobs Act regulatory adjustment in 2017.  The remaining $12.3 million increase is a result of a $10.1 million increase in lease revenue, $5.6 million benefit from the Texas franchise tax settlement, $3.4 million decrease in depreciation expense and $0.4 million increase in other income, net partially offset by the $5.6 million increase in general and administrative expense and $1.4 million increase in interest expense, net.  The increase in general and administrative expense was mainly due to a $4.4 million increase in transaction costs, a $1.2 million professional services fee associated with the settlement of the Company's Texas franchise taxes, $0.5 million for the review of the Company's structure ("De-REIT Alternatives"), $0.3 million loss on distribution inventory and $0.2 million for the evaluation of the Tax Cuts and Jobs Act ("TCJA") partially offset by a $0.5 million decrease in regulatory expenses and $0.4 million decrease in management fees.  The increase in transaction costs represents the difference between the $9.1 million of professional services fees the Company incurred in 2018 compared to $4.7 million in 2017.  The $4.4 million increase in transaction costs represents $8.9 million of fees related to the pending sale of InfraREIT incurred during the second half of 2018 and $0.2 million of fees related to the 2017 Asset Exchange Transaction incurred in the first quarter of 2018 partially offset by $4.7 million of fees related to the 2017 Asset Exchange Transaction incurred in 2017.

Non-GAAP EPS was $1.42 per share for 2018 compared to $1.26 per share for 2017, representing an increase of 13 percent.  The drivers of growth in Non-GAAP EPS were due to an increase in lease revenue of $10.1 million, an increase of $0.4 million in other income, net and a $3.4 million decrease in depreciation expense partially offset by a $2.8 million base rent adjustment reduction and an increase of $1.4 million in interest expense, net.  The change in general and administrative expense was flat between the two periods when the following items are excluded: professional services fees of $1.2 million associated with the settlement of the Company's Texas franchise taxes, $8.9 million of professional services fees related to the pending sale of InfraREIT and $0.2 million related to the 2017 Asset Exchange Transaction during 2018 and $4.7 million of professional services fees related to the 2017 Asset Exchange Transaction during 2017. Non-GAAP EPS of $1.42 per share in 2018 exceeded the Company's guidance range of $1.35 to $1.40 per share primarily due to lower than expected interest expense, higher than expected allowance for funds used during construction ("AFUDC") on other funds and lower recurring general and administrative expense partially offset by expenses associated with the Company's De-REIT Alternatives.

FFO was $133.0 million for the year ended December 31, 2018, compared to $68.3 million in 2017, representing an increase of $64.7 million.  The increase in FFO between the two periods was due to the non-cash reduction to revenue of $55.8 million from the Tax Cuts and Jobs Act regulatory adjustment recorded in 2017, $10.1 million increase in lease revenue, $5.6 million benefit from the Texas franchise tax settlement partially offset by a $5.6 million increase in general and administrative expense.  For the full year of 2018, AFFO was $132.8 million, compared to $126.9 million in 2017, representing an increase of 4 percent.

Liquidity and Capital Resources
As of December 31, 2018, the Company had $1.8 million of unrestricted cash and cash equivalents and $212.5 million of unused capacity under its revolving credit facilities.

Outlook and Guidance
InfraREIT expects to maintain the Company's current quarterly cash dividend of $0.25 per share through the transaction close, including a pro-rated dividend for any partial quarter prior to closing.  Additionally, InfraREIT will maintain its REIT status through the transaction close.

The Company estimates footprint capital expenditures in the following ranges over the next two years: $20 million to $35 million for 2019 and $10 million to $35 million for 2020.

The Company's consolidated debt profile continues to target debt as a percentage of total capitalization at or below 60 percent and AFFO-to-debt of at least 12 percent.

The guidance provided above constitutes forward-looking statements, which are based on current economic conditions and estimates, and the Company does not include other potential impacts, such as changes in accounting or unusual items.

Pending Sale of InfraREIT - Transaction Details
Asset Exchange:
As a condition to the closing of the sale to Oncor, Sharyland Distribution & Transmission Services, L.L.C. ("SDTS") will exchange its South Texas assets for Sharyland's Golden Spread Electric Cooperative interconnection ("Golden Spread Project") and other related assets.  The difference between the net book value of the exchanged assets will be paid in cash at closing.  Following the asset exchange, Sharyland will operate as an independent utility in South Texas. Additionally, SDTS and Sharyland have agreed to terminate their existing leases in connection with the asset exchange.

Oncor Merger:
After the completion of the asset exchange transaction with Sharyland, Oncor will acquire InfraREIT for $21.00 per share in cash.  Upon the close of the transaction, Oncor will own and operate all of SDTS's post-asset exchange assets, including the Golden Spread Project and Lubbock Power & Light interconnection.  Oncor plans to fund its acquisition of InfraREIT with capital contributions from its owners Sempra Energy and Texas Transmission Investment LLC.

The asset exchange and Oncor merger are mutually dependent on one another, and neither will become effective without the closing of the other.

Arrangements with Hunt:
InfraREIT is externally managed by Hunt Utility Services, LLC ("Hunt Manager") under its management agreement, which will be terminated upon the closing of the transactions.  Under the management agreement, Hunt Manager is entitled to the payment of a termination fee upon the termination or non-renewal of the management agreement.  The termination of the management agreement automatically triggers the termination of the development agreement between InfraREIT and Hunt.  InfraREIT has agreed to pay Hunt approximately $40.5 million at the closing of the transactions to terminate the management agreement, development agreement, leases with Sharyland, and all other existing agreements between InfraREIT or its subsidiaries with Hunt, Sharyland or their affiliates.  That amount is consistent with the termination fee that is contractually required under the management agreement.

Agreements among Hunt, Oncor and Sempra Energy:
Concurrently with the execution of the merger agreement and the asset exchange agreement, Sharyland and Sempra Energy entered into an agreement in which Sempra Energy will purchase a 50 percent limited partnership interest in Sharyland Holdings LP ("Sharyland Holdings"), which will own a 100 percent interest in Sharyland.  The closing of Sempra Energy's purchase is a requirement of the asset exchange agreement between SDTS and Sharyland.  Additionally, under a separate agreement with Sharyland, Oncor has agreed to operate and maintain all of Sharyland's assets following the closing of the transactions.

Transaction Approvals and Closing Conditions:
The closing of the transactions is dependent upon and will be subject to several closing conditions, including:

• PUCT approval of the transactions, including:
• Exchange of assets with Sharyland;
• Acquisition of InfraREIT by Oncor; and
• Sempra Energy's 50 percent ownership of Sharyland Holdings;
• Other necessary regulatory approvals, including FERC approval, the expiration or termination of the waiting period under the HSR Act and CFIUS clearance;
• Stockholder approval;
• Certain lenders consents; and
• Other customary closing conditions.

The early termination of the 30-day waiting period required by the HSR Act was received on December 14, 2018.  On December 21, 2018, certain of the Company's subsidiaries entered into amendments that, effective as of the closing, will satisfy the closing condition with respect to the lender consents.  Additionally, a special meeting of InfraREIT's stockholders was held on February 7, 2019, at which time the stockholders voted to approve the transactions.

In accordance with the definitive agreements, SDTS, Sharyland and Oncor filed a Sale-Transfer-Merger application ("STM") with the PUCT on November 30, 2018, and a hearing on the merits is scheduled for April 10-12, 2019. The 180-day deadline for the STM is May 29, 2019, although the PUCT is permitted to extend that deadline for an additional 60 days if necessary.

Subject to obtaining the required regulatory approvals, the transactions are expected to close by mid-2019.  Additional information related to the transactions can be found in the Company's filings with the U.S. Securities and Exchange Commission ("SEC") and other documents on the SEC's Web site, www.sec.gov.

Dividends and Distributions
On February 26, 2019, InfraREIT's Board of Directors declared cash distributions and dividends of $0.25 per unit and share, respectively, to unitholders and stockholders of record on March 29, 2019, which are payable on April 18, 2019.

On December 7, 2018, InfraREIT's Board of Directors declared cash distributions and dividends of $0.25 per unit and share, respectively, to unitholders and stockholders of record on December 31, 2018, which were paid on January 17, 2019.

Hunt Project Quarterly Updates
InfraREIT's quarterly "Hunt Project Updates" can be found on the Company's Web site (www.InfraREITInc.com) under the "Hunt Transmission-Our Developer" and "Investor Relations" sections posted on the Company's Web site.

Availability of Annual Report on Form 10-K
InfraREIT has filed its Annual Report on Form 10-K for the year ended December 31, 2018 with the SEC.  A copy of the Annual Report is available in the Investor Relations section of the Company's Web site at www.InfraREITInc.com or on the SEC's Web site at www.sec.gov.  InfraREIT stockholders may also obtain a hard copy of the Annual Report on Form 10-K (including complete audited financial statements) free of charge by contacting the Company's corporate secretary at the following address: InfraREIT, Inc., Attention: Corporate Secretary, 1900 North Akard Street, Dallas, Texas 75201.

Non-GAAP Measures
This press release contains certain financial measures that are not recognized under generally accepted principles in the United States of America ("GAAP").  In particular, InfraREIT uses Non-GAAP EPS, FFO and AFFO as important supplemental measures of the Company's operating performance.  The Company presents non-GAAP performance measures because management believes they help investors understand InfraREIT's business, performance and ability to earn and distribute cash to its stockholders by providing perspectives not immediately apparent from net income.  Reporting on these measures in InfraREIT's public disclosures also ensures that this information is available to all of InfraREIT's investors.  The non-GAAP measures presented in this press release are not intended to be considered in isolation or as a substitute for, or superior to, the financial information prepared and presented in accordance with GAAP.

InfraREIT offers these measures to assist users in assessing the Company's operating performance under GAAP, but these measures are non-GAAP measures and should not be considered measures of liquidity, alternatives to net income or indicators of any other performance measures determined in accordance with GAAP, nor are they indicative of funds available to fund the Company's cash needs, including capital expenditures, make payments on the Company's indebtedness or make distributions.  In addition, InfraREIT's method of calculating these measures may be different from methods used by other companies and, accordingly, may not be comparable to similar measures as calculated by other companies.  Investors should not rely on these measures as a substitute for any GAAP measure, including net income, cash flows from operating activities or revenues.  Reconciliations of these measures to their most directly comparable GAAP measures are included in the Schedules to this press release.

About InfraREIT, Inc.
InfraREIT is engaged in owning and leasing rate-regulated electric transmission assets in the state of Texas and is structured as a real estate investment trust.  The Company is externally managed by Hunt Utility Services, LLC, an affiliate of Hunt Consolidated, Inc. (a diversified holding company based in Dallas, Texas, and managed by the Ray L. Hunt family).  The Company's shares are traded on the New York Stock Exchange under the symbol "HIFR."  Additional information on InfraREIT is available at www.InfraREITInc.com.

Forward Looking Statements
This release contains forward-looking statements within the meaning of the federal securities laws.  These statements give the current expectations of the Company's management.  Words such as "could," "will," "may," "assume," "forecast," "strategy," "guidance," "outlook," "target," "expect," "intend," "plan," "estimate," "anticipate," "believe," or "project" and similar expressions are used to identify forward-looking statements.  Without limiting the generality of the foregoing, forward-looking statements contained in this release include the Company's expectations regarding anticipated financial and operational performance, including projected or forecasted capital expenditures, distributions to stockholders, AFFO-to-debt ratios, capitalization matters and other forecasted metrics as well as the consummation of the transactions described herein.

Forward-looking statements can be affected by assumptions used or known or unknown risks or uncertainties.  Consequently, no forward-looking statements can be guaranteed and actual results may differ materially and adversely from those reflected in the forward-looking statements.  Factors that could cause actual results to differ materially from those indicated in the forward-looking statements include, among other things, (a) the following risks inherent in the transactions (in addition to others described elsewhere in this document and in the Company's filings with the SEC): (1) failure to obtain regulatory approval necessary to consummate the transactions or to obtain regulatory approvals on favorable terms and (2) delays in consummating the transactions or the failure to consummate the transactions and (b) other risks and uncertainties disclosed in the Company's filings with the SEC, including, among others, the following (1) decisions by regulators or changes in governmental policies or regulations with respect to the Company's organizational structure, lease arrangements, capitalization, acquisitions and dispositions of assets, recovery of investments, the Company's authorized rate of return and other regulatory parameters; (2) the Company's current reliance on its tenant for all of its revenues and, as a result, its dependency on the tenant's solvency and financial and operating performance; (3) the amount of available investment to grow the Company's rate base; (4) cyber breaches and weather conditions or other natural phenomena; (5) the Company's ability to negotiate future rent payments or to renew leases with its tenant; (6) insufficient cash available to meet distribution requirements; and (7) the effects of existing and future tax and other laws and governmental regulations.

Because the Company's forward-looking statements are based on estimates and assumptions that are subject to significant business, economic and competitive uncertainties, many of which are beyond the Company's control or are subject to change, actual results could be materially different and any or all of the Company's forward-looking statements may turn out to be wrong.  Forward-looking statements speak only as of the date made and can be affected by assumptions the Company might make or by known or unknown risk and uncertainties.  Many factors mentioned in this release and in the Company's annual and quarterly reports will be important in determining future results.  Consequently, the Company cannot assure you that the Company's expectations or forecasts expressed in such forward-looking statements will be achieved.

Schedule 1
InfraREIT, Inc.
Explanation and Reconciliation of Non-GAAP EPS

Non-GAAP EPS
InfraREIT defines non-GAAP net income as net income (loss) adjusted in a manner the Company believes is appropriate to show its core operational performance, which includes (a) an adjustment for the difference between the amount of base rent payments that the Company receives with respect to the applicable period and the amount of straight-line base rent recognized under GAAP; (b) adding back the TCJA regulatory adjustment related to the enactment of the TCJA reducing the corporate federal income tax rate from 35 percent to 21 percent; (c) adding back the transaction costs related to the pending sale of InfraREIT to Oncor and the asset exchange with Sharyland; (d) adding back the transaction costs related to the 2017 Asset Exchange Transaction; (e) adding back the professional services fee related to the franchise tax settlement with the state of Texas; (f) removing the effect of the Texas franchise tax settlement; and (g) removing the effect of the gain on the 2017 Asset Exchange Transaction.  The Company defines Non-GAAP EPS as non-GAAP net income (loss) divided by the weighted average shares outstanding calculated in the manner described in the footnotes below.

The following tables set forth a reconciliation of net income attributable to InfraREIT, Inc. per diluted share to Non-GAAP EPS: