Cold weather turned El Paso Electric's profits hot in the first quarter.
Colder than normal weather in the first three months of this year increased the utility's electric sales and helped more than double its first-quarter profit compared to a year ago to $7.6 million, or 19 cents per share, the company reported Wednesday.
Revenues from the utility's electric sales to residential customers increased almost 8 percent, which made up for revenue declines for commercial customers due to lower commercial electric rates, which went into effect in May 2012, said David Carpenter, company chief financial officer.
Total electric sales, not including fuel charges, increased $2.3 million in the January-March quarter compared with the same quarter a year ago to $108.5 million, or an increase of 2.2 percent, the company reported.
"It was a good quarter, and a good start to the year," Carpenter said. "We'll see how the rest of the year goes. Weather in the summer is what makes or breaks a year. We are a summer peaking utility. About 80 percent or more of our profits are realized in the second and third quarters."
Lower maintenance and operation expenses at the company's power plants in the first quarter compared with a year ago also helped boost the company's profit, Carpenter said. In the first quarter of 2012, El Paso Electric had maintenance projects at its Rio Grande power plant in Sunland Park and at its Newman power plant in Northeast El Paso, he said. It did not have major maintenance costs in the first three months of this year.
El Paso Electric's stock closed at $37.31 per share Wednesday on the New York Stock Exchange -- down 15 cents per share. The company trades under the EE symbol.
Company officials also gave updates Wednesday on power plant projects.
Construction of a new, $89.7 million generating unit at El Paso Electric's Rio Grande power plant has been completed, and the unit is expected to go online late this month. It's now undergoing tests, officials said.
The company is in the process of getting state and federal environmental permits for its proposed power plant at Zaragoza and Montana on the far East Side. Company officials said they hope to start construction of what will be named the Montana Station power plant by late this year or early next year. Some people who live in the area are opposed to the plant, but company officials have said the plant will have no trouble meeting permit requirements.
(c)2013 the El Paso Times (El Paso, Texas)
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