News Column

Duke Energy reports big jump in earnings

August 7, 2014

By Bruce Henderson, The Charlotte Observer



Aug. 07--Duke Energy reported second-quarter profits Thursday of $609 million, an 80 percent jump from the previous year, and increased its earnings outlook for 2014.

Duke saw improved results from all sectors of its business, led by regulated utilities that benefited from higher rates, warm weather that kept air conditioners humming and a state tax settlement. The second quarter of 2013 had milder weather by comparison.

Duke reported earnings of 86 cents compared to the 48 cents of the same quarter a year ago, on revenue of $5.9 billion.

Earnings adjusted for one-time items were $1.11 a share, compared to 87 cents a year ago. That beat the 98 cents analysts surveyed by Thomson One Analytics had expected.

Duke increased its earnings guidance for the year from $4.45 to $4.60 a share to $4.50 to $4.65 a share.

"We continue to be able to control operating and maintenance (costs) and find efficiencies in our operations," said chief financial officer Steve Young. "We're also benefiting from newly-signed, contracted wholesale customers, and we recognized some income tax efficiencies this year."

Duke said last month it has agreed to pay $1.2 billion for the interests in four of its power plants held by Eastern North Carolina municipal power systems.

The agreement is contingent on regulatory approval and legislation to let the municipalities sell revenue bonds. The generating capacity that Duke will buy includes 500 megawatts of nuclear capacity, which is among Duke's cheapest generating options.

President and chief executive Lynn Good said the company will adjust its coal-ash disposal plans to comply with North Carolina legislation, which stalled last week in Raleigh.

"In the interim, as we discussed back in February and March in putting forward our comprehensive (disposal) plan, we are continuing to move forward on that plan and will make adjustments to it once the legislation is ultimately passed," she said.

Good wouldn't comment on the prospects of settling litigation against the company by North Carolina regulators and environmental advocates, or on state and federal investigations of its Feb. 2 ash spill into the Dan River.

"We are cooperating fully with all the investigations that are occurring and also vigorously defending the company in all of the litigation and other investigative items," she said. Those issues, she said, "have the highest attention of the company."

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(c)2014 The Charlotte Observer (Charlotte, N.C.)

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Source: Charlotte Observer (NC)


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