Duke Third-Quarter Profit Rises After Progress Takeover
Duke Energy Corp. (DUK) said added customers and higher rates boosted profit 26 percent in the third quarter, the first full period since its takeover of Progress Energy Inc. made it the largest U.S. utility owner.
Net income increased to $594 million, or 85 cents a share, from $472 million, or $1.06, a year earlier, Charlotte, North Carolina-based Duke said in a statement today. Excluding costs from the merger and construction of Indiana power plant, per- share profit was 3 cents more than the average of 15 analysts’ estimates compiled by Bloomberg. Sales rose 70 percent to $6.72 billion.
“At first blush, it looks roughly in line with expectations,” Paul Patterson, a New York-based utility analyst at Glenrock Associates LLC, said today in an interview. Patterson doesn’t rate the shares or own the stock.
Higher power rates helped make up for cooler weather that reduced energy demand and lower earnings from its international business and commercial unit, Chief Financial Officer Lynn Good said today in a telephone interview. The company reaffirmed its outlook for adjusted 2012 earnings of $4.20 to $4.35 a share.
Utility income more than doubled with the addition of Progress customers in North Carolina, South Carolina and Florida. The number of homes and businesses paying state- regulated rates to Duke’s rose 78 percent to 7.1 million.
In North Carolina, where Duke sells power to 3.2 million homes and businesses, the third quarter was the coolest in three years, according to the National Climatic Data Center. Weather- driven demand for cooling fell about 9 percent from a year earlier, according to data compiled by Bloomberg.
Weather also was cooler than a year earlier in Florida, Ohio, Indiana, and Kentucky, where Duke sells power to 3.9 million homes and businesses, according to data compiled by Bloomberg.
Duke’s all-stock acquisition of Raleigh, North Carolina- based Progress closed on July 2. The company announced the next morning that it replaced Progress Chief Executive Officer Bill Johnson with Duke CEO Jim Rogers, who was to have become executive chairman. The change triggered investigations by North Carolina regulators and the state’s attorney general.
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