Utility reports performance hurt by election uncertainties
Published: November 5,2012
ATLANTA — Southern Company reported third quarter earnings of $976 million, or $1.11 a share, compared with $916 million, or $1.07 a share, for the same period a year ago.
For the nine months ended Sept. 30, 2012, Southern’s earnings were $1.97 billion, or $2.26 a share, compared with $1.94 billion, or $2.27 a share, for the same period a year ago.
Earnings for the nine months ended Sept. 30, 2012, included 2 cents a share of insurance recovery related to the March 2009 settlement agreement with MC Asset Recovery, LLC to resolve a lawsuit arising out of the 2003 bankruptcy of Mirant Corp., a Southern Company subsidiary until its 2001 spinoff. Excluding the impact of that recovery, Southern Company, the parent company of Mississippi Power, earned $2.24 a share for the first nine months of 2012, compared with $2.27 a share for the first nine months of 2011.
Operating revenues for the third quarter of 2012 were $5.05 billion, compared with $5.43 billion for the same period a year ago, a 7.0 percent decrease. For the first nine months of 2012, operating revenues were $12.83 billion, compared with $13.96 billion for the same period last year, an 8.1 percent decrease. The third quarter and year-to-date decreases were primarily due to lower fuel costs that were passed through to customers.
Earnings for the third quarter of 2012 were negatively influenced by milder-than-normal weather as compared to warmer-than-normal weather for the same period in 2011. This effect was offset by reductions in non-fuel operations and maintenance expenses and by other revenue effects across the company’s traditional operating units.
“After a promising first six months of 2012, the economy has slowed due to uncertainty around the elections, the fiscal cliff and the slowing world economy,” said Thomas A. Fanning, Southern Company chairman, president and CEO. “Until these issues are resolved, the near-term outlook for the national economy will be unclear. We continue to believe that the long-term prospects for the Southeast remain strong relative to other portions of the country.”
Retail kilowatt-hour sales in Southern Company’s four-state service territory decreased 4.0 percent in the third quarter of 2012 compared with the third quarter of 2011. Residential and commercial sales – which were affected by milder weather during the third quarter of 2012 compared to the third quarter of 2011 – decreased 7.2 percent and 2.4 percent, respectively, while industrial sales decreased 1.9 percent.
For the year to date, kilowatt-hour sales to retail customers decreased 3.7 percent compared with the same period a year ago. Residential sales decreased 8.3 percent, commercial sales decreased 2.3 percent and industrial sales decreased 0.1 percent.
Total energy sales to Southern Company’s customers in the Southeast, including wholesale sales, decreased 4.9 percent in the third quarter of 2012 compared with the same period in 2011. On a year-to-date basis, total energy sales decreased 5.0 percent compared with the same period in 2011.
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