Cinergy Posts 2000 Gains, Despite EPA Deal
After a busy 2000, Cinergy Corp. reported a slight decrease from 1999 levels in net income in the fourth quarter, but the company's end-of-year net income showed growth over the year before. Net income after taxes for the fourth quarter was approximately $92 million ($0.58 per share), compared to about $93.5 million ($0.60 per share) for the equivalent time period last year.
For the entire year 2000, Cinergy posted a little over $398 million ($2.51 per share) after taxes, compared with 1999's net income of almost $395 million ($2.54 per share). The company said EPS showed an $0.11 decrease in 2000 due to a one time charge relating to its agreement with the Environmental Protection Agency (EPA).
Cinergy's revenues almost doubled in the fourth quarter, helping to bring the company's full year mark of $5.9 billion in 1999 to $8.4 billion for 2000.
"2000 was a year of significant momentum for Cinergy," said James E. Rogers, CEO of Cinergy. "We resolved a number of uncertainties facing the company through the completion of the electric restructuring transition plan in Ohio and the tentative agreement on the EPA lawsuit. In addition, we solidified our regional leadership position in our energy merchant business by increasing revenues approximately $2.2 billion, while more than doubling trading volumes. By creating Cinergy Ventures, we focused on the future through investments in energy-related technologies that we can apply in serving customers and improving our operations."
Cinergy's announcement came just a few days after Moody's assigned negative outlooks to the debt and preferred stock securities of the company, and all of its subsidiaries, in response to several recent Cinergy announcements including: the purchase of two peaking plants from Enron; a tenative deal with EPA and two Cinergy utility subsidiaries (Cincinnati Gas & Electric and PSI Energy); and the uncertainty surrounding CG&E's post-deregulation corporate and financial structure. Its agreement with the EPA and several Northeast states stems from Clean Air Act violations involving Cinergy's coal-fired power plants. The company estimates its related costs will be $1.4 billion through 2013.
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