Spurred on by strong operations that fought through an arduousfourth quarter, Duke Energy posted a 36% increase in annualearnings to $3.41 per share in 1998 from $2.51 per share in 1997,the company announced Wednesday. Duke’s revenues increased to $17.6billion compared to $16.3 billion in 1997. Earnings before interestand taxes (EBIT) rose $540 million from the previous year, reaching$2.65 billion.

For 1998’s fourth quarter, the company posted a drop in totalrevenue to $4.18 billion from $4.59 billion in 4Q97. Despite thefall in revenue, the company revealed an increase in net income of21% to $224 million in 4Q98 from $185 million in 4Q97. Total EBITalso increased 21% to $516 million.

Duke Power, Duke’s electric utility business unit, led theoverall growth surge with total 1998 EBIT of $1.51 billion, up 18%from 1997’s $1.28 billion. Sales grew 5.3% for the year. “Wecontinue to see healthy growth at Duke Power,” said Richard Priory,CEO of Duke Energy. “We added almost 50,000 new customers in 1998.We served our customers reliably despite some wild swings inweather that challenged many utilities around the country.”

Duke’s natural gas transmission operations had to work hard tobeat the fourth quarter blues. For the year, EBIT was up 13% from1997 to $702 million. This total was bolstered by a pre-tax $39million gain due to the resolution of gas supply costs. Operatingrevenues fell $54 million dollars to $1.54 billion in 1998, butexpenses also fell from $964 million in 1997 to $864 million in1998. Duke’s sale of Panhandle Eastern Pipeline Co. and TrunklineGas Co. were not included in the earnings report because it hasn’tbeen completed yet. Duke expects it to close in the first quarterof 1999.

As with the year-end results, Duke’s fourth quarter natural gasoperations contributed positive growth, despite experiencing a dropin revenue. It posted a decline in revenue from $397 million in1997 to $376 million in 1998. Yet, the company made up for the lackof revenue by cutting back operating expenses from $255 million in1997’s last quarter to $224 in the fourth quarter of 1998. The endresult is an increase in fourth quarter EBIT from $139 million in1997 to $168 million in 1998.

One area that escaped a poor fourth quarter performance wasDuke’s Trading and Marketing. For that time period, it posted atotal EBIT of $63 million versus $15 million in 1997’s lastquarter. For 1998, this outfit posted an EBIT of $122 millioncompared to $44 million in 1997. “I am encouraged at the progressin our trading and marketing of gas and electricity.,” Priory said.

©Copyright 1999 Intelligence Press Inc. All rights reserved. Thepreceding news report may not be republished or redistributed, inwhole or in part, in any form, without prior written consent ofIntelligence Press, Inc.