Coming as some encouraging news in an energy industry in the midst of a financial and credit crisis, Dominion reported Thursday operating earnings for the second quarter of $272 million (97 cents per share), compared with $180 million (72 cents per share) for the same period in 2001, excluding a $25 million charge related to the divestiture of Saxon Capital, Inc.
“Our second-quarter results demonstrate the strength and dependability of Dominion’s asset-backed, integrated business model,” said Thomas E. Capps, CEO. “We’ve maintained year-over-year earnings growth and expect to sustain it the old-fashioned way — by rigorously improving our business processes through Six Sigma, by prudently hedging our wholesale energy production, by carefully controlling costs and by producing and delivering energy at high efficiency levels.”
Dominion Energy contributed $171 million (61 cents per share) to second-quarter 2002 earnings compared to $148 million (59 cents per share) in the second quarter of 2001. The company attributed the increase to higher than normal temperatures in the company’s electric service area, customer growth, and the 5-cents per share corporate hedge impact, partially offset by share dilution and other factors.
Dominion Delivery also broke last year’s contribution, earning $72 million (26 cents per share) in its second quarter compared to $47 million (19 cents per share) for the same period in 2001. Higher than normal temperatures, customer growth, and reduced expenses, partially offset by share dilution, were the reasons for the jump.
“Hot weather added about 7 cents per share compared to normal weather, and we benefited 5 cents per share through the timing of our corporate hedges on natural gas. Even without these benefits, our year-over-year growth was solid,” said Capps. “We’re pleased that during a difficult and unsettling period for our industry and financial markets in general, Dominion is providing a return to our investors through the payment of common stock dividends and bond coupons as well as growth in the company’s long-term value.”
Dominion Exploration & Production (E&P) contributed $92 million (33 cents per share) to the quarter’s earnings, up from $84 million (34 cents per share) in the second quarter of 2001. The company said the slight increase is primarily attributable to higher production, offset by lower average realized prices, increased expenses and share dilution.
The corporate segment, including Dominion Capital, posted net expenses of $63 million (23 cents per share) for the quarter, compared to net expenses of $99 million (40 cents per share) in the second quarter of 2001. Dominion said the decrease in the corporate segment’s net expenses is attributable to the elimination of goodwill amortization, Dominion Capital’s contribution, and other factors.
Dominion also accomplished the following during the quarter:
“Year-to-date results remain in line with our expectations,” Capps added. “Dominion is positioned to earn between $4.90 and $4.95 per share for the full year 2002 and grow earnings an average of 10% annually going forward.”
The company noted that Dominion’s assets remain wholly-owned by its legal subsidiaries, Virginia Electric and Power Company (Virginia Power), Consolidated Natural Gas Company (CNG), and Dominion Energy Inc. (DEI), pending full implementation of electric and gas deregulation legislation in the company’s service areas.
For those subsidiaries, second-quarter 2002 earnings for Virginia Power were 61 cents per share, compared to 51 cents per share in the second quarter of 2001. Second-quarter 2002 earnings for CNG were 37 cents per share, compared to 29 cents per share in 2001 and DEI earned 22 cents per share in the second quarter of 2002, compared to 31 cents per share in the second quarter of 2001.
Â©Copyright 2002 Intelligence Press Inc. Allrights reserved. The preceding news report may not be republishedor redistributed, in whole or in part, in any form, without priorwritten consent of Intelligence Press, Inc.
© 2022 Natural Gas Intelligence. All rights reserved.
ISSN © 2577-9877 | ISSN © 1532-1266 |