Struggling with a well of problems in the past few months, the once venerable Duke Energy’s quarterly earnings plunged 71% from a year ago. Huge merchant energy losses, problems in California, the deferral of several large generation projects and mounting severance costs all played a part in the losses. But Duke disclosed more bad news last week, revealing that the Securities and Exchange Commission (SEC) launched a formal investigation in mid-October of its round-trip energy trades. The SEC’s stepped up scrutiny joins two inquiries already under way by the Commodity Futures Trading Commission (CFTC) and a Houston grand jury, which subpoenaed Duke last summer (see NGI, July 15).
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Duke Earnings Dive 71%; SEC Investigation Raised to Formal Status
Duke Energy’s third-quarter earnings plunged 71% from a year ago, as the company struggled with a drop in energy costs, the collapse of the merchant energy business, problems in California, pull-outs in planned generation projects and severance costs from layoffs. But as if that was not enough, Duke revealed Thursday the Securities and Exchange Commission’s (SEC) inquiry into the company’s round-trip trading practices has been elevated to formal status. This is on top of the investigations already being carried out by the Commodity Futures Trading Commission (CFTC) and a Houston grand jury, which subpoenaed Duke over the summer for information on its bogus trading activities (see Daily GPI, July 15).
October 25, 2002
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