American Electric Power Inc.'s (AEP) first-quarter earnings rose 10%, helped by a continuing rise in demand from U.S. manufacturers.
"Our ongoing earnings for the quarter were in line with results from first-quarter last year despite record-setting mild winter weather in the regions that we serve," said Chief Executive Nicholas K. Akins. "We continue to see growth in industrial demand."
But for the year, the company didn't reaffirm its previous downbeat outlook of $3.05 to $3.25 a share, citing uncertainties related to its Ohio business. AEP had previously warned that this year's results would be weighed down by its operations in Ohio, as that state deregulates its electricity market and customers switch to other utilities. AEP plans to separate its Ohio business from the rest of its company.
AEP, one of the largest U.S. electric utilities, has seen growth in recent quarters, mostly from industrial demand, but the industry faces a considerable climb to pre-recession levels. Earlier this month, it said it would form a joint venture with Great Plains Energy Inc. (GXP) to build $466 million in transmission projects, in an effort to take advantage of an increasingly attractive market in shipping electricity from one part of the country to another.
American Electric Power reported a profit of $389 million, or 80 cents a share, up from $353 million, or 73 cents a share, a year earlier. Excluding previous-quarter litigation costs and other items, earnings from ongoing operations were down from 82 cents.
Revenue was down 2.7% to $3.6 billion
Analysts polled by Thomson Reuters recently forecast earnings of 79 cents on revenue of $3.73 billion.
Earnings from ongoing operations at its utilities segment were down 1.5% to $383 million.
Profit from transmission operations surged to $9 million, compared with $4 million a year earlier. Earnings from AEP River operations improved 29% to $9 million.
Its generating and marketing business, which includes non regulated power operations that sell electricity at market rates and its energy trading activities, swung to a loss of $1 million, compared with a profit of $1 million a year earlier.
Wholesale volume was down 2.6%. Retail electricity volume fell 5.1%.
Shares closed Thursday at $37.89 and were inactive premarket. The stock is down 8.3% so far this year.
-By Kristin Jones; Dow Jones Newswires; 212-416-2208; [email protected]