Xcel Energy Inc.'s (XEL) first-quarter profit fell 9.7% from an essentially flat core performance a year earlier as warm winter weather reduced demand for electricity and natural gas.
The profit decline, which included a much-worse-than-expected top line, comes after a streak of improving results last year for the Minnesota-based utility, which serves a broad range of markets in Colorado and the Midwest.
Chairman and Chief Executive Ben Fowke in February warned Xcel faces new headwinds this year due to weaker electric and natural gas sales amid a spate of mild weather across the U.S. that threatens its bottom line.
The company recently reached a settlement in Colorado that will phase in rate increases gradually through 2014, potentially offering the multistate utility company more certainty about its future revenue.
In the latest quarter, the company said it experienced one of the warmest winters on record, prompting it to start cutting costs.
Xcel reported a profit of $183.9 million, down from $203.6 million a year earlier. On a per-share basis that includes the effect of preferred-share dividend payments, earnings fell to 38 cents from 42 cents as revenue slipped 8.5% to $2.58 billion.
Analysts polled by Thomson Reuters expected a 36-cent per-share profit and $2.72 billion of revenue.
Operating margin narrowed to 14.7% from 15.1%.
Revenue from Xcel's electricity business eased 4.6%, while natural-gas sales dropped 19%.
Shares of Xcel closed at $26.93 Wednesday and were inactive premarket.
-By Drew FitzGerald, Dow Jones Newswires; 212-416-2909; Andrew.FitzGerald@dowjones.com