FPL Group, Inc. (NYSE:FPL) today reported 2010 first quarter net income on a GAAP basis of $556 million, or $1.36 per share, compared with $364 million, or $0.90 per share, in the first quarter of 2009. On an adjusted basis, FPL Group’s earnings were $386 million, or $0.94 per share, compared with $364 million, or $0.90 per share, in the first quarter of 2009. Adjusted earnings exclude the mark-to-market effects of non-qualifying hedges and the net effect of other than temporary impairments (OTTI) on certain investments, both of which relate to NextEra Energy Resources.
FPL Group management uses adjusted earnings, which is a non-GAAP financial measure, internally for financial planning, for analysis of performance, for reporting of results to the Board of Directors and as input in determining whether certain performance targets are met for performance-based compensation under the company’s employee incentive compensation plans. FPL Group also uses earnings expressed in this fashion when communicating its earnings outlook to analysts and investors. FPL Group management believes that adjusted earnings provide a more meaningful representation of FPL Group’s fundamental earnings power. The attachments to this news release include a reconciliation of historical adjusted earnings to net income, which is the most directly comparable GAAP measure.
“Although we continue to be challenged by the economic environment in the United States and Florida, we are pleased to report a more than 4 percent increase in adjusted earnings per share for the quarter. FPL Group experienced contrasting weather effects in the quarter, with a weak wind resource at NextEra Energy Resources partially offset by increased demand for electricity at Florida Power & Light as a result of unseasonably cold weather in Florida. Revenue recovery associated with the West County Energy Center units 1 and 2 contributed to FPL’s results as well. Our customers are benefitting significantly from the addition of these units because they are among the most fuel efficient, most reliable and cleanest of their kind in the country,” said FPL Group Chairman and CEO Lew Hay.