UniSource Energy Corporation (NYSE: UNS) today reported 2011 net income of $110 million, or $2.75 per share of common stock on a fully diluted basis, compared with $113 million, or $2.86 per diluted share in 2010.
“Our financial results in 2011 were consistent with our expectations,” said Paul Bonavia, UniSource Energy’s Chairman and CEO. “Providing safe, reliable service to our customers remains our number one priority, and we took several important steps during the year to strengthen the operational performance and improve the long-term financial position of our utility companies.”
UniSource Energy and its utility subsidiaries completed various financing activities during 2011 that strengthened the companies’ balance sheets, enhanced liquidity, and reduced exposure to variable rate debt. The companies invested in infrastructure improvements that will enhance reliability and increase operational flexibility.
“TEP is in the fourth year of a base-rate freeze,” said Bonavia. “Frozen rates and an economy in the very early stages of recovery will constrain our financial performance in 2012,” Bonavia said. “We will continue to focus on operational efficiencies to maintain tight control of our costs.”
UniSource Energy’s earnings for 2012 are estimated to be in the range of $2.05 to $2.35 per diluted share. The mid-point of the range assumes consolidated base operations and maintenance (O&M) expense of $270 million, which is the same level of base O&M expense recorded in 2011. TEP’s estimated retail kWh sales in 2012, which assume normal weather patterns, are expected to be approximately 0.7 percent below 2011 sales. Cooling degree days during 2011 were 3.7 percent above normal.
Under the terms of TEP’s last settlement agreement, approved by the Arizona Corporation Commission (ACC) in November 2008, the company can file a rate case on or after July 1, 2012. The parties to the 2008 settlement committed to using best efforts to implement new rates within 13 months of the filing date.