NEW YORK (AP) â¿¿ Duke Energy reported strong earnings for the second quarter on higher electric rates, but newly acquired subsidiary Progress Energy saw earnings plummet as a result of planned refueling shutdowns at three nuclear power plants.
Duke became the nation's largest utility last month after it completed what became an acrimonious combination with in-state rival Progress. The poor results at Progress â¿¿ and the good results at Duke â¿¿ may take some pressure off Duke's board. State regulators are investigating the board's controversial decision to oust former Progress CEO Bill Johnson only hours after he was handed the top job at the combined company.
"They needed a good quarter to brighten the mood around there," said Andy Smith, an analyst at Edward Jones. "It's something they want and needed to get the attention on the actual results."
Duke said Thursday that it earned $444 million, or 99 cents per share, on revenue of $3.58 billion in the quarter. A year earlier, the company earned $435 million, or 98 cents per share, on revenue of $3.53 billion. Adjusted earnings of $1.02 per share topped analysts' forecast of 97 cents per share, according to FactSet.
Duke CFO Lynn Good called the quarter "extraordinary" in an interview. Duke's biggest division, regulated utilities that deliver power to customers in the Carolinas, saw earnings rise because regulators allowed Duke to charge more for electricity. Also, last year's results were hurt by high storm-related maintenance costs.
Residential demand for power slipped in Duke's service territory, partly because of cooler weather, while industrial demand rose slightly.
Power demand typically grows with the economy as factories turn out more goods, businesses serve more customers, and families move into bigger houses with more gadgets. Good said Thursday that the automotive and heavy equipment sectors were going strong, but textiles and fabricated metals were somewhat weak.