NextEra Energy (NEE)
Q2 2011 Earnings Call
July 27, 2011 9:00 am ET
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Armando Pimentel - Chief Financial Officer, Executive Vice President of Finance, Chief Financial Officer of Florida Power & Light Company and Executive Vice President of Finance - Florida Power & Light Company
James Robo - President and Chief Operating Officer
Lewis Hay - Chairman, Chief Executive Officer, Chairman of Executive Committee, Chairman of FPL Energy LLC and Chairman of Florida Power & Light Company
Rebecca Kujawa -
Michael Lapides - Goldman Sachs Group Inc.
Greg Gordon - Morgan Stanley
Dan Eggers - Crédit Suisse AG
James Dobson - Wunderlich Securities Inc.
Unknown Analyst -
Gary Hovis - Argus Research Company
Hugh Wynne - Sanford C. Bernstein & Co., Inc.
Brian Chin - Citigroup Inc
Steven Fleishman - BofA Merrill Lynch
Good day, everyone, and welcome to the NextEra Energy Second Quarter 2011 Earnings Release Conference Call. Today's conference is being recorded. At this time for opening remarks and introductions, I would like to turn the conference over to Ms. Rebecca Kujawa. Ms. Kujawa, please go ahead now.
Thank you, Rufus. Good morning, everyone, and welcome to our Second Quarter 2011 Earnings Conference Call. Lew Hay, NextEra Energy's Chairman and Chief Executive Officer, will provide an overview of NextEra Energy's performance and recent accomplishments. Lew will be followed by Armando Pimentel, our Chief Financial Officer, who will discuss the specifics of our financial results.
Also joining us this morning are Jim Robo, President and Chief Operating Officer of NextEra Energy; Armando Olivera, President and Chief Executive Officer of Florida Power & Light Company; and Mitch Davidson, President and Chief Executive Officer of NextEra Energy Resources, LLC, which we will refer to with the subsidiaries as Energy Resources in this presentation. Following our prepared remarks, our senior management team will be available to take your questions.
We will be making statements during this call that are forward looking. These statements are based on our current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially from our forward-looking statements.
If any of our key assumptions are incorrect or because of other factors discussed in today's earnings news release and the comments made during this conference call in the Risk Factors section of the accompanying presentation or in our latest reports and filings with the Securities and Exchange Commission, each of which can be found on the Investors section of our website, www.nexteraenergy.com. We do not undertake any duty to update any forward-looking statements.
Please also note that today's presentation includes references to adjusted earnings, which is a non-GAAP financial measure. You should refer to the information contained in the slides accompanying this presentation for definitional information and reconciliations of the non-GAAP measure to the closest GAAP financial measure.
With that, I will turn the call over to Lew Hay. Lew?
Okay. Thank you, Rebecca. Good morning, everyone. I'm pleased to report that NextEra Energy had strong performance in the second quarter. We grew adjusted earnings per share be approximately 6% over the prior year comparable quarter. Our strategy of investing in clean renewable and efficient generation continues to drive solid results. We're executing well while continuing to enhance our generation portfolio by weighting it significantly toward regulated and long-term contracted opportunities that should enhance shareholder value.
At Florida Power & Light Company, we had a strong second quarter. Net income was up approximately 14% over the prior year comparable quarter, primarily due to increased investment in the business. Over the quarter, FPL averaged more than 10,000 additional customers than we had in the first 3 months of the year. In Florida, our biggest area of concern remains the difficult employment climate in the state with an unemployment rate of 10.6% as of June 2011, which gears the depressed national employment market. However, even in a difficult economy, our generation portfolio development pipeline at FPL -- our generation portfolio and our development pipeline at FPL is setting the pace for the industry, providing significant operating efficiencies, sustainable environmental performance and strong customer benefits.
The uprate work at our St. Lucy and Turkey Point nuclear facilities in Florida is proceeding. We expect that these investments, which will add about 450 megawatts of clean, reliable, emission-free energy to our portfolio will save FPL customers about $4.6 billion to $4.8 billion in fuel cost over the life of the plants. We've brought the third unit of our West County Energy Center online, on time and on budget. This unit adds approximately 1,220 megawatts to what is now the nation's largest combined cycle natural gas-fired power plant. This facility increases the efficiency of FPL's generation fleet, saves our customers money on fuel and reduces air emissions.
In June, we moved forward with the construction of the modernized $1.3 billion Riviera Beach Next Generation Clean Energy Center by demolishing the boilers, the stacks and related equipment at the Riviera Beach plant. If you haven't taken a chance to look at it, there's a nice little clip on YouTube, kind of fun to watch. We expect the modernized plant to come online in 2014. In addition, the modernization of our Cape Canaveral plant is progressing well and is on track to meet its planned 2013 start date. These 2 combined cycle facilities at an estimated cost of $2.4 billion are expected to be among the most efficient natural gas plants in the nation, and we estimate that they will provide customers $850 million to $950 million in net savings over the life of the plants.