first-quarter loss widened more than expected on a 6% decline in revenue as the company's efforts to restructure itself were complicated by mild weather.
Calpine lost $71.2 million, or 17 cents a share, in the latest quarter, compared with a loss of $52 million, or 14 cents a share, last year. Revenue was $2.04 billion in the latest quarter compared with $2.17 billion a year ago. The lower revenue in part reflected a new accounting treatment related to hedging that required Calpine to offset $370 million of sold power against expenses. Revenue would have risen 11% without that accounting change.
The latest quarter included gains and charges that amounted to a net gain of 3 cents a share. Analysts surveyed by Thomson First Call were forecasting a loss of 11 cents a share in the latest quarter on revenue of $2.51 billion.
The company said first-quarter gross profit fell 27% to $120.5 million, reflecting lower margins on energy sales (the "spark spread") and added costs related to new power plants. Calpine generated 21.1 million megawatt hours in the first quarter and had an average spark spread of $21.05 per megawatt hour. In the year-ago period, the company generated 19.1 million megawatt hours at an average spark spread of $23.09 per megawatt hour.
Calpine reaffirmed its breakeven GAAP earnings guidance for all of 2004 and said it expects full-year adjusted EBITDA of $1.7 billion.