American Electric Power (AEP - Get Report) reported first quarter earnings of $501 million, or $1.02 per share, missing analysts' expectations by 3.7% and down 20% over the same period last year.

Sales for the Columbus, Ohio, utility came in at $4 billion, 13% below the first quarter of 2015.

The company said operating earnings are on track to reach its goal of $3.60 to $3.80 for the year, which could be different from its GAAP, or Generally Accepted Accounting Principles, earnings, depending on impairments, divestitures or changes in accounting principles.

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In the release AEP chairman, CEO and president Nicholas Akins blamed unseasonably mild temperatures in the quarter for the drop in earnings but said that the company's performance demonstrates that its fundamental strategy is strong. "Our investment in our regulated businesses kept us on track to achieve our earnings targets for this year, despite a warm winter that produced weak residential sales and low power prices," he said.

The utility's stock dropped more than 3% in early morning trading to $61.88 per share.

Last week Jefferies & Co. analyst Anthony Crowdell anticipated that the "warm winter blues" would affect utilities' results across the U.S. and expected American Electric Power's earnings per share to be $1.00 versus the $1.13 analyst consensus.

Akins said normalized load growth was essentially flat year over year but the company had increases in commercial and industrial sales from a year ago. But those were offset by declines in residential sales because of job losses in the natural resources and mining sectors and energy efficiency gains. "We are still seeing industrial growth from shale gas production and from sectors supporting the auto industry," he said. "Overall, we expect normalized load growth in 2016 to track slightly better than 2015."

American Electric Power is one of the largest electric utilities in the U.S. delivering electricity and custom energy solutions to nearly 5.4 million customers in 11 states. It also the nation's largest electricity transmission system and ranks among the country's largest generators of electricity. It has operations in Ohio, Texas, Virginia, West Virginia, Tennessee, Indiana, Michigan, Kentucky, Oklahoma, Arkansas and Louisiana.