Duke turns second-quarter profit on higher revenue

Back to TopCommentsE-mailPrintBookmark and Share

Duke Energy Corp., which is buying Progress Energy Inc. to become the largest U.S. utility owner, on Tuesday reported a second-quarter profit after a year-ago loss as foreign exchange rates benefited its international units.

Earnings were $435 million, or 33 cents a share, compared with the year-ago loss of $222 million, or 17 cents, Charlotte, N.C.-based Duke said in a prepared statement.

Duke, which has about 780,000 customers in Indiana, affirmed its full-year forecast for profit of $1.35 to $1.40 a share, excluding quarterly adjustments to the value of contracts used to lock in margins at commercial power plants and special items. Sales rose 7.5 percent, to $3.53 billion.

“There was a very nice 42-percent increase in their international power business,” said Nathan Judge, a London-based analyst for Atlantic Equities LLC, who rates Duke “neutral,” owns none and had expected quarterly profit of 30 cents a share. “That’s the reason they beat our expectation.”

International operations, which include hydroelectric dams in Brazil that sold power at higher prices and a stake in National Methanol Co. in Saudi Arabia, may have benefited from higher foreign currency values as the U.S. dollar fell, Judge said. Earnings from the segment were $179 million before interest and taxes, compared with $126 million a year earlier.

In the U.S., utility earnings before interest and taxes fell 7.7 percent, to $619 million, on storm damage and as cooler weather reduced the demand for air conditioning, Duke said.

Duke shares have dropped 5 percent this year. The shares have 19 hold ratings and 2 sells from analysts.

Shareholders of Duke and Progress are scheduled to vote Aug. 23 on the $14.4 billion takeover, which would create a company selling electricity to more than 7.1 million homes and businesses in six states from Indiana to Florida. Regulatory approvals are expected by year end, the companies told shareholders in a July 7 filing.

Year-earlier results included pretax costs of $660 million to reflect the lower value of plants in the U.S. Midwest that sell power on competitive wholesale markets. Benchmark power prices in PJM Interconnection LLC averaged $53.51 a megawatt-hour last year, 21 percent less than the previous five-year average.

The Progress purchase will reduce sales on competitive markets by half, to about 12 percent of revenue, according to the filing.


Post a comment to this story

We reserve the right to remove any post that we feel is obscene, profane, vulgar, racist, sexually explicit, abusive, or hateful.
You are legally responsible for what you post and your anonymity is not guaranteed.
Posts that insult, defame, threaten, harass or abuse other readers or people mentioned in IBJ editorial content are also subject to removal. Please respect the privacy of individuals and refrain from posting personal information.
No solicitations, spamming or advertisements are allowed. Readers may post links to other informational websites that are relevant to the topic at hand, but please do not link to objectionable material.
We may remove messages that are unrelated to the topic, encourage illegal activity, use all capital letters or are unreadable.

Messages that are flagged by readers as objectionable will be reviewed and may or may not be removed. Please do not flag a post simply because you disagree with it.

Sponsored by

facebook - twitter on Facebook & Twitter

Follow on TwitterFollow IBJ on Facebook:
Follow on TwitterFollow IBJ's Tweets on these topics:
Subscribe to IBJ
  1. I am a Lyft driver who is a licensed CDL professional driver. ALL Lyft drivers take pride in providing quality service to the Indianapolis and surrounding areas, and we take the safety of our passengers and the public seriously.(passengers are required to put seat belts on when they get in our cars) We do go through background checks, driving records are checked as are the personal cars we drive, (these are OUR private cars we use) Unlike taxi cabs and their drivers Lyft (and yes Uber) provide passengers with a clean car inside and out, a friendly and courteous driver, and who is dressed appropriately and is groomed appropriately. I go so far as to offer mints, candy and/or small bottle of water to the my customers. It's a mutual respect between driver and passenger. With Best Regards

  2. to be the big fish in the little pond of IRL midwest racin' when yer up against Racin' Gardner

  3. In the first sentance "As a resident of one of these new Carmel Apartments the issue the local governments need to discuss are build quality & price." need a way to edit

  4. As a resident of one of these new Carmel Apartments the issue the local governments need to discuss is build quality & price. First none of these places is worth $1100 for a one bedroom. Downtown Carmel or Keystone at the Crossing in Indy. It doesn't matter. All require you to get in your car to get just about anywhere you need to go. I'm in one of the Carmel apartments now where after just 2.5 short years one of the kitchen cabinet doors is crooked and lawn and property maintenance seems to be lacking my old Indianapolis apartment which cost $300 less. This is one of the new star apartments. As they keep building throughout the area "deals" will start popping up creating shoppers. If your property is falling apart after year 3 what will it look like after year 5 or 10??? Why would one stay here if they could move to a new Broad Ripple in 2 to 3 years or another part of the Far Northside?? The complexes aren't going to let the "poor" move in without local permission so that's not that problem, but it the occupancy rate drops suddenly because the "Young" people moved back to Indy then look out.

  5. Why are you so concerned about Ace hardware? I don't understand why anyone goes there! Every time ive gone in the past, they don't have what I need and I end up going to the big box stores. I understand the service aspect and that they try to be helpful but if they are going to survive I think they might need to carry more specialty parts.