Energy provider Dominion’s 1Q profit falls despite higher weather-related demand

Dominion’s 1Q profit falls due to costs

RICHMOND, Va. — Energy provider Dominion Resources Inc. said Thursday its first-quarter profit dropped nearly 30 percent despite higher demand for electricity.

The Richmond-based company said that it earned $174 million, or 29 cents per share, in the January-March period compared with $248 million, or 42 cents per share, in the same period last year.

But Dominion says its operating earnings grew less than a percent to $576 million during the period. The company uses operating earnings that exclude certain items as its primary performance measurement.

Revenue fell about 9 percent to $4.2 billion for the quarter from $4.6 billion in the year-ago quarter.

“Overall we are pleased with the results for the first quarter despite a soft economy and lower commodity prices,” CEO Thomas F. Farrell II said in a conference call with investors.

Profits took a hit from charges of $206 million related to an employee buyout completed during the quarter, and $57 million related to health care legislation changes. It also recorded a $149 million loss from its sale of Dominion Peoples, its Pennsylvania natural gas distribution company.

Electricity sales were negatively impacted by costs related to storms, the company said.

For the rest of the year, Dominion said its earnings will benefit from customer surcharges and cost savings from the buyout of about 1,400 employees. It also expects lower margins for energy it generates and losses from a planned refueling outage at its Millstone Power Station in Connecticut.

Dominion also said beginning in May, its earnings will not include its Appalachian exploration and production business, which it agreed to sell to Consol Energy Inc. for $3.475 billion. The deal is expected to close Friday.

Dominion produces electricity, natural gas and oil and has the nation’s largest natural gas storage system. It operates in 14 states and serves retail energy customers in a dozen states.