Duke Energy 1st-quarter profit climbs 29 percent as economy, cold winter boost electric sales

Duke Energy 1Q profit jumps 29 percent

Power company Duke Energy said Tuesday that its first-quarter earnings jumped 29 percent as improving industrial demand and a cold winter boosted electricity sales.

The report is another sign that the economy is on the mend. Electricity sales for the nation’s utilities are a good indicator of how the nation’s businesses are performing.

Duke said it earned $445 million, or 34 cents per share, for the quarter ended March 31, compared with profit of $344 million, or 27 cents per share, in the year-ago quarter.

Excluding charges, Duke said it would have earned 36 cents per share in the quarter.

Like other utilities and power generators, Duke saw demand for electricity plummet during the recession, especially among industrial customers.

Duke, based in Charlotte, N.C., said industrial sales rose 11.6 percent in the Midwest and 4.3 percent in the Carolinas.

“We’re off to a good start, but there’s a lot more to do,” said Jim Rogers, Duke’s chairman, president and CEO.

Chief Financial Officer Lynn Good said Duke saw strength across its industrial sector, led by a 30 percent increase in sales to its metal customers and a 10 percent increase in the Carolinas to its textile customers.

Good said Duke’s metal customers include steel makers benefiting from a rebound in the auto sector.

Duke’s industrial sales fell 14 percent last year as major energy users cut production.

Below-normal temperatures in the company’s Midwest service areas of Indiana, Ohio and Kentucky and a brutal cold snap in the Carolinas also drove residential electricity sales higher during the quarter. The company has 4 million power customers between the two regions.

The company also benefited from rate increases in much of its service areas.

Revenue rose to $3.6 billion in the quarter compared with $3.3 billion in the year-ago first quarter.

Analysts surveyed by Thomson Reuters expected profit of 32 cents per share on revenue of $3.4 billion.

The company said it is on track to achieve adjusted earnings per share of $1.25 to $1.30 per share. Wall Street is looking for profit of $1.33 per share.

Rogers also said the company participated in the auction that German utility giant E.On conducted for the sale of Louisville Gas & Electric Co. and Kentucky Utilities Co.

Power company PPL, based in Allentown, Pa., said last week that it was buying the companies for $6.7 billion in cash.

Duke’s shares fell 22 cents, or 1.3 percent, to close at $16.71, dropping with the broader market in Tuesday trading.