By the OGJ Online Staff
HOUSTON, Dec. 21 -- Citing mild fall and winter weather, Wisconsin Energy Corp. Friday lowered its 2001 earnings forecast to $1.90-$2/share.
The previous earnings forecast was $2-$2.10. The Milwaukee, based holding company said warm temperatures have hurt the heating revenues of its regulated natural gas and electric businesses. The company reaffirmed its 2002 earnings projection of $2.20-$2.40/share.
The service territory of Wisconsin Electric-Wisconsin Gas, the company's primary regulated utility operations, experienced the warmest November in 100 years and extremely mild weather for the first half of December, Wisconsin Energy reported. Between October and December heating degree-days were 27% lower than the 20-year normal weather on which the company's rates are established.
The company also warned the 2001 earnings forecast excludes the impact of certain accounting charges, nonrecurring gains on asset sales, and potential fourth quarter charges for the redemption of high coupon bonds and the write-down of nonutility assets. The nonutility energy segment is involved in the development, ownership, and operation of independent electric generating facilities; natural gas purchasing and marketing; and others. The company didn't detail which particular operations could be affected by the write-down.
Wisconsin Energy reported third quarter earnings of 41¢/share, after a 12¢/share accounting charge, up from 36¢/share in the comparable 2000 quarter. It attributed the increase to a return to normal summer weather, recovery of fuel costs, and reduced interest costs.
The company also is seeking regulatory approval for an ambitious $3 billion plan to build 2,800 Mw of new in-state generation, including two 500 Mw combined cycle gas-fired units at the company's existing Port Washington power plant site, and three 600 Mw advanced technology, coal-based generation units at its Oak Creek power plant site. In all the company has proposed $7 billion in capital expenditures, including upgrades to existing distribution facilities.
It received preliminary approval to begin advance planning on the plan from regulators in October.