By the OGJ Online Staff
HOUSTON, Dec. 19 -- American Electric Power Co. Inc. the largest US power producer, Wednesday lowered earnings expectations for 2001 and 2002, citing unusually mild weather and a weak economy.
AEP, which owns utilities serving customers in the Midwest and Southwest, said it now expects earnings from continuing operations of $3.35-$3.45/share for 2001.The company previously forecast earnings at the lower end of $3.50-$3.60/share. Company officials warned in October a slowing economy could make it difficult to meet the upper range of its 2001 earnings target.
The Columbus, Ohio power company also cut its 2002 guidance for earnings from continuing operations, to a range of $3.70-$3.80/share from a previous range of $3.80 -$3.90.
Analysts' consensus estimate for 2001 is $3.55/share, according to Thomson Financial/First Call. The consensus for 2002 is $3.84/share.
In mid-day trading, AEP shares were up 84¢/share at $43.
"Extremely mild weather and the recession hurt earnings in the (2001) fourth quarter," said CEO E. Linn Draper Jr. "While continued economic weakness will also likely affect 2002, we remain strongly positioned to grow and build on our energy market leadership."
Regarding the effect of Enron's collapse on energy markets, Draper said, the recent events have put the entire industry under tremendous scrutiny. "We are confident in the future of our country's energy markets and our ability to meet commitments and deliver value for shareholders over the long term," he said.