Avista profit dips slightly in second quarter
Avista Corp. saw its profit decline slightly in the second quarter, the Spokane energy company said today. The results primarily are due to an increase in interest expense, other operating expenses and depreciation and amortization, Avista said.
Net income was $25.5 million, or 46 cents per share, May through June, compared to $25.8 million, or 47 cents per share, in the second quarter of 2009.
The company also confirmed its earnings outlook for the full year. “Our outlook has improved for the full year of 2010, particularly with respect to our utility earnings, president and CEO Scott Morris said in a prepared statement.
Cooler, wetter spring weather helped hydroelectric generation, Morris explained. But Avista still expects below-normal power generation this year due to low snowpack and precipitation last winter, he said.
“The improvement in the second quarter has partially offset a challenging first quarter due to one of the warmest January to March periods on record,” Morris said.
For the quarter, Avista’s operating revenues increased $46.2 million and its resource costs increased $42.5 million, which resulted in an increase of $3.7 million in gross margin, compared to the second quarter a year ago. Most of that — $2.5 million — was on natural gas sales due to colder weather that increased retail loads and lead to general rate increases in Washington on Jan. 1 and in Idaho on Aug. 1.
The gross margin on electric sales increased $1.2 million, due to rate increases in Washington and Idaho and a slight increase in retail loads.
In confirming its outlook for 2010, Avista said it expects earnings will fall somewhere between $1.55 and $1.65 per diluted share. That’s a rosier outlook than three months ago, primarily due to lower power supply costs, the company indicated.
The earnings outlook assumes a general rate increase to go into effect in Idaho on Oct. 1, as well as normal precipitation and temperatures the rest of the year.