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AEP: Regulated businesses offsetting costs of deregulation

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    Pittsburgh (AP)Pittsburgh (AP)
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American Electric Power reported 2013 second-quarter GAAP earnings on July 25 of $338 million, or $0.69 per share, compared with $362 million or $0.75 per share for second-quarter 2012.

Excluding special items, operating earnings for second quarter 2013 were $357 million or $0.73 per share, $19 million higher than GAAP earnings because of a pretax $154 million impairment charge related to the expected retirement of Muskingum River Plant Unit 5 in 2015. This impairment was partially offset by a U.S. Supreme Court decision resulting in a favorable $80 million United Kingdom windfall profits tax credit.

Year-to-date operating earnings for the six months ended June 30 were $43 million, or $0.09 per share, higher than GAAP earnings. The difference was due to the second-quarter items as well as to a $30 million reversal of a storm cost deferral in Virginia and a $7 million restructuring charge in the first quarter.

The company continues to experience load decline in parts of its service territory due to lagging industrial demand, said AEP President and CEO Nicholas K. Akins.

There also was a slight decline in commercial demand in the second quarter, and residential load remains essentially flat year over year, Akins said.

"The strong results from our regulated businesses, including transmission, are offsetting some of the negative earnings impacts from the transition to competition in Ohio," he said.

"Although our second-quarter results reflect higher operations and maintenance expenses related to storms and plant outages, much of this is timing. We are on track to keep our operations and maintenance expenses, net of offsets, at essentially the same level as last year," Akins said.

AEP reaffirmed its operating earnings guidance range for 2013 of $3.05 to $3.25 per share.

American Electric Power's quarterly conference call with financial analysts will be webcast live at 9 a.m. Eastern time on July 25.

The company's shares trade on the New York Stock Exchange under the symbol AEP.