Green Mountain Power Corporation (NYSE: GMP) today announced
consolidated earnings of $0.54 per share of common stock, diluted,
for the third quarter of 2006 compared with consolidated earnings
of $0.48 per share of common stock, diluted, for the same period in
2005. Year to date earnings for 2006 are $1.60 per share, diluted,
compared with earnings of $1.50 per share, diluted, for the first
nine months of 2005. Earnings increased in the third quarter of
2006 primarily as a result of lower power supply costs and
transmission expenses, which were partially offset by a reduction
in retail revenues of $3.3 million consistent with a restriction on
earnings required in the rate agreement approved by the Vermont
Public Service Board in 2003 in the Company�s last retail rate
case. This earnings restriction calculation is reviewed by the
Vermont Public Service Board and is subject to change. The
Company�s regulated earnings are capped at its allowed rate of
return on equity of 10.5 percent for 2006. Costs that are not
allowed for rate setting purposes reduce the Company�s earning
potential under the rate agreement and limit the Company�s ability
to achieve its allowed rate of return on equity for its operations
as a whole. �Despite the recording of this earnings restriction
reserve in the third quarter of 2006 and an additional reserve
anticipated at year end, we expect our earnings per share for the
year to range between $2.00 and $2.15,� said Christopher L. Dutton,
President and Chief Executive Officer. Retail operating revenues
for the third quarter of 2006 decreased by $3.0 million compared
with the same period in 2005, reflecting the effects of the $3.3
million restriction on earnings and milder summer weather. This was
partially offset by an increase in sales of utility services to
other municipalities and utilities, a 0.9 percent rate increase
that took effect in January 2006 and an increase in the number of
customers. Total retail megawatt hour sales of electricity
decreased by 3.9 percent in the third quarter of 2006 compared with
the same period in 2005. Sales to residential, small commercial and
industrial, and large commercial and industrial customers decreased
by 3.6, 4.8 and 3.2 percent, respectively, compared with the third
quarter in 2005, which was affected by last year�s unusually hot
weather. Increased revenues from the sale of utility services to
other utilities and large industrial customers in the third quarter
of 2006 contributed approximately $1.7 million more to retail
revenue growth than the same period last year. Other operating
expenses increased by $1.9 million in the third quarter of 2006,
reflecting an increase of $1.3 million in utility services expense,
compared with the third quarter of 2005. These sales of services
are intended to allow the Company to recover some of its
administrative and general and staffing costs from other parties
and ultimately reduce costs to retail customers. The remaining
$600,000 increase in other operating expenses related to additional
costs associated with the proposed acquisition of the Company by
Northern New England Energy Corporation, an affiliate of GazM�tro
Limited Partnership, and an increase in employee benefits. Power
supply expenses decreased by $4.3 million in the third quarter of
2006 compared with the same period last year. Increased 2006
entitlements to power under a long-term contract with Hydro-Quebec
and a temporary increase in the Company�s entitlement from the
Vermont Yankee nuclear power plant reduced the Company�s reliance
on wholesale market purchases of electricity. The additional 2006
entitlements under the Hydro-Quebec contract and the Vermont Yankee
output were purchased, on average, at prices below the wholesale
market price for the third quarter of 2006 and substantially below
2005 wholesale market prices. Market prices for Company purchases
in the third quarter of 2006 were substantially lower than 2005,
reflecting the interruption of gas supplies in the Gulf caused by
hurricane activity coupled with warmer than normal summer
temperatures in 2005. Transmission expenses decreased by $1.1
million in the third quarter compared to the same period last year,
primarily as a result of regional transmission credits from ISO New
England to VELCO. Income tax expense increased by $600,000 in the
third quarter of 2006 compared to the third quarter of 2005 due to
an increase in pretax book income and an increase in the effective
tax rate due to nondeductible merger expenses, which were partially
offset by a decrease in the Vermont state income tax rate. Green
Mountain Power Corporation Quarterly Earnings Summary Three Months
Ended Nine months ended September 30 September 30 2006� 2005� 2006�
2005� in thousands except per share amounts Retail revenues $
54,615� $ 57,584� $ 160,242� $ 162,874� Wholesale revenues 6,818�
6,740� 21,547� 14,586� Total operating revenues $ 61,433� $ 64,324�
$ 181,789� $ 177,460� Net income $ 2,884� $ 2,542� $ 8,522� $
7,902� Net income-continuing operations 2,831� 2,524� 8,393� 7,900�
Net income(loss)-discontinued operations 53� 18� 129� 2� � Basic
earnings per share-continuing operations $ 0.54� $ 0.49� $ 1.60� $
1.52� Basic earnings per share-discontinued operations 0.01� -�
0.02� -� Basic earnings per common share $ 0.55� $ 0.49� $ 1.62� $
1.52� Diluted earnings per share-continuing operations $ 0.53� $
0.48� $ 1.58� $ 1.50� Diluted earnings per share-discontinued
operations 0.01� -� 0.02� -� Fully diluted earnings per common
share $ 0.54� $ 0.48� $ 1.60� $ 1.50� Dividends declared per share
$ 0.28� $ 0.25� $ 0.84� $ 0.75� Weighted average shares of common
stock outstanding-Basic 5,280� 5,208� 5,261� 5,185� Weighted
average shares of common stock outstanding-Diluted 5,362� 5,301�
5,338� 5,284� Certain statements in this press release may be
forward-looking in nature, or �forward-looking� statements as
defined in the United States Securities Litigation Reform Act of
1995. Actual results may differ from those expressed or implied in
forward-looking statements. The forward-looking statements
contained in this press release are subject to a number of factors
and uncertainties, including regulatory and judicial decisions or
legislation, changes in regional market and transmission rules,
energy supply and demand and pricing, contractual commitments,
availability, terms and use of capital, general economic and
business environment, changes in technology, nuclear and
environmental issues, industry restructuring and cost recovery
(including stranded costs, and weather), and other factors and
uncertainties disclosed from time to time in our filings with the
Securities and Exchange Commission. Any forward-looking statements
in this press release should be evaluated in light of these
important factors and uncertainties. The Company disclaims any
obligation to update any information in this press release. Green
Mountain Power Corporation (NYSE: GMP) today announced consolidated
earnings of $0.54 per share of common stock, diluted, for the third
quarter of 2006 compared with consolidated earnings of $0.48 per
share of common stock, diluted, for the same period in 2005. Year
to date earnings for 2006 are $1.60 per share, diluted, compared
with earnings of $1.50 per share, diluted, for the first nine
months of 2005. Earnings increased in the third quarter of 2006
primarily as a result of lower power supply costs and transmission
expenses, which were partially offset by a reduction in retail
revenues of $3.3 million consistent with a restriction on earnings
required in the rate agreement approved by the Vermont Public
Service Board in 2003 in the Company's last retail rate case. This
earnings restriction calculation is reviewed by the Vermont Public
Service Board and is subject to change. The Company's regulated
earnings are capped at its allowed rate of return on equity of 10.5
percent for 2006. Costs that are not allowed for rate setting
purposes reduce the Company's earning potential under the rate
agreement and limit the Company's ability to achieve its allowed
rate of return on equity for its operations as a whole. "Despite
the recording of this earnings restriction reserve in the third
quarter of 2006 and an additional reserve anticipated at year end,
we expect our earnings per share for the year to range between
$2.00 and $2.15," said Christopher L. Dutton, President and Chief
Executive Officer. Retail operating revenues for the third quarter
of 2006 decreased by $3.0 million compared with the same period in
2005, reflecting the effects of the $3.3 million restriction on
earnings and milder summer weather. This was partially offset by an
increase in sales of utility services to other municipalities and
utilities, a 0.9 percent rate increase that took effect in January
2006 and an increase in the number of customers. Total retail
megawatt hour sales of electricity decreased by 3.9 percent in the
third quarter of 2006 compared with the same period in 2005. Sales
to residential, small commercial and industrial, and large
commercial and industrial customers decreased by 3.6, 4.8 and 3.2
percent, respectively, compared with the third quarter in 2005,
which was affected by last year's unusually hot weather. Increased
revenues from the sale of utility services to other utilities and
large industrial customers in the third quarter of 2006 contributed
approximately $1.7 million more to retail revenue growth than the
same period last year. Other operating expenses increased by $1.9
million in the third quarter of 2006, reflecting an increase of
$1.3 million in utility services expense, compared with the third
quarter of 2005. These sales of services are intended to allow the
Company to recover some of its administrative and general and
staffing costs from other parties and ultimately reduce costs to
retail customers. The remaining $600,000 increase in other
operating expenses related to additional costs associated with the
proposed acquisition of the Company by Northern New England Energy
Corporation, an affiliate of GazMetro Limited Partnership, and an
increase in employee benefits. Power supply expenses decreased by
$4.3 million in the third quarter of 2006 compared with the same
period last year. Increased 2006 entitlements to power under a
long-term contract with Hydro-Quebec and a temporary increase in
the Company's entitlement from the Vermont Yankee nuclear power
plant reduced the Company's reliance on wholesale market purchases
of electricity. The additional 2006 entitlements under the
Hydro-Quebec contract and the Vermont Yankee output were purchased,
on average, at prices below the wholesale market price for the
third quarter of 2006 and substantially below 2005 wholesale market
prices. Market prices for Company purchases in the third quarter of
2006 were substantially lower than 2005, reflecting the
interruption of gas supplies in the Gulf caused by hurricane
activity coupled with warmer than normal summer temperatures in
2005. Transmission expenses decreased by $1.1 million in the third
quarter compared to the same period last year, primarily as a
result of regional transmission credits from ISO New England to
VELCO. Income tax expense increased by $600,000 in the third
quarter of 2006 compared to the third quarter of 2005 due to an
increase in pretax book income and an increase in the effective tax
rate due to nondeductible merger expenses, which were partially
offset by a decrease in the Vermont state income tax rate. -0- *T
Green Mountain Power Corporation Quarterly Earnings Summary Three
Months Nine months Ended ended September 30 September 30 2006 2005
2006 2005 -------- -------- --------- --------- in thousands except
per share amounts Retail revenues $54,615 $57,584 $160,242 $162,874
Wholesale revenues 6,818 6,740 21,547 14,586 -------- --------
--------- --------- Total operating revenues $61,433 $64,324
$181,789 $177,460 -------- -------- --------- --------- Net income
$2,884 $2,542 $8,522 $7,902 Net income-continuing operations 2,831
2,524 8,393 7,900 Net income(loss)-discontinued operations 53 18
129 2 Basic earnings per share- continuing operations $0.54 $0.49
$1.60 $1.52 Basic earnings per share- discontinued operations 0.01
- 0.02 - -------- -------- --------- --------- Basic earnings per
common share $0.55 $0.49 $1.62 $1.52 ======== ======== =========
========= Diluted earnings per share- continuing operations $0.53
$0.48 $1.58 $1.50 Diluted earnings per share- discontinued
operations 0.01 - 0.02 - -------- -------- --------- ---------
Fully diluted earnings per common share $0.54 $0.48 $1.60 $1.50
======== ======== ========= ========= Dividends declared per share
$0.28 $0.25 $0.84 $0.75 Weighted average shares of common stock
outstanding-Basic 5,280 5,208 5,261 5,185 Weighted average shares
of common stock outstanding-Diluted 5,362 5,301 5,338 5,284 *T
Certain statements in this press release may be forward-looking in
nature, or "forward-looking" statements as defined in the United
States Securities Litigation Reform Act of 1995. Actual results may
differ from those expressed or implied in forward-looking
statements. The forward-looking statements contained in this press
release are subject to a number of factors and uncertainties,
including regulatory and judicial decisions or legislation, changes
in regional market and transmission rules, energy supply and demand
and pricing, contractual commitments, availability, terms and use
of capital, general economic and business environment, changes in
technology, nuclear and environmental issues, industry
restructuring and cost recovery (including stranded costs, and
weather), and other factors and uncertainties disclosed from time
to time in our filings with the Securities and Exchange Commission.
Any forward-looking statements in this press release should be
evaluated in light of these important factors and uncertainties.
The Company disclaims any obligation to update any information in
this press release.
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