Appalachian Power’s parent reports flat earnings in first quarter

THE TAKE: Ohio-based American Electric Power, the parent company of Appalachian Power, reported that its first-quarter operating earnings were virtually flat in comparison to the same period last year. Appalachian Power supplies electricity to 1 million customers in Virginia, West Virginia and Tennessee.

THE NUMBERS:

GAAP earnings: Earnings, prepared in accordance with Generally Accepted Accounting Principles (GAAP) were $363 million or 75 cents per share, compared with $389 million or 80 cents per share in first-quarter 2012.

Operating earnings: Excluding special items, first-quarter earnings were $387 million, or 80 cents per share, compared with first-quarter 2012 operating earnings of $389 million, or 80 cents per share.

The difference: For first-quarter 2013, operating earnings were $24 million, or 5 cents per share, higher than GAAP earnings, because of a $30 million ($19 million, net of tax) reversal of a storm cost deferral due to a change in Virginia law and a $7 million restructuring charge ($5 million, net of tax) associated with additional sustainable cost-control efforts.

Revenues: $3.8 billion in the first quarter, up from $3.6 billion in the same quarter in 2012.

THE COMPANY’S TAKE: “Our solid performance in the first quarter reflects our continued progress in advancing our earnings growth strategy,” Nicholas K. Akins, AEP president and chief executive officer, said in a statement. “AEP’s Board increased our quarterly dividend April 23 by $0.02 to $0.49 per share based on its confidence in that strategy and in support of our goal to achieve a dividend payout ratio in the range of 60 to 70 percent of consolidated earnings.”

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