news-release-details

Pinnacle West Reports Second Quarter Results

07/22/1998

PHOENIX, ARIZ. - Pinnacle West Capital Corporation (NYSE:PNW) today reported consolidated net income for the quarter ended June 30, 1998 of $49.0 million or $0.57 per share of common stock, compared with $67.2 million or $0.78 per share a year ago.

Continued strong customer growth of 3.8 percent at Arizona Public Service was not enough to overcome the effect on earnings from the weather, which was both very mild in the second quarter this year and warmer than normal in the prior-year period. The Company believes that the weather adversely affected the earnings comparison by approximately $22 million after income taxes.

For the second quarter 1998, utility operations and maintenance expenses increased, primarily as a result of the timing of scheduled outages at power plants and of other miscellaneous expenses. Earnings were also affected by a 1.2 percent price decrease for APS electricity customers, which became effective July 1, 1997.

"The story in the second quarter was the weather," said Chairman Richard Snell.

"With the exception of potential weather effects, which we can't predict, our earnings outlook for the year remains on track," he said. "Customer growth is still about three times the national average, and our commitment to managing costs will stay in high gear."

For the quarter ended June 30, 1998, APS earned $49.7 million, compared with $66.3 million for the year-ago quarter.

SunCor Development, the company's real estate subsidiary, and El Dorado, its investment subsidiary, reported combined earnings of approximately $3.1 million, compared with earnings of $4.9 million a year earlier.

For the six-month period ended June 30, 1998, Pinnacle West reported consolidated net income of $80.1 million or $0.94 per share of common stock, compared with $92.6 million or $1.07 per share for the corresponding period in 1997.

Pinnacle West is a Phoenix-based holding company with consolidated assets of approximately $7 billion. Its major subsidiary is APS, Arizona's largest electric utility.

SunCor, its real estate subsidiary, has some 13,400 acres of residential, commercial and industrial projects under development.

Pinnacle West Capital Corporation Consolidated Income Statements
(In Thousands, Except Per Share Amounts)
(Unaudited)

Three Months Ended
June 30,
Six Months Ended
June 30,
Twelve Months Ended
June 30,
1998 1997 1998 1997 1998 1997






Operating Revenues
Electric $ 441,715 $ 458,751 $ 822,138 $ 837,772 $ 1,862,919 $ 1,784,125
Real estate 28,916 30,166 63,077 49,709 129,841 107,053






    Total 470,631 488,917 885,215 887,481 1,992,760 1,891,178






Fuel Expenses
Fuel for electric generation 50,434 55,626 100,762 106,748 195,355 237,518
Purchased power 45,151 43,684 68,740 78,031 225,995 136,757






    Total 95,585 99,310 169,502 184,779 421,350 374,275






Operating Expenses
Utility operations and maintenance 102,713 89,162 199,129 177,178 421,385 419,853
Real estate operations 26,213 28,301 56,449 48,063 120,014 100,790
Depreciation and amortization 93,585 91,809 186,415 184,411 370,289 365,641
Taxes other than income taxes 29,930 30,311 60,278 60,555 121,269 112,921






    Total 252,441 239,583 502,271 470,207 1,032,957 999,205






Operating Income 122,605 150,024 213,442 232,495 538,453 517,698






Other Income (Deductions)
Allowance for equity funds
used during construction
-- -- -- -- -- 1,531
Interest on long-term debt (38,067) (41,232) (78,282) (81,520) (160,927) (164,502)
Other interest (4,374) (5,973) (7,081) (10,474) (15,280) (23,191)
Capitalized interest 4,874 5,339 9,530 10,010 19,223 16,226
Preferred stock dividend requirements of APS (2,435) (3,195) (5,313) (6,821) (11,295) (15,110)
Other - net 192 4,823 4,551 9,046 74 1,611






    Total (39,810) (40,238) (76,595) (79,759) (168,205) (183,435)






Income From Continuing Operations Before Income Taxes 82,795 109,786 136,847 152,736 370,248 334,263
Income Tax Expense 33,798 42,604 56,764 60,172 146,873 126,953
Income From Continuing Operations 48,997 67,182 80,083 92,564 223,375 207,310
Loss on Discontinued Operations,
Net of Income Tax of $6,461
-- -- -- -- -- (9,539)
Extraordinary Charge for Early Retirement of Debt, Net of Income Tax of $9,667 -- -- -- -- -- (14,272)
  Net Income $ 48,997 $ 67,182 $ 80,083 $ 92,564 $ 223,375 $ 183,499
Average Common Shares Outstanding 84,811 85,156 84,798 86,281 84,768 86,869

Earnings (Loss) Per Average
Common Share Outstanding
Continuing operations - basic $ 0.58 $ 0.79 $ 0.94 $ 1.07 $ 2.64 $ 2.38

Contacts

This press release contains forward-looking statements that involve risks and uncertainties, which include, but are not limited to, the ongoing restructuring of the electric industry; the outcome of the regulatory proceedings relating to the restructuring; regional economic and market conditions, which could affect customer growth and the cost of power supplies; the cost of debt and equity capital; weather variations affecting customer usage; and the strength of the real estate market. These factors and the other matters discussed above may cause future results to differ materially from historical results, or from results or outcomes currently expected or sought by the Company.

Email Alerts

*
*




 
Enter the code shown above.

Unsubscribe