news-release-details

Pinnacle West Reports Third Quarter Earnings; Increases Common Stock Dividend

10/18/2000

PHOENIX - Pinnacle West Capital Corporation (NYSE: PNW) today reported consolidated income from continuing operations for the quarter ended September 30, 2000, of $116.0 million or $1.37 per diluted share of common stock. The result compares with income from continuing operations of $125.6 million or $1.48 per share for the same period in 1999. Lower earnings were reported for El Dorado Investment Co., the Company’s investment subsidiary, and Arizona Public Service Co. (APS).

APS earnings for the third quarter were $124.2 million, compared with $129.5 million before an extraordinary charge in the comparable 1999 period. Completion of investment tax credits in 1999, most of which related to APS, accounted for $12.5 million or $0.15 per share in the prior-year period.

El Dorado reported a loss for the quarter of $8.8 million or $0.10 per share. This loss was related primarily to the quarterly adjustment of the value of El Dorado's investment in a technology venture capital partnership. Earnings related to El Dorado’s investments are dependent on stock market conditions, as the investments are valued each quarter based on market prices and other factors.

Year-to-date, Pinnacle West reported consolidated income from continuing operations of $260.0 million, or $3.06 per diluted share of common stock, compared with $225.0 million or $2.64 per share for the corresponding period in 1999.

"Although earnings for the quarter were down somewhat, year-to-date operating results show we met the challenge of stable prices for our customers while producing excellent financial results in an extremely volatile electric market," said Chief Executive Officer Bill Post.

Post said the volatile market, including record bulk power prices, resulted in a sharp increase in the Company’s fuel and purchased power costs, which the Company was able to mitigate by its ongoing risk management activities.

APS has lowered prices in six of the last seven years. The latest, a 1.5 percent price decrease which became effective July 1, 2000, is part of APS’ commitment to reduce residential customer prices a total of 16 percent from 1994 to 2004.

SunCor Development Co., Pinnacle West’s real estate subsidiary, reported net income for the quarter of $2.2 million, due primarily to an increase in land and home sales. This compares to a loss of $0.5 million for the prior-year period.

Third quarter net income of a year-ago for Pinnacle West was $23.7 million or $0.28 per diluted share of common stock, including an extraordinary charge of $139.9 million after income taxes or $1.65 per share. APS recorded the extraordinary charge in the third quarter for a regulatory disallowance. This charge was partially offset by a $38 million or $0.45 per share tax benefit from discontinued operations.

Also today, the Company announced a dividend increase of approximately 7.1 percent or ten cents per share annually. This action will result in an indicated annual dividend of $1.50 per share (37.5 cents per share quarterly). The declared dividends are payable December 1, 2000, to shareholders of record on November 1, 2000.

Post said the Company's dividend policy calls for annual increases by relatively consistent dollar amounts, which will continue dividend growth at a pace well above the industry average but at a payout ratio well below the industry average.

Pinnacle West is a Phoenix-based company with consolidated assets of approximately $7 billion. Through its subsidiaries, the company generates, sells and delivers electricity and sells energy-related products and services to retail and wholesale customers in the western United States. It also develops residential, commercial and industrial real estate projects.

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

Three Months Ended

Nine Months Ended

Twelve Months Ended

 

 

September 30,

September 30,

September 30,


 

 

2000

1999

2000

1999

2000

1999

 

 

 

 

 

 

 

 

Operating Revenues

 

Electric

$1,567,960

$867,630

$2,734,362

$1,793,047

$3,234,499

$2,236,573

 

Real estate

39,396

26,640

117,659

83,870

163,958

126,705


 

Total

1,607,356

894,270

2,852,021

1,876,917

3,398,457

2,363,278


 

 

 

 

 

 

 

 

Operating Expenses

 

Fuel and purchased power

1,079,436

400,961

1,495,218

636,062

1,655,265

752,832

 

Operations and maintenance

113,670

109,006

331,754

319,212

459,319

425,239

 

Real estate operations

33,980

26,757

101,374

78,393

142,497

118,454

 

Depreciation and amortization

98,628

95,068

293,607

289,361

389,814

387,644

 

Taxes other than income taxes

25,641

22,184

76,643

73,028

100,221

96,400


 

Total

1,351,355

653,976

2,298,596

1,396,056

2,747,116

1,780,569


Operating Income

256,001

240,294

553,425

480,861

651,341

582,709


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Other Income (Expense)

 

Preferred stock dividend requirements of APS

--

--

--

(1,016)

--

(3,059)


 

Net other income and expense

(14,778)

1,040

13,785

(898)

25,476

(3,329)


 

Total

(14,778)

1,040

13,785

(1,914)

25,476

(6,388)


Income From Continuing Operations Before Interest and Income Taxes

241,223

241,334

567,210

478,947

676,817

576,321

 

 

 

 

 

 

 

 

Interest Expense

 

 

 

 

 

 

 

Interest charges

42,773

39,614

126,996

121,488

167,889

163,224


 

Capitalized interest

(5,240)

(1,990)

(13,875)

(10,253)

(15,286)

(14,588)


 

Total

37,533

37,624

113,121

111,235

152,603

148,636


Income From Continuing Operations Before Income Taxes

203,690

203,710

454,089

367,712

524,214

427,685

 

 

 

 

 

 

 

 

Income Taxes

87,641

78,131

194,069

142,741

219,393

167,186


 

 

 

 

 

 

 

 

Income From Continuing Operations

116,049

125,579

260,020

224,971

304,821

260,499

 

 

 

 

 

 

 

 

Income Tax Benefit From Discontinued Operations

--

38,000

--

38,000

--

38,000

 

 

 

 

 

 

 

 

Extraordinary Charge - Net of Income Taxes of $94,115

--

(139,885)

--

(139,885)

--

(139,885)


Net Income

$ 116,049

$ 23,694

$ 260,020

$ 123,086

$ 304,821

$ 158,614


 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Average Common Shares Outstanding - Basic

84,745

84,759

84,735

84,715

84,732

84,719

 

 

 

 

 

 

 

 

Average Common Shares Outstanding - Diluted

85,012

84,989

84,901

85,087

84,898

85,140

 

 

 

 

 

 

 

 

Earnings Per Average Common Share Outstanding

 

Continuing Operations - Basic

$ 1.37

$ 1.48

$ 3.07

$ 2.66

$ 3.60

$ 3.07

 

Net Income - Basic

$ 1.37

$ 0.28

$ 3.07

$ 1.45

$ 3.60

$ 1.87

 

Continuing Operations - Diluted

$ 1.37

$ 1.48

$ 3.06

$ 2.64

$ 3.59

$ 3.06

 

Net Income - Diluted

$ 1.37

$ 0.28

$ 3.06

$ 1.45

$ 3.59

$ 1.86

 

Certain prior year amounts have been restated to conform to the 2000 presentation.

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