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TECO's earnings increase 20 percentBy MARK ALBRIGHT © St. Petersburg Times, published October 20, 2000 TAMPA -- TECO Energy Inc. continued its comeback from a dramatic slump in 1999, posting a 20 percent gain in earnings per share during the third quarter. The news, however, had little effect on the company's stock price, which has soared 58 percent since the beginning of the year. Utility stocks, those slow but steady growth stocks of the old economy, have been among the big benefactors of investor flight from the dot-com debacle on Wall Street. TECO, which has hovered in the middle of the pack among its peer group, closed Thursday at $28, down 13 cents. The company said net income in the quarter ended Sept. 30 hit $82-million, or 65 cents per share, up from $72-million, or 54 cents per share, in the year-ago quarter. Revenue was $614.7-million, up from $555.9-million. "All of our businesses were up," said Gordon Gillette, TECO's chief financial officer, noting the company had increased its projected earnings growth rate from 7 percent earlier this year to more than 10 percent through the coming year. The biggest surprise was the performance of the company's coal operations. With TECO's Tampa Electric Co. reducing its reliance on coal-powered generators, TECO's Kentucky coal mines found new customers ranging from other utilities to steel mills. The coal unit earnings more than tripled to $15.7-million from $4.2-million. Net income from the company's core business, Tampa Electric, inched up 3 percent to $54.7-million from $53-million. Peoples Gas System posted an 18 percent gain in earnings to $8-million as the company's expansion of the long-dormant natural gas network began paying off. Acquired in 1997 from Lykes Energy after years of minimal capital spending, TECO extended pipelines from Fort Myers to Naples and is now signing up customers. The company's plan to build small power plants in other regions and sell the electricity wholesale also showed improved results. Earnings were $7-million, up from $3.7-million, from plants in Guatemala, Virginia, Hawaii and Hardee County. TECO is midway through borrowing $650-million to expand and convert its old Gannon power station from coal to natural gas. The impact of the increased debt on the company's earnings power caused the three debt rating agencies to knock down TECO's ratings a half peg. The ratings remain investment grade. TECO rival FPL Group Inc., the Juno Beach parent of Florida Power & Light Co., reported net income of $314-million, or $1.85 per share, up from $291-million, or $1.70 per share, for the quarter that ended Sept. 30. Revenues were $2.1-billion, up from $1.9-billion.
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From the Times Business report
From the AP
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