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DTE Energy Company Reports Operating Results (10-Q)

July 30, 2010 | About:
10qk

10qk

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DTE Energy Company (DTE) filed Quarterly Report for the period ended 2010-06-30.

Dte Energy Company has a market cap of $8.11 billion; its shares were traded at around $48.16 with a P/E ratio of 13.4 and P/S ratio of 1. The dividend yield of Dte Energy Company stocks is 4.3%. Dte Energy Company had an annual average earning growth of 2.3% over the past 10 years.DTE is in the portfolios of John Hussman of Hussman Economtrics Advisors, Inc., Paul Tudor Jones of The Tudor Group, Jeremy Grantham of GMO LLC, Steven Cohen of SAC Capital Advisors, Kenneth Fisher of Fisher Asset Management, LLC.

Highlight of Business Operations:

Net income attributable to DTE Energy in the second quarter of 2010 was $86 million, or $0.51 per diluted share, compared to net income attributable to DTE Energy of $83 million, or $0.51 per diluted share, in the second quarter of 2009. Net income attributable to DTE Energy in the six months ended June 30, 2010 was $315 million, or $1.88 per diluted share, compared to net income attributable to DTE Energy of $261 million, or $1.59 per diluted share, in the comparable period of 2009. The increases in net income are primarily due to higher earnings in the electric and gas utilities and in the Power and Industrial Projects segment, partially offset by lower earnings in Energy Trading.

Both utilities continue to experience high levels of past due receivables primarily attributable to economic conditions. Our service territories continue to experience high levels of unemployment, underemployment and low income households, home foreclosures and a lack of adequate levels of assistance for low-income customers. Despite the economic conditions, total arrears were reduced during 2010 in our electric and gas utilities. We have taken actions to manage the level of past due receivables, including increasing customer disconnections, contracting with collection agencies and working with Michigan officials and others to increase the share of low-income funding allocated to our customers. Detroit Edison has an uncollectible expense tracking mechanism that enables it to recover or refund 80 percent of the difference between the actual uncollectible expense for each year and the $66 million level reflected in base rates. In the June 2010 MPSC rate order, the base amount of MichCons uncollectible expense tracking mechanism was increased prospectively from $37 million to $70 million and MichCons portion of recovery or refund of the expenses above or below the base amount was modified to 80 percent from 90 percent. The Detroit Edison and MichCon uncollectible tracking mechanisms require annual reconciliation proceedings before the MPSC.

In April 2010, the Company signed an agreement with the U.S. Department of Energy for a grant of approximately $84 million in matching funds on total anticipated spending of approximately $168 million related to the accelerated deployment of smart grid technology in Michigan through 2012. The smart grid technology includes the establishment of an advanced metering infrastructure and other technologies that address improved electric distribution service. See Note 2 of the Notes to Consolidated Financial Statements.

Gross margin increased $82 million in the second quarter of 2010 and $107 million in the six-month period ended June 30, 2010. The following table details changes in various gross margin components relative to the comparable prior period:

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