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DTE Energy Company Reports Operating Results (10-Q)

July 30, 2012 | About:
10qk

10qk

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DTE Energy Company (DTE) filed Quarterly Report for the period ended 2012-06-30.

Dte Energy Company has a market cap of $10.4 billion; its shares were traded at around $61.15 with a P/E ratio of 16.39 and P/S ratio of 1.17. The dividend yield of Dte Energy Company stocks is 3.84%. Dte Energy Company had an annual average earning growth of 4.9% over the past 10 years.

Highlight of Business Operations:

Net income attributable to DTE Energy increased $3 million and $5 million for the 2012 second quarter and six-month period, respectively. The increases were due to higher revenues and increased earnings from an equity investment.

Operating revenues increased $162 million and $376 million in the three and six months ended June 30, 2012, respectively. The increase in the second quarter of 2012 is primarily due to a $168 million increase related to new reduced emissions fuel projects (REF) and a $9 million increase associated with higher volumes from existing REF projects, of which $130 million represent affiliate transactions, partially offset by a $10 million decrease from lower volumes associated with the steel business, a $4 million decrease in coal transportation and marketing services primarily related to lower volumes and a $3 million decrease from lower volumes primarily associated with the on-site business. The increase in the six-month period is primarily due to a $338 million increase related to new REF projects and a $56 million increase associated with higher volumes from existing REF projects, of which $293 million represent affiliate transactions, and a $5 million increase due to higher volumes related to the on-site and renewable businesses, partially offset by a $12 million decrease in coal transportation and marketing services primarily related to lower volumes and an expired rail transportation contract, a $6 million decrease primarily associated with the expiration of a customer contract related to the on-site projects, and a $5 million decrease from lower volumes associated with the steel business.

Other (income) and deductions increased by $16 million and $23 million in the three and six months ended June 30, 2012, respectively. The increases were due primarily to gains recognized in connection with the sale of membership interests in REF facilities (treated as sales of tax credits for financial reporting purposes).

Outlook - The Company has constructed and placed in service nine REF facilities including two facilities located at third party owned coal-fired power plants. The Company has sold membership interests in two of the facilities located at the Detroit Edison sites. We continue to optimize these facilities by seeking tax investors for facilities operating at Detroit Edison and other utility sites. Additionally, we intend to relocate four underutilized facilities, located at Detroit Edison sites, to alternative coal-fired power plants which may provide increased production and emission reduction opportunities in 2012 and future years. One of the underutilized facilities is currently being relocated to a third party owned coal-fired power plant and will be operating in the new location by the end of 2012. The proceeds from executed and planned sales of membership interests in the REF facilities are expected to be received by the Company on an installment basis, and the Company will recognize the related gains (treated as sales of tax credits for financial reporting purposes) as production tax credits are generated by the respective facilities.

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