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FirstEnergy Corp. Reports Operating Results (10-Q)

August 07, 2012 | About:
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10qk

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FirstEnergy Corp. (FE) filed Quarterly Report for the period ended 2012-06-30.

Firstenergy Corp. has a market cap of $20.71 billion; its shares were traded at around $46.375 with a P/E ratio of 13.9 and P/S ratio of 1.3. The dividend yield of Firstenergy Corp. stocks is 4.4%. Firstenergy Corp. had an annual average earning growth of 0.8% over the past 10 years.

Highlight of Business Operations:

Total revenues increased $288 million, or 11%, in the first six months of 2012, compared to the same period of 2011, primarily due to growth in direct and governmental aggregation sales and wholesale sales partially offset by a net decline in POLR and structured sales. Revenues were also adversely impacted by lower unit prices compared to the first six months of 2011.

Total other expense decreased by $19 million in the first six months of 2012, compared to the same period of 2011, primarily due to lower net interest expense of $13 million resulting from debt reductions in 2011 and credits related to the settlement with the DOE noted above. Non-operating income increased by $16 million due primarily to additional proceeds on 2011 asset sales that were earned during the first six months of 2012, and was partially offset by lower investment income ($10 million) on the NDTs.

Retail generation revenues are attributable to non-shopping customers and are satisfied by generation procured through full-requirements auctions. OE and Penn defer the difference between retail generation revenues and purchased power costs, resulting in no material effect to current period earnings. Retail generation revenues decreased by $1 million primarily due to reduced MWH sales from increased customer shopping, partially offset by higher average prices in the residential customer class. Lower MWH sales were primarily due to lower weather-related usage resulting from heating degree days that were 22% below 2011 levels, declining average customer consumption, reduced residential accounts as well as an increase in customer shopping levels to 73% compared to 69% in the same quarter of last year. Higher average prices for residential customers were primarily due to the recovery of residential generation credits for electric heating discounts, which began in September 2011.

Revenues decreased by $263 million, or 21%, in the first six months of 2012, compared to the same period of 2011. The decrease in revenues was due to lower distribution, retail generation and wholesale generation revenues.

Retail generation obligations are attributable to non-shopping customers and are satisfied by generation procured through full-requirements auctions. JCP&L defers the difference between retail generation revenues and purchased power costs, resulting in no material effect on earnings. Retail generation revenues decreased by $104 million due to lower retail generation MWH sales in all customer classes primarily due to lower weather-related usage and an increase in customer shopping levels to 50% in the first six months of 2012, compared to 43% in the same period of 2011.

Read the The complete Report

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