Summary
Dominion Energy, Inc. (D) reported its first quarter results for 2004, showing a decrease in net income and diluted earnings per share compared to the same period in 2003. Net income declined to $437 million from $508 million, and diluted EPS fell to $1.34 from $1.64. This decrease was attributed to lower contributions from energy trading and marketing activities and the absence of significant one-time gains realized in the prior year, such as the cumulative effect of adopting new accounting standards. The company's revenue saw an increase to $3.879 billion from $3.579 billion, driven by higher regulated electric and gas sales, as well as increased non-regulated gas sales. However, operating expenses also rose, notably in electric fuel and energy purchases and purchased gas expenses, largely offsetting the revenue growth. Operationally, Dominion Generation saw an increase in net income contribution, while Dominion Energy experienced a significant decrease. Dominion Delivery and Dominion Exploration & Production showed modest increases. The company also highlighted progress in its strategic initiatives, including the ongoing divestiture of certain non-core assets and preparations for integration into the PJM regional transmission organization.
Key Highlights
- 1Net income decreased by $71 million to $437 million, and diluted EPS fell by $0.30 to $1.34 for the three months ended March 31, 2004, compared to the prior year.
- 2Total operating revenue increased by $300 million to $3.879 billion, primarily driven by higher regulated electric and gas sales, as well as non-regulated gas sales.
- 3Operating expenses rose by $424 million to $2.989 billion, with significant increases in electric fuel/energy purchases and purchased gas costs.
- 4Dominion Generation's net income contribution increased by $33 million, while Dominion Energy's contribution decreased significantly by $104 million, largely due to lower energy trading and marketing results.
- 5The company adopted FIN 46R for variable interest entities not considered special purpose entities, with no immediate impact on results of operations or financial position.
- 6Dominion is progressing with the sale of its telecommunications business (DTI), expecting to close in the second quarter of 2004, with a potential pre-tax loss of up to $30 million.
- 7The company reported a $7 million after-tax charge in Q1 2004 related to a class action lawsuit settlement regarding fiber-optic cable installations.