Summary
NextEra Energy Inc. (formerly FPL Group Inc.) filed an 8-K on May 25, 2007, primarily to disclose updated financial guidance and a significant securitization transaction. The company reaffirmed its adjusted earnings per share expectations for its main segments, Florida Power & Light Company and FPL Energy, LLC, for both 2007 and 2008. These projections assume normal weather conditions and exclude the impact of new accounting standards and mark-to-market adjustments for certain hedges. Furthermore, the filing details a $652 million securitization of storm-recovery charges by FPL Recovery Funding LLC, a subsidiary of Florida Power & Light Company. These senior secured bonds are secured by storm-recovery property and related charges, and the proceeds will be used by FPL to reimburse storm restoration costs and establish an insurance reserve. This transaction provides FPL with financing specifically tied to storm-related expenses, backed by a dedicated revenue stream from customers.
Key Highlights
- 1Reaffirmed 2007 and 2008 adjusted earnings per share guidance for Florida Power & Light Company ($2.10-$2.15 and $2.15-$2.25 respectively) and FPL Energy, LLC ($1.45-$1.55 and $1.65-$1.85 respectively).
- 2Total FPL Group adjusted earnings guidance for 2007 was reaffirmed at $3.35-$3.45 and for 2008 at $3.60-$3.80.
- 3FPL Recovery Funding LLC, a subsidiary of Florida Power & Light Company, issued $652 million in senior secured bonds on May 22, 2007.
- 4The bonds are secured by storm-recovery property and the right to collect storm-recovery charges from FPL customers.
- 5Proceeds from the securitization will be used by FPL to reimburse storm restoration costs and fund a storm and property insurance reserve.
- 6This financing structure isolates the debt from FPL's general obligations, being payable only from the specified storm-recovery assets and charges.