News Releases

Sierra Pacific Resources Reports Fourth Quarter Earnings

Jan 29, 1998

Sierra Pacific Resources
Contact: Karl Walquist (media contact)/Rich Atkinson (analyst contact)
Phone: (775)834-4345/(775)834-4358

For Immediate Release

Sierra Pacific Resources (NYSE: SRP) today reported net income of $74.4 million for common stock for the year ended Dec. 31, 1997, an 11 percent increase over 1996. Earnings per share of $2.41 were 10 percent higher than the $2.19 reported last year. Growth in utility customers and sales accounted for the earnings increase. The company reported increases of 3 percent, 5 percent and 3 percent for electric, natural gas and water customers, respectively. Electric retail kilowatt hour sales were up 13 percent for the year, including a 32 percent increase in lower-margin industrial sales. Retail gas decatherm sales were up 6 percent compared to last year.

Fourth quarter 1997 earnings were 65 cents per share, versus 40 cents per share for the fourth quarter 1996. Included in net income for the quarter was an after-tax adjustment of 9 cents per share for either regulatory refunds or purchased coal advances. Earnings per share for the same period in 1996 were 40 cents, and included an adjustment of 28 cents after tax, which provided for refunds to Nevada electric customers early in 1997. Net income rose by 9 percent in the fourth quarter of 1997, or 6 cents per share, compared to the same quarter in 1996 after excluding these one-time effects.

"Our core utility revenues were up 6 percent compared to last year due to the continued strength of the northern Nevada economy," said Mark Ruelle, chief financial officer and treasurer."This growth, combined with disciplined cost control by our employees led to the increase in income." The company reported that its ongoing non-fuel operations and maintenance expenditures were up less than 2 percent from last year.

"We are happy with this year's performance, especially in a challenging year when we reduced electric rates, recovered quickly from a devastating flood, and made progress in reducing our long-term coal purchase obligations," said Malyn Malquist, president and chief executive officer.

Included as one-time adjustments affecting net income for the year were after-tax adjustments of $2.2 million to buy down long-term fuel contracts, $1.8 million related to delays in construction, and $1.3 million in repairs related to the 1997 New Year's flood. In addition, the company recognized additional reserves of $5.8 million related to either regulatory refunds or further purchased coal advances.

Headquartered in Reno, Nev., Sierra Pacific Resources is a holding company whose principal subsidiary is Sierra Pacific Power Co., the electric utility for most of northern Nevada and the Lake Tahoe area of California, and a natural gas and water distributor in the Reno - Sparks area. Other subsidiaries include the Tuscarora Gas Pipeline Co., which owns 50 percent interest in an interstate natural gas transmission partnership, Lands of Sierra, a real estate management company, and ethree, an energy services company.

Sierra Pacific ResourcesFinancial Highlights
(In thousands, except for per share amounts)

Fourth Quarter

Operating Expenses$137,402$129,6975.9%
Net Income Available for Common$19,969$12,31062.2%
Average Shares Outstanding$30,898$30,7550.5%
Net Income Per Share$0.65$0.4062.5%

12 Months Ended Dec. 31

Operating Expenses$544,616$518,8335.0%
Net Income Available for Common$74,445$66,87911.3%
Average Shares Outstanding$30,880$30,4951.3%
Net Income Per Share$2.41$2.1910.0%