News Releases

Plant Additions and Energy Costs Affect Sierra Pacific's Quarterly Earnings

Apr 29, 1999

April 30, 1999
Sierra Pacific Resources
Contact: Mark Ruelle or Rich Atkinson
Phone: (775) 834-5400 or (775) 834-4358

For Immediate Release

(Reno) - Sierra Pacific Resources (NYSE: SRP) today reported net income of $20.1 million for common stock for the quarter ended March 31, 1999, a decline of 5.5 percent over first quarter 1998. Basic earnings per share of 65 cents were 5.7 percent lower than the 69 cents reported for the same period last year. Earnings before interest, taxes and depreciation increased over the 1998 quarter by $3.2 million or 4.7 percent.

Operating revenues of $194.8 million were 5.6 percent higher than the $184.5 million reported for the first quarter of 1998. Of the increase, $4.2 million was due to customer growth, and $4.9 million was due to low margin wholesale electric and natural gas sales. The decrease in net income was largely attributed to increased depreciation and lower AFUDC (Allowance for Funds Used During Construction) due to the completion of major facilities not yet fully reflected in rates. Higher energy costs also affected net income.

"Customer growth helped us increase revenues over the same period last year, but not as much as we expected due to less favorable weather conditions that resulted in lower heating degree days than normal for this time of the year," said Mark Ruelle, senior vice president, chief financial officer and treasurer of Sierra Pacific."Our service territory continues to show strong growth with increases over the same period last year of 2.5 percent, 4.1 percent and 3.3 percent for electric, natural gas and water customers, respectively."

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, e· three, an energy services company, and Sierra Pacific Energy Company which markets the Simple Choice line of products under a licensing agreement.

Sierra Pacific Resources is merging with Las Vegas-based Nevada Power Company (NYSE: NVP). The Federal Energy Regulatory Commission approved the merger on April 14. The U.S. Department of Justice effectively authorized the merger on April 16 by notifying the company that it would permit the waiting period required by law to expire without issuing further requests for information or taking any further action. Compliance issues with the Public Utilities Commission of Nevada need to be satisfied and approval from the Securities and Exchange Commission needs to be obtained before the merger can be consummated. The merger is expected to be completed by mid-1999.

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

First Quarter

Operating Expenses$159,688$151,5105.4%
Net Income Available for Common$20,125$21,286-5.5%
Average Shares Outstanding31,01030,9310.3%
Net Income Per Share$0.65$0.69-5.7%

12 Months Ended March 31

Operating Expenses$622,897$553,73012.5%
Net Income Available for Common$76,160$74,8981.7%
Average Shares Outstanding30,97530,8960.3%
Net Income Per Share$2.46$2.421.4%