Sierra Pacific Resources
Contact: Media Contact: Karl Walquist / Analyst Contact: Rich Atkinson
Phone: 775-834-3891 / 775-834-4358
For Immediate Release
Reno, Nev., August 7, 2000 -- Sierra Pacific Resources (NYSE:SRP) today reported a net loss of $20.2 million for common stock for the quarter ended June 30, 2000. Net income for the same period in 1999 was $14.8 million for Sierra Pacific Resources and $11.7 million for Nevada Power before their merger in July 1999. Basic earnings per share were ($0.26) for the quarter. Included in this loss was $70 million of unanticipated fuel and purchased power price increases as reported by Sierra Pacific Resources in July.
The 2000 operating revenues for Nevada Power and Sierra Pacific Power Company, the two wholly-owned utilities of Sierra Pacific Resources, increased by 13.1% and 10.4%, respectively, over the first half of 1999. These revenue gains were attributed mainly to continued customer growth for both companies and warmer than normal weather in southern Nevada. Sierra Pacific Power Company experienced lower use per customer due to mild weather in northern Nevada but had increased wholesale sales. Expenses were affected by significantly higher energy costs and were partially offset by recognition of merger savings.
Last month the Public Utilities Commission of Nevada approved an agreement between the utilities, regulators and other parties that granted a $48 million rate increase to Nevada Power in order to recover increased fuel and purchased power costs. The agreement also allows monthly rate adjustments to reflect changes in fuel and purchased power costs for both Nevada Power and Sierra Pacific Power Company. Last week, Nevada Power filed its first adjustment to recover $15 million of these costs effective September 1, 2000. Sierra Pacific Power Company will use the same monthly adjustment to recover its fuel and purchased power costs with the first adjustment effective October 1, 2000.
Nevada Power operating revenues for the year to date increased by $55.1 million over 1999 to $475.4 million. The cost of purchased and generated power increased by 47.8% due to higher fuel and purchased power prices and additional megawatt hours generated and purchased. Other operating and maintenance expenses decreased by 13.6% or $13.2 million from 1999 mainly due to efficiencies resulting from the merger. Non-cash Allowance for Funds Used During Construction (AFUDC) was $2.3 million lower than 1999 due primarily to completion of the Crystal Transmission Project.
Sierra Pacific Power Company operating revenues for the year to date increased by $38.9 million over 1999 to $411.3 million. Electric revenues increased by 14.7% over 1999 due to customer growth and greater low-margin wholesale sales. Gas revenues were 9.8% lower than in 1999 due to mild weather, partially offset by increased customers. The cost of purchased and generated power increased by 43.6% primarily as a result of higher prices. The average cost of natural gas purchased for utility retail sales increased by 9.6% over 1999, offset by lower decatherms purchased resulting from mild weather. Other operating and maintenance expenses, adjusted in 1999 for a reclassification to revenue decreased by 1.6% due mainly to efficiencies resulting from the merger.
Headquartered in Reno, Nevada, Sierra Pacific Resources is a holding company whose principal subsidiaries are Nevada Power Company, the electric utility for southern Nevada, and Sierra Pacific Power Company, 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 Company, which owns 50% interest in an interstate natural gas transmission partnership; and Sierra Pacific Communications, a telecommunications company.
Sierra Pacific announced in November that it will be acquiring Portland General Electric for $2.1 billion from Enron Corporation. The proposed transaction, which is subject to customary regulatory approvals, is expected to close in the last quarter of 2000 and will increase Sierra Pacific's customer base by 700,000 customers.
Sierra Pacific ResourcesFinancial Highlights
(In thousands, except for per share amounts)
Second Quarter
| |
2000 |
1999 |
Change |
| Revenues |
$490,743 |
$237,937 |
106.2% |
| Operating Expenses |
$469,132 |
$207,024 |
126.6% |
| Net Income Available for Common |
$(20,191) |
$11,712 |
-272.4% |
| Average Shares Outstanding |
$78,420 |
$51,265 |
53.0% |
| Net Income Per Share |
$(0.26) |
$0.23 |
--213.0% |
6 Months Ended June 30
| |
2000 |
1999 |
Change |
| Revenues |
$893.265 |
$420,370 |
112.5% |
| Operating Expenses |
$810,954 |
$368,496 |
120.1% |
| Net Income Available for Common |
$(2,013) |
$16,153 |
-112.5% |
| Average Shares Outstanding |
$78,418 |
$51,265 |
53.0% |
| Net Income Per Share |
$(0.03) |
$0.32 |
-109.4% |
Note: 1999 comparative numbers reflect the results of Nevada Power Company. The changes reflect both the level of business activity as well as the merger of the two companies.
