Wednesday after the bell, energy company Integrys Energy Group Inc. (TEG) announced that its net income available for common shareholders plunged nearly 70% from last year, hurt by non-cash accounting losses.
On a GAAP basis, the company's net income available for common shareholders declined to $25.6 million or $0.33 per share from $85.1 million or $1.11 per share in the year-ago period.
The recent fourth-quarter results included net after-tax non-cash accounting losses of $41.9 million, compared with net after-tax non-cash accounting gains of $47.2 million in the year-ago period. The company blamed the negative $89.1 million after-tax change in non-cash activity quarter-over-quarter to derivative and inventory accounting activities at its nonregulated subsidiary, Integrys Energy Services Inc.
The company's income from continuing operations for the quarter was $21.8 million or $0.27 per share from $91.9 million or $1.19 per share in the year-earlier period.
Integrys Energy Group's adjusted earnings from continuing operations for the quarter were $0.30 per share, compared to $1.25 per share in the year-earlier quarter. On average, 3 analysts polled by Thomson Reuters expected the company to earn $1.60 per share.
Total revenue for the quarter, which includes non regulated revenue and utility revenue, increased to $3.42 billion from $3.06 billion in the year-ago period.
For the year ended December 31, 2008 the company's income available for common shareholders declined to $126.4 million or $1.64 per share from $251.3 million or $3.50 per share in 2007.
Integrys Energy Group's income from continuing operations in 2008 was $124.8 million or $1.58 per share, compared to $181.1 million or $2.48 per share a year before.
On an adjusted basis, the company's earnings from continuing operations in 2008 dropped to $1.83 per share from $2.52 per share a year before. Wall Street analysts were looking for earnings of $3.41 per share.
The company's total revenues rose to $14.05 billion from $10.29 billion in 2007 and topped analysts' consensus estimate of $13.57 billion.
Integrys Energy Group said it has decided to either divest entirely or partially its nonregulated energy services business segment, Integrys Energy Services, or significantly reduce its scope and scale. The company noted that its short-term strategy will be to reduce and refocus its capital on those aspects of Integrys Energy Services' business that yield the highest return.
The divestiture of the nonregulated business segment, or a reduction in its size and scope, is also expected to allow the company to eliminate or reduce the credit facilities and other forms of financial support committed to Integrys Energy Services.
Looking ahead, the company anticipates generating earnings per share in 2009 within the range of $2.51 to $2.66. On an adjusted basis, the company expects earnings for 2009 to range between $2.53 and $2.68. Analysts polled by Thomson Reuters have earnings estimate pegged in the range of $3.55 to $4.35 per share.
TEG closed Wednesday's regular trade at $36.62 down 0.05% on a volume of 1.62 million shares. In after-hours, the stock gained 0.01% and was at $36.62.
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