Electric utility American Electric Power Co., Inc. (AEP) reported Friday a decline in second-quarter profit, mainly on headcount reduction and restructuring charges. Ongoing earnings increased from the prior year and exceeded analysts' expectations. Further, the company reaffirmed its 2010 ongoing earnings guidance. For the second quarter, the Columbus, Ohio-based company's GAAP earnings declined to $136 million or $0.28 per share from $316 million or $0.67 per share in the previous year. The result reflect a one-time severance and other restructuring charge of $185 million as a result of elimination of 2,461 jobs as well as disallowance by Virginia State Corp. Commission of the recovery of $54 million related to the Mountaineer Plant carbon capture and storage project.
Ongoing earnings, that excludes special items, were $355 million or $0.74 per share, up from $321 million or $0.68 per share in the prior year. Per-share results for the quarter reflect the dilutive effect of additional shares outstanding, which reduced ongoing earnings by $0.01 per share for the quarter.
On average, 14 analysts polled by Thomson Reuters expected the company to report earnings of $0.69 per share. Analysts' estimates typically exclude special items.
Revenues for the quarter marginally increased to $3.4 billion from $3.2 billion in the same quarter last year. Four analysts had a consensus revenue estimate of $3.48 billion for the quarter. Total Retail Electric sales increased 5% from last year, while Wholesale Electric sales declined 2.1% from the same quarter a year ago.
The company said recovery in the industrial sector increased industrial sales 9.4% from the prior-year quarter. Michael Morris, chairman, president and chief executive officer of the company said, "We have seen improvement in the industrial sector from the lows of 2009, but demand in other sectors is essentially flat. We benefited from our geographic diversity, with sales volumes by our western and Ohio utilities showing growth over the prior period, while sales volumes in our east regulated utilities have seen little improvement."
Further, the company reaffirmed its 2010 ongoing earnings guidance range of between $2.80 and $3.20 per share. Analysts expect earnings of $3.02 per share for the full year. AEP closed Thursday's regular trading at $36.10 on the NYSE. In the past 52 weeks, the shares have been trading in a range of $28.26-$36.86.
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June 05, 2026 16:18 ET A busy week for economic news flow saw a slew of reports being released that reflected the trends in the U.S. labor market. In Europe, economic growth and inflation data gained attention as the European Central Bank and Bank of England head for policy session later in the month. In Asia, the monetary policy session of the Indian central bank was in focus as the country, a major oil importer, reels under the pressures of a weaker rupee and rising inflation.