By Melodie Warner
Southern Co.'s (SO) second-quarter earnings fell 52% as
increased construction costs and mild weather weighed on the
electric-power company's results.
"The wet weather and unseasonably mild temperatures appear to
have slowed economic activity, reduced energy demand and lowered
margins due to increases in hydroelectric generation," said
Chairman and Chief Executive Thomas A. Fanning.
Southern operates power utilities in Georgia, Florida, Alabama
and Mississippi. The company's revenue performance has been mixed
over the past year as milder weather pressured kilowatt-hour sales
to retail customers.
Southern reported a profit of $297 million, or 34 cents a share,
down from $623 million, or 71 cents, a year earlier. Excluding
items such as increased cost estimates for Mississippi Power's
Kemper County project and an insurance-related gain, earnings fell
to 66 cents from 69 cents.
Revenue rose 1.6% to $4.25 billion.
Analysts polled by Thomson Reuters had most recently forecast
per-share earnings of 68 cents on revenue of $4.3 billion.
Operating margin shrank to 15.1% from 27.3%.
Total energy sales, including wholesale sales, fell 4.6%.
Kilowatt-hour sales to retail customers declined 2.9%.
Residential and commercial energy sales decreased 5.3% and 4.2%,
respectively. Industrial energy sales were up 0.6%.
Shares closed Tuesday at $45.42 and were inactive premarket. The
stock is up 6.1% so far this year.
Write to Melodie Warner at melodie.warner@wsj.com
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