US power and natural gas giant Duke Energy extended its 2011 rebound through the second quarter of the year, reporting increasing profit on robust revenue growth, particularly in its international operations.
Duke Energy reported a $441 million profit in the second quarter of 2011 and a nearly $1 billion profit for the first six months of the year at $941 million, up from a second-quarter loss in 2010 of $217 million and a first-half 2010 profit of only $228 million.
The boost was driven by strong revenue growth across the company’s three major operating sectors, with US franchised gas and electric, commercial power and international energy all showing revenue increases for both the second quarter of 2011 over the same period in 2010 and for the first half of the year over the preceding year.
Duke, which is pursuing a proposed merger with US electricity utility Progress Energy, highlighted its international and commercial operations in announcing second quarter results on August 2. The international energy operating unit marked $406 million in revenue in the second quarter of 2011 despite a decline in power sales to 4,516 GWh from 5,041 GWh over the same period. The commercial power unit’s revenues rose by $55 million to hit $595 million in Q2 2011, with power sales actually increasing there to 9,965 GWh, up from 8,681 GWh in the same period for that unit last year.
“Traditionally, our third quarter is the most significant,” Duke CEO and chairman James Rogers said in announcing the company’s results, echoing the third-quarter focus of other utilities that rely on air-conditioning related demand to boost revenue and financial results.
For more on how utilities are handling low demand, in the case of NV Energy, read: Nevada Energy Betting On 2012. In meeting the high demand seen in many parts of the US during a late-July heat wave, utilities adopted a wide range of creative solutions; see: Looking To Past, Future For Heat Beating Methods.
“We will be working hard the remainder of the year on our proposed merge with Progress Energy; pending rate cases in the Carolinas; ongoing fleet modernization; and in pursuing a new Electric Security Plan for Duke Energy Ohio customers,” Rogers said.
The company cited higher operations and maintenance costs related to storms restorations, but cut back capital expenditures as new generation investments in the North and South Carolina and Indiana came online. Capital expenditure slipped to $980 million in the second quarter of 2011 from $1.286 billion in the same period last year, and fell $494 million from the first six months of 2011 to the first six months of 2010.
Photo Caption: A man walks past one of two buildings that house Duke Energy’s headquarters January 10, 2011 in Charlotte, North Carolina. Duke Energy announced plans to buy Progress Energy, which is based in Raleigh, North Carolina. If the merger is approved, the combining of the two companies will create the country’s largest electric utility and will provide power to over 7 million customers.
