Exelon earnings disappoint on low power prices

CHICAGO (AP) ? Exelon, the nation's largest supplier of wholesale electric power, reported weak second-quarter earnings on Wednesday amid a nationwide slump in electricity prices.

Net income was $286 million, or 33 cents per share on revenue of $5.95 billion. Adjusted to exclude the costs associated with the company's recent acquisition of Constellation Energy and other items, Exelon earned $522 million, or 61 cents per share.

Analysts expected the company to make 64 cents per share on revenue of $4.43 billion, according to FactSet.

The results are not directly comparable to last year because the company has since acquired Constellation and began incorporating those results.

Exelon, based in Chicago, operates the largest number of nuclear plants in the U.S. and has operations in 47 states. Its power plants sell electricity into wholesale markets in regions of the country that have deregulated power markets. In those markets, the price of power paid to all generators is generally set by the price of natural gas-fired generation. A glut of natural gas in the U.S. brought on by increased production and a historically warm winter has pushed wholesale power prices down, denting the results of Exelon and other wholesale generators.

The company's generation results were also hurt by higher nuclear fuel costs and higher operating and maintenance costs. Operating expenses grew from $3.46 billion last year to $5.22 billion in the recent quarter.

Exelon also operates regulated utilities that deliver power to 6.6 million customers in Maryland, Illinois and Pennsylvania. Results at those utilities slipped because of lower rates allowed by regulators and higher maintenance costs.

In midday trading Exelon shares fell 18 cents to $38.94.

Source: http://news.yahoo.com/exelon-earnings-disappoint-low-power-prices-173509748--finance.html

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