Duke Energy reported a 58 percent jump in profits in its fourth quarter earnings, partially due to lower costs and higher rates.
The company reported saving $190 million in fuel and other costs because of the merger with Progress Energy, enough to increase earnings per share by 20 cents by itself. At the same time, the utility received increases in five rate cases, which CEO Lynn Good said will ultimately add $600 million in annual revenues.
Investors on today’s earnings call were especially interested in Duke’s planned sale of its Midwest assets, 13 coal and natural gas plants in Ohio, Pennsylvania and Illinois. The company plans to get rid of those plants in the next 18 months. Good says it doesn’t fit Duke’s business model.
"The volatility inherent has challenged our ability to earn consistent and fair returns investors expect," Good said. "This business is not a strategic fit."
Overall Duke earned $688 million, up from $435 million in the previous quarter. Shares rose during the call by about a dollar, above $72 per share, but have since fallen back to about $71.50.
The Associated Press contributed to this report.