MINNEAPOLIS, Minn., Jan. 31, 2003 -- Xcel Energy Inc.'s preliminary earnings for 2002 were a net loss of $2.0 billion, or $5.26 per share, including NRG results and impacts, compared with net earnings of $791 million, or $2.30 per share, in 2001.
Xcel Energy's earnings, excluding NRG Energy's pro forma operating results and other NRG impacts, were $525 million, or $1.38 per share, compared with $591 million, or $1.72 per share, for the year 2001.
Xcel Energy considers its and NRG's results to be preliminary until Xcel Energy's and NRG's financial results have been audited and final financial statements have been distributed publicly. See Note 1.
Xcel Energy's 2002 preliminary earnings consisted of the following components:
* Utility net income of $606 million, or $1.59 per share, compared with $655 million, or $1.90 cents per share, for the year 2001;
* Other subsidiary net losses and holding company costs of $0.22 per share (including 1 cent per share of NRG restructuring costs incurred at the holding company), compared with a loss of $0.18 per share for the year 2001;
* NRG net loss of $3.2 billion, or $8.40 per share (including a $3.0-billion pretax loss, or about $7.57 per share, recorded primarily in the third quarter of 2002 for asset impairments and disposal losses), compared with net income of $200million, or $0.58 per share in 2001; and
* Tax benefit of $676 million in 2002 (as reported in third quarter), or $1.77 per share, related to Xcel Energy's investment in NRG.
"The 2002 financial results of our utility operations reflect our continued focus on our primary business," said Wayne H. Brunetti, chairman, president and chief executive officer of Xcel Energy. "We are pleased with their performance, given the less favorable market conditions of 2002 compared with 2001."
Xcel Energy's annual utility earnings-per-share contribution was lower in 2002 than in 2001, primarily due to lower margins from electric wholesale and trading sales. As anticipated, less favorable market conditions reduced margins from electric wholesale and trading sales, decreasing 2002 earnings by about 33 cents per share in comparison to 2001. Additionally, an increased number of shares outstanding reduced utility earnings by approximately 16 cents per share in 2002. These earnings reductions were partially offset by higher retail electric margins, reflecting sales growth and favorable weather impacts in comparison to 2001.
NRG's results include operating losses from continuing low power pool prices, as well as significant costs associated with the potential financial restructuring with NRG's creditors. Excluding asset impairment and disposal losses of $7.50 per share, the preliminary estimate of NRG losses incurred in 2002 is $0.83 per share. Approximately $0.35 of such losses per share was related to estimated restructuring costs incurred in 2002.
"As negotiations continue with NRG creditors, we remain optimistic that a mutually beneficial resolution of the NRG financial difficulties will be reached," said Brunetti. "Once NRG's issues are behind us, we can focus all our attention on the fundamentals of our core businesses."
Wednesday's conference call is available on Xcel Energy's web site at www.xcelenergy.com. To access the presentation, click on Investor Information.