Akron-based FirstEnergy Corp. said Tuesday its profit rose 6.1 percent in the first quarter despite “extremely challenging market conditions.” However, shares fell as the company lowered its yearly earnings outlook.
The utility and parent company of Ohio Edison said its first quarter net income was $208 million or 50 cents per share, compared with $196 million or 47 cents per share for the same time a year ago. Revenues were $4.2 billion for the first quarter of 2014, compared with $3.7 billion a year ago.
The company said electricity distribution increased 6 percent compared with the first quarter of last year, largely attributable to colder temperatures.
Sales to residential customers increased by 11 percent and deliveries to commercial customers increased 6 percent. Sales to industrial customers increased by 1 percent year over year.
In the company’s segment in which it has competitive energy services, overall margins decreased significantly. The company said it saw higher costs related to unit outages and increased demand. Also, it noted there were higher service costs from PJM Interconnection, which is a nonprofit company managing the high-voltage grid in 13 states, including Ohio.
“The strong performance of our distribution and transmission business drove first quarter results that are in line with our expectations, and partially offset the impact of extremely challenging market conditions on our competitive business,” FirstEnergy President and Chief Executive Officer Anthony Alexander said in a news release. “Reflecting these results, we have updated our full-year 2014 operating earnings guidance to $2.40 to $2.60 per share, from our previous range of $2.45 to $2.85 per share.”
Shares fell by 77 cents, or 2.3 percent, to $32.65. Shares are up 1.3 percent since Jan. 1, including dividends, and are down 22.2 percent from a year ago.
In other news, in a conference call with analysts, Leila Vespoli, FirstEnergy executive vice president of markets and chief legal officer said the company expects to file a new Electric Security Plan, the process to determine the electricity prices for customers who buy their power directly from the utility, by the end of the year. The utility’s current plan runs through May 2016.
Vespoli said the company expects most of the main aspects of the filing to be similar to its current plan.