FPL Group, Inc.
For the fourth quarter of 2000, FPL Group's recurring net income was $106 million, or 63 cents per share, compared with $97 million, or 57 cents per share in the 1999 quarter. Nonrecurring gains and charges for both quarters were excluded.
Including the merger-related costs, FPL Group's 2000 net income was $704 million or $4.14 per share, and fourth quarter 2000 net income was $65 million or 38 cents per share. Including special gains from the sale of cable investments and nonrecurring charges in 1999, full-year net income was $697 million or $4.07 per share, and fourth quarter net income was $121 million or 71 cents per share.
"This past year was a landmark year for FPL Group," said James L. Broadhead, FPL Group chairman and chief executive officer. "Florida Power & Light and FPL Energy produced outstanding operating results, and our new subsidiary, FPL FiberNet, achieved profitability in its first year of operation. This performance enabled us to reach new records of net income and earnings per share, and shareholders were rewarded with exceptionally attractive returns. The highlight of our year was the announcement of our agreement to merge with Entergy Corporation, thereby creating one of America's leading energy companies."
Shareholders of FPL Group and Entergy approved the merger in December. The companies have said they expected to complete the transaction in the fourth quarter of this year. Earlier this month, however, an Administrative Law Judge, assigned to the Louisiana Public Service Commission, scheduled hearings on the merger for late October. Entergy will file a motion for reconsideration of that schedule, noting it believes the commission's review can be accomplished within a shorter timeframe without undue hardship on the LPSC. If the revised schedule is not obtained, the companies estimate the merger closing could be delayed by three to six months.
In 2000, the company's recurring net income increased 9 percent, and earnings per share growth exceeded 10 percent. The total return on the company's common stock -- dividends plus stock price appreciation -- was 74.8 percent, compared to the Standard & Poor's Electric Utilities Index of 53.5 percent.
Florida Power & Light Company
Fourth quarter net income for the company's principal subsidiary Florida Power & Light, excluding merger-related expenses and 1999 nonrecurring items, was $92 million compared to $87 million in 1999. Net income for the full year 2000 increased more than four percent to $645 million from $618 million in 1999.
FPL added 92,000 new customers during 2000, an increase of 2.5 percent from 1999. Customer growth, increased usage per customer of nearly two percent, and lower operations and maintenance and depreciation expense contributed to earnings -- offset somewhat by the effect of the rate agreement and interest expense associated with the company's power plant and system expansion program.
"The key to FPL's success is our ability to lower costs while improving customer service and reliability," said Mr. Broadhead. "FPL has lowered operating and maintenance expense per kilowatt-hour by 40 percent over the past decade. We have improved the performance of our power plants to be among the best run in the nation, and our service reliability far exceeds the national average."
FPL Energy
In the fourth quarter, net income for FPL Energy, excluding merger-related expenses, more than doubled to $9 million in 2000 from $4 million in 1999. Net income for the full year 2000 increased by 43 percent to $83 million from $58 million in 1999. The growth in earnings reflects an increase in FPL Energy's power plant portfolio, as well as improved operating performance of existing assets.
During 2000, FPL Energy increased its power project portfolio by nearly 40 percent to approximately 4,100 megawatts. It now has power plants operating, under construction or in development in 15 states.
"In addition to having made a significant contribution to our earnings growth in 2000," said Mr. Broadhead, "FPL Energy has developed a solid and growing pipeline of projects that should help ensure its continued healthy growth."
Corporate & Other
FPL FiberNet, which leases fiber optic capacity in Florida and the Southeast, posted modest earnings in its first year of operation. The subsidiary began operating as a wholly owned subsidiary of FPL Group in January. It operates a 2,000-mile fiber optic network throughout much of the state and has plans to build intra-city networks in 15 metropolitan areas in Florida.
The increase in net income and contributions to earnings per share from Corporate and Other was largely attributable to FPL FiberNet.
Other 2000 Highlights for FPL Group
Improved Service: Florida Power & Light's electric reliability continued to improve in 2000, and its reliability is 40 percent better than the national average.
Added power sources: Florida Power & Light continued to repower its Fort Myers and Sanford plants and construct new peaking units at its Martin plant. By 2002, FPL will have added 15 percent capacity to its existing power plant fleet in Florida.
FPL Energy completed construction of a 1000-megawatt gas-fired power plant in Paris, Texas and acquired a 104-megawatt wind farm in Minnesota in 2000. In addition, the subsidiary announced plans to construct new plants: a 744-megawatt project in Pennsylvania; a 171-megawatt plant in Virginia; a 160-megawatt wind farm in Texas; and a 535-megawatt plant in Rhode Island. In January, FPL Energy announced it has begun construction of a 535-megawatt gas-fired plant in Bastrop, Texas, which will be co-owned with Coastal Power Company. It also announced it will build a 300-megawatt wind farm on the Washington-Oregon border.
Stock Repurchase: FPL Group repurchased approximately 2.6 million shares of FPL common stock during 2000 compared to 2.2 million shares in 1999. Approximately one million shares were repurchased in the fourth quarter of 2000.
Profile
FPL Group, with annual revenues of more than $7 billion, is one of the nation's largest providers of electricity-related services. Its principal subsidiary, Florida Power & Light Company serves 3.9 million customer accounts in Florida. FPL Energy, LLC, FPL Group's independent power producer subsidiary, is a leader in generating electricity from clean and renewable fuels. Information about FPL Group businesses and the company's pending merger with Entergy is available on the Internet at http://www.fplgroup.com/
Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
This press release contains forward looking statements within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. Investors are cautioned that such forward-looking statements with respect to revenues, earnings, performance, strategies, prospects and other aspects of the businesses of FPL Group, Inc. and Entergy Corporation are based on current expectations that are subject to risk and uncertainties. A number of factors could cause actual results or outcomes to differ materially from those indicated by such forward looking statements. These factors include, but are not limited to, risks and uncertainties relating to: changes in laws or regulations, changing governmental policies and regulatory actions with respect to allowed rates of return including but not limited to return on equity and equity ratio limits, industry and rate structure, operation of nuclear power facilities, acquisition, disposal, depreciation and amortization of assets and facilities, operation and construction of plant facilities, recovery of fuel and purchased power costs, decommissioning costs, present or prospective wholesale and retail competition (included but not limited to retail wheeling and transmission costs), political and economic risks, changes in and compliance with environmental and safety laws and policies, weather conditions (including natural disasters such as hurricanes), population growth rates and demographic patterns, competition for retail and wholesale customers, availability, pricing and transportation of fuel and other energy commodities, market demand for energy from plants or facilities, changes in tax rates or policies or in rates of inflation or in accounting standards, unanticipated delays or changes in costs for capital projects, unanticipated changes in operating expenses and capital expenditures, capital market conditions, competition for new energy development opportunities and legal and administrative proceedings (whether civil, such as environmental, or criminal) and settlements and other factors. Readers are referred to FPL Group, Inc.'s and Entergy Corporation's most recent reports filed with the Securities and Exchange Commission.
A webcast of our 4th quarter earnings conference call scheduled at 9 a.m. ET on Monday January 22, 2001 is available on FPL Group's Web site, http://www.fplgroup.com/, by following the link provided.
FPL Group, Inc.
Financial Summary
(in millions, except per share amounts)
Three Months Ended December 31,
2000 1999
FPL kilowatt-hour sales 21,216 20,132
Operating Revenues $ 1,857 $ 1,520
Operating Expenses
Fuel, purchased power and
interchange 877 578
Other operations and
maintenance 349 411
Merger-related 67 --
Depreciation and
amortization 269 271
Taxes other than income
taxes 149 154
Total operating
expenses 1,711 1,414
Other Income (Deductions)
Interest charges and
preferred stock dividends (81) (63)
Redemption of interest in
cable limited partnership -- 108
Other - net 13 1
Total other income
(deductions) - net (68) 46
Income Taxes 13 31
Net Income $ 65 $ 121
Earnings per share:
Basic $ 0.39 $ 0.71
Assuming dilution $ 0.38 $ 0.71
Weighted-average shares
outstanding (basic and assuming
dilution) 169 171
Twelve Months Ended December 31,
2000 1999
FPL kilowatt-hour sales 91,969 88,067
Operating Revenues $ 7,082 $ 6,438
Operating Expenses
Fuel, purchased power and
interchange 2,868 2,365
Other operations and
maintenance 1,257 1,322
Merger-related 67 --
Depreciation and
amortization 1,032 1,040
Impairment loss on Maine
assets -- 176
Taxes other than income
taxes 618 615
Total operating
expenses 5,842 5,518
Other Income (Deductions)
Interest charges and
preferred stock dividends (293) (237)
Divestiture of cable
investments -- 257
Other - net 93 80
Total other income
(deductions) - net (200) 100
Income Taxes 336 323
Net Income $ 704 $ 697
Earnings per share (basic and
assuming dilution) $ 4.14 $ 4.07
Weighted-average shares
outstanding:
Basic 170 171
Assuming dilution 170 172
FPL Group, Inc.
Earnings Per Share Summary
Three Months Ended December 31,
2000 1999
Earnings Per Share
Basic:
Florida Power & Light
Company $ 0.55 $ 0.51
FPL Energy, LLC 0.06 0.03
Corporate and other 0.02 0.03
Subtotal 0.63 0.57
Merger-related and
nonrecurring items:
Merger-related
expenses (0.24) --
Redemption of
interest in cable
limited partnership -- 0.39
Litigation settlement -- (0.25)
Total $ 0.39 $ 0.71
Assuming dilution $ 0.38 $ 0.71
Twelve Months Ended December 31,
2000 1999
Earnings Per Share
Basic:
Florida Power & Light
Company $ 3.80 $ 3.61
FPL Energy, LLC 0.49 0.34
Corporate and other 0.09 0.03
Subtotal 4.38 3.98
Merger-related and
nonrecurring items:
Merger-related
expenses (0.24) --
Divestiture of cable
investments -- 0.95
Impairment loss on
Maine assets -- (0.61)
Litigation settlement -- (0.25)
Total $ 4.14 $ 4.07
Assuming dilution $ 4.14 $ 4.07
FPL Group, Inc.
Merger-Related Expenses in 2000 and Nonrecurring Items in 1999
(in millions, except per share amounts)
Three Months Ended December 31,
2000 1999
Effect on Net Income
Florida Power & Light Company $ (38) $ (42)
FPL Energy, LLC (1) --
Corporate and other (2) 66
Total $ (41) $ 24
Effect on Earnings Per Share
Florida Power & Light Company $ (0.22) $ (0.25)
FPL Energy, LLC (0.01) --
Corporate and other (0.01) 0.39
Total $ (0.24) $ 0.14
Twelve Months Ended December 31,
2000 1999
Effect on Net Income
Florida Power & Light Company $ (38) $ (42)
FPL Energy, LLC (1) (104)
Corporate and other (2) 162
Total $ (41) $ 16
Effect on Earnings Per Share
Florida Power & Light Company $ (0.22) $ (0.25)
FPL Energy, LLC (0.01) (0.61)
Corporate and other (0.01) 0.95
Total $ (0.24) $ 0.09
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SOURCE: FPL Group, Inc.
Contact: (Investor Relations) Lisa Kuzel of FPL Group, Inc.,
Corporate Communications Dept., 561-694-4697