News & Updates


FPL Group cites first-quarter surge, expects stimulus boost


Palm Beach Post Staff Writer

JUNO BEACH — Even as demand continues to lag at its electric utility, FPL Group Inc. is expecting federal stimulus dollars and new limits on carbon emissions to boost its bottom line.

During a conference call Tuesday to report first-quarter results, executives with Juno Beach-based FPL Group (NYSE: FPL) said this year’s profits would be heftier than expected. They increased adjusted earnings-per-share projections for the year – from the $4.05-$4.25 range predicted in January to $4.20-$4.40.

 The outlook for 2010 also surged: from the previously announced $4.50-$4.90 per share to $4.65 to $5.05.

Executives pointed to the $787 billion stimulus package, enacted this year by President Obama, as a main driver. The American Recovery and Reinvestment Act will extend tax credits for solar and wind projects by several years – a huge perk for FPL Group subsidiary NextEra Energy Resources, the nation’s largest wind and solar energy producer.

"We have never had such long-term certainty in this market," Chief Financial Officer Armando Pimentel Jr. said during the call.

NextEra plans to add 1,000 megawatts of wind projects this year, plus another 1,000-2,000 megawatts next year.

Also during the call, FPL Group reported that earnings jumped 46 percent during the first quarter, beating analysts’ estimates.

Net income for the three months ended March 31 was $364 million, or 90 cents a share, compared with $249 million, or 62 cents per share a year ago.

Revenue for the quarter was $3.7 billion, up from $3.43 billion during the first quarter of 2008.

Shares of FPL rallied Tuesday, climbing 5.8 percent to close at $54.27.

FPL is proof that the stimulus bill is having an impact, said David Parker, a utilities analyst at Robert W. Baird & Co. in Tampa.

"Being able to have policy cast in stone for more than 18 months is going to be really positive for wind and solar," he said.

Despite FPL Group’s upbeat outlook, the protracted slump has continued to hurt its regulated utility, Florida Power & Light Co. The utility – the state’s largest – had about 17,000 fewer customer accounts at the end of this March than it did at the end of March 2008. Electricity usage per customer also is down – but past-due accounts are declining, a possible sign that the economy has hit bottom.

The outlook for the company as a whole remains strong as momentum builds to limit carbon emissions, said Lew Hay, FPL Group chairman and CEO.

Because NextEra sells wholesale electricity to providers – using a fleet of solar, wind and nuclear plants – it stands to benefit from an increase in energy prices stemming from a tax or cap on carbon.

Hay pointed to a climate-change bill proposed by Rep. Henry Waxman, D-Calif., and Rep. Ed Markey, D-Mass., and related developments in the U.S. Senate.

"Federal policy finally appears to be catching up to FPL Group," Hay said.