Duke Energy's profits rose 23 percent in 2010, to $1.3 billion, on a rebound in industrial sales and unusually hot and cold weather that drove up power usage, the company said Thursday.
Fourth-quarter net income also rose 23 percent, to $427 million compared with $346 million in 2009. Earnings per share of 32 cents compared with the 26 cents of 2009.
Not counting one-time expenses and income, Duke earned 21 cents a share for the quarter, below analysts' expected 23 cents a share.
Frigid winter weather and a hot summer last year helped drive up demand for power. Rate increases that went into effect last year and recovery of costs for new power plant construction contributed to earnings.
Not counting the effects of weather, customers used about 2 percent more electricity than in 2009. Industrial use went up 7 percent.
"It's a year you could learn to love," CEO Jim Rogers said Thursday..
Duke also earned nearly $250 million from the sales of some assets, including a 50 percent ownership stake in DukeNet Communications to investment funds managed by Alinda Capital Partners. DukeNet manages fiber optic networks in the Southeast. Duke also sold telecommunications company Q-Comm Corp.
Power sales are considered bellwethers of economic activity. Rogers continues to think recovery from the recession will be slow. Duke's forecasters don't expect sales to return to 2007, pre-recession levels until about 2015.
"I think we're having a very anemic recovery," he said. "And I'm afraid it's going to be a jobless recovery."
Duke expects sales to grow about 1percent this year, again anchored by industrial growth.
Duke plans to ask for rate increases in North Carolina and South Carolina at midyear. It's undecided whether cases will be filed in the company's Midwestern territories of Ohio and Kentucky, Chief Financial Officer Lynn Good said.
Duke wants the higher rates to help pay for the construction of two coal-fired power plants, two natural gas-fueled plants and digital smart grid technology. Duke and Raleigh-based Progress Energy cited looming capital expenses in announcing a merger last month.
The company spent $4.9 billion on capital projects in 2010 and expects to invest $4.5 billion to $5 billion this year, Good told analysts Thursday. Meeting new environmental standards could cost another $5 billion over the next decade, she said.
For the year, adjusted earnings of $1.43 a share fell within the company's target of $1.40 to $1.45, which had been increased during the year. Duke set its 2011 earnings guidance at $1.35 to $1.40 a share.
Duke serves about 4 million customers in North Carolina, South Carolina and the Midwest.
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