Exhibit 99.1
News Release
CONTACT: Jeffrey R. Kotkin
OFFICE: (860) 665-5154
NU REPORTS FIRST-QUARTER EARNINGS
BERLIN, Connecticut, April 29, 2004 - Northeast Utilities
(NU-NYSE) today reported first-quarter 2004 earnings of
$67.4 million, or $0.53 per share, compared with earnings of
$60.2 million, or $0.47 per share, in the first quarter of
2003.
Charles W. Shivery, NU chairman, president and chief
executive officer, said the improved results were driven
primarily by increased earnings at NU's competitive energy
businesses. Those businesses, which include Select Energy,
Inc., NU's competitive wholesale and retail energy marketing
subsidiary, earned $18.8 million in the first quarter of
2004, compared with $5.2 million in the same period of 2003.
The following table reconciles 2004 and 2003 first quarter
earnings:
First Quarter
2003 Reported EPS $0.47
Lower regulated results ($0.04)
Improved competitive results $0.11
Other ($0.01)
2004 Reported EPS $0.53
Select Energy's wholesale business, which includes
approximately 1,440 megawatts of primarily hydroelectric
generation assets, earned $16.8 million in the first quarter
of 2004, compared with approximately $6.8 million in the
same period of 2003. Select Energy's retail marketing
business earned $2.3 million in the first quarter of 2004,
compared with a loss of $1.9 million in the first quarter of
2003. NU's energy services businesses lost $0.2 million in
the first quarter of 2004, compared with a profit of $0.4
million in the first quarter of 2003.
Shivery attributed the improved performance in the marketing
businesses primarily to improved margins and higher retail
volumes. He also said that Select Energy's earnings profile
in the first half of 2004 will be quite different from the
first six months of 2003, particularly in the wholesale
business. Select Energy's cost per kilowatt-hour for
procuring electricity is relatively flat throughout 2004.
However, contracted sales prices to some of Select Energy's
wholesale customers were relatively high in the first
quarter and will be lower in the second quarter, creating
better wholesale margins in the first quarter of 2004 and
lower margins in the second quarter.
Overall, Shivery said, NU expects first half competitive
business earnings in 2004 to be well ahead of results in the
first half of 2003, when those businesses earned
approximately $17 million, but second quarter 2004 earnings
for those businesses are projected to be significantly below
results in the same period of 2003. NU's competitive
businesses now are expected to earn in the middle to upper
end of their previously announced 2004 earnings range of
between $0.22 per share and $0.30 per share. NU has
approximately 128 million NU common shares outstanding.
Combined earnings at NU's regulated businesses declined in
the first quarter of 2004, compared with the first quarter
of 2003, primarily due to higher depreciation and pension
expense. Higher earnings at The Connecticut Light and Power
Company (CL&P) and Public Service Company of New Hampshire
(PSNH) were more than offset by lower results at Yankee Gas
Services Company and Western Massachusetts Electric Company
(WMECO). Regulated electric sales rose by 2.7 percent in
the first quarter of 2004, compared with the same period of
2003.
CL&P earnings totaled $26.2 million after payment of
preferred dividends in the first quarter of 2004, compared
with $25.3 million in the first quarter of 2003. In the
first quarter of 2004, distribution and transmission rate
increases and a 2.0 percent increase in retail electric
sales at CL&P more than offset expected higher depreciation
and other expense and lower pension income.
PSNH earned $11.8 million in the first quarter of 2004,
compared with $10.8 million in the same period of 2003,
primarily as a result of a 6.9 percent increase in retail
sales.
Yankee Gas earned $11.9 million in the first quarter of
2004, compared with $15.8 million in the first quarter of
2003. Lower Yankee Gas earnings resulted from higher
pension, interest and depreciation expense and an August
2003 change in the company's rate design. That change
shifted some of Yankee Gas' cost recovery to more stable
fixed monthly charges from more variable energy charges.
That shift will reduce earnings in the higher-use first and
fourth quarters and improve results in the lower-use second
and third quarters.
WMECO earned $3.5 million in the first quarter of 2004,
compared with $6.1 million in the first quarter of 2003.
Lower WMECO earnings were due primarily to lower pension
income and higher depreciation and interest expense.
Shivery said NU continues to project consolidated earnings
of between $1.20 per share and $1.40 per share, including
between $1.08 per share and $1.20 per share for the
regulated businesses. The consolidated figures include the
competitive business earnings noted above and parent company
costs of approximately $0.10 per share related to interest
and other expenses.
Northeast Utilities is a Fortune 500 diversified energy
company located in Connecticut with operations throughout
the Northeast. Through its competitive and regulated
subsidiaries, NU provides Energy for Home, Business, Life
with a full range of energy-related products and services to
millions of residential and business customers from Maine to
Maryland. From delivering electricity and natural gas, to
marketing energy products, to operating and maintaining
power plant facilities, NU is committed to safety,
reliability and expanding consumers' energy options. For
more information on Northeast Utilities and its
subsidiaries, visit the NU family of Web sites at
www.nu.com.
This press release includes forward-looking statements
within the meaning of the Private Securities Litigation
Reform Act of 1995, which are statements of future
expectations and not facts. Actual results or developments
might differ materially from those included in the forward-
looking statements because of factors such as competition
and industry restructuring, changes in economic conditions,
changes in weather patterns, changes in laws, regulations or
regulatory policies, developments in legal or public policy
doctrines, technological developments, volatility in
electric and natural gas commodity markets, and other
presently unknown or unforeseen factors. Other risk factors
are detailed from time to time in NU's reports to the
Securities and Exchange Commission.
# # #
NU will webcast an investor conference call today at 4 p.m.
Eastern Daylight Time. A link to the call will be available
on NU's website at www.nu.com.