AEP profits jump 15 percent on higher revenue
July 26, 2014 at 10 p.m.
The parent of AEP Southwestern Electric Power Co. said profits jumped 15 percent in the second quarter.
American Electric Power, the Columbus, Ohio-based utility, said revenue increased on rate base growth and higher sales in its transmission business.
Transmission revenue rose to $111 million from $78 million a year ago.
Revenue also was boosted by fracking, which has boosted industrial power use. Oil and gas companies use a lot of electricity to power fracking and related operations, which are faster-moving than typical industrial users.
Year-to-year sales were up 39 percent in shale-gas counties and down 1.6 percent in non-shale counties, AEP said Friday.
The company said its overall performance so far this year has led it to make an additional $100 million investment in its transmission business, bringing its 2014 investment to $300 million and its total investment to nearly $2 billion.
For the three months ended June 30, AEP posted a profit of $390 million, or 80 cents a share, up from a year-earlier profit of $338 million, or 69 cents a share. Excluding special items, the company's operating profit was 80 cents a share, up from 73 cents a year ago.
Revenue climbed 11 percent to $4 billion.
AEP is one of the largest electric utilities in the United States, delivering electricity to more than 5.3 million customers in 11 states. Its Shreveport-based SWEPCO unit provides electricity to customers in Longview and elsewhere in East Texas, as well as western Louisiana and southwestern Arkansas.
AEP also owns the nation's largest electricity transmission system.