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Enron 2Q profit tops mark
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July 12, 2001: 8:17 a.m. ET
Wholesale, retail electric business lifts results; '02 guidance raised
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NEW YORK (CNNfn) - Lifted by higher electricity prices, energy provider Enron Corp. beat second-quarter forecasts for improved earnings Thursday and set slightly higher guidance for next year's profit.
The Houston-based company said strong results from its wholesale and retail electric business led it to post net income of $404 million, or 45 cents a diluted share, up from $289 million, or 34 cents a share, a year earlier. Analysts surveyed by earnings tracker First Call forecast the company to earn 42 cents in the latest period.
The company said it is confident it will meet First Call's forecast of $1.80 per share for the full year, and that it now expects to post EPS of $2.15 in 2002, up from the First Call forecast of $2.12.
Enron said that while its electric business showed strong results, its broadband communications business had weak revenue and a loss of $102 million in the quarter, wider than the $8 million loss a year ago. It said it expects to "significantly modify the cost structure" of the unit to deal with the downturn, but gave no details of job cuts or reduced capital spending that could accompany such a move.
Enron is the world's leading wholesale supplier of power and has been a subject of harsh criticism from California elected officials, who blame it and other power generators for price gouging and creating the current energy crisis there.
The Federal Energy Regulatory Commission recently approved price caps for wholesale electric sales to the West. The state is demanding $8.9 billion in refunds from generators, and the chief administrative law judge with FERC now is weighing that demand.
Shares of Enron (ENE: Research, Estimates) lost 12 cents to $49.10 Wednesday. 
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