TAX CUTS BOOST FPL PARENT’S 1ST QUARTER
Results announced Tuesday beat analysts’ expectations and left no question that federal tax cuts sweetened the bottom line at Palm Beach County’s largest company, Juno Beach-based NextEra Energy Inc. Yet to be fully resolved: Whether 4.9 million Florida Power & Light customers are getting their fair share of relief.
NextEra earnings in the first quarter of the year nearly tripled to $4.4 billion, or $9.32 per share, up from $1.6 billion, or $3.37 per share, in the same quarter last year. Tax savings were among several reasons acknowledged by company officials.
Still under scrutiny is whether customers of its core FPL business are reaping the full benefits. FPL has proposed not charging customers for $1.3 billion in Hurricane Irma restoration costs and delaying any rate increase for several years, but state officials have asked for more information on how the numbers add up. More filings are expected by June in a Public Service Commission docket to examine tax savings at all Florida utilities.
“We’ve got to get that right going forward,” Public Counsel J.R. Kelly, representing Florida’s utility customers, said Tuesday. “We’re going to be pushing to get that money back into ratepayers’ wallets.”
Tax cuts of about $1.5 trillion that took effect this year reduced corporate tax rates from 35 percent to 21 percent.
Even excluding certain gains from investments and other financial transactions and what it called “the transitional impacts of tax reform,” NextEra reported adjusted earnings of $919 million or $1.94 per share for the period. Analysts had been expecting in the neighborhood of $1.82.
“NextEra Energy delivered strong first-quarter results and is off to a solid start toward achieving our overall objectives for the year,” said Jim Robo, chairman and CEO of NextEra. “We grew adjusted earnings per share by almost 11 percent against the prior year comparable quarter, reflecting successful performance at both Florida Power & Light Co. and NextEra Energy Resources.”
According to a slide-show presentation Tuesday, FPL’s net income rose to $484 million from $445 in the year-earlier quarter, and earnings per share climbed to $1.02 from 95 cents.
FPL proposed in January to apply federal tax savings to $1.3 billion in Hurricane Irma restoration costs. Company officials said that would save typical customers from paying charges of about $250 each in storm-related costs and eliminate the need for a rate increase until at least 2021.
FPL said in January it would apply federal tax savings to $1.3 billion in Hurricane Irma restoration costs, and it did so.
Company officials said that saves typical customers from paying charges of about $250 each in storm-related costs and could eliminate the need for a rate increase until at least 2021.
The utility said its typical 1,000-kilowatt-hour customer bill dropped to $99.37, nearly 30 percent below the latest U.S. average, with a decrease of $3.35 a month after Hurricane Matthew recovery charges expired in March.
FPL President and CEO Eric Silagy called it at the time “the fastest way to begin passing tax savings along to our customers.”
FPL last week filed to lower charges another 59 cents on a typical residential bill effective in July to reflect tax savings, subject to approval from regulators.