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Strong 3Q15 financial results for FirstEnergy

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World Coal,

FirstEnergy Corp. has reported 3Q15 operating (non-GAAP) earnings of US$0.98 per basic share of common stock – an increase from 3Q14 earnings of US$0.89 per basic share of common stock.

GAAP earnings for the third quarter were US$395 million, or US$0.94 per basic share of common stock (US$0.93 diluted), on revenue of $4.1 billion. Again an increase compared to 3Q14, where GAAP earnings were US$333 million, or US$0.79 per basic and diluted share of common stock, on revenue of US$3.9 billion.

"Our strong third quarter results reflect a solid performance across all three of our businesses – Regulated Distribution, Regulated Transmission and Competitive Energy Services," commented Charles E. Jones, FirstEnergy President and CEO. "This quarter, we also made tremendous progress on our initiatives to create a strong and flexible framework for our company that will allow us to achieve stable, predictable and customer-service driven growth in our regulated operations."

In FirstEnergy's Regulated Distribution business, 3Q15 operating earnings saw an increase as a result of warmer summer temperatures and the net impact of approved rate cases. The company reported that these results offset increases in operating expenses, such as operating and maintenance costs, pension and OPEB expenses, and depreciation, as well as a higher effective tax rate.

3Q15 operating earnings in the company's Regulated Transmission business increased compared to 3Q14, reportedly a result of higher revenues related to the company's Energising the Future transmission programme.

In the Competitive Energy Services segment, operating earnings increased compared to 3Q14. Commodity margin benefited from higher capacity revenues, lower purchased power costs and lower transmission charges. Contract sales volume decreased in line with the company’s expectations, while wholesale sales volume increased slightly. Operating costs increased in the quarter, mainly because of higher expenses associated with nuclear refueling outages compared to the same period in 2014.

2015 earnings guidance

Operating earnings in the first nine months of 2015 increased compared to the same period last year. The company has indicated that this is largely a result of a higher rate base and a forward-looking rate structure at ATSI in the company's Regulated Transmission business, improved commodity margin in the Competitive Energy Services business and a modest improvement in the Regulated Distribution business – resulting from the impact of weather-related sales and approved rate cases, partially offset by higher operating expenses.

The company has raised and narrowed its full-year 2015 operating (non-GAAP) earnings guidance to US$2.67 – US$2.75 per basic share, from its previous range of US$2.40 to US$2.70 per basic share.

Edited from press release by Harleigh Hobbs

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