NextEra Energy (NEE)
Q3 2011 Earnings Call
November 04, 2011 9:00 am ET
Armando J. Olivera - Chief Executive Officer of Florida Power & Light Company and President of Florida Power & Light Company
Armando Pimentel - Chief Executive Officer and President
Previous Statements by NEE
» NextEra Energy's CEO Discusses Q2 2011 Results - Earnings Call Transcript
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Rebecca Kujawa -
Michael J. Lapides - Goldman Sachs Group Inc., Research Division
Dan Eggers - Crédit Suisse AG, Research Division
Jonathan P. Arnold - Deutsche Bank AG, Research Division
Paul Patterson - Glenrock Associates LLC
Good day, everyone, and welcome to this NextEra 2011 Third Quarter Earnings Conference Call. Today's call is being recorded. At this time for opening remarks, I would like to turn the call over to Rebecca Kujawa, Director of Investor Relations. Please go ahead, ma'am.
Thank you, Bill. Good morning, everyone, and welcome to our Third Quarter 2011 Earnings Conference Call. Lew Hay, NextEra Energy's Chairman and Chief Executive Officer, will provide an overview of NextEra Energy's performance and recent accomplishments. Lew will be followed by Armando Pimentel, our former Chief Financial Officer and current President and Chief Executive Officer of NextEra Energy Resources LLC, which we will refer to with its subsidiaries as Energy Resources in this presentation. Armando will discuss the specifics of our financial results. Also joining us this morning are Moray Dewhurst, Vice Chairman and Chief Financial Officer of NextEra Energy; Jim Robo, President and Chief Operating Officer of NextEra Energy; and Armando Olivera, President and Chief Executive Officer of Florida Power & Light.
Following our prepared remarks, our senior management team will be available to take your questions. We will be making statements during this call that are forward-looking. These statements are based on our current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially from our forward-looking statements.
If any of our key assumptions are incorrect or because of other factors discussed in today's earnings news release and the comments made during this conference call in the Risk Factors section of the accompanying presentation or in our latest reports and filings with the Securities and Exchange Commission, each of which can be found in the Investor Relations section of our website, www.nexteraenergy.com. We do not undertake any duty to update any forward-looking statements.
Please also note that today's presentation includes references to adjusted earnings, which is a non-GAAP financial measure. You should refer to the information contained in the slides accompanying this presentation for definitional information and reconciliations of the non-GAAP measure to the closest GAAP financial measure.
With that, I will turn the call over to Lew Hay. Lew?
Okay. Thank you, Rebecca, and good morning, everyone. I'm pleased to report that FPL had strong performance in the third quarter and while Energy Resources had a challenging quarter financially, the team executed well on creating tangible growth opportunities for the future. During the quarter, we continued to build a large backlog of future investment opportunities at both of our main businesses. Despite the decline in year-over-year financial results at Energy Resources, we continue to expect adjusted earnings per share for 2011 to be at the low end of our range of $4.35 to $4.65.
At Florida Power & Light Company, earnings per share were up approximately 12% over the prior year comparable quarter due to increased investment in the business. The Florida economy continues to show mixed signs with improvement in some indicators and little change in others. Florida's unemployment rate was 10.6% as of September 2011. This is 1.1 percentage points below last year's comparable month, and represents one of the largest year-over-year decreases in state unemployment rates in the United States. Florida's housing affordability has improved significantly, particularly in FPL's core markets. The Case-Shiller index, which tracks the prices of residential real estate has fallen 50% from its 2006 peak for the Miami-Dade, Broward, and Palm Beach County markets in South Florida. This makes Florida much more attractive to baby boomers as they enter retirement, and the state's existing home sales trend continue to show positive momentum.
Over the quarter, FPL averaged 24,000 more customers than we had in the year-ago comparable quarter, and our inactive meters have declined 4.4% since the year-ago period. Florida also continues to have a low tax burden, and we are encouraged by the efforts of Governor Scott's administration to make the state even more attractive to businesses.
At FPL, we continue to make good progress on our large investment program. Our nuclear uprate work at St. Lucie and Turkey Point continues. Last week, the Florida Public Service Commission approved FPL's nuclear cost recovery of $196 million through the capacity clause. This amount relates primarily to the cost of nuclear uprates, which by themselves are estimated to provide fuel savings to customers of $4.6 billion to $4.8 million over the lives of the plants. The commission determined that FPL's 2009 and 2010 uprate costs were prudently incurred, and FPL's actual and projected 2011 and 2012 costs are reasonable. Cost recovery for 2009 and 2010 was one of several issues that had been left unresolved by the prior commission. All of the prior unresolved issues have now been resolved. This week, the commission approved the remainder of the clauses for 2012 including fuel conservation and environmental clauses. This approval was reached through stipulation with all parties.