El Paso Corp. (ticker: EP, exchange: New York Stock Exchange (.N))
News Release -
El Paso Reports 41-Percent Increase in First Quarter 2001 Adjusted Earnings Per Share
HOUSTON, TEXAS, April 25, 2001-El Paso Corporation (NYSE:EPG) today reported
its first quarter of combined results since the completion of its merger with
The Coastal Corporation in January 2001. Adjusted diluted earnings per share
increased by 41 percent to $0.96 per diluted share compared with $0.68 per
diluted share in 2000. First quarter adjusted net income rose to $500 million in
2001 from an adjusted $342 million in 2000. The adjusted results exclude
merger-related costs and extraordinary items totaling $900 million in net
after-tax charges in 2001 and $86 million in net after-tax gains in 2000.
Diluted average common shares outstanding totaled 525 million for 2001 compared
with 505 million in 2000.
Consolidated earnings before interest expense and taxes (EBIT), adjusted for
non-recurring items, increased 42 percent to $1,093 million from an adjusted
$769 million in 2000. "These outstanding first quarter results are directly
attributable to the successful integration of the El Paso and Coastal
organizations, as well as the combined company's broad presence across all
segments of the natural gas-to-power value chain," said William A. Wise,
chairman, president, and chief executive officer of El Paso. "Each of our
business segments achieved record financial results this quarter. We are
especially pleased by the tremendous growth of our non-regulated businesses,
which delivered 63 percent of total first quarter EBIT. We are well on our way
to achieving better than 20?percent earnings per share growth in 2001."
The Natural Gas Transmission segment reported an 8-percent increase in adjusted
EBIT to $422 million, compared with $390 million in the first quarter of 2000.
The increase primarily was due to higher throughput and increased operating
efficiencies. Total pipeline system throughput for the first quarter of 2001
averaged 21,073 billion British thermal units per day (BBtu/d), up 7 percent
from 2000 levels.
The Merchant Energy Group reported adjusted EBIT of $394 million, up from $152
million in the first quarter of 2000. The improvement was broad-based,
reflecting substantially higher transaction volumes, an increase in risk
management and long-term customer solutions, higher petroleum margins, and
growing fee-based income from power assets and financial services businesses.
EBIT growth from North American activities was especially strong, rising to $271
million from $62 million last year. Total worldwide energy equivalent volumes
totaled 274,500 BBtu/d equivalent, up approximately 75 percent over last year.
Physical natural gas and power volumes rose 149 percent and 50 percent,
respectively, while financial volumes increased 78 percent from 2000 levels. The
company made excellent progress in advancing its liquefied natural gas (LNG)
business in the quarter and in increasing the value of assets in Electron, the
U.S. power entity that El Paso manages for a fee.
Higher natural gas and oil prices, together with increased production, caused El
Paso Production Company's adjusted EBIT to grow to $248 million from $154
million last year. Production volumes for the quarter averaged 1,697 million
cubic feet per day (MMcf/d) equivalent, up 7 percent from the year earlier
quarter. The company's realized natural gas price rose to $3.48 per thousand
cubic feet (Mcf) from $2.47 per Mcf a year ago, while realized oil, condensate,
and liquids prices increased to $27.42 per barrel from $20.99 in 2000. El Paso
Production also experienced strong drilling results in all of its core areas in
the first quarter.
El Paso Field Services reported adjusted first quarter 2001 EBIT of $65 million,
compared with first quarter 2000 EBIT of $55 million. The improvement reflects
higher gathering and processing volumes and an increased contribution from its
general and limited partner interests in El Paso Energy Partners, which will
report earnings on May 1, 2001. During the first quarter of 2001, gathering and
treating volumes increased 63 percent to 6,477 BBtu/d, up from 3,985 BBtu/d in
the year-ago period, while processing volumes rose 33 percent to 3,892 BBtu/d
from 2,925 BBtu/d last year. Gathering and processing volumes were strengthened
by the acquisition of PG&E's Texas Midstream operations in December 2000.
Based on the company's excellent first quarter results and the continued strong
outlook for the rest of the year, the company expects to earn approximately
$3.30 per share in 2001, versus earlier guidance of $3.25 per share. The company
expects second quarter diluted earnings per share, excluding additional merger
charges, to be in line with the current $0.75 First Call consensus estimate.
El Paso Corporation has scheduled a conference call on Wednesday, April 25,
2001, at 10:00 a.m. Eastern Time. The company will discuss first quarter
earnings results as well as recent business developments. The public may listen
to this call live by calling (973) 321-1020 or listen to a replay through May 2,
2001 by dialing (402) 220-0803.
A live Web cast of the call will be available online through our Web site at
www.elpaso.com/investor. El Paso will maintain an audio replay of this call on
the Web site through May 2, 2001 In the event that the company is unable to
respond to questions during the call, El Paso may choose to post selected
questions and answers at www.elpaso.com/investor.
Detailed operating statistics for each of El Paso's businesses are also
available on our website listed above.
El Paso Corporation, the largest and most broadly based natural gas company in
the world, spans the energy value chain from wellhead to electron. With an
enterprise value in excess of $50 billion, El Paso is a leader in every phase of
the natural gas industry. The company owns and operates a significant portion of
the North American natural gas delivery grid, operates the fastest growing, most
sophisticated energy merchant group, and is the nation's third largest natural
gas producer. El Paso, a leader in risk management techniques, is focused on
maximizing shareholder value, transforming existing markets, and speeding the
development of new markets. Visit El Paso at www.elpaso.com.
View the attached table of
additional financial information by clicking here.
This release includes forward-looking statements and projections, made
in reliance on the safe harbor provisions of the Private Securities Litigation
Reform Act of 1995. The company has made every reasonable effort to ensure that
the information and assumptions on which these statements and projections are
based are current, reasonable, and complete. However, a variety of factors could
cause actual results to differ materially from the projections, anticipated
results or other expectations expressed in this release. While the company makes
these statements and projections in good faith, neither the company nor its
management can guarantee that the anticipated future results will be achieved.
Reference should be made to the company's (and its affiliates') Securities and
Exchange Commission filings for additional important factors that may affect