Tucson-based UNS Energy Corp. on Tuesday reported lower fourth-quarter profits but beat analysts' estimates for income and revenues.
UNS, parent of Tucson Electric Power Co., posted net income of $7.5 million, or 18 cents per share, compared with net income of $8.2 million and 22 cents per share in fourth-quarter 2011.
Fourth-quarter operating revenue rose 4.3 percent to $348 million.
Analysts on average had expected earnings of 16 cents per share on revenues of $330 million, according to Thomson Financial.
For all of 2012, UNS reported net income of $90.9 million, or $2.20 per share, compared with net income of $110 million, or $2.75 per share in 2011. Operating revenues totaled $1.46 billion, compared with $1.48 billion in 2011.
TEP reported net income of $65.5 million in 2012, 23 percent below net income of $85.3 million in 2011.
Paul Bonavia, UNS Energy's chairman and CEO, said the company met all of its key operational and financial objectives in 2012, exceeding its safety and service reliability targets and holding operating and maintenance costs below 2012 budget and 2009 actual levels.
In prepared remarks, Bonavia noted that the company's performance fell within the middle of its forecast range, despite the slow economic recovery, new energy-efficiency measures expected to dampen demand, and "TEP's out-dated retail rate structure."
TEP, whose rates have been capped since December 2008, had requested an increase of 15 percent, or about $11 per month on the average monthly residential bill.
Under a proposed settlement between the Arizona Corporation Commission staff, TEP and other parties, the average residential customer bill would increase by less than $3, the commission said.
The overall impact reflects a base-rate increase, as well as a reduction in a floating surcharge for purchased power and fuel and a reduction in a surcharge for conservation programs, stemming from the adoption of a plan proposed to comply with a state energy-efficiency mandate.
Bonavia said the settlement is broadly supported by many of TEP's key stakeholder groups and will benefit customers while supporting TEP's long-term financial stability.
Formal hearings on the TEP rate case begin March 6 in Tucson.
TEP public meeting
The Arizona Corporation Commission will hold a public-comment meeting on a pending settlement of Tucson Electric Power Co.'s pending rate case at 5:30 p.m. Monday at 400 W. Congress Street, Room 222.
Formal hearings on the TEP rate case begin next Wednesday in Tucson. An administrative law judge will hear evidence and submit a recommendation to the full Corporation Commission, which will make the final rate decision.
Contact Assistant Business Editor David Wichner at firstname.lastname@example.org or 573-4181.