Dominion Retail Reports Quarterly Loss on ERCOT Weather

Dominion Retail reported a loss before interest and taxes of $1 million for the quarter ending September 30, 2011, due to the need to purchase incremental power for its ERCOT retail business at peak prices.

The loss, on an EBIT basis, compares to EBIT of $14 million for the year-ago quarter.

Dominion did not quantify the specific impact from the ERCOT weather during the third quarter. However, the company's forecast EBIT for the third quarter of 2011 had been $15 million to $35 million.

Nevertheless, executives said that Dominion Retail is still on track to deliver results within the guidance range provided at the beginning of the year. This is due to the "very strong margin support" expected from the retail unit for the fourth quarter of 2011, which is mainly driven by year-over-year customer growth.

"We're well-positioned, both gas and electric, for the quarter. We've picked up a lot of customers, and we're bullish on the fourth quarter for retail," executives said during an earnings cal.

For the three months ended September 30, 2011, Dominion Retail had an average of 2.181 million customers, versus an average of 2.165 million for the quarter ending June 30, 2011, and 2.072 million for the quarter ending September 30, 2010.

Dominion Retail's average electric customer count was 773,000 for the three months ended September 30, 2011, versus 778,000 for the quarter ending June 30, 2011, and 750,000 for the quarter ending September 30, 2010.

Dominion Retail's average natural gas customer count was 557,000 for the three months ended September 30, 2011, versus 565,000 for the quarter ending June 30, 2011, and 572,000 for the quarter ending September 30, 2010.

Dominion Retail's average Products and Services customer count was 850,000 for the three months ended September 30, 2011, versus 821,000 for the quarter ending June 30, 2011, and 750,000 for the quarter ending September 30, 2010.

Electric volumes for Dominion Retail were 4.1 million MWh for the quarter ending June 30, 2011, versus 3.9 million MWh a year ago.

Dominion Retail gas volumes were 10,775 mmcf for the quarter ending June 30, 2011, versus 10,520 mmcf a year ago.

Operating revenue for Dominion Retail for the second quarter of 2011 was $441 million.