AGL Retail Supply Earnings Lower on Weather

AGL Resources' retail energy operations segment, which now consists of SouthStar Energy Services, and for 22 days in 2011, several Nicor retail energy businesses, reported lower EBIT of $93 million for the year 2011, versus $103 million a year ago.

AGL said that weather in Georgia that was 23% warmer than 2010 resulted in lower usage and a $15 million decline in operating margin for the retail segment. Also negatively impacting earnings was a Lower of Cost or Market adjustment that was $5 million higher than the LOCOM adjustment taken in the prior year, offset by a $5 million reduction in operating expenses, due primarily to lower legal and bad debt expenses.

For the fourth quarter of 2011, retail energy EBIT was $29 million, versus $37 million a year ago, on similar drivers as the full year.

SouthStar's average customer count in Georgia for the year 2011 was 485,000, versus an average of 496,000 in 2010. An average customer count for only the fourth quarter was not reported; the average Georgia customer count for the third quarter of 2011 had been 482,000.

SouthStar maintained 33% market share in Georgia at the end of 2011, equal to its year-ago share.

SouthStar's average customer count in Ohio and Florida for the year 2011 was 96,000, versus 77,000 a year ago.

With the acquisition of the Nicor retail businesses, which occurred just prior to the end of 2011, AGL's retail energy segment now serves more than one million retail customers, and markets natural gas and related home services to end-use customers in Georgia, Illinois, Ohio, Florida and New York.

AGL said that its retail energy segment continues to explore opportunities to expand service offerings and customer base across multiple states.

Georgia firm volumes for SouthStar were 35 Bcf in 2011, versus 46 Bcf in 2010.

Ohio and Florida volumes were 9 Bcf for the year, versus 10 Bcf in 2010.