Spokane Journal of Business

Avista gives 2011 profit estimate

Company provides figure in latest quarterly report, confirms 2010 number

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Avista Corp. has started to provide "guidance," or projections on future profitability, to securities analysts for 2011, announcing in its just-released third-quarter earnings report that it expects to earn $1.60 to $1.80 a share next year.

The company also confirmed its guidance for this year, saying it expected consolidated earnings of $1.55 to $1.75 a share for 2010.

Part of the company's 5 cent higher guidance for next year is due to improved projections for its Advantage IQ subsidiary, which manages clients' facility-related bills, such as utility bills. Avista expects that Advantage IQ will contribute 13 cents to 16 cents a share to its earnings next year, up from 10 cents to 13 cents a share in 2010.

On Oct. 28, Avista reported third-quarter net income of $12.3 million, or 22 cents a share, compared with $8.1 million, or 15 cents a share, in the year-earlier period. Through the first nine months, the company's operating revenues increased to $1.18 million from $1.11 million.

"As an investor-owned utility, we want to make sure that we keep moving forward and are showing growth," says Jesse Wuerst, an Avista communications manager.

Yet, slow load growth due to the tepid economy, continued delay in the recovery of operating and capital expenses through rate increase requests, and increased costs, including major generating plant maintenance expenses and higher pension and medical costs, will crimp earnings, Avista says.

This year, Avista is making $210 million in capital expenditures in infrastructure, and it plans to make capital investments at a similar level next year, Wuerst says.

"We have to attempt to recover those investments" through applications to utility commissions for rate adjustments to recover costs, she says.

  • Richard Ripley

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