CEO Ken Lay's comments today on CNBCfn at about 11:25AM -
(Thanks for the earnings PR, Glenn.)
Regards,
Harry J.
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CNBC opened by noting that ENE's earnings, announced prior to today's market opening, met Street estimates of $0.43 a share (if, which CNBC didn't mention, the write-offs being taken are excluded) and that 18 analysts follow ENE with 13 rating it a "Strong Buy", 3 a "Buy", and 2 a "Hold".
Asked how he "feels" about ENE, Mr. Lay answered that he felt ENE had had a "very strong quarter" even considering the write-offs with overall net income up 35% or $400 million after taxes . EPS were up 26% which were "right on Street expectations". Volume was up 65%, and retail business had a "very strong quarter" with EBITA up "3 ½ fold" [although he didn't tell us up from "what"]. The write-offs are write-offs and are done so let's move on, he indicated.
After a bit of "Just what does ENE do?", he was asked whether the current stock price is a reflection of the "California problem"? He answered that, in ENE's opinion, the California problem is beginning to work out and that he expects the work-out to be completed "over the next few months".
Asked about the recently announced Moody's review of ENE's LT debt, particularly whether the California problem and noncore businesses, caused the review, he responded that ENE has "more than adequately reserved" for the California problem. He also noted that ENE's broadband business, like everybody else's, suffered this past year. He then noted that other credit rating agencies haven't changed, or indicated an intent to review, their ratings of ENE's debt. He further noted that "even Moody's says" that the closing of the Portland General transaction makes the balance sheet stronger than it was before the write-offs being taken.
Finally, he was asked about the "future". He said that, as this AM's press release indicated, ENE thinks it will hit its 4th quarter numbers just like it hit this quarter's, that it will earn about $1.80 a share this year and $2.15 a share next year, which, he says means ENE expects 20% year-over-year growth.
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