Dynegy Lowers 2002 Guidance, Faces SEC Probe
By Michael Dunn
04/25/2002 09:28
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Dynegy DYN said it expects to meet first-quarter earnings estimates, but the company slashed its full-year guidance and said the Securities and Exchange Commission has launched an informal investigation into one of the company's natural gas deals.
The energy company said it will report first-quarter earnings, excluding charges, in line with previous guidance at $173 million, or 41 cents a share, compared with last year's $137 million, or 41 cents a share. According to Thomson Financial/First Call, analysts had been looking for 40 cents a share.
When calculated according to generally accepted accounting principles, Dynegy expects to post a first-quarter loss of $140 million, or 41 cents a share. Reported results will include noncash charges of $313 million, or 74 cents a share.
For the rest of the year, Dynegy said it has lowered its outlook because of continued weakness in the telecommunications and technology markets. The company now expects full-year earnings of $2 to $2.05 a share, well below the previous guidance of $2.26 and the First Call estimate of $2.23.
Dynegy said the SEC has launched an informal investigation into a natural gas deals. The company is cooperating with the agency. Dynegy had originally said the deal in question resulted in "significant" tax benefits, but it will now record the deal as "financing activity." The company says this won't affect the 2001 tax benefit.
Share of Dynegy were falling 13.9% to $23.50 in Instinet premarket trading. |
