Texas headquartered US utility El Paso Electric has reported a net loss for the quarter ended June 30, 2005 of $4 million, which it said was due to refinancing costs.
El Paso, which serves 330,000 customers in the Rio Grande Valley in west Texas and southern New Mexico, said its $0.08 per share loss was due to a $12 million charge for the extinguishment of debt related to the company’s retirement of its outstanding first mortgage bonds in May 2005. Net income for the same period last year was $7.7 million, or $0.16 basic per share.
Operating revenue was up by 4% to $189.3 million in the quarter. However, electricity volumes dropped 8% as a 1% rise in retail volumes were offset by a dramatic 42% fall in business volumes.
Gary Hedrick, president and CEO of El Paso Electric, chose to focus on the long term benefits when commenting on the results: One of our priorities this year for increasing shareholder value was to refinance our first mortgage bonds, and we are pleased to have accomplished this goal. The interest savings from our debt refinancing will provide long-term benefits to our shareholders.