Constellation Energy Group Inc. (CEG) swung to a fourth-quarter loss as the power company reported struggles in its generation business and increased losses at its NewEnergy retail operations.
Constellation and other power producers that sell in competitive markets have been hurt in recent quarters by a weak wholesale market that remains under pressure from low natural-gas prices.
Exelon Corp. (EXC) last year agreed to buy Constellation in a stock-for-stock deal valued at about $8 billion. The deal would allow Exelon, the largest operator of nuclear plants in the U.S., to combine its generation fleet with Constellation's large retail marketing business.
Constellation Chief Executive and Chairman Mayo A. Shattuck III on Friday said the deal remains on track and is anticipated to close in the first quarter, absent any delay in the Federal Energy Regulatory Commission approval process.
For the fourth quarter, the company posted a loss of $583.6 million, or $2.91 a share, compared with a year-earlier profit of $159.8 million, or 79 cents a share.
Stripping out merger-related costs and other items, the company reported a per-share profit of 5 cents, well below the 64 cents expected by analysts polled by Thomson Reuters.
Revenue declined 15% to $2.95 billion, far short of the $5.89 billion expects by Wall Street analysts.
The generation segment booked a loss of $2.62 a share, compared with a year-earlier profit of 60 cents a share. The NewEnergy retail segment reported a loss of 45 cents a share, versus a profit of 2 cents a year earlier.
Shares of Constellation closed Thursday at $36.67 and were inactive premarket. The stock is down 7.6% year to date.
-By Mia Lamar, Dow Jones Newswires; 212-416-3207; firstname.lastname@example.org