TORONTO - Ontario Power Generation Inc. has reported a slight increase in first-quarter profit despite a decline in revenue, largely as a result of lower spot prices for electricity.
The Ontario government-owned generator of almost 60 per cent of the electricity produced in the province said Friday that net income in the three months ended March 31 was $154 million, up $1 million from $153 million for 2011 period.
Revenue was just under $1.2 billion, down from $1.28 billion in the prior-year period.
"The average revenue that OPG received for a kilowatt hour of electricity in the first quarter of 2012 was 5.0 cents," president and CEO Tom Mitchell said in a statement accompanying the results.
"This is slightly below the average revenue that we received in the same period a year earlier of 5.2 cents and it is well below the prices currently paid by consumers under Ontario's regulated price plan, which range from 6.5 cents to 11.7 cents per kilowatt hour."
OPG's income before interest and income taxes from the electricity generation business segments was $157 million for the quarter, compared with $244 million for the same period in 2011.
"This decrease in income from the electricity generation business segments was primarily due to lower Ontario spot electricity market prices and higher depreciation and amortization expenses, partially offset by lower operations, maintenance and administration costs," the utility said.
The regulated nuclear waste management business recorded income before interest and income taxes of $24 million, compared with a loss before interest and income taxes of $34 million for the same period in 2011. This increase was primarily due to higher earnings from the nuclear funds in 2012, it said.
Total electricity generated in the quarter was 22.0 terawatt hours, slightly lower than the 22.2 TWh produced in the first quarter of 2011.
It said the decrease was primarily due to lower unregulated hydroelectric generation as a result of below normal precipitation and water flows across the northwestern Ontario river systems, largely offset by an increase in regulated hydroelectric generation due to higher water flows on the St. Lawrence River.