Teco Energy to sell power plants in Guatemala
Friday, September 28, 2012
TAMPA, Fla. (AP) — Teco Energy Inc., the owner of Tampa Electric Co., said Friday that it is selling its power plants in Guatemala for $227.5 million in cash.
Teco said the sales of the plants in Alborada and San Jose will reduce its earnings per share in 2013 and 2014, but allow it to focus on its domestic operations and reduce debt.
Its Guatemalan subsidiary closed the sale of the Alborada facility on Thursday to Sur Electrica Holding Ltd of the Bahamas.
It plans to sell the San Jose power station and port facilities to a Sur Electric subsidiary. That could change, however, because a third party, which Teco did not identify, holds preferential rights.
Teco expects to net $223 million from the sale, which will leave it without international power plants. It plans to repay $25 million of debt on the San Jose power station and use the rest to buy back stock and pay down debt as it exits the Guatemalan market. The Guatemalan subsidiary will record a $24 million charge.
The Guatemalan operations added $20 million, or about 10 cents per share, to Teco's annual earnings. The company will classify it as a discontinued operation. It reduced its forecast for 2012 earnings from continuing operations to a range of $1.10 to $1.20 per share, down from $1.20 to $1.30 per share. Analysts surveyed by FactSet had been expecting $1.23 per share.
Teco did not say how much 2013 and 2014 earnings would be affected. It said the sale would eliminate uncertainty about 2015 and beyond.
"The completion of these sales will sharpen our focus on our regulated utilities, enable us to return a portion of the proceeds to our investors through share repurchases, and continue our pattern of debt reduction," Teco CEO John Ramil said.
In afternoon trading, shares of Teco unchanged at $17.70.
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