Duke Energy profit disappoints as mild winter hits demand

May 3 (Reuters) – Duke Energy Corp, the biggest U.S. power company by generation capacity, reported a lower-than-expected quarterly profit as a mild winter hurt electricity demand.

The company said adjusted income in the regulated utilities business fell 10.2 per cent to $695 million in the first quarter ended March 31.

The regulated utilities unit serves retail electric and natural gas customers in the United States.

The company has been cutting exposure to the volatility of wholesale power markets and focusing on regulated markets, where power prices are stable.

Income in the commercial portfolio, which includes wind and solar generation assets, fell 73 percent to $27 million, primarily due to the sale of the Midwest generation business in April 2015 to Dynegy Inc.

Duke said its plans to sell its international business – which spans Brazil, Argentina and Chile – is in the preliminary phases, while it expects to close its acquisition of Piedmont Natural Gas Co by the end of the year.

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The North Carolina-based company said it is on track to achieve its 2016 adjusted earnings target of $4.50-$4.70 per share. Analysts on average were expecting $4.59 per share.

Net income attributable to Duke fell to $694 million, or $1.01 per share, in the first quarter ended March 31, from $864 million, or $1.22 per share, a year earlier.

Excluding special items, it earned $1.13 per share, missing analysts’ average estimate of $1.14 per share, according to Thomson Reuters I/B/E/S.

Total operating revenue fell 7.3 per cent to $5.62 billion.

Shares of the company were little changed in morning trading. Duke Energy shares have risen about 11 per cent in the past 12 months, compared with a 12.2 per cent increase in the Dow Jones US Utilities Sector index.

(Reporting by Arathy S Nair in Bengaluru; Editing by Shounak Dasgupta and Don Sebastian)