Business Context and Reporting Period
This Form 8-K filing by American Electric Power Company, Inc. (AEP) is dated March 9, 2010. The report serves as a Regulation FD disclosure regarding investor meetings scheduled between March 9, 2010, and March 23, 2010.
Key Financial Metrics
The filing does not provide specific historical financial data such as revenue, profit, cash flow, margins, debt, or liquidity figures for the current or prior periods. The only financial metric disclosed is the forward-looking earnings guidance.
Material Changes and Guidance
During the investor meetings, AEP representatives will reaffirm their prior guidance for the 2010 fiscal year. The company projects ongoing earnings of $2.80 to $3.20 per share. This guidance was most recently stated in a Form 8-K filed on January 28, 2010.
Management defines "ongoing earnings" as GAAP earnings adjusted for certain items, considering this metric a more meaningful representation of performance for internal budgeting and external communication.
Risks and Contingencies
The filing contains extensive forward-looking statements subject to numerous risks that could cause actual results to differ materially from projections. Key risk factors include:
- Electric load, customer growth, and weather conditions.
- Fuel availability, costs, and supplier creditworthiness.
- Regulatory decisions, rate cases, and environmental compliance (emissions of sulfur, nitrogen, mercury, carbon).
- Resolution of litigation, including Clean Air Act enforcement and Enron Corp. bankruptcy disputes.
- Changes in the creditworthiness of energy trading market participants and financial market conditions affecting debt refinancing.
- Actions by rating agencies and volatility in electricity and natural gas markets.
- Performance of pension and postretirement benefit plans.
- Unforeseen events such as wars, terrorism, and catastrophic events.
The registrant expressly disclaims any obligation to update forward-looking information.
Investor Verification Checklist
- Verify the specific adjustments made to GAAP earnings to arrive at the "ongoing earnings" figure of $2.80 to $3.20 per share.
- Review the January 28, 2010 Form 8-K for the original context of the reaffirmed guidance.
- Monitor pending rate cases and regulatory decisions that could impact cost recovery.
- Assess the status of pending litigation, particularly regarding the Clean Air Act and Enron Corp.
- Track fuel costs and creditworthiness of suppliers given the company's exposure to energy commodities.