Dynegy's 2Q Earnings Rise on Tax Benefit

Monday, August 8th 2005, 10:34 am

By: News On 6

HOUSTON (AP) _ Electricity and natural-gas provider Dynegy Inc. said Monday its second-quarter profit rose because of a tax benefit resulting from the anticipated sale of its Midstream natural-gas business.

Net income rose to $32 million, or 8 cents per share, from $2 million, or 1 cent per share, a year ago. The company reported a loss from continuing operations of $109 million, or 30 cents per share, in the latest quarter.

Analysts surveyed by Thomson Financial expected a loss of 12 cents per share.

Revenue fell 33 percent to $459 million from $689 million last year.

After the news, shares of Dynegy fell 28 cents, or 5.8 percent, to $4.58 in morning trading on the New York Stock Exchange.

Dynegy expects full-year earnings of $400 million to $410 million, up from its previous estimated loss of about $410 million to $395 million, because of an expected gain of $815 million on the Midstream sale.

The Houston-based company announced Tuesday it would sell its Midstream unit for about $2.48 billion to Targa Resources.