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Profit at Duke Tumbles 71%; Firm Plans to Slash 1,900 Jobs

October 25, 2002|From Associated Press

CHARLOTTE, N.C. — Duke Energy Corp. said Thursday that its third-quarter profit plunged 71% because of weakness in the U.S. economy, forcing it to cut 1,500 regular positions and 400 contract workers.

Duke Chairman and Chief Executive Richard Priory said the move will save Duke Energy about $100 million a year.

"One of Duke Energy's strengths is our operating efficiency and ability to adapt to rapidly changing market conditions," Priory said.

Duke Energy shares Thursday fell 5.3%, or $1.06, to $19.08 on the New York Stock Exchange.

The Charlotte-based company said net income for the third quarter was $230 million, or 27 cents a share, down from $796 million, or $1.01 a share, in the same period in 2001.

Excluding charges, earnings per share were 52 cents. The consensus forecast of analysts surveyed by Thomson First Call projected 57 cents for the quarter.

Revenue fell to $4.21 billion, down from $4.78 billion a year earlier.

Duke also said it has been subpoenaed by the Commodity Futures Trading Commission and a federal grand jury about its energy trading activities.

Duke Energy said it was advised in mid-October that the SEC has formalized its inquiry regarding so-called round-trip, or "wash," trading, in which an equal amount of electricity is bought and sold at the same price. Such trades inflate revenue and trading volume.

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