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News Release

TECO Energy reports fourth quarter earnings per share up 28 percent, full year 2000 earnings up 18 percent to $1.99 per share

TAMPA, January 22, 2001

TECO Energy, Inc. (NYSE:TE) today reported fourth quarter earnings of $.46 per share, up 28 percent from $.36 per share from continuing operations before charges in 1999. Year 2000 earnings per share were $1.99, 18 percent higher than $1.68 from continuing operations before charges in 1999. Charges were recorded in 1999 that reduced earnings per share from continuing operations to $.33 and $1.53 for the fourth quarter and full year, respectively.

Net income for the quarter was $57.9 million, 25 percent higher than the $46.2 million recorded before charges in the 1999 period. Year 2000 net income was $250.9 million, up 14 percent compared with 1999's net income of $220.5 million from continuing operations before charges. Charges were recorded in 1999 that reduced net income from continuing operations to $42.7 million and $200.9 million for the fourth quarter and full year, respectively.

TECO Energy Chairman and CEO Robert Fagan said, "Clearly, TECO Energy had a great year in 2000 with all of our operating companies delivering strong results. Our fourth quarter and full-year results confirm that we are once again consistently delivering the growth that we anticipated."

"Led by good growth in our Florida operations, the new power generation projects that TECO Power Services is developing and bringing online and continued good results at TECO Transport, we expect to deliver the strong earnings growth that we targeted in 2001 and beyond," Fagan added.

Operating Segment Results:
Results for the quarter relative to last year reflected the continued strong customer growth and favorable weather in the core electric and gas businesses; contributions from TECO Power Services' Guatemalan operations and Hardee expansion projects; good operating conditions and north bound river shipments at TECO Transport; and the addition of synthetic fuel production at TECO Coal.

Three months
ended
Twelve months
ended
(in millions)
Net Income Summary:2000 1999 20001999
Net income before charges
Tampa Electric
Peoples Gas System
TECO Transport
TECO Coal
TECO Power Services
Other diversified companies
Other/eliminations

 $25.6
5.9
6.4
13.2
12.3
8.2
(13.7)

$23.7
6.5
6.3
4.3
4.2
8.7
(7.5)

$144.5
21.8
28.7
37.5
36.9
31.3
(49.8)

$138.8
19.8
26.2
16.0
14.6
27.3
(22.2)

Net income before charges57.946.2250.9220.5

Charges

--

(3.5)

--


(19.6)
Net income from continuing operations57.942.7250.9200.9
Discontinued operations
--
--
--
(14.8)
Net income
$57.9
$42.7
$250.9
$186.1
Amounts from 1999 were reclassified to reflect the results of TeCom as discontinued operations. This business was sold in November 1999.

Starting in 2001 segment net income will be reported as net earnings on a basis that will include internally allocated financing costs.

Tampa Electric’s net income for the fourth quarter was $25.6 million, compared with $23.7 million, excluding charges, for the same period in 1999. The company showed improved results from strong customer growth of 3 percent for the quarter, and energy sales growth of 7 percent driven by continued customer growth and favorable weather. Tampa Electric’s full-year net income was $144.5 million, compared with $138.8 million, excluding charges, last year. Full-year retail sales were 5 percent above 1999 levels, driven by 3 percent customer growth and increased usage by all customers, especially residential and commercial.

Expenses for the quarter reflected higher depreciation from normal electric plant additions to support customer growth and the scrubber addition at Big Bend Station. Higher operating expenses for the year included the increased scrubber depreciation, higher maintenance expenses associated with improving summer unit availability and costs associated with organizational streamlining. In addition, 1999 results reflected Polk Power Station's U.S. Department of Energy credits, which expired at the end of 1999. Results for the current quarter and full year included the favorable impact of cost recovery from the scrubber investment at Big Bend Station, which was placed into service in December 1999. Also included in Tampa Electric’s 2000 results was a $6.1 million after-tax provision for interest associated with deferred taxes.

Peoples Gas System reported net income of $5.9 million for the quarter, compared with $6.5 million last year. Quarterly results reflected strong customer growth of more than 3 percent, and higher residential and commercial sales, offset by decreased volumes for electric power generators, interruptible customers and off-system sales. Full-year results at Peoples Gas System improved 10 percent over 1999, with net income increasing to $21.8 million from $19.8 million last year. The successful Southwest Florida expansion has already connected 195 commercial customers, in the first eight months of operation, representing annual consumption of 5.8 million therms.

Full-year customer growth of 4 percent and normal winter weather contributed to higher gas sales to residential and commercial customers. Increased transportation volumes for power generation, interruptible customers and off-system sales boosted results early in the year.

TECO Transport reported net income of $6.4 million in the quarter, compared with $6.3 million last year. For the year, net income was $28.7 million, up almost 10 percent from $26.2 million in 1999. Increased shipments for Tampa Electric, strong government grain shipments and higher northbound river volumes more than offset higher fuel prices and lower phosphate shipments.

TECO Power Services’ net income for the quarter was $12.3 million, compared with $4.2 million last year; full-year net income was $36.9 million, more than double the results of $14.6 million last year. Improvements for the quarter and year-to-date periods reflected contributions from the new Hardee and San José generating projects that began commercial operation in 2000, as well as improved results at EEGSA, the Guatemalan distribution utility.

TECO Coal achieved fourth quarter net income of $13.2 million, up from $4.3 million last year; full-year net income was $37.5 million, compared with $16.0 million. These results were driven primarily by the addition of synthetic fuel production facilities this year, which more than offset the impact of the expiration of the Tampa Electric contract at the end of 1999, higher production costs and continued soft metallurgical coal prices.

TECO Energy’s other diversified companies recorded net income of $8.2 million and $31.3 million for the fourth quarter and full year, respectively, compared to $8.7 million and $27.3 million for the same periods in 1999. The full-year results include the $8.3 million gain from the US Propane and Heritage Propane transactions and the $3.8 million charge to adjust property values at TECO Properties. TECO Coalbed Methane achieved higher earnings as higher gas prices more than offset normal production declines. Full-year realized gas prices were $2.75 per mcf compared to $2.09 in 1999.

Non-operating Items
In 2000, an $8.3 million after-tax gain from the US Propane and Heritage Propane transactions was offset by after-tax charges of $5.2 million to adjust the value of leveraged leases and $3.8 million to adjust property values at TECO Properties.

Financing costs were higher for the quarter and full year, reflecting higher borrowing levels primarily associated with the expansion of the independent power business. The company's share repurchase program favorably impacted earnings per share in the quarter and year-to-date periods by $.01 and $.06 per share, respectively.

Additional financial information related to the company's fourth quarter and full year results, including unaudited financial statements; segment revenues and operating income; and electric and gas volumes is available in the Investor Relations section of TECO Energy's web site at www.tecoenergy.com.

TECO Energy is a diversified energy-related holding company headquartered in Tampa. Its principal businesses are Tampa Electric, Peoples Gas System, TECO Power Services, TECO Transport, TECO Coal, TECO Coalbed Methane, TECO Propane Ventures and TECO Solutions.

Note: This press release contains forward-looking statements, which are subject to the inherent uncertainties in predicting future results and conditions. Certain factors that could cause actual results to differ materially from those projected in these forward-looking statements include the following: general economic conditions, particularly those in Tampa Electric’s service area affecting energy sales; weather variations affecting energy sales and operating costs; potential competitive changes in the electric and gas industries, particularly in the area of retail competition; regulatory actions affecting Tampa Electric and Peoples Gas System; commodity price changes affecting the competitive positions of Tampa Electric and the Peoples Gas companies as well as the margins at TECO Coalbed Methane and TECO Coal; energy price changes affecting TECO Power Services’ merchant plants; changes in and compliance with environmental regulations that may impose additional costs or curtail some activities; TECO Power Services’ ability to successfully develop, construct, finance and operate its projects on schedule and within budget; TECO Energy’s ability to find and successfully implement attractive investments in unregulated businesses; interest rates and other factors that could impact TECO Energy’s ability to obtain access to sufficient capital on satisfactory terms; and TECO Coal's ability to successfully operate its synthetic fuel production facilities in a manner qualifying for Section 29 federal income tax credits. Some of these factors are discussed more fully under "Investment Considerations" in the company’s Annual Report on Form 10-K for the year ended December 31, 1999, and reference is made thereto.

Summary information (as of December 31):
Three months
ended
Twelve months
ended
(millions except per share amounts)
2000
1999
2000
1999
Revenues$596.4
$490.0
$2,295.1
$1,983.0
Net income from continuing operations (after non-recurring charges) $57.9 $42.7$250.9$200.9
Net income (loss) from discontinued operations
-- -- --(2.5)
Gain (loss) on disposal of discontinued operations
--
--
--
(12.3)
Net income $57.9
$42.7
$250.9
$186.1
Earnings per share from continuing operations - basic
$0.46$0.33$1.99$1.53
Earnings per share from continuing operations - diluted $0.44$0.33$1.97$1.53
Earnings per share - basic
Earnings per share -
diluted
$0.46
$0.44
$0.33
$0.33
$1.99
$1.97
$1.42
$1.42
Average common shares
outstanding - basic
126.1128.8125.9131.0
Average common shares
outstanding - diluted
127.3128.9126.3131.2
  1. Net income (loss) from continuing operations.(before non-recurring charges)

  2. Earnings per share from continuing operations (before non-recurring charges)

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