Dynegy’s Q3 Loss Widens (DYN)

Dynegy Inc. (NYSE: DYN) today announced a wider loss for the third quarter as weak prices and lower demand continued to negatively impact the company’s operations.

Dynegy, which last week announced a restructuring under which one of its major subsidiaries would file for bankruptcy, was hurt by lower generation for both coal and gas segments during the third quarter. The company’s third-quarter results were also negatively impacted by lower realized prices and spark spreads.

For the third quarter of 2011, Houston, Texas-based Dynegy reported a net loss of $75 million, or $0.61 per share, compared with a loss of $24 million, or $0.20 per share reported for the same period in the previous year. The company’s third-quarter net loss was well above analysts’ estimate of a loss of $0.20 per share.

Dynegy’s revenue for the third quarter ended September 30, 2011 was $516 million, compared with $775 million reported for the same period in the previous year. Analysts were expecting the company to report third-quarter revenue of $689 million.

Dynegy CEO Robert C. Flexon said that several milestones in the company’s restructuring occurred during the third quarter. Flexon said that the company’s portfolios were realigned by fuel type and financed at the operating level; the company initiated its PRIDE operating program and also made substantial progress in addressing its legacy debt load. Flexon added that the PRIDE initiative has already contributed company’s liquidity and earnings through re-establishment of the first lien collateral arrangement and lower fixed operating costs.

Dynegy shares, which had risen sharply last week after the company announced its restructuring plan, have fallen following the release of third-quarter financial results. AT last check, Dynegy shares were trading 5.08% lower at $2.80. The stock fell to an intra-day low of $2.53 today.

Dynegy shares have fallen more than 50% this year.

Post Written By: Ed Liston Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.