Legalectric

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“Dollar bill, dollar bill, dollar billlllll, it’s all about the dollar bill…”

or is it…

“Nothin’ makes ’em holler, like the almighty dollar…”

and the classic version here…

Ever notice that when they report quarterly financials they NEVER annualize the figure, only report a percentage down or up related to the prior quarter, or a year ago or whatever, it’s always this relative number that is meaningless… grrrrrrrrrrr…. anyway, here’s the scoop on Xcel’s quarterly profits, from the STrib:

Higher rates push up Xcel profits 18%

Xcel Energy Inc., owner of utilities in the Twin Cities and in Denver, said second-quarter profit rose 18 percent on higher rates for electricity and natural gas.

Net income rose to $98.3 million, or 24 cents a share after payment of preferred dividends, from $83.4 million, or 20 cents, a year earlier, the Minneapolis-based company said Tuesday. Sales rose to $2.07 billion from $2.06 billion. Xcel stock rose 16 cents, or 0.8 percent, to $20.20.

For the full year, the company repeated its forecast for per-share profit from continuing operations of $1.25 to $1.35. The company had profit from continuing operations of $1.20 in 2005.

Xcel raised Minnesota electric rates by $147 million in January. The rate increase is subject to refund as state regulators consider the utility’s pricing plan.

BLOOMBERG NEWS

2nd quarter FY2006, 6/30

2006 2005 % chg.

Revenue $2,073.9 $2,064.1 +0.5

Cont. ops. 97.9 77.7 +26.1

Disc. ops 0.3 5.7 -94.1

Income 98.3 83.4 +17.8

Net/cm 97.2 82.3 +18.1

Earn/share 0.24 0.20 +20.0

6 months

Revenue $4,962.0 $4,454.6 +11.4

Cont. ops. 247.7 202.1 +22.6

Disc. ops 1.8 2.7 -33.5

Income 249.6 204.9 +21.8

Net/cm 247.5 202.8 +22.0

Earn/share 0.60 0.49 +22.4

Figures in millions except for earnings per share.

©2006 Star Tribune. All rights reserved.

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And so juxtapose that with this (note it’s “alternative” and not “renewable” though “alternative” does fit better in this context):

The capitalist case for alternative energy

The history of capitalism suggests that a transition from today’s petroleum-based economy to a post-oil era is inevitable.
Isaac Cheifetz

« Keeping America competitive requires affordable energy. And here we have a serious problem: America is addicted to oil, which is often imported from unstable parts of the world. »

– George W. Bush, State of the Union address, Jan. 31, 2006

The price of petroleum continues to reach new highs, with crude oil prices hovering around $75 a barrel, and gasoline at the pump in the United States at $3 a gallon. The unrest in the Middle East threatens to push prices even higher.

It is difficult to imagine our modern economy without oil. For the past 125 years, fossil-fuel energy has been as American as apple pie. The automobile, airplane and much of our modern conveniences are enabled by petroleum-based products.

But from a historical perspective, shifts in energy and technology are inevitable. What is the capitalist case for seriously planning for a post-petroleum economy now?

â?¢ National security: Our reliance on a consistently available and reasonably priced supply is inherently risky. But the worldwide search for oil has a secondary negative impact.

Underdeveloped countries with sizable oil resources consistently react like vagabonds winning the lottery, or a decadent hotel heiress. None has leveraged oil wealth to become advanced industrial economies.

Of the international trouble spots, only North Korea is not directly or indirectly funded by petro-dollars. If oil was worth less, these countries might still be troublesome, but they’d be far less of a threat.

â?¢ True cost of oil: Despite today’s higher costs, U.S. oil is inexpensive compared with prices in most Western economies, and compared with historical U.S. prices in inflation-adjusted dollars. But the pump price does not include our indirect costs of militarily ensuring stability in oil producing regions. If the direct and indirect costs of oil from unstable regions were reflected in consumer prices, many alternative energy sources would become more cost effective.

â?¢ The environmental business case: There is a sound business case for being environmentally proactive. The rising expectations of middle-class consumers worldwide are a potential strain on resources, but a certain opportunity.

The essence of capitalism is looking forward, not fighting to maintain the status quo. Capitalism’s success in spurring economic growth is rooted in “creative destruction,” as described by economist Joseph Schumpeter.

The success of Toyota and Honda versus troubled General Motors and Ford is partly attributable to the Japanese firms’ aiming for future markets (subcompacts in the 1970’s, hybrids in the present), while the U.S. firms stubbornly focused on successful profitable products (high-margin gas guzzlers in both eras), and fought attempts to mandate higher mileage standards.

What are the building blocks of the path toward a post-petrol future?

â?¢ Market driven: Government cannot effectively mandate disruptive shifts to energy sources of the future. But it can play a leading role by seeding the landscape, as it did during the Cold War era by funding basic research, which became the foundation of Silicon Valley.

â?¢ Forward looking: Subsidize future technologies, not current political dilemmas. Congressional hearings considering using the Strategic Oil Reserve to stabilize gas prices, or investigating oil company “windfall” profits, are distractions, not solutions.

â?¢ Non-ideological: Both liberals and conservatives must become more rigorous yet flexible in their approach to energy. For the right, glorifying SUV’s as a symbol of liberty is dangerous in an era when we are threatened by oil-producing countries that fund a range of toxic societies and ideologies worldwide. For the left, serious consideration of unpalatable alternatives like nuclear energy and Alaska drilling should be part of the solution.

â?¢ Evolutionary alternatives: It is impossible to predict tomorrow’s energy efficiencies precisely. But a variety of existing technologies have the potential to reduce oil consumption incrementally, and together, they can put us on the path to the post-oil era. Ethanol is one obvious example. And cellulosic ethanol — made not from corn but from carbon-based waste products such as switchgrass, sewage sludge and wood chips — is attracting a lot of investor attention.

â?¢ Revolutionary alternatives: Future generations will consider us wise if we invest additional billions now in basic research, pursuing radical advances in safer nuclear energy production and disposal, cold fusion, batteries, and solar, wind and water-driven energy.

About 150 years ago, the United States was a rapidly growing economic and social force, in the era when coal and whale oil were the energy foundations of our economy, and petroleum was considered nearly worthless. In 150 years, our energy sources probably will make oil the curiosity that whale oil is today.Isaac Cheifetz is a Minneapolis-based executive recruiter who helps companies hire technology-savvy senior executives. His Commerce Chain column focuses on best practices, leadership and trends in business technology. He can be reached at www.opentechnologies.com.

©2006 Star Tribune. All rights reserved.