By the OGJ Online Staff
HOUSTON, Nov. 29, 2001 — National energy retailer New Power Co., a unit of NewPower Holdings Inc., Thursday said the company has sufficient cash and liquidity to do business at least through the second quarter of next year.
New Power said it doesn’t expect any earnings effect in the event of an Enron bankruptcy. NewPower, a 43%-owned affiliate of Enron Corp., said it has sufficient financial resources to satisfy its current credit agreement with Enron and can support all current utility and regulatory credit obligations.
The company said it was reaffirming its business plan and fourth quarter 2001 guidance of losses of 65-73-/share.
As previously reported, NewPower said it may need additional financing to build natural gas inventories for the 2002-2003 winter heating season. The company said it is in discussions with several asset-backed lenders for that financing and believes that a transaction will be in place when needed.
CEO Eugene Lockhart said while Enron is a major counterparty, NewPower has a diversified array of supplier relationships and the ability to trade with, and be supplied by, 14 other counterparties. He added the company will be able to serve customer energy delivery obligations.
Enron and New Power reported a revised master netting agreement in October which reduced the amount of cash collateral that NewPower is required to post to Enron subsidiaries. Enron reported third quarter 2001 charges of $544 million related to losses associated with certain investments, principally Enron’s interest in New Power Co.