News Release
May 30, 2003

DUKE ENERGY HOSTS 2003 ANALYST CONFERENCE TODAY

  • Company reiterates 2003 guidance of $1.35 -- $1.60 EPS, excluding cumulative effect of previously announced accounting changes. Reaffirms support of $1.10 per share annual dividend.
  • Gulfstream contract with FPL strengthens Gas Transmission business.
  • Duke Capital will redeem 7-3/8 percent trust preferred securities to enhance its balance sheet and reduce future costs.
  • Company indicates it has infused $900 million of capital into Duke Capital in 2003 to strengthen its financial position.
  • Company expands DENA disclosures regarding commodity price effects, credit risk and collateral needs.

CHARLOTTE, N.C. – With the theme, “Proven History, Strong Future,” Duke Energy opened its annual conference today by telling about 100 financial analysts and investors that the company is on course to meet its 2003 guidance and has taken steps this year that pave the way for future growth.

“Our staying power is fueled by strong corporate character, a proven business model and solid financial fundamentals,” said Chairman and Chief Executive Officer Rick Priory as he welcomed attendees. “We take a long view of value creation. Our near-term measures are focused on preserving a strong and lasting competitive position.

“We’ve taken a number of decisive steps in 2003 to protect our financial position and to ensure that we’re positioned for growth. We had a good first quarter and are seeing some promising indicators. It’s beginning to feel like we’ve rounded the toughest curves.”

Priory reaffirmed 2003 EPS guidance of $1.35 -- $1.60, excluding the cumulative effect of previously announced accounting changes. He also said the company’s current financial plan includes fully funding the $1.10 per share dividend.

Priory, along with other key members of senior management, will discuss progress on 2003 financial goals and prospects for the company. A copy of the prepared presentations, including the newly disclosed information, is available at the company’s investors' Web site, www.duke-energy.com/investors. An audio file of the presentations will be available early next week on the same Web site. The presentations will include certain non-GAAP financial measures as defined under SEC rules. A reconciliation of those measures to the most directly comparable GAAP measures is available at: http://www.duke-energy.com/investors/financial/gaap.

In addition to discussing previously announced business milestones and plans, the company will also provide perspective on the following:

  • Gulfstream Natural Gas System L.L.C. announced the execution of a 23-year agreement with Florida Power & Light Company (FPL) in which Gulfstream will provide up to 350 million cubic feet per day of firm natural gas transportation service to FPL for its Martin and Manatee power plant expansions. The contract will bring Gulfstream’s subscribed capacity to approximately 65 percent. Gulfstream currently is a 581-mile pipeline system with the capacity to deliver 1.1 billion cubic feet per day of natural gas to serve Florida’s growing energy needs. The pipeline is jointly owned by Duke Energy and Williams.
  • Duke Capital Corporation, a subsidiary of Duke Energy, announced plans to redeem $250 million in trust preferred securities on June 30. This action will enhance Duke Capital's balance sheet and reduce ongoing expense obligations of Duke Capital.

The following new information will be included in today’s presentations:

  • Duke Energy North America (DENA) President Robert Ladd will unveil new data that outlines the effects on DENA's 2003 hedged gross margin from price movements of electricity and natural gas.
  • Duke Energy Executive Vice President and Chief Risk Officer Richard Osborne will discuss a collateral “stress test” at DENA, which estimates the effects on incremental outgoing collateral from price movements of electricity and natural gas.
  • Osborne will also introduce a table of information that describes DENA’s net credit position to its trading partners and customers, in accordance with recommendations from the Committee of Chief Risk Officers.
  • Duke Energy Executive Vice President and Chief Financial Officer Robert Brace will discuss DENA’s 2004 currently hedged gross margin expectations of approximately $400 million. Brace said this amount is expected to increase over the coming months as DENA secures new business. The $400 million of 2004 currently hedged gross margin represents a non-GAAP financial measure as defined under SEC rules. The most directly comparable GAAP measure is DENA segment earnings before interest and taxes (EBIT) for 2004, which represents DENA gross margin reduced by operations and maintenance expenses, general and administrative expenses and depreciation and amortization. Later this year, after Duke Energy has completed its budget process, DENA will be able to provide a more detailed estimate of its total gross margin and its corresponding expense and EBIT expectations for 2004.

The new data further underlines Duke Energy’s commitment to transparency for investors regarding its merchant power business, including DENA’s base earnings and collateral requirements.

Duke Energy is a diversified multinational energy company with an integrated network of energy assets and expertise. The company manages a dynamic portfolio of natural gas and electric supply, delivery and trading businesses – meeting the energy needs of customers throughout North America and in key markets around the world. Duke Energy, headquartered in Charlotte, N.C., is a Fortune 500 company traded on the New York Stock Exchange under the symbol DUK. More information about the company is available on the Internet at: www.duke-energy.com.

This document includes forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although Duke Energy believes that its expectations are based on reasonable assumptions, it can give no assurance that its goals will be achieved. Important factors that could cause actual results to differ materially from those in the forward-looking statements herein include legislative and regulatory developments; the outcomes of litigation and regulatory proceedings or inquiries; general economic conditions, including any potential effects arising from terrorist attacks and any consequential hostilities or other hostilities; the effectiveness of the company's risk management and internal controls systems; the timing and extent of changes in commodity prices for oil, gas, coal, electricity and interest rates; the extent of success in connecting natural gas supplies to gathering and processing systems and in connecting and expanding natural gas and electric markets; the performance of electric generation, pipeline and natural gas processing facilities; the timing and success of efforts to develop domestic and international power, pipeline, gathering, processing and other infrastructure projects; conditions of the capital markets and equity markets during the periods covered by the forward-looking statements; and other factors discussed in Duke Energy's filings with the Securities and Exchange Commission.

Contact: Terry Francisco -- Media Contact
Phone: 704/373-6680
24 Hour Phone: 704/382-8222
Email: thfrancisco@duke-energy.com
Contact: Greg Ebel
Phone: 704/382-8118
24 Hour Phone: n/a
Email: glebel@duke-energy.com