CEO says Southern’s wisdom now obvious

The nation’s economic storm is hitting Atlanta’s Southern Co. like most companies.

But the utility holding company’s stock price hasn’t suffered nearly as much as either the Dow Jones average or its electric utility peers. It’s down from six months ago, but by less than 10 percent, compared to 20 percent to 40 percent for peers.

Southern owns Georgia Power, Alabama Power, Mississippi Power, Gulf Power and related operations. Though environmental groups and competitive energy advocates often call it a dinosaur, Wall Street seems pleased with its low-risk profile and conservatism. It the volatile wholesale energy business eight years ago, has moved cautiously on policy issues such as mandatory renewable energy purchases, and has some of the highest returns on equity in the utility industry.

CEO David Ratcliffe’s take: “We’ve said for a year-and-a-half that the market has not appreciated the risk that exists in these markets and even in our sector,” he said. “What you see now is the market coming to understand that we’re much lower risk and in a much more solid financial position than even our peers.”

 CHARLES W. JONES / Staff 
PERCENT CHANGE OF FOUR INDICATORS
Southern Company..........................-3.77%
Dow Jones Industrial Average..............-35.75%
S&P's 500 Electric Utilities Index........-28.18%
Entergy Corporation ......................-32.26%
Source: Bloomberg News