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PNM Re-Prices Bonds at New Rate

Albuquerque, New Mexico
July 1 , 2004

PNM Resources' (NYSE:PNM) utility subsidiary Public Service Company of New Mexico has reset the interest rate paid on a series of bonds valued at $36 million. The bonds will pay a fixed annual interest rate of 4 percent for a five-year term, up from the original rate of 2.75 percent based on a one-year term.

The re-pricing of the bonds is part of an overall corporate strategy to diversify PNM's debt portfolio, which includes both short- and long-term debt at fixed and variable rates. Another series of bonds, valued at $146 million, were re-priced in April of this year. Both series of bonds are part of three series of tax-exempt pollution control revenue bonds valued at $182 million.

"This re-pricing allows us to continue to diversify our portfolio by staggering our portfolio risk and taking advantage of low intermediate-term interest rates," said PNM Senior Vice President and Chief Financial Officer John Loyack.

PNM Resources is an energy holding company based in Albuquerque, New Mexico. PNM, the principal subsidiary of PNM Resources, serves about 462,000 natural gas customers and 403,000 electric customers in New Mexico. The company also sells power on the wholesale market in the Western U.S. PNM Resources stock is traded primarily on the NYSE under the symbol PNM.

Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995
Statements made in this news release and documents we file with the SEC that relate to future events or our expectations, projections, estimates, intentions, goals, targets and strategies are made pursuant to the Private Securities Litigation Reform Act of 1995. You are cautioned that all forward-looking statements are based upon current expectations and estimates and we assume no obligation to update this information. Because actual results may differ materially from those expressed or implied by the forward-looking statements, PNM Resources cautions you not to place undue reliance on these statements. Many factors could cause actual results to differ, and will affect our future financial condition, cash flow and operating results. These factors include interest rates, weather, fuel costs, changes in supply and demand in the market for electric power, wholesale power prices, market liquidity, the competitive environment in the electric and natural gas industries, the performance of generating units and transmission system, state and federal regulatory and legislative decisions and actions, the outcome of legal proceedings and the performance of state, regional and national economies. For a detailed discussion of the important factors that affect PNM Resources and that could cause actual results to differ from those expressed or implied by our forward-looking statements, please see "Management's Discussion and Analysis of Financial Condition and Results of Operations" in our current and future Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q and our current and future Current Reports on Form 8-K, filed with the SEC.

Analysts' contacts
Gina Jacobi: (505) 241-2211
Caroline Souders: (505) 241-0679


Press & analysts' contact
Frederick Bermudez: (505) 241-4831

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