TECO Energy Reports Improved Second Quarter Results

TECO Energy, Inc. (NYSE:TE) today reported second quarter net income of $60.9 million or $0.29 per share, compared to $51.4 million or $0.24 per share in the second quarter of 2008.

Year-to-date net income and earnings per share were $95.6 million or $0.45 per share in 2009, compared to $82.2 million or $0.39 per share in the same period in 2008.

TECO Energy Chairman and CEO Sherrill Hudson said, "Our improved results this quarter reflect the benefits of the recent balanced decisions by the Florida Public Service Commission in the base rate proceedings for our Florida utilities and better prices for our products at TECO Coal. Despite better weather, energy sales at our Florida utilities were reduced by the lower numbers of customers and the continued weak Florida economy. There are some signs that the economy may be near the bottom and that limited growth may be ready to resume, but we expect only a modest improvement later this year.”

Non-GAAP Results

The table below compares the TECO Energy GAAP net income to the non-GAAP measures used in this release. There were no non-GAAP adjustments to second quarter 2009 results. Non-GAAP results in the year-to-date and 12-months ended periods exclude the charges and gains described in the operating company discussions. Non-GAAP Results Excluding Synthetic Fuel exclude charges and gains and also exclude the earnings benefits associated with the production of synthetic fuel in the 12-months ended Jun. 30, 2008 period. For a reconciliation to GAAP results and a discussion regarding this presentation of non-GAAP results and management’s use of this information, please see the Non-GAAP Presentation section and Results Reconciliation table later in this release.

Results Comparisons
		3 months ended June 30						6 months ended June 30						12 months ended June 30
(millions)		2009			2008			2009			2008			2009			2008
Net income		$	60.9		$	51.4		$	95.6		$	82.2		$	175.7		$	348.9
Net income from continuing operations		$	60.9		$	51.4		$	95.6		$	82.2		$	175.7		$	348.9
Non-GAAP Results With Synthetic Fuel		$	60.9		$	51.4		$	90.5		$	82.8		$	190.9		$	220.5
Non-GAAP Results Excluding Synthetic Fuel		$	60.9		$	51.4		$	90.5		$	82.8		$	190.9		$	209.6

Segment Reporting

The table below includes TECO Energy segment information on a GAAP basis, which includes all charges and gains and synthetic fuel-related benefits or costs for the periods shown.

Segment Information		3 months ended June 30								6 months ended June 30								12 months ended June 30
(millions)
Net Income (loss)		2009				2008				2009				2008				2009				2008
Tampa Electric		$	48.5			$	40.2			$	66.8			$	56.1			$	146.3			$	149.8
Peoples Gas System			4.6				5.3				15.8				15.3				27.6				25.5
TECO Coal			10.1				4.2				18.1				11.7				24.4				39.4
TECO Guatemala			7.9				14.9				21.1				25.4				32.6				47.0
Parent/other			(10.2	)			(13.2	)			(26.2	)			(26.3	)			(55.2	)			69.2
TECO Transport(1)			--				--				--				--				--				18.0
Net income from continuing operations			60.9				51.4				95.6				82.2				175.7				348.9
Discontinued operations(1)			--				--				--				--				--				--
Total net income		$	60.9			$	51.4			$	95.6			$	82.2			$	175.7			$	348.9

(1) Due to the ongoing contractual relationship for solid fuel waterborne transportation services, TECO Transport was not classified as a discontinued operation and is included in TECO Energy’s historical results through the sale in December 2007.

Operating Company Results:

All amounts included in the operating company and Parent/Other results discussions are after tax, unless otherwise noted.

Tampa Electric

Tampa Electric reported net income for the second quarter of $48.5 million, compared with $40.2 million for the same period in 2008. Results for the quarter reflected 4.8% higher base revenues due to the increase in base rates effective May 7, 2009, higher earnings on nitrogen oxide (NOx) control projects, a 0.2% lower average number of customers, and slightly higher operations and maintenance expenses. Net income included $2.5 million of Allowance for Funds Used During Construction (AFUDC) - equity, which represents allowed equity cost capitalized to construction costs, related to the installation of NOx control equipment and combustion turbines for peak loads, compared with $1.7 million in the 2008 period.

In the second quarter of 2009, there was no reduction in net income due to the previous waterborne transportation disallowance for the transportation of solid fuel, which reduced net income $2.3 million in the 2008 period. In November 2008, the Florida Public Service Commission (FPSC) approved Tampa Electric's fuel adjustment filing, which included full recovery of waterborne transportation costs under new contracts effective Jan. 1, 2009. This approval eliminated the annual reduction in net income that occurred in 2004 through 2008 during the previous transportation contract.

Total retail energy sales decreased 4.7% in the second quarter of 2009, compared to the same period in 2008. Although total degree days in Tampa Electric's service area were 5% above normal and 3% above the second quarter of 2008, the 15 consecutive days of rain in May, the third wettest May on record, contributed to the lower energy sales. Sales to the residential, commercial and industrial customer segments decreased 4.5%, 3.6% and 10.1%, respectively, in the second quarter, driven primarily by the weak housing market, economic conditions and the weather. Pretax base revenues increased approximately $15 million in the second quarter due to higher base rates approved by the Florida Public Service Commission for Tampa Electric effective May 7, 2009, which were partially offset by the lower number of customers and the effects of the weather.

Operations and maintenance expense, excluding all FPSC-approved cost recovery clauses, increased $0.6 million. The increase included the write-off of $0.6 million of disallowed rate case expenses, and higher employee-related expenses, including pension, that were offset by lower power generating unit maintenance and lower overhead expenses. Bad-debt expense was $0.1 million higher than in the second quarter of 2008.

Compared to the second quarter of 2008, depreciation expense increased $2.3 million, reflecting additions to facilities to serve customers. Interest expense at Tampa Electric increased slightly due to higher long-term debt balances outstanding, and interest income decreased due to lower interest rates and lower under-recovered fuel balances on which interest is accrued.

Year-to-date net income was $66.8 million, compared with $56.1 million in the 2008 period, driven primarily by the higher base revenues from the new base rates and higher earnings on NOx control projects, partially offset by 0.2% lower average number of customers, and higher operations and maintenance expenses. Net income included $5.8 million of AFUDC - equity related to the installation of NOx control equipment and combustion turbines for peak loads, compared with $3.0 million in the 2008 period. Sales to other utilities declined 37% from the 2008 period, reflecting lower demand and lower natural gas prices. In the 2009 year-to-date period, there was no reduction in net income due to the waterborne transportation disallowance for the transportation of solid fuel, compared to a $3.9 million reduction in the 2008 period.

In the 2009 year-to-date period, total retail energy sales decreased 2.4%, compared to the 2008 period driven primarily by the economy, weather in the second quarter, and the 0.2% decline in the average number of customers. Total degree days in Tampa Electric's service area were 5% above normal and 6% above the prior year; however, extended periods of rain reduced sales in May. Colder winter weather in the first quarter contributed to a 0.3% increase in sales to the weather-sensitive residential customer class. Sales to commercial and industrial customers declined by 4.1% and 7.9% respectively, primarily due to economic conditions. Operations and maintenance expense, excluding all FPSC-approved cost recovery clauses, increased $3.5 million. The increase included the second quarter write-off of disallowed rate case expenses and higher employee related expenses that were partially offset by lower power generating unit maintenance and overhead costs. Bad-debt expense was $0.3 million higher in the 2009 year-to-date period than in 2008.

Compared to the 2008 year-to-date period, depreciation expense increased $4.0 million, reflecting additions to facilities to serve customers. Interest expense at Tampa Electric increased slightly due to higher long-term debt balances outstanding.

Peoples Gas

Peoples Gas reported net income of $4.6 million for the second quarter, compared to $5.3 million in the same period in 2008. Quarterly results reflect a 0.2% lower average number of customers due to the weak Florida housing market, decreased sales to residential customers and increased sales to commercial customers due to several higher volume new customers. Base rates increased due to an interim base rate increase granted in October 2008 and the higher permanent base rates effective June 18, 2009. Gas transported for power generation customers increased in 2009, compared to the second quarter of 2008 when mild weather, generating unit outages, and the use of other fuels for power generation due to high gas prices affected natural gas used for power generation. Lower sales volumes to industrial customers reflected economic conditions and reduced operations by industries sensitive to the housing market, such as cement plants and wallboard producers. Non-fuel operations and maintenance expense increased, primarily due to higher spending on pipeline integrity inspections and the $0.4 million write-off of disallowed rate case expenses partially offset by lower overhead costs. Results also reflect increased depreciation expense due to routine plant additions.

Peoples Gas reported net income of $15.8 million for the year-to-date period, compared to $15.3 million in the same period in 2008. Results reflect a 0.2% lower average number of customers. Residential customer usage increased due to colder winter weather in the first quarter of 2009, compared to the very mild winter weather in 2008. Gas transported for power generation customers increased over the year-to-date period 2008. Non-fuel operations and maintenance expense increased, due to the same factors as the second quarter.

TECO Coal

In 2009, TECO Coal achieved second quarter net income of $10.1 million on sales of 2.2 million tons, compared to $4.2 million on sales of 2.4 million tons in the same period in 2008. Results reflect an average net per-ton selling price, excluding transportation allowances, of more than $70 per ton, almost 17% higher than 2008, but below prior guidance due to a sales mix that was more heavily weighted to steam coal. Second quarter 2009 metallurgical coal sales were below prior projections due to economic conditions that have reduced demand for steel products worldwide. In the second quarter of 2009, the all-in total per-ton cost of production increased to more than $65 per ton, almost 12% over 2008’s level, and within the cost guidance range previously provided. Net income for the quarter included $2.0 million related to a payment for a contract renegotiation with a steam coal customer, which resulted in higher selling prices in 2009 in exchange for deferred deliveries of contracted tons into 2010 and 2011. Due to tax percentage depletion differences between periods, in the second quarter of 2009 TECO Coal's effective income tax rate was 14% compared to 6% in the 2008 period.

TECO Coal recorded year-to-date net income of $18.1 million on sales of 4.5 million tons in 2009, compared to $11.7 million on sales of 4.9 million tons in the 2008 period. The year-to-date sales mix was driven by the same factors as the second quarter. The 2009 year-to-date average net per-ton selling price and the all-in total per-ton cost of production were similar to those in the second quarter. Results in 2008 reflected a $0.6 million benefit in the first quarter from the true-up of the 2007 synthetic fuel tax credit rate. In the 2009 year-to-date period, TECO Coal's effective income tax rate was 14% compared to 15% in the 2008 period.

TECO Guatemala

TECO Guatemala reported second quarter net income of $7.9 million in 2009, compared to $14.9 million in the 2008 period. Year-to-date 2009 net income was $21.1 million, compared to $25.4 million in the 2008 period. Year-to-date 2009 non-GAAP results were $12.4 million, which exclude the $8.7 million gain on the sale of the telecommunication company, Navega, recorded in the first quarter. There were no non-GAAP adjustments to 2008 results in either period. Results in the 2009 quarter for the distribution utility (EEGSA) and affiliated companies also include a $2.5 million benefit related to an adjustment to previously estimated year-end equity balances, compared to a similar $3.1 million benefit in 2008.

Lower contract and spot energy sales at the San José Power Station reduced net income $3.8 million in the second quarter of 2009 due to the extended unplanned outage as a result of a generator rotor failure. The repairs were completed and the unit returned to service July 2. The 2009 results reflect $2.5 million of lower net income from EEGSA as a result of the reduction in the Value Added Distribution tariff (VAD) in August 2008, partially offset by customer and energy sales growth. The earnings from the unregulated EEGSA-affiliated companies (DECA II), which provide, among other things, electricity transmission services, wholesale power sales to unregulated electric customers and engineering services, increased in both periods from fundamental growth in the businesses.

Parent / Other

The cost for "Parent/other” in the second quarter of 2009 was $10.2 million, compared to a cost of $13.2 million in the same period in 2008. Results in 2009 included a $2.6 million benefit from a sale of property by TECO Properties. The year-to-date "Parent/other” cost was $26.2 million in 2009, compared to $26.3 million in the 2008 period. The 2009 year-to-date Parent/other non-GAAP cost was $22.6 million, excluding the $3.6 million valuation adjustment recorded in the first quarter on student-loan securities held at TECO Energy parent. In 2008, the year-to-date non-GAAP cost for Parent/other was $25.7 million excluding the $0.6 million after-tax adjustment to previously estimated transaction costs related to the sale of TECO Transport. (See the Results Reconciliation table.)

Cash and Liquidity

The table below sets forth the Jun. 30, 2009 consolidated liquidity and cash balances, the cash balances at the operating companies and TECO Energy parent, and amounts available under the TECO Energy/Finance and Tampa Electric Company credit facilities.

Balances as of Jun. 30, 2009
(millions)	Consolidated			Tampa Electric Company			Unregulated Companies			Parent
Credit facilities	$	675.0		$	475.0		$	--		$	200.0
Drawn amounts/LCs		201.4			165.3			--			36.1
Available credit facilities		473.6			309.7			--			163.9
Cash and short-term investments		28.0			5.6			17.9			4.5
Total liquidity	$	501.6		$	315.3		$	17.9		$	168.4

Consolidated other cash and short-term investments includes $17.9 million of cash at the unregulated operating companies for normal operations. In addition to consolidated cash, as of Jun. 30, 2009 unconsolidated affiliates owned by TECO Guatemala, CGESJ (San José) and TCAE (Alborada), had unrestricted cash balances of $18.9 million, which are not included in the table above.

2009 Earnings Outlook

TECO Energy indicated in May an outlook for 2009 earnings per share to be within a range of $1.00 and $1.15 per share, excluding charges and gains, and continues to expect earnings to be within that range.

The May guidance was provided in the form of a range to allow for varying outcomes with respect to important variables, such as a start to an economic recovery late in 2009, weather and customer usage at the Florida utilities, pricing and demand for production at TECO Coal for uncontracted tons and the potential impact of the world-wide economic slowdown on coal demand. The upper end of the guidance range in May included TECO Coal’s full sales forecast of 9.9 million tons, including the 0.4 million tons that were unsold at that time, at an average selling price of $73 per ton and an average all-in, total cost of production in a range between $63 and $66 per ton. At the same time, Tampa Electric forecasted that an economic recovery would begin later in 2009 and there would be 0.1% customer growth for the year with energy sales growth slightly above that.

Consistent with the guidance provided in May, for the remainder of 2009 Tampa Electric will benefit from the higher base rates that became effective May 7. Additionally, a base rate increase will become effective August 13 as a result of the recent FPSC decision on Tampa Electric’s Motion for Reconsideration. Tampa Electric and Peoples Gas have continued to experience lower numbers of retail customers and continued economic weakness in the areas served, which has reduced sales to commercial and industrial customers. Both utilities are focused on managing costs to offset the lower number of customers and lower energy sales forecasts than were included in their base rate proceedings. Tampa Electric continues to anticipate the start of an economic recovery late in 2009 to produce limited customer and weather-normalized energy sales growth, and also expects higher AFUDC, and ECRC-related earnings on an additional NO_x control project that entered service in May. Peoples Gas will benefit from higher base rates that were effective June 18, but expects resumption of customer growth to lag Tampa Electric. The rate design approved by the FPSC in Peoples Gas’ base rate proceeding makes it less volume and weather sensitive.

At TECO Coal, the world-wide demand for metallurgical coal remains weak, and domestic steam coal usage has been reduced due to declining electricity sales to commercial and industrial customers nationwide. TECO Coal expects total sales volumes below prior guidance due to the 0.4 million tons of metallurgical coal that remains unsold and the possible net deferral of 0.2 to 0.7 million tons of steam and metallurgical coal from 2009 into 2010 and 2011. Due to less metallurgical coal in the product mix, the average per-ton selling price is expected to be slightly below the previously provided guidance. TECO Coal expects the all-in total cost of production to be within the previously provided range but towards the high end reflecting the lower volume. TECO Coal’s effective income tax rate is now expected to be about 18% in 2009.

TECO Guatemala previously indicated earnings for 2009 would be lower than 2008 levels and that outlook remains unchanged. Repairs were completed on the San José Power Station and the unit returned to service July 2. Provided crude oil prices remain in the $60 per barrel or higher range, the station is expected to run at 65% capacity factor or more for the remainder of the year. TECO Guatemala benefited from the second quarter adjustment to previously estimated year-end equity balances, and the DECA II companies continue to seek opportunities to offset the impact of the 2008 VAD decision.

Non-GAAP Presentation

The "Results Reconciliation" table below presents non-GAAP financial results after elimination of the effects of certain identified gains and charges in the 2009 and 2008 quarterly periods and earnings from the production of synthetic fuel in the 12-months ended 2008 period. The production of synthetic fuel ended in December 2007 upon the expiration of the Federal tax credit program associated with the production of synthetic fuel. This non-GAAP presentation provides investors additional information to compare 2009 results, which include no synthetic fuel production, to 12-month ended 2008 results, which included synthetic fuel production.

Management believes it is helpful to present a non-GAAP measure of performance that clearly reflects the ongoing operations of TECO Energy's businesses and which allows investors to better understand and evaluate the business as it is expected to operate in future periods.

Management and the Board of Directors use non-GAAP measures as a yardstick for measuring the company's performance, in making decisions that are dependent upon the profitability of the company's various operating units, and in determining levels of incentive compensation.

The non-GAAP measures of financial performance used by the company are not measures of performance under accounting principles generally accepted in the United States and should not be considered an alternative to net income or other GAAP figures as an indicator of the company's financial performance or liquidity. TECO Energy's non-GAAP presentation of net income may not be comparable to similarly titled measures used by other companies.

Results Reconciliation (millions)		3 months ended June 30						6 months ended June 30							12 months ended June 30
		2009			2008			2009				2008			2009				2008
GAAP net income		$	60.9		$	51.4		$	95.6			$	82.2		$	175.7			$	348.9
Exclude discontinued operations			--			--			--				--			--				--
GAAP net income from continuing operations		$	60.9		$	51.4		$	95.6			$	82.2		$	175.7			$	348.9
Add TECO Transport transaction costs recorded at TECO Energy parent			--			--			--				0.6							6.9
Exclude TECO Transport depreciation			--			--			--				--			--				(6.1	)
Exclude gain on TECO Transport sale			--			--			--				--			--				(149.4	)
Add parent debt extinguishment			--			--			--				--			--				20.2
Exclude TECO Transport transaction costs and final adjustments recorded at TECO Energy parent			--			--			--				--			(3.2	)			--
Exclude gain on sale of Navega			--			--			(8.7	)			--			(8.7	)			--
Add valuation adjustment on auction rate securities			--			--			3.6				--			3.6				--
Add Tampa Electric waterborne transportation audit adjustment			--			--			--				--			1.9				--
Add taxes on repatriated cash and investments			--			--			--				--			21.6				--
Total charges and gains			--			--			(5.1	)			0.6			15.2				(128.4	)
Non-GAAP results from continuing operations (1)		$	60.9		$	51.4		$	90.5			$	82.8		$	190.9			$	220.5
Synthetic fuel cost / (benefit)			--			--			--				--			--				(10.9	)
Non-GAAP results excluding synthetic fuel		$	60.9		$	51.4		$	90.5			$	82.8		$	190.9			$	209.6

(1) A non-GAAP financial measure is a numerical measure that includes amounts, or is subject to adjustments that have the effect of including amounts, that are excluded from the most directly comparable GAAP measure.

Webcast

As previously announced, TECO Energy will host a Webcast with the investment community on its second quarter results at 5:00 PM Eastern time, Tuesday, July 28, 2009. The Webcast will be accessible through the link on TECO Energy’s Website: www.tecoenergy.com. The Webcast and accompanying slides will be available for replay for 30 days through the Web site, beginning approximately two hours after the conclusion of the live event.

TECO Energy, Inc. (NYSE:TE) is an energy-related holding company. Its principal subsidiary, Tampa Electric Company, is a regulated utility in Florida with both electric and gas divisions (Tampa Electric and Peoples Gas System). Other subsidiaries include TECO Coal, which owns and operates coal production facilities in Kentucky and Virginia, and TECO Guatemala, which is engaged in electric power generation and distribution and energy-related businesses in Guatemala.

Note: This press release contains forward-looking statements, which are subject to the inherent uncertainties in predicting future results and conditions. Actual results may differ materially from those forecasted. The forecasted results are based on the company's current expectations and assumptions, and the company does not undertake to update that information or any other information contained in this press release, except as may be required by law. Factors that could impact actual results include: regulatory actions by federal, state or local authorities; unexpected capital needs or unanticipated reductions in cash flow that affect liquidity; the ability to access to capital and credit markets when required; the availability of adequate rail transportation capacity for the shipment of TECO Coal's production; general economic conditions affecting energy sales at the utility companies; economic conditions, both national and international, affecting the Florida economy and demand for TECO Coal's production; weather variations and changes in customer energy usage patterns affecting sales and operating costs at Tampa Electric and Peoples Gas and the effect of extreme weather conditions or hurricanes; operating conditions, commodity price and operating cost changes affecting the production levels and margins at TECO Coal; fuel cost recoveries and related cash at Tampa Electric and natural gas demand at Peoples Gas; the ability of TECO Energy's subsidiaries to operate equipment without undue accidents, breakdowns or failures; changes in the U.S. federal tax code on earnings from foreign investments that could reduce earnings; the ability to increase the utilization of the coal-fired San José Power Station versus competing oil-fired generators during a period of lower oil prices; and the ultimate outcome of efforts to revise the significantly lower EEGSA VAD tariff rates implemented by regulatory authorities in Guatemala effective Aug. 1, 2008 affecting TECO Guatemala's results. Additional information is contained under "Risk Factors" in TECO Energy, Inc.'s Annual Report on Form 10-K for the period ended Dec. 31, 2008.

Summary Information as of June 30, 2009
		3 months ended						6 months ended						12 months ended
(millions except per share amounts)
		2009			2008			2009			2008			2009			2008
Revenues		$	825.2		$	887.2		$	1,649.2		$	1,678.9		$	3,345.5		$	3,527.3
Net income		$	60.9		$	51.4		$	95.6		$	82.2		$	175.7		$	348.9
Earnings (loss) per share – basic		$	0.29		$	0.24		$	0.45		$	0.39		$	0.82		$	1.65
Earnings (loss) per share – diluted		$	0.29		$	0.24		$	0.45		$	0.39		$	0.82		$	1.65
Average common shares outstanding – basic			211.7			210.4			211.6			210.1			211.4			209.7
Average common shares outstanding – diluted			212.5			212.1			212.3			211.6			212.1			211.1

TECO ENERGY

JUNE 2009

Figures appearing in these statements are presented as general information and not in connection with any sale or offer to sell or solicitation of an offer to buy any securities, nor are they intended as a representation by the company of the value of its securities. All figures reported are subject to adjustments as the annual audit by independent accountants may determine to be necessary and to the explanatory notes affecting income and balance sheet accounts contained in the company’s Annual Report on Form 10-K. Reference should also be made to information contained in that and other reports filed by TECO Energy, Inc. and Tampa Electric Company with the Securities and Exchange Commission.

TECO ENERGY, Inc.
CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(All significant intercompany transactions have been eliminated in the consolidated financial statements.)
		Three Months Ended								Six Months Ended								Twelve Months Ended
		June 30,								June 30,								June 30,
(millions except share data)		2009				2008				2009				2008				2009				2008
Revenues
Regulated electric and gas		$	662.9			$	730.0			$	1,316.7			$	1,370.2			$	2,724.7			$	2,828.4
Unregulated			162.3				157.2				332.5				308.7				620.8				698.9
Total revenues			825.2				887.2				1,649.2				1,678.9				3,345.5				3,527.3
Expenses
Regulated operations
Fuel			225.5				176.2				454.2				339.8				933.8				798.1
Purchased power			56.1				115.9				98.3				197.8				205.9				346.6
Cost of natural gas sold			50.9				133.8				139.2				252.8				363.0				442.6
Other			81.0				71.9				158.0				143.2				292.4				297.6
Operation other expense
Mining related costs			110.9				116.8				229.4				224.0				446.0				464.9
Waterborne transportation costs			0.0				0.0				0.0				0.0				0.0				97.4
Other			4.3				5.6				8.4				9.9				16.8				18.9
Maintenance			46.2				45.6				98.6				91.6				180.8				178.7
Depreciation and amortization			71.3				64.9				141.0				129.9				277.2				255.2
Loss / (Gain) on sale, net of transaction related costs			0.0				0.0				0.0				0.9				0.0				(236.7	)
Taxes, other than income			55.9				54.1				116.3				109.0				218.8				213.5
Total expenses			702.1				784.8				1,443.4				1,498.9				2,934.7				2,876.8
Income from operations			123.1				102.4				205.8				180.0				410.8				650.5
Other income (expense)
Allowance for other funds used during construction			2.5				1.7				5.8				3.0				9.1				4.7
Other income			6.1				4.0				20.1				9.3				32.2				46.8
Loss on debt exchange / extinguishment			0.0				0.0				0.0				0.0				0.0				(32.9	)
Income from equity investments			12.9				21.6				21.7				39.0				55.6				72.6
Total other income			21.5				27.3				47.6				51.3				96.9				91.2
Interest charges
Interest expense			57.4				56.6				115.0				114.8				231.5				240.4
Allowance for borrowed funds used during construction			(1.0	)			(0.7	)			(2.3	)			(1.2	)			(3.5	)			(1.8	)
Total interest charges			56.4				55.9				112.7				113.6				228.0				238.6
Income before provision for income taxes			88.2				73.8				140.7				117.7				279.7				503.1
Provision for income taxes			27.3				22.4				45.1				35.5				104.0				192.6
Income before Noncontrolling Interest			60.9				51.4				95.6				82.2				175.7				310.5
Noncontrolling Interest			0.0				0.0				0.0				0.0				0.0				38.4
Net income		$	60.9			$	51.4			$	95.6			$	82.2			$	175.7			$	348.9
Average common shares outstanding - basic (millions)			211.7				210.4				211.6				210.1				211.4				209.7
Average common shares outstanding - diluted (millions)			212.5				212.1				212.3				211.6				212.1				211.1
Earnings per average common share outstanding:
Earnings per share -- basic			0.29				0.24				0.45				0.39				0.82				1.65
Earnings per share -- diluted			0.29				0.24				0.45				0.39				0.82				1.65

TECO ENERGY, Inc.
CONSOLIDATED BALANCE SHEETS (Unaudited)
(All significant intercompany transactions have been eliminated in the consolidated financial statements.)
		June 30,			December 31,
(millions)		2009			2008
Assets
Current assets
Cash and cash equivalents		$28.0			$12.2
Short-term investments		0.0			2.4
Receivables		309.7			285.9
Inventories at average cost
Fuel		142.9			90.2
Materials and supplies		67.5			72.8
Current derivative assets		0.2			0.0
Income tax receivables		0.5			3.5
Prepayments and other current assets		25.1			25.8
Current regulatory assets		172.4			272.6
Total current assets		746.3			765.4
Property, plant and equipment
Utility plant in service
Electric		5,743.5			5,528.3
Gas		993.3			964.4
Construction work in progress		460.7			463.5
Other property		366.9			354.8
Property plant and equipment at original cost		7,564.4			7,311.0
Accumulated depreciation		(2,155.8	)		(2,089.7	)
Total property, plant and equipment, net		5,408.6			5,221.3
Other assets
Deferred income taxes		278.5			333.8
Other investments		9.8			21.3
Long-term regulatory assets		319.2			325.3
Investment in unconsolidated affiliates		273.6			284.0
Goodwill		59.4			59.4
Long-term derivative assets		0.6			0.1
Deferred charges and other assets		134.1			136.8
Total other assets		1,075.2			1,160.7
Total assets		$7,230.1			$7,147.4
Liabilities and capital
Current liabilities
Long-term debt due within one year
Recourse		$5.5			$5.5
Non-recourse		1.4			1.4
Notes payable		188.0			93.0
Accounts payable		264.5			304.4
Other current liabilities		15.6			15.3
Customer deposits		148.6			144.6
Current derivative liabilities		113.7			132.1
Interest accrued		48.1			45.1
Taxes accrued		46.2			21.2
Current regulatory liabilities		26.9			21.7
Total current liabilities		858.5			784.3
Other liabilities
Investment tax credits		11.0			11.2
Long-term regulatory liabilities		579.8			588.2
Long-term derivative liabilities		10.3			19.4
Deferred credits and other liabilities		527.9			530.0
Long-term debt, less amount due within one year
Recourse		3,199.0			3,199.0
Non-recourse		6.2			7.6
Total other liabilities		4,334.2			4,355.4
Total Liabilities		5,192.7			5,139.7
Capital
Common equity		213.7			212.9
Additional paid in capital		1,523.9			1,518.2
Retained earnings		332.9			322.6
Accumulated other comprehensive loss		(33.1	)		(46.0	)
Total capital		2,037.4			2,007.7
Total liabilities and capital		$7,230.1			$7,147.4
Book Value Per Share		$9.53			$9.43

TECO ENERGY, Inc.
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(All significant intercompany transactions have been eliminated in the consolidated financial statements.)
		Three Months Ended						Six Months Ended						Twelve Months Ended
		June 30,						June 30,						June 30,
(millions)		2009			2008			2009			2008			2009			2008
Cash flows from operating activities
Net income		$60.9			$51.4			$95.6			$82.2			$175.7			$348.9
Adjustments to reconcile net income to net cash from operating activities:
Depreciation and amortization		71.3			64.9			141.0			129.9			277.2			255.2
Deferred income taxes		27.4			24.2			45.5			39.7			101.2			186.9
Investment tax credits, net		(0.1	)		(0.3	)		(0.2	)		(1.0	)		(0.2	)		(2.2	)
Allowance for other funds used during construction		(2.5	)		(1.7	)		(5.8	)		(3.0	)		(9.1	)		(4.7	)
Non-cash stock compensation		2.9			3.7			4.7			6.1			8.4			10.2
Gain on sales of business / assets, pretax		0.1			(0.1	)		(18.6	)		(1.1	)		(19.1	)		(202.7	)
Noncash debt extinguishment / exchange, pretax		0.0			0.0			0.0			0.0			0.0			2.6
Equity in earnings of unconsolidated affiliates, net of cash distributions on earnings		7.4			(21.6	)		0.3			(6.8	)		(15.7	)		(10.8	)
Noncontrolling interest		0.0			0.0			0.0			0.0			0.0			(38.4	)
Derivatives marked to market		0.0			0.0			0.0			0.0			0.0			(70.4	)
Deferred recovery clause		16.4			(81.0	)		83.3			(92.4	)		59.9			4.6
Receivables, less allowance for uncollectibles		(14.7	)		(20.9	)		(23.8	)		(34.0	)		20.1			(32.3	)
Inventories		(19.7	)		(15.1	)		(47.4	)		(7.9	)		(48.5	)		49.2
Prepayments and other current assets		(4.5	)		(3.1	)		0.7			(2.1	)		0.0			3.5
Taxes accrued		14.1			14.4			27.2			15.7			(3.3	)		(3.4	)
Interest accrued		(30.6	)		(17.7	)		3.0			15.0			0.4			(3.6	)
Accounts payable		13.8			82.5			(9.6	)		76.9			(94.8	)		68.7
Other		7.1			5.9			32.1			21.3			25.1			(2.4	)
		149.3			85.5			328.0			238.5			477.3			558.9
Cash flows from investing activities
Capital expenditures		(176.8	)		(128.8	)		(367.8	)		(265.7	)		(691.5	)		(488.1	)
Allowance for other funds used during construction		2.5			1.7			5.8			3.0			9.1			4.7
Net proceeds from sale of business / assets		0.1			0.0			29.2			(7.3	)		37.0			352.5
Restricted cash		0.0			0.0			0.2			0.0			0.1			29.9
Distributions from unconsolidated affiliates		0.0			0.0			0.0			13.2			0.0			26.7
Other investments		7.3			(0.1	)		9.7			76.2			9.6			121.9
		(166.9	)		(127.2	)		(322.9	)		(180.6	)		(635.7	)		47.6
Cash flows from financing activities
Dividends		(42.7	)		(42.4	)		(85.3	)		(83.5	)		(170.4	)		(165.6	)
Proceeds from sale of common stock		1.4			18.7			2.4			20.0			4.2			25.5
Proceeds from long-term debt		0.0			137.1			0.0			327.9			0.0			451.1
Repayment of long-term debt / Purchase in lieu of redemption		0.0			0.0			(1.4	)		(288.1	)		(7.2	)		(977.8	)
Debt exchange premiums		0.0			0.0			0.0			0.0			0.0			(21.2	)
Noncontrolling interest		0.0			0.0			0.0			0.0			0.0			33.4
Net increase (decrease) in short-term debt		52.0			(18.0	)		95.0			(25.0	)		188.0			0.0
		10.7			95.4			10.7			(48.7	)		14.6			(654.6	)
Net increase (decrease) in cash and cash equivalents		(6.9	)		53.7			15.8			9.2			(143.8	)		(48.1	)
Cash and cash equivalents at beginning of period		34.9			118.1			12.2			162.6			171.8			219.9
Cash and cash equivalents at end of period		$28.0			$171.8			$28.0			$171.8			$28.0			$171.8

TECO ENERGY, Inc.
SEGMENT INFORMATION (Unaudited)
(millions)			Tampa			Peoples			TECO			TECO			TECO				Other &				TECO
			Electric			Gas			Coal			Guatemala			Transport				Eliminations				Energy
Three months ended June 30,
2009		Revenues - outsiders	$	563.2		$	99.7		$	160.2		$	2.0		$	-			$	0.1			$	825.2
		Sales to affiliates		0.4			3.4			-			-			-				(3.8	)			-
		Total revenues		563.6			103.1			160.2			2.0			-				(3.7	)			825.2
		Equity Earnings in Unconsolidated Affiliates		-			-			-			12.9			-				-				12.9
		Depreciation		49.3			11.0			10.8			0.2			-				-				71.3
		Total interest charges (1)		28.6			4.8			1.9			3.1			-				18.0				56.4
		Allocated interest expense (income) included above (1)		-			-			1.7			3.1			-				(4.8	)			-
		Provision (Benefit) for income taxes		27.8			2.9			1.7			-			-				(5.1	)			27.3
		Net income (loss) from continuing operations	$	48.5		$	4.6		$	10.1		$	7.9		$	-			$	(10.2	)		$	60.9
2008		Revenues - outsiders	$	545.7		$	184.3		$	155.2		$	2.0		$	-			$	-			$	887.2
		Sales to affiliates		0.4			-			-			-			-				(0.4	)			-
		Total revenues		546.1			184.3			155.2			2.0			-				(0.4	)			887.2
		Equity Earnings in Unconsolidated Affiliates		-			-			-			21.6			-				-				21.6
		Depreciation		45.0			10.3			9.3			0.2			-				0.1				64.9
		Total interest charges (1)		27.9			4.5			2.0			3.7			-				17.8				55.9
		Allocated interest expense (income) included above (1)		-			-			1.5			3.6			-				(5.1	)			-
		Provision (Benefit) for income taxes		23.6			3.4			0.2			2.1			-				(6.9	)			22.4
		Net income (loss) from continuing operations	$	40.2		$	5.3		$	4.2		$	14.9		$	-			$	(13.2	)		$	51.4
Six months ended June 30,
2009		Revenues - outsiders	$	1,070.5		$	246.2		$	328.3		$	4.1							0.1			$	1,649.2
		Sales to affiliates		0.7			9.9			-			-							(10.6	)			-
		Total revenues		1,071.2			256.1			328.3			4.1							(10.5	)			1,649.2
		Equity Earnings in Unconsolidated Affiliates		-			-			-			21.7							-				21.7
		Depreciation		97.3			21.8			21.4			0.4							0.1				141.0
		Total interest charges (1)		56.8			9.5			3.7			6.3							36.4				112.7
		Allocated interest expense (income) included above (1)		-			-			3.2			6.2							(9.4	)			-
		Provision (Benefit) for income taxes		37.2			10.1			3.0			9.6							(14.8	)	(3)		45.1
		Net income (loss) from continuing operations	$	66.8		$	15.8		$	18.1		$	21.1	(2)					$	(26.2	)	(3)	$	95.6
2008		Revenues - outsiders	$	1,006.9		$	363.3		$	304.3		$	4.3		$	-			$	0.1			$	1,678.9
		Sales to affiliates		0.7			-			-			-			-				(0.7	)			-
		Total revenues		1,007.6			363.3			304.3			4.3			-				(0.6	)			1,678.9
		Equity Earnings in Unconsolidated Affiliates		-			-			-			39.0			-				-				39.0
		Depreciation		90.2			20.6			18.5			0.4			-				0.2				129.9
		Total interest charges (1)		57.3			8.7			4.5			7.5			-				35.6				113.6
		Allocated interest expense (income) included above (1)		-			-			3.8			7.4			-				(11.2	)			-
		Provision (Benefit) for income taxes		32.1			9.8			2.1			4.0			-				(12.5	)			35.5
		Net income (loss) from continuing operations		56.1			15.3			11.7			25.4			-				(26.3	)		$	82.2
Twelve months ended June 30,
2009		Revenues - outsiders	$	2,153.5		$	571.2		$	612.4		$	8.2		$	-			$	0.2			$	3,345.5
		Sales to affiliates		1.4			9.9			-			-			-				(11.3	)			-
		Total revenues		2,154.9			581.1			612.4			8.2			-				(11.1	)			3,345.5
		Equity Earnings in Unconsolidated Affiliates		-			-			-			55.2			-				0.4				55.6
		Depreciation		192.8			43.0			40.4			0.8			-				0.2				277.2
		Total interest charges (1)		114.2			19.0			7.3			14.1			-				73.4				228.0
		Allocated interest expense (income) included above (1)		-			-			6.0			13.9			-				(19.9	)			-
		Provision (Benefit) for income taxes		87.0			17.6			3.1			20.4			-				(24.1	)	(3)		104.0
		Net income (loss) from continuing operations	$	146.3	(4)	$	27.6		$	24.4		$	32.6	(2)	$	-			$	(55.2	)	(3)(5)	$	175.7
2008		Revenues - outsiders	$	2,177.7		$	650.6		$	594.1		$	8.3		$	96.3			$	0.3			$	3,527.3
		Sales to affiliates		1.6			-			-			-			40.9				(42.5	)			-
		Total revenues		2,179.3			650.6			594.1			8.3			137.2				(42.2	)			3,527.3
		Equity Earnings in Unconsolidated Affiliates		-			-			-			72.8			(0.2	)			-				72.6
		Depreciation		175.0			41.0			38.3			0.5			-				0.4				255.2
		Total interest charges (1)		114.2			17.4			10.8			15.2			2.2				78.8				238.6
		Allocated interest expense (income) included above (1)		-			-			9.7			14.9			1.2				(25.8	)			-
		Provision (Benefit) for income taxes		86.8			15.9			20.7			8.5			7.3				53.4				192.6
		Net income (loss) from continuing operations	$	149.8		$	25.5		$	39.4		$	47.0		$	18.0			$	69.2		(6)(7)	$	348.9
(1)		Segment net income is reported on a basis that includes internally allocated financing costs. Allocated interest is included in "Total interest charges".
(2)		Results for the 6 and 12 months ended June 30, 2009 include a $8.7 million gain related to the sale of Navega in the first quarter of 2009. Additionally, the 12 months ended June 30, 2009 results include $9.6 million in taxes related to the repatriated cash and investments from Guatemala in the fourth quarter of 2008.
(3)		Results for the 6 and 12 months ended June 30, 2009 include a $3.6 million loss related to the auction rate security valuation allowance in the first quarter of 2009. Additionally, the 12 months ended June 30, 2009 includes a $12.0 million valuation allowance in consolidated income taxes related to the cash and investments repatriated from Guatemala in the fourth quarter of 2008.
(4)		Results for the 12 months ended June 30, 2009 include a $1.9 million after-tax charge related to a settlement in the fourth quarter of 2008 with the Florida Public Service Commission Staff of issues involving waterborne coal transportation services provided by a former affiliate company (TECO Transport).
(5)		Results for the 12 months ended June 30, 2009 include a $3.2 million tax benefit booked in the fourth quarter of 2008 related to the sale of TECO Transport.
(6)		Results for the 12 months ended June 30, 2008 include $6.9 million in after-tax transaction costs related to the sale of TECO Transport ($3.0 million in the third quarter of 2007, $3.3 million in the fourth quarter of 2007, and $0.6 million in the first quarter of 2008).
(7)		Results for the 12 months ended June 30, 2008 include the $149.4 million gain on the sale of TECO Transport and $20.2 million of debt extinguishment costs.

TAMPA ELECTRIC COMPANY
ELECTRIC OPERATING STATISTICS (Unaudited)
	Operating Revenues*											Sales -- Kilowatt-hours*
Three Months Ended June 30,									Percent							Percent
	2009				2008				Change			2009		2008		Change
Residential	$	257,656			$	247,254			4.2			2,057,076		2,153,445		(4.5	)
Commercial		173,257				161,872			7.0			1,563,588		1,621,521		(3.6	)
Industrial -- Phosphate		19,867				16,468			20.6			220,302		240,165		(8.3	)
Industrial -- Other		29,344				30,353			(3.3	)		287,059		324,242		(11.5	)
Other sales of electricity		50,469				46,811			7.8			450,328		463,998		(2.9	)
		530,593				502,758			5.5			4,578,353		4,803,371		(4.7	)
Deferred and other revenues		7,366				13,027			(43.5	)		--		--		--
Sales for resale		13,065				19,144			(31.8	)		121,116		230,654		(47.5	)
Other operating revenue		12,416				10,100			22.9			--		--		--
SO2 Allowance Sales		92				999			(90.8	)		--		--
	$	563,532			$	546,028			3.2			4,699,469		5,034,025		(6.6	)
Average customers		666,376				667,617			(0.2	)		--		--		--
Retail Net Energy For Load												5,100,730		5,275,859		(3.3	)
Total Degree Days												1,254		1,216		3.1
	Operating Revenues*											Sales -- Kilowatt-hours*
Six Months Ended June 30,									Percent							Percent
	2009				2008				Change			2009		2008		Change
Residential	$	508,664			$	454,250			12.0			3,944,774		3,931,532		0.3
Commercial		339,539				309,345			9.8			2,963,450		3,089,536		(4.1	)
Industrial -- Phosphate		40,825				33,090			23.4			467,147		484,801		(3.6	)
Industrial -- Other		58,623				57,672			1.6			559,220		630,073		(11.2	)
Other sales of electricity		100,464				89,417			12.4			864,840		882,583		(2.0	)
		1,048,115				943,774			11.1			8,799,431		9,018,525		(2.4	)
Deferred and other revenues		(25,122	)			5,771			(535.3	)		--		--		--
Sales for resale		25,200				35,181			(28.4	)		266,653		419,800		(36.5	)
Other operating revenue		22,903				20,892			9.6			--		--		--
SO2 Allowance Sales		93				1,962			(95.3	)		--		--		--
	$	1,071,189			$	1,007,580			6.3			9,066,084		9,438,325		(3.9	)
Average customers		666,844				668,280			(0.2	)		--		--		--
Retail Net Energy For Load												9,463,371		9,633,596		(1.8	)
Total Degree Days												1,845		1,736		6.3
	Operating Revenues*											Sales -- Kilowatt-hours*
Twelve Months Ended June 30,									Percent							Percent
	2009				2008				Change			2009		2008		Change
Residential	$	1,036,127			$	1,017,527			1.8			8,559,710		8,871,862		(3.5	)
Commercial		669,165				656,108			2.0			6,272,633		6,574,056		(4.6	)
Industrial -- Phosphate		73,800				69,911			5.6			951,481		1,014,195		(6.2	)
Industrial -- Other		112,193				117,081			(4.2	)		1,164,882		1,291,105		(9.8	)
Other sales of electricity		196,765				183,870			7.0			1,821,805		1,819,904		0.1
		2,088,050				2,044,497			2.1			18,770,511		19,571,122		(4.1	)
Deferred and other revenues		(49,186	)			(53,318	)		(7.7	)		--		--		--
Sales for resale		59,704				71,035			(16.0	)		730,824		903,746		(19.1	)
Other operating revenue		46,358				41,692			11.2			--		--		--
SO2 Allowance Sales		9,925				75,424			(86.8	)		--		--		--
	$	2,154,851			$	2,179,330			(1.1	)		19,501,335		20,474,868		(4.8	)
Average customers		666,548				667,805			(0.2	)		--		--		--
Retail Net Energy For Load												19,728,560		20,501,153		(3.8	)
Total Degree Days												4,032		4,276		(5.7	)
* in thousands

PEOPLES GAS SYSTEM
GAS OPERATING STATISTICS (Unaudited)
	Operating Revenues*									Therms*
Three Months Ended June 30,							Percent							Percent
	2009			2008			Change			2009		2008		Change
By Customer Segment:
Residential	$	27,065		$	32,182		(15.9	)		13,724		14,819		(7.4	)
Commercial		33,256			38,065		(12.6	)		91,566		90,783		0.9
Industrial		1,806			2,271		(20.5	)		45,391		53,432		(15.0	)
Off System Sales		26,295			97,806		(73.1	)		62,172		82,109		(24.3	)
Power generation		2,601			3,789		(31.4	)		144,936		132,920		9.0
Other revenues		9,998			8,591		16.4			-		-		--
	$	101,021		$	182,704		(44.7	)		357,789		374,063		(4.4	)
By Sales Type:
System supply	$	69,500		$	151,672		(54.2	)		88,951		111,010		(19.9	)
Transportation		21,523			22,441		(4.1	)		268,838		263,053		2.2
Other revenues		9,998			8,591		16.4			-		-		--
	$	101,021		$	182,704		(44.7	)		357,789		374,063		(4.4	)
Average customers		335,524			336,283		(0.2	)		--		--		--
	Operating Revenues*									Therms*
Six Months Ended June 30,							Percent							Percent
	2009			2008			Change			2009		2008		Change
By Customer Segment:
Residential	$	86,466		$	80,953		6.8			46,792		42,605		9.8
Commercial		80,489			82,430		(2.4	)		201,663		197,780		2.0
Industrial		3,984			4,490		(11.3	)		92,289		100,154		(7.9	)
Off System Sales		52,710			166,380		(68.3	)		113,185		160,651		(29.5	)
Power generation		5,355			7,159		(25.2	)		253,032		239,644		5.6
Other revenues		22,962			18,430		24.6			-		-		--
	$	251,966		$	359,842		(30.0	)		706,961		740,834		(4.6	)
By Sales Type:
System supply	$	183,243		$	294,358		(37.7	)		191,183		234,932		(18.6	)
Transportation		45,761			47,054		(2.7	)		515,778		505,902		2.0
Other revenues		22,962			18,430		24.6			-		-		--
	$	251,966		$	359,842		(30.0	)		706,961		740,834		(4.6	)
Average customers		335,565			336,204		(0.2	)		--		--		--
	Operating Revenues*									Therms*
Twelve Months Ended June 30,							Percent							Percent
	2009			2008			Change			2009		2008		Change
By Customer Segment:
Residential	$	155,971		$	135,744		14.9			78,565		69,099		13.7
Commercial		153,613			149,167		3.0			379,764		369,102		2.9
Industrial		7,736			9,232		(16.2	)		181,891		186,675		(2.6	)
Off System Sales		203,831			298,758		(31.8	)		276,317		335,514		(17.6	)
Power generation		10,863			15,477		(29.8	)		468,758		528,734		(11.3	)
Other revenues		41,030			35,527		15.5			-		-		--
	$	573,044		$	643,905		(11.0	)		1,385,295		1,489,124		(7.0	)
By Sales Type:
System supply	$	444,861		$	517,534		(14.0	)		414,026		464,226		(10.8	)
Transportation		87,153			90,844		(4.1	)		971,269		1,024,898		(5.2	)
Other revenues		41,030			35,527		15.5			-		-		--
	$	573,044		$	643,905		(11.0	)		1,385,295		1,489,124		(7.0	)
Average customers		334,817			334,875		0.0			--		--		--
* in thousands