WRAPUP 2-AEP, Xcel Energy sales hit by cool weather

* AEP sales down 17 pct, Xcel Energy rev down 19 pct

* AEP moves FY forecast to top end of prior range

* Xcel sees FY shr at mid-point of prior range

* NRG sales up 12 pct on acquisition, profit dips

* AEP shares up 3 pct, NRG, Xcel Energy down 1 pct (Recasts; adds conference call details, updates share movement)

By Adveith Nair and Hezron Selvi

BANGALORE, Oct 29 (Reuters) - A cool summer in eastern U.S. put a damper on the third-quarter results of power companies Xcel Energy Inc (XEL.N) and American Electric Power Co (AEP) (AEP.N), with their sales falling way short of Wall Street targets, but the companies said there are signs of pick up in industrial demand.

"This was the coolest summer in 30 years for the Eastern states that we serve and the fourth coolest summer in 30 years for our customers in the Southwest Power Pool...the cool summer weather reduced both retail and wholesale sales," AEP Chief Executive Michael Morris said.

AEP's revenue dropped 17 percent to $3.5 billion, below estimates of $3.97 billion. Total operating revenue at Xcel Energy slipped 19 percent to $2.31 billion, while analysts were looking for revenue of $3.01 billion.

The weather hurt AEP's third-quarter profit by 7 cents a share, while reducing Xcel Energy's earnings by 5 cents a share.

AEP's per-share earnings, however, remained unchanged at 93 cents. The company also moved its full-year forecast to the upper end of its earlier range, and said sales to industrial customers registered a slight sequential improvement. [ID:nN29346679]

Electric utilities serving the manufacturing states in the U.S. "Rust Belt" such as Illinois, Indiana, Michigan, Ohio, and Pennsylvania have been hit hard as large manufacturers curbed production in response to the global financial crisis.

However, the companies indicated that industrial demand is rebounding.

"You all know me to be an optimist, and I believe we are beginning to see some uptick in industrial demand," AEP's Morris said on a conference call with analysts.

He currently expects 2010 industrial load to be better than 2009.

AEP noted that its sales to industrial customers in the third quarter was down 17 percent from a year ago, but was sequentially up from the second quarter.

"We did see an increase in sales to several large metals customers from second quarter to third quarter. We hope that's a sign of better things to come, but we don't see it as a cause for celebration yet," AEP said in a statement.

Xcel Energy, whose profit dropped 3 cents a share to 48 cents a share from a year ago, said it expects electricity sales will bottom in 2009 and grow about 1 percent in 2010.

"So it's a slow recovery," an Xcel executive said on the call.

Power producer NRG Energy Inc (NRG.N) revenue, which reported a 12 percent rise in revenue that topped market estimates, also said it had seen signs of demand picking up.

"Reliant Energy continued to experience stronger residential demand, driven by warmer weather during July and August, and higher industrial demand across Texas on the same customer basis versus the second quarter of 2009," company executives said on a conference call.

Reliant is the largest commercial and industrial retail provider in Texas.

NRG said it expects the demand trends to continue as the state exited the current recession.

AEP shares were up 3 percent at $30.60, while Xcel Energy stock was down 1 percent at $19.05 Thursday on the New York Stock Exchange. NRG shares were down about 2 percent at $24.32. (Editing by Anil D'Silva)