CenterPoint Energy, Inc. (CNP) reported second quarter 2014 earnings of 25 cents per share, surpassing the Zacks Consensus Estimate by 4.2%. The upside was primarily due to a higher customer count despite the milder weather.
However, the reported number was lower than the prior-year adjusted profit of 30 cents per share.
Total Revenue
CenterPoint Energy’s total revenue for the reported quarter was $1,884 million, beating the Zacks Consensus Estimate of $1,735 million by 8.6%. Quarterly revenues however decreased $10 million year over year.
Operational Results
Total expenses rose 1.6% year over year to $1,698 million, primarily due to a surge in operation and maintenance expenses.
The company’s operating income decreased 16.6% year over year to $186 million in the reported quarter.
In second quarter 2014, total interest expenses of $119 million were on par with the year-ago level.
Segment Results
The Electric Transmission & Distribution segment reported an operating income of $145 million, down 12.1% year over year. Natural Gas Distribution’s operating income climbed 20% year over year to $30 million. The Energy Services segment’s operating income was $11 million versus $3 million a year ago. The Interstate Pipelines, Field Services and Other segments did not generate any operating income.
Financial Condition
As of Jun 30, 2014, CenterPoint Energy reported cash and cash equivalents of $206 million, down from $208 million as of Dec 31, 2013.
Total long-term debt was $7,755 million as of Jun 30, 2014, down from $7,817 million at the end of Dec 31, 2013.
In the first six months of 2014, the company’s net cash from operating activities was $712 million, lower than $790 million in the year-ago period.
In the reported quarter, CenterPoint Energy’s total capital expenditures increased to $343 million from $328 million in the year-ago period, primarily on the back of higher investments in the Electric Transmission & Distribution and Natural Gas Distribution segments.
Guidance
CenterPoint Energy increased its 2014 earnings guidance to $1.14–$1.21 per share from the previous projection of $1.10–$1.19 per share on the back of its Midstream investments. The company revised its 2014 earnings expectation from Midstream investments to the range of 42 cents to 45 cents per share. Yet, it reaffirmed its 2014 earnings forecast for its utility operations at 72–76 cents.
Peer Reviews
Exelon Corp. (EXC) announced second-quarter 2014 operating earnings of 51 cents per share, surpassing the Zacks Consensus Estimate by a penny. Quarterly earnings however decreased 3.8% year over year due to lower realized prices, lesser output from nuclear plants owing to outages and higher operations and maintenance expenses.
Ameren Corp. (AEE) posted second quarter 2014 earnings from continuing operations of 62 cents per share, beating the Zacks Consensus Estimate by 5 cents. Quarterly earnings were also substantially higher than the year-ago figure of 44 cents by 40.9%. The year-over-year upside came on the back of a solid Missouri division.
Edison International (EIX) reported solid second quarter 2014 results with its adjusted earnings of $1.08 per share well ahead of the Zacks Consensus Estimate of 83 cents by 30.1%. Earnings for the quarter also increased 36.7% from the year-ago figure of 79 cents per share.
Zacks Rank
CenterPoint Energy currently has a Zacks Rank #2 (Buy).
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