OGE Energy (OGE) Q3 Earnings Miss Estimates, Cuts ’17 View

OGE Energy Corp. OGE posted third-quarter 2017 earnings of 92 cents per share, which missed the Zacks Consensus Estimate of 93 cents by a penny. However, the reported figure was flat year over year.

Revenues

OGE Energy’s operating revenues of $716.8 million in the quarter fell 3.6% from the prior-year figure of $743.9 million.

Operational Highlights

Total sales in the reported quarter amounted to 8.1 million megawatt-hours (MWh), down from 8.7 million MWh in the prior-year quarter. This decline was due to lower system as well as integrated market sales. Meanwhile, the company’s customer count increased by 8,285 or 1%.

Cost of sales in the quarter under review was $255.7 million, down 5.2%.

Total operating expenses increased 0.5% year over year to $217.8 million mainly on the back of higher other operation and maintenance expenses as well as taxes other than income. However, operating income declined 14% to $243.3 million from the year-ago figure of $257.3 million.

Interest expenses totaled $35.9 million in the quarter, up from $35.4 million a year ago.

Other Highlights of the Release

OGE Energy reported net income of $183.4 million in this quarter, down from the prior-year figure of $183.6 million.

OG&E: The segment’s net income increased 1.3% year over year to $162 million in the quarter. The upside was mainly owing to non-cash earnings used to recover financing costs during construction of the Mustang and Sooner plants.

Natural Gas Midstream Operations: The segment posted net income of $21 million compared with $23 million in the year-ago period. The decline was primarily due to increased operating and interest expenses.

Guidance

OGE Energy revised its guidance for 2017. The company now expects consolidated earnings to be in the range of $1.85 to $1.91 per share compared with $1.93-$2.09, projected earlier.

Also, OG&E, the regulated utility, expects to earn $1.50-$1.52 per share, down from $1.58-$1.70, guided earlier.

Peer Releases

Entergy Corporation ETR reported third-quarter 2017 operational earnings of $2.35 per share beating the Zacks Consensus Estimate of $2.24 by 4.9%. The reported number improved 1.7% from the year-ago figure. The company carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

DTE Energy Company DTE reported third-quarter 2017 operating earnings per share (EPS) of $1.48, which missed the Zacks Consensus Estimate of $1.53 by 3.3%. Operating earnings also declined 24.5% from the year-ago figure of $1.96. The company carries a Zacks Rank #2 (Buy).

American Electric Power Co., Inc. AEP reported third-quarter 2017 operating EPS of $1.10, missing the Zacks Consensus Estimate of $1.19 by 7.6%. The bottom line also declined 15.4% from $1.30 a year ago. The company carries a Zacks Rank #3.

Zacks Rank

OGE Energy carries a Zacks Rank #4 (Sell).

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