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The AES Corporation’s (AES - Free Report) second-quarter 2024 adjusted earnings of 38 cents per share beat the Zacks Consensus Estimate of 36 cents by 5.6%. The bottom line also improved 81% from 21 cents reported in the year-ago quarter.
The year-over-year improvement in adjusted earnings can be attributed to a lower adjusted tax rate and higher contributions from the Utilities SBU, as well as renewable projects placed in service in 2024.
The company generated GAAP earnings of 27 cents per share against a GAAP loss of 6 cents incurred in the second quarter of 2023. This improvement was driven by higher contributions from renewable projects placed in service in 2024, prior-year unrealized foreign currency losses at the Energy Infrastructure SBU and higher margins at the Utilities and Energy Infrastructure SBUs.
Total Revenues
The top line amounted to $2.94 billion, down 2.8% year over year due to lower non-regulated revenues. The figure also missed the Zacks Consensus Estimate of $3.28 billion by 10.4%.
The AES Corporation Price, Consensus and EPS Surprise
The total cost of sales was $2.39 billion in the reported quarter, down 5.5% year over year.
The operating income totaled $553 million, up 11% from $498 million in the year-ago period.
Interest expenses amounted to $389 million, up 25.5% from $310 million in the prior-year quarter.
During the second quarter, the company signed 2.5 gigawatts (GW) of new agreements, including 2.2 GW directly with data center customers. AES signed a 15-year Power Purchase Agreement (“PPA”) for 727 megawatts (MW) of wind and solar to serve data center growth in Texas and also a 310 MW retail supply agreement to support data centers throughout Ohio. This brought AES’ total backlog of 12.6 GW signed long-term PPAs.
Financial Condition
AES had cash and cash equivalents of $1.77 billion as of Jun 30, 2024 compared with $1.43 billion as of Dec 31, 2023.
Non-recourse debt totaled $20.23 billion as of Jun 30, 2024, up from $18.48 billion as of Dec 31, 2023.
During the first six months of 2024, AES generated cash from operating activities worth $0.68 billion compared with the year-ago figure of $1.19 billion.
Total capital expenditure was $1.69 billion, down from $1.85 billion recorded a year ago.
2024 Guidance
AES now expects to generate earnings in the upper half of its earlier projected adjusted earnings per share (EPS) guidance range of $1.87-$1.97. The Zacks Consensus Estimate for the same is pegged at $1.91.
AES reaffirmed its average annual earnings growth target of 7-9% through 2027.
CenterPoint Energy, Inc. (CNP - Free Report) reported second-quarter 2024 adjusted earnings of 36 cents per share, which surpassed the Zacks Consensus Estimate of 33 cents by 9.1%. The bottom line also improved 28.6% from the year-ago quarter’s figure of 28 cents per share.
CNP generated revenues of $1.91 billion, which beat the Zacks Consensus Estimate of $1.88 billion by 1.1%. The top line also came in 1.6% higher than the year-ago quarter’s reported figure of $1.88 billion.
Edison International (EIX - Free Report) reported second-quarter 2024 adjusted earnings of $1.23 per share, which increased 21.8% from $1.01 in the year-ago quarter. The Zacks Consensus Estimate was pegged at $1.05.
Edison International's second-quarter operating revenues totaled $4.34 billion, which beat the Zacks Consensus Estimate of $4.03 billion by 7.5%. The top line also increased 9.4% from the year-ago quarter’s figure of $3.96 billion.
PG&E Corporation (PCG - Free Report) reported second-quarter 2024 adjusted earnings per share of 31 cents, which surpassed the Zacks Consensus Estimate of 30 cents by 3.3%. The bottom line also improved 34.8% from the year-ago quarter’s reported figure.
PCG reported second-quarter total revenues of $5.99 billion, up 13.2% from $5.29 billion registered in the year-ago period. Operating revenues also surpassed the Zacks Consensus Estimate of $5.83 billion by 2.7%.
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AES' Q2 Earnings Surpass Estimates, Revenues Decline Y/Y
The AES Corporation’s (AES - Free Report) second-quarter 2024 adjusted earnings of 38 cents per share beat the Zacks Consensus Estimate of 36 cents by 5.6%. The bottom line also improved 81% from 21 cents reported in the year-ago quarter.
The year-over-year improvement in adjusted earnings can be attributed to a lower adjusted tax rate and higher contributions from the Utilities SBU, as well as renewable projects placed in service in 2024.
The company generated GAAP earnings of 27 cents per share against a GAAP loss of 6 cents incurred in the second quarter of 2023. This improvement was driven by higher contributions from renewable projects placed in service in 2024, prior-year unrealized foreign currency losses at the Energy Infrastructure SBU and higher margins at the Utilities and Energy Infrastructure SBUs.
Total Revenues
The top line amounted to $2.94 billion, down 2.8% year over year due to lower non-regulated revenues. The figure also missed the Zacks Consensus Estimate of $3.28 billion by 10.4%.
The AES Corporation Price, Consensus and EPS Surprise
The AES Corporation price-consensus-eps-surprise-chart | The AES Corporation Quote
Highlights of the Release
The total cost of sales was $2.39 billion in the reported quarter, down 5.5% year over year.
The operating income totaled $553 million, up 11% from $498 million in the year-ago period.
Interest expenses amounted to $389 million, up 25.5% from $310 million in the prior-year quarter.
During the second quarter, the company signed 2.5 gigawatts (GW) of new agreements, including 2.2 GW directly with data center customers. AES signed a 15-year Power Purchase Agreement (“PPA”) for 727 megawatts (MW) of wind and solar to serve data center growth in Texas and also a 310 MW retail supply agreement to support data centers throughout Ohio. This brought AES’ total backlog of 12.6 GW signed long-term PPAs.
Financial Condition
AES had cash and cash equivalents of $1.77 billion as of Jun 30, 2024 compared with $1.43 billion as of Dec 31, 2023.
Non-recourse debt totaled $20.23 billion as of Jun 30, 2024, up from $18.48 billion as of Dec 31, 2023.
During the first six months of 2024, AES generated cash from operating activities worth $0.68 billion compared with the year-ago figure of $1.19 billion.
Total capital expenditure was $1.69 billion, down from $1.85 billion recorded a year ago.
2024 Guidance
AES now expects to generate earnings in the upper half of its earlier projected adjusted earnings per share (EPS) guidance range of $1.87-$1.97. The Zacks Consensus Estimate for the same is pegged at $1.91.
AES reaffirmed its average annual earnings growth target of 7-9% through 2027.
Zacks Rank
AES currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Utility Releases
CenterPoint Energy, Inc. (CNP - Free Report) reported second-quarter 2024 adjusted earnings of 36 cents per share, which surpassed the Zacks Consensus Estimate of 33 cents by 9.1%. The bottom line also improved 28.6% from the year-ago quarter’s figure of 28 cents per share.
CNP generated revenues of $1.91 billion, which beat the Zacks Consensus Estimate of $1.88 billion by 1.1%. The top line also came in 1.6% higher than the year-ago quarter’s reported figure of $1.88 billion.
Edison International (EIX - Free Report) reported second-quarter 2024 adjusted earnings of $1.23 per share, which increased 21.8% from $1.01 in the year-ago quarter. The Zacks Consensus Estimate was pegged at $1.05.
Edison International's second-quarter operating revenues totaled $4.34 billion, which beat the Zacks Consensus Estimate of $4.03 billion by 7.5%. The top line also increased 9.4% from the year-ago quarter’s figure of $3.96 billion.
PG&E Corporation (PCG - Free Report) reported second-quarter 2024 adjusted earnings per share of 31 cents, which surpassed the Zacks Consensus Estimate of 30 cents by 3.3%. The bottom line also improved 34.8% from the year-ago quarter’s reported figure.
PCG reported second-quarter total revenues of $5.99 billion, up 13.2% from $5.29 billion registered in the year-ago period. Operating revenues also surpassed the Zacks Consensus Estimate of $5.83 billion by 2.7%.