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Sempra Energy (SRE) Misses Q1 Earnings & Revenue Estimates

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Sempra Energy’s (SRE - Free Report) first-quarter 2018 adjusted earnings per share of $1.43 lagged the Zacks Consensus Estimate of $1.67 by 14.4%. Earnings dropped 17.8% from the prior-year quarter figure of $1.74.

Barring the one-time adjustments, the company reported GAAP loss of $1.33 per share in the quarter, against earnings of $1.75 in the prior-year quarter.

Total Revenues

In the quarter under review, total revenues were $2,962 million, down 2.3% year over year primarily due to lower contribution from the Utilities business (down 3.7%), marginally offset by strong contribution from the energy-related businesses (up 9.3%). Total revenues also missed the consensus mark of $3,422 million by 13.4%.

Sempra Energy Price, Consensus and EPS Surprise
 

Sempra Energy Price, Consensus and EPS Surprise | Sempra Energy Quote

Highlight of the Release

During the quarter, the company completed the acquisition of 80% indirect ownership interest in Oncor for $9.45 billion, after receiving necessary regulatory approval.

Cost of electric fuel and purchased power in the reported quarter was $546 million, up 3.6% from a year ago.

Interest expenses in the reported quarter were up 27.8% year over year to $216 million.

Segment Update

San DiegoGas & Electric (SDG&E): Quarterly earnings in this segment were $170 million compared with the year-ago figure of $155 million.

Southern California Gas Company (SoCalGas): The segment registered earnings of $225 million in the first quarter compared with $203 million in the year-ago quarter.

Sempra South American Utilities: The segment recorded earnings of $46 million in the first quarter, down from $47 million in the prior-year quarter.

Sempra Mexico: The segment reported earnings of $20 million, compared with $48 million recorded in the prior-year quarter.

Sempra Renewables: The segment recorded quarterly earnings of $21 million, up from $11 million in the prior-year quarter.

Sempra LNG & Midstream: The segment reported a loss of $16 million against the year-ago quarter’s earnings of $1 million.

Financial Update

As of Mar 31, 2018, Sempra Energy’s cash and cash equivalents were $239 million compared with $288 million as of Dec 31, 2017.

Long-term debt was $20,863 million as of Mar 31, 2018 compared with $16,445 million at the end of 2017.

Cash flow received from operating activities in the first quarter was $966 million, down from $1,004 million received in the year-ago quarter.

Guidance

Sempra Energy reaffirmed its 2018 earnings in the band of $5.30-$5.80.

Zacks Rank

Sempra Energy currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Gas Distribution Releases

Atmos Energy Corporation (ATO - Free Report) reported second-quarter fiscal 2018 adjusted earnings of $1.57 per share, beating the Zacks Consensus Estimate of $1.54 by 3.3%.

MDU Resources Group Inc. (MDU - Free Report) reported operating earnings per share of 22 cents in first-quarter 2018, beating the Zacks Consensus Estimate of 21 cents by 4.8%.

ONEOK Inc. (OKE - Free Report) reported operating earnings per share of 64 cents in the first quarter of 2018, beating the Zacks Consensus Estimate of 62 cents by 3.2%.

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