AES Q2 Earnings Fall Short of Estimates, Revenues Decline Y/Y
The AES Corporation’s AES second-quarter 2023 adjusted earnings of 21 cents per share missed the Zacks Consensus Estimate of 25 cents by 16%. The bottom line also declined 38.2% from 34 cents reported in the year-ago quarter.
The company incurred GAAP loss of 6 cents per share compared with a reported loss of 27 cents in the second quarter of 2022. This improvement was driven by lower long-lived asset impairments.
Total Revenues
Total revenues were $3,027 million in the reported quarter, down 1.7% year over year due to lower non-regulated revenues. The top line, however, beat the Zacks Consensus Estimate of $2,876 million by 5.2%.
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 $2,529 million in the reported quarter, up 0.6 % year over year.
The operating income totaled $498 million, down 11.5% from $563 million in the year-ago period.
Interest expenses totaled $310 million, up 11.1% from $279 million in the prior-year quarter.
The company's backlog for renewable energy projects was 13.2 GW as of Jun 30, 2023.
Financial Condition
AES had cash and cash equivalents of $1,322 million as of Jun 30, 2023, compared with $1,374 million on Dec 31, 2022.
Non-recourse debt totaled $18,622 million as of Jun 30, 2023, up from $17,846 million as of Dec 31, 2022.
In the first six months of 2023, AES generated cash from operating activities worth $1,187 million compared with the year-ago figure of $865 million.
Total capital expenditure for the second quarter was $1,845 million, up substantially from $893 million recorded in the year-ago quarter.
Guidance
For 2023, AES reaffirmed its earnings guidance. It expects adjusted earnings per share (EPS) in the range of $1.65-$1.75. The Zacks Consensus Estimate for 2023 earnings is pegged at $1.72 per share, higher than the midpoint of the company’s guided range.
AES reiterated its 7-9% average annual growth target through 2025.
Zacks Rank
AES currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Utility Releases
NextEra Energy NEE reported second-quarter 2023 adjusted earnings of 88 cents per share, which beat the Zacks Consensus Estimate of 83 cents by 6%. The bottom line was also up 8.6% from the prior-year quarter’s level. The year-over-year improvement was due to the solid performances of Florida Power & Light Company and NextEra Energy Resources.
For the second quarter, NEE’s operating revenues totaled $7,349 million, which surpassed the Zacks Consensus Estimate of $6,681 million by 10%. The top line also improved 41.8% year over year.
DTE Energy Company DTE reported second-quarter 2023 operating EPS of 99 cents, which surpassed the Zacks Consensus Estimate of 89 cents by 11.2%. The bottom line also improved 12.5% from the year-ago quarter’s reported figure of 88 cents.
The company reported GAAP earnings of 97 cents per share compared with 19 cents in the prior-year quarter.
American Electric Power Company, Inc. AEP reported second-quarter 2023 operating EPS of $1.13, which lagged the Zacks Consensus Estimate of $1.14 by 0.9%. The bottom line also declined 5.8% from $1.20 a year ago.
American Electric’s operating revenues of $4,372.5 million lagged the Zacks Consensus Estimate of $4,686.7 million by 6.7%. The reported figure also decreased 5.8% from the year-ago quarter’s level of $4,639.7 million.
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