Eversource's (ES) Earnings and Revenues Beat Estimates in Q3

Eversource Energy ES delivered third-quarter 2018 operating earnings of 93 cents per share, surpassing the Zacks Consensus Estimate of 88 cents by 5.7%. The bottom line also improved 13.4% year over year.

GAAP earnings in the reported quarter were 91 cents compared with 82 cents in the year-ago quarter. The difference between GAAP and operating earnings in the reported quarter was due to an impairment charge of 8 cents relating to the company’s investment in the proposed Access Northeast natural gas pipeline project, along with non-recurring tax benefits of 6 cents related to federal and state tax law changes.

Total Revenues

Eversource’s third-quarter revenues of $2,271.4 million topped the Zacks Consensus Estimate of $1,968 million by 15.4% and also improved 14.2% from the year-ago figure of $1,988.5 million.

Highlights of the Release

In the reported quarter, electric distribution increased 8.7% year over year to 15,316 Gwh.

Operating expenses increased nearly 20.9% year over year to $1,805.4 million, primarily owing to higher expenses from purchased power, fuel and transmission, plus operation and maintenance costs.

Operating income was down 5.9% to $466.3 million while interest expenses were up 15.2% year over year to $125.2 million.

Net income in the quarter under review was $289.4 million, up 11.1% from the year-ago level.

Eversource Energy Price, Consensus and EPS Surprise
 

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

Segmental Performance

Electric Distribution: Earnings from this segment were up 10.4% to $173.8 million. The upside was primarily attributable to higher distribution margins.

Electric Transmission: The bottom line of the segment increased 10.6% year over year to $109.5 million. The upside was primarily attributable to higher level of investment in Eversource’s electric transmission system.

Natural Gas Distribution: This segment recorded a loss of $12.6 million compared with $6.2 million in the year-ago quarter. The segment’s unimpressive third-quarter results were primarily due to higher operation and maintenance expenses.

Water Distribution: Eversource’s water distribution segment, created after the company acquired Aquarion Water Company in December 2017, earned $17.6 million in third-quarter 2018.

Eversource Parent & Other Companies: The segment earned $1.1 million compared with the year-ago quarter’s earnings of $10.2 million.

Financial Highlights

As of Sep 30, 2018, the company’s cash was $59.1 million, up from $38.2 million on Dec 31, 2017.

Its long-term debt was $12.15 billion as of the same date, up from $11.77 billion on Dec 31, 2017.

Cash provided during the first nine months of 2018 in operating activities was $1.40 billion compared with $1.47 billion in the year-ago period.

Guidance

Eversource reaffirmed its 2018 earnings guidance in the range of $3.20-$3.30. Long-term earnings growth of the company is projected in the 5-7% band.

Zacks Rank

Eversource currently carries a Zacks Rank #2 (Buy). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.

Other Releases

Dominion Energy Inc. D reported third-quarter 2018 operating earnings of $1.15 per share, beating the Zacks Consensus Estimate of $1.11 by 3.6%.
 
Exelon Corporation’s EXC third-quarter 2018 operating earnings of 88 cents per share were on par with the Zacks Consensus Estimate.
 
NextEra Energy, Inc. NEE reported third-quarter 2018 adjusted earnings of $2.18 per share, which beat the Zacks Consensus Estimate of $2.17 by 0.46%.

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