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FirstEnergy (FE) Q1 Earnings Beat, Revenues Miss Estimates

Zacks Equity Research

Diversified energy company, FirstEnergy Corporation FE announced first-quarter 2017 operating earnings of 77 cents per share, beating the Zacks Consensus Estimate of 71 cents by 8.4%. Quarterly earnings were down 2.5% year over year.

Moreover, the figure surpassed the guidance range of 65–75 cents per basic share provided by the company during the last quarter of 2016.

On a GAAP basis, FirstEnergy reported earnings of 46 cents per share, much wider than the prior-year earnings of 77 cents.

Total Revenue

FirstEnergy generated total revenue of $3,552 million in first-quarter 2017, missing the Zacks Consensus Estimate of $3,612 million by 1.69%.

Reported revenues were also down 8.92% from $3,869 million reported a year ago. The top line declined primarily due to lower revenues from Competitive Energy Services.

Highlights of the Release

Total electric sales decreased by 530 thousand megawatt-hours (MWh), or 1.4% year over year. Residential sales decreased by 467 thousand MWh, or 3.3% while commercial sales fell 115 thousand MWh, or 1.1%. Industrial sales improved by 56 thousand MWh or 0.5% primarily on account of higher usage in the shale, gas and coal sectors.

For the first quarter, FirstEnergy incurred operating expenses of $ 2,978 million, down 3.7% from $ 3,093 million a year ago primarily owing to lower fuel and purchased power.

Operating income in the reported quarter stood at $ 574 million, down from $ 776 million in the prior-year quarter.
 

FirstEnergy Corporation Price, Consensus and EPS Surprise

 

FirstEnergy Corporation Price, Consensus and EPS Surprise | FirstEnergy Corporation Quote

Financial Update

FirstEnergy's cash on hand as of Mar 31, 2017 was $164 million, down from $199 million as of Dec 31, 2016.

Cash from operating activities in first-quarter 2017 was $785 million, compared with $650 million in the year-ago quarter. Long-term debt and other long-term obligations as of Mar 31, 2017 were 17,762 million compared with $18,192 million as of Dec 31, 2016.

Guidance

FirstEnergy has provided operating earnings guidance for second-quarter and full-year 2017 in the range of 55–65 cents and $2.70–$3.00, respectively.

Other Utility Releases

Entergy Corporation ETR reported first-quarter 2017 operating earnings of 99 cents per share, missing the Zacks Consensus Estimate of $1.06 by 6.60%.

DTE Energy Company DTE reported first-quarter 2017 adjusted earnings of $1.79 per share, missing the Zacks Consensus Estimate of $1.57 by 14.01%.

American Electric Power Company, Inc. AEP reported first-quarter 2017 adjusted earnings of 95 cents per share, compared to the Zacks Consensus Estimate of 97 cents by 2.06%.

Zacks Rank

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

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