Gas utility NiSource lifts 2024 profit view despite fourth-quarter miss
Feb 21 (Reuters) - U.S. electric and gas utility company NiSource raised its profit forecast for 2024 on Wednesday, even though it missed fourth-quarter estimates due to higher interest-rate expenses.
Steep U.S. interest rates have made borrowing more expensive for businesses and dented their profits, but markets widely expect the Federal Reserve to start reducing rates this year.
NiSource's interest expenses rose 38% year-over-year to $141 million in the reported quarter. Its adjusted profit of 53 cents per share narrowly missed analysts' estimates of 54 cents, according to LSEG data.
However, the Merrillville, Indiana-based company raised its 2024 adjusted earnings forecast range to between $1.70 and $1.74, from $1.68 to $1.72 earlier. The midpoint of the new forecast was above estimates of $1.70.
"The company's balance sheet is now strengthened and more flexible following the successful completion of the NIPSCO minority transaction in December," CEO Lloyd Yates said in a statement, referring to NiSource's sale of a minority stake in its unit, NIPSCO, for $2.15 billion to asset manager Blackstone's infrastructure unit.
The utility company serves about 3.3 million natural gas customers and 500,000 electric customers across six states through its local Columbia Gas and NIPSCO brands.
Its gas distribution operating income was reported at $287.4 million, compared with $291 million a year earlier, while earnings from its electric operations rose 6% to $71.4 million.
Revenue fell to $1.42 billion from $1.70 billion last year, missing estimates of $1.70 billion. (Reporting by Roshia Sabu in Bengaluru; Editing by Devika Syamnath)
