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National Fuel Gas (NFG) Q1 Earnings Beat, Revenues Lag

Zacks Equity Research

National Fuel Gas Company NFG posted first-quarter fiscal 2020 operating earnings of $1.01 per share, beating the Zacks Consensus Estimate of 95 cents by 6.3%. However, earnings declined from the year-ago figure of $1.12 per share by 9.8%.

Total Revenues

Total revenues of $444 million missed the Zacks Consensus Estimate of $522 million by 14.9%. The top line also decreased from the prior-year figure of $490 million by 9.4%.

National Fuel Gas Company Price, Consensus and EPS Surprise

National Fuel Gas Company Price, Consensus and EPS Surprise

National Fuel Gas Company price-consensus-eps-surprise-chart | National Fuel Gas Company Quote

Highlights of the Release

Total operating costs in the reported quarter decreased 9.9% from the year-ago level to $296.2 million, owing to decline in purchase gas prices.

Total production in the reported quarter was 58.4 billion cubic feet, up 19% from the year-ago period. The uptick was led by higher production from the Appalachia region.

Operating income in the reported quarter declined nearly 8.4% year over year to $148.1 million.

The company incurred interest expenses of $25.5 million, which was in line with the year-ago figure.

Financial Highlights

On Dec 31, 2019, National Fuel Gas had cash and cash equivalents of $34.9 million compared with $20.5 million as of Sep 30, 2019.

Long-term debt (excluding current maturities) was $2,134.5 million as of Dec 31 compared with the Sep 30, 2019 level of $2,133.7 million.

The company’s cash flow from operating activities in first-quarter fiscal 2020 was $167.8 million, up from $104.4 million recorded in the year-ago period.

Total capital expenditure in first-quarter fiscal 2020 was $198.5 million, up 11.8% from the year-ago level.

Guidance

National Fuel Gas revised its fiscal 2020 earnings guidance to the range of $2.95-$3.15 from the prior expectation of $3.00-$3.30. The mid-point of the guidance is 10 cents higher than the Zacks Consensus Estimate of $2.95.

The company now expects Exploration and Production capital expenditures in fiscal 2020 in the range of $375-$410 million, reflecting a reduction of $42.5 million from the previous guidance at the midpoint.

National Fuel Gas lowered its fiscal 2020 capital expenditure guidance to the range of $695-$785 million from the earlier guided range of $725-$820 million.

Expectations for fiscal 2020 net production remained unchanged in the range of 235-245 billion cubic feet equivalent.

Zacks Rank

Currently, National Fuel Gas carries a Zacks Rank #5 (Strong Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Upcoming Releases

Atmos Energy Corporation ATO is slated to release first-quarter fiscal 2020 results on Feb 4.  The Zacks Consensus Estimate for the quarter’s earnings is pegged at $1.49 per share.

ONE Gas Inc. OGS is set to release fourth-quarter 2019 results on Feb 19. The Zacks Consensus Estimate for earnings for the quarter is pegged at 95 cents per share.

Sempra Energy SRE is scheduled to release fourth-quarter 2019 results on Feb 25. The Zacks Consensus Estimate for quarterly earnings is pegged at $1.31 per share.

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