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National Fuel Gas (NFG) Q2 Earnings & Revenues Lag Estimates

Zacks Equity Research

National Fuel Gas Company NFG posted second-quarter fiscal 2019 operating earnings of $1.07 per share, lagging the Zacks Consensus Estimate of $1.15 by nearly 7% and declining 3.6% from the year-ago figure of $1.11.

Total Revenues

Total revenues of $552.5 million missed the Zacks Consensus Estimate of $590 million by 6.4%. However, the top line increased 2.1% from the prior-year figure of $540.9 million.

Utility and Energy Marketing revenues improved 3.4% year over year to $357.7 million. On the contrary, revenues from Pipeline, Storage and Gathering, as well as Exploration and Production and Other dropped 9.7% and 0.9% from the prior-year quarter to $48.4 million and $146.5 million, respectively.

National Fuel Gas Company Price, Consensus and EPS Surprise

National Fuel Gas Company Price, Consensus and EPS Surprise | National Fuel Gas Company Quote

Highlights of the Release

Total operating costs in the reported quarter increased 8.1% from the year-ago period to $399.2 million, owing to a rise in operating and maintenance expenses, and purchased gas prices.

Total gas production in the reported quarter was 45,370 million cubic feet (MMcf), up from the year-ago quarter figure of 42,078 MMcf, primarily due to higher production from the Appalachia region. Oil production was 564,000 barrels, down 14.9% from the year-ago level due to lower production from the West Coast region.

Operating income in the reported quarter was down 10.6% year over year to $153.4 million.

The company incurred interest expenses of $25.3 million, up 7% from the year-ago period.

Financial Highlights

On Mar 31, 2019, National Fuel Gas had cash and cash equivalents of $100.6 million compared with $229.6 million as of Sep 30, 2018.

Long-term debt (excluding current maturities) was $2,132.5 million as of Mar 31, 2019 compared with the Sep 30, 2018 level of $2,131.4 million.

The company’s cash flow from operating activities in the first six months of fiscal 2019 was $340.8 million, up from $288.7 million recorded in the comparable prior-year period.

Total capital expenditure in the first six months of fiscal 2019 was $386.6 million, higher than $288.7 million in the comparable year-ago period.

Guidance

National Fuel Gas reiterated its fiscal 2019 earnings guidance in the range of $3.45-$3.65. The midpoint of the range is $3.55 per share, which is lower than the current Zacks Consensus Estimate of $3.66 for the period.

The company lowered Exploration and Production segment’s fiscal 2019 net production guidance to the range of 205-215 billion cubic feet equivalent (“Bcfe”) from prior expectation of 210-230 Bcfe, with the primary reason being drilling and completion delays.

Other Releases

MDU Resources Group Inc. MDU reported first-quarter 2019 operating earnings of 21 cents per share, which missed the Zacks Consensus Estimate of 24 cents by 12.5%

ONE Gas, Inc. OGS recorded first-quarter 2019 operating earnings of $1.76 per share, which beat the Zacks Consensus Estimate of $1.73 by 1.7%.

ONEOK Inc. OKE came up with first-quarter 2019 operating earnings of 81 cents per share, which beat the Zacks Consensus Estimate of 73 cents by 10.96%.

Zacks Rank

National Fuel Gas 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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