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Sempra Energy (SRE) Beats on Q1 Earnings, Keeps '17 View

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Sempra Energy’s (SRE - Free Report) first-quarter 2017 adjusted earnings per share (EPS) came in at $1.74, beating the Zacks Consensus Estimate of $1.59 by 9.4%. Earnings also improved 8.8% from the prior-year quarter figure.

GAAP earnings were $1.75 per share in the quarter, compared with $1.40 a year ago.

Total Revenue

In the quarter under review, total revenue was $3,031 million, up 15.6% year over year on higher contributions from both the energy-related businesses (up 85%) and utilities (10.5%). Also, total revenue surpassed the consensus mark of $2,873.9 million by 5.5%.

Sempra Energy Price, Consensus and EPS Surprise

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

Segment Update

San DiegoGas & Electric (SDG&E): Quarterly earnings were $155 million, compared with the year-ago figure of $136 million. The upside was driven by a higher California Public Utilities Commission (CPUC) base margin and lower operating expenses.

Southern California Gas Company (SoCalGas): The segment registered earnings of $203 million in the first quarter of 2017, compared to the year-ago earnings of $199 million.

Sempra South American Utilities: The segment recorded earnings of $47 million in the first quarter, up from $38 million in the prior-year quarter. The upside can be attributed to higher operating earnings in Peru.

Sempra Mexico: The segment recorded earnings of $48 million, up from $18 million recorded in the prior-year quarter. The earnings improvement was driven primarily by the deferred tax expense of $24 million that the company incurred in 2016, on account of the planned sale of the Termoeléctrica de Mexicali (TdM) power plant.

Sempra Renewables: The segment recorded quarterly earnings of $11 million, down from $14 million in the prior-year quarter.

Sempra LNG & Midstream: The segment reported earnings of $1 million, against the year-ago quarter’s loss of $32 million.

Financial Update

As of Mar 31, 2017, Sempra Energy’s cash and cash equivalents were $290 million, compared with $349 million as of Dec 31, 2016.

Long-term debt was $14,409 million as of Mar 31, 2017, compared with $14,429 million at 2016 end.

Cash flow from operating activities was $1,004 million at the end of first-quarter 2017, up from $626 million at the end of the prior-year quarter.

In the first quarter, the company’s capital expenditures and investments were $1,051 million compared with $1,001 million in the prior-year period.

Guidance

Sempra Energy reaffirmed its 2017 earnings per share guidance in the band of $4.85–$5.25.

Zacks Rank

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

Peer Earnings Review

Consolidated Edison Inc. (ED - Free Report) posted first-quarter 2017 adjusted earnings of $1.27 per share that beat the Zacks Consensus Estimate of $1.19 by 6.7%. It reported total revenue of $3,228 million in the first quarter, which exceeded the Zacks Consensus Estimate of $3,061 million by 5.5%.

Entergy Corporation (ETR - Free Report) reported first-quarter 2017 operational earnings of 99 cents per share, lagging the Zacks Consensus Estimate of $1.06 by 6.6%. It reported total revenue of $2,588.5 million, beating the Zacks Consensus Estimate of $2,566 million by 0.9%.

Ameren Corporation (AEE - Free Report) posted first-quarter 2017 earnings from continuing operations of 42 cents per share, in line with the Zacks Consensus Estimate. Total revenue of $1,514 million in the first quarter of 2017 was up 5.6% year over year.

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