Consolidated Edison Inc. ( ED - Analyst Report ) reported third-quarter 2012 results after the market close with earnings from continuing operations of $1.44 per share, surpassing the Zacks Consensus Estimate of $1.38 per share and year-over-year figure of $1.33 per share.

The results reflect changes in the rate plans of utility subsidiaries and the effects of the milder winter weather on steam revenues.

On a reported basis, the company reported GAAP earnings of 1.50 per share compared with $1.31 per share in the year-ago quarter. The variance of 6 cents between earnings from continuing operations and GAAP earnings per share was primarily due to higher mark-to-market gains in the Competitive Energy businesses.

Operational Results

During the third quarter of 2012, operations and maintenance expenses were higher year over year primarily due to pension costs and the support and maintenance of company underground facilities to accommodate municipal projects.

Consolidated Edison’s earnings from ongoing operations were $423 million compared with $390 million in the year-ago quarter. The company’s net income was $440 million compared with $380 million in the year-ago quarter.

At the peer

Recently, one of Consolidated Edison’s peer, Dominion Resources Inc. ( D - Snapshot Report ) reported third quarter 2012 operating earnings of 92 cents per share, falling short of the Zacks Consensus Estimate by 5.2% and the year-ago earnings by 3.2%. Dominion’s earnings were at the lower end of the guidance range of 90 cents–$1.00.

Dominion’s operating revenue of $3.4 billion in the third quarter of 2012 declined 8.9% from the year-ago quarter. Lower revenue across all segments resulted in the decline. Revenue also fell short of the Zacks Consensus Estimate of $3.7 billion.

Guidance

Consolidated Edison expects its earnings per share from ongoing operations for full-year 2012 in the range of $3.65 – $3.85.

Outlook

New York City-based Consolidated Edison Inc. is a diversified utility holding company with subsidiaries engaged in both regulated and unregulated businesses. ConEd’s regulated businesses operate through two subsidiaries — Consolidated Edison Company of New York (CECONY) and Orange and Rockland Utilities (O&R).

Consolidated Edison posted strong results. The company has a stable earnings base from its two regulated utilities. It also operates a small portfolio of non-regulated businesses that are involved in electric generation and competitive energy services.

Going forward, key growth drivers of the company are favorable regulatory decisions, higher electricity rates in New York, revenue insulation from demand volatility and infrastructure improvement programs. However, these positives are offset by expected lower demand for electricity, earnings dilutive issuances and regulatory risks. The company presently retains a short-term Zacks #3 Rank (Hold) that corresponds with our long-term Neutral recommendation on the stock.