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SCANA (SCG) Earnings Lag Estimates in Q3, Revenues Fall Y/Y

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SCANA Corporation’s third-quarter 2018 earnings of 47 cents per share missed the Zacks Consensus Estimate of 70 cents. Reduction in electric revenues related to the order issued by the Public Service Commission of South Carolina (SCPSC) hurt the bottom line.

Nevertheless, the bottom line improved from 24 cents in the year-ago quarter. Expanding customer base and higher margin from South Carolina Electric & Gas Company (SCE&G) contributed to the growth.

Quarterly operating revenues declined to $926 million from $1,076 million in the year-ago quarter.  
 

SCANA Corporation Price, Consensus and EPS Surprise

 

SCANA Corporation Price, Consensus and EPS Surprise | SCANA Corporation Quote

 

Segment Performance

South Carolina Electric & Gas Company (SCE&G): Quarterly profits in this segment — SCANA’s principal subsidiary — amounted to $104 million, up from $42 million in the year-ago quarter. During the third quarter, results depicted reduction in electric revenues that is related to the order issued by the SCPSC. Results for 2017reflect an impairment loss connected with the VC Summer new nuclear construction project, which was recorded during the third quarter of 2017. Meanwhile, increases in interest expense and depreciation more than offset declines in operations and maintenance expenses.

As of Sep 30, 2018, SCE&G provided services to about 374,000 customers of natural gas, up 3% annually and 728,000 electric clients, up 1.5% annually.

PSNC Energy: This segment recorded a loss of $7 million in the July-to-September quarter of 2018, wider than the year-ago quarter’s loss of $2 million, thanks to higher expenses. The downtrend was partially offset by a higher customer count.

SCANA Energy Marketing: The segment reported breakeven results for the third quarter compared with $1 million in the prior-year quarter, owing to a surge in operations and maintenance expenses.

Expenses

During the third quarter, the company reported $743 million in operating expenses, lower than $954 million in the prior-year quarter.

Zacks Rank & Stocks to Consider

SCANA carries a Zacks Rank #4 (Sell).

A few better-ranked players in the same sector are Murphy Oil Corporation (MUR - Free Report) , Shell Midstream Partners, L.P and Eni SpA (E - Free Report) . Murphy Oil and Eni flaunt a Zacks Rank #1 (Strong Buy), while Shell Midstream Partners carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

El Dorado, AR-based Murphy Oil C is a global oil and gas exploration as well as production company. It pulled off an average positive earnings surprise of 96.5% in the last four quarters.

Shell Midstream Partners is involved in owning, operating, developing and acquiring pipelines and other midstream assets. The partnership delivered an average positive earnings surprise of 7.9% in the trailing four quarters.

Based in Rome, Italy, Eni is among the leading integrated energy players in the world. The partnership delivered a negative earnings surprise of 0.3% in the last four quarters.

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