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Atmos Energy (ATO) Q2 Earnings Beat Estimates, Guidance Up
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Atmos Energy Corporation (ATO - Free Report) posted second-quarter fiscal 2019 earnings of $1.82 per share, which surpassed the Zacks Consensus Estimate of $1.68 by 8.3%. The reported earnings also improved 15.9% from the prior-year figure. The year-over-year improvement in earnings is driven by the implementation of new rates and customer growth.
Total Revenues
Total revenues of $1,094.7 million lagged the Zacks Consensus Estimate of $1,279 million by 14.4%. Moreover, the figure was 10.2% lower than the year-ago total revenues of $1,219.4 million. The year-over-year decline in revenues was due to lower contribution from its distribution segment.
Segment Revenues
Distribution: Revenues from the segment decreased 11.8% to $1,057.9 million from $1,199.3 million in the prior-year quarter. Distribution contribution margin increased to $487.5 million from $472.2 million in the year-ago quarter, driven by increase in customer growth in Mid-TexDivision.
Pipeline and Storage: Revenues from the segment increased 12.3% to $135.7 million from $120.9 million in the year-ago quarter.
Atmos Energy Corporation Price, Consensus and EPS Surprise
Total operating expenses in the reported quarter increased 1.1% from the year-ago level to $325.3 million due to higher tax, and depreciation and amortization costs.
Operating income in the reported quarter was up 9.9% year over year to $297.7 million. The increase reflects positive rate case outcomes, customer growth, strong transportation activity in the distribution segment, along with higher volumes and margins in the pipeline and storage segment.
The company incurred interest expenses of $26.9 million, down 1.5% from the year-ago period.
It invested $777.6 million in the six months ended Mar 31, 2019. Of the total spending, nearly 84% was assigned for improving system safety and reliability investments.
Financial Highlights
As of Mar 31, 2019, Atmos Energy had cash and cash equivalents of $108.4 million compared with $13.8 million on Sep 30, 2018.
Long-term debt was $3.58 billion as of Mar 31, 2019, up from $2.49 billion on Sep 30, 2018.
The company’s cash flow from operating activities over the six months ended Mar 31, 2019 was $560.9 million, down from $751.4 million recorded in the prior-year comparable period.
Guidance
Atmos Energy now expects its fiscal 2019 earnings guidance in the range of $4.25-$4.35, up from prior expectation of $4.20-$4.35. The midpoint of the revised guided range is $4.30, which is in line with the current Zacks Consensus Estimate for fiscal 2019.
Capital expenditure for fiscal 2019 is expected in the range of $1.65-$1.75 billion.
NextEra Energy, Inc. (NEE - Free Report) reported first-quarter 2019 adjusted earnings of $2.20 per share, beating the Zacks Consensus Estimate of $2.01 by 9.4%.
FirstEnergy Corp. (FE - Free Report) reported first-quarter 2019 operating earnings of 67 cents per share, which beat the Zacks Consensus Estimate of 66 cents by 1.52%.
Dominion Energy Inc. (D - Free Report) reported first-quarter 2019 operating earnings of $1.10 per share, lagging the Zacks Consensus Estimate of $1.12 by 1.8%.
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Atmos Energy (ATO) Q2 Earnings Beat Estimates, Guidance Up
Atmos Energy Corporation (ATO - Free Report) posted second-quarter fiscal 2019 earnings of $1.82 per share, which surpassed the Zacks Consensus Estimate of $1.68 by 8.3%. The reported earnings also improved 15.9% from the prior-year figure. The year-over-year improvement in earnings is driven by the implementation of new rates and customer growth.
Total Revenues
Total revenues of $1,094.7 million lagged the Zacks Consensus Estimate of $1,279 million by 14.4%. Moreover, the figure was 10.2% lower than the year-ago total revenues of $1,219.4 million. The year-over-year decline in revenues was due to lower contribution from its distribution segment.
Segment Revenues
Distribution: Revenues from the segment decreased 11.8% to $1,057.9 million from $1,199.3 million in the prior-year quarter. Distribution contribution margin increased to $487.5 million from $472.2 million in the year-ago quarter, driven by increase in customer growth in Mid-TexDivision.
Pipeline and Storage: Revenues from the segment increased 12.3% to $135.7 million from $120.9 million in the year-ago quarter.
Atmos Energy Corporation Price, Consensus and EPS Surprise
Atmos Energy Corporation Price, Consensus and EPS Surprise | Atmos Energy Corporation Quote
Quarterly Highlights
Total operating expenses in the reported quarter increased 1.1% from the year-ago level to $325.3 million due to higher tax, and depreciation and amortization costs.
Operating income in the reported quarter was up 9.9% year over year to $297.7 million. The increase reflects positive rate case outcomes, customer growth, strong transportation activity in the distribution segment, along with higher volumes and margins in the pipeline and storage segment.
The company incurred interest expenses of $26.9 million, down 1.5% from the year-ago period.
It invested $777.6 million in the six months ended Mar 31, 2019. Of the total spending, nearly 84% was assigned for improving system safety and reliability investments.
Financial Highlights
As of Mar 31, 2019, Atmos Energy had cash and cash equivalents of $108.4 million compared with $13.8 million on Sep 30, 2018.
Long-term debt was $3.58 billion as of Mar 31, 2019, up from $2.49 billion on Sep 30, 2018.
The company’s cash flow from operating activities over the six months ended Mar 31, 2019 was $560.9 million, down from $751.4 million recorded in the prior-year comparable period.
Guidance
Atmos Energy now expects its fiscal 2019 earnings guidance in the range of $4.25-$4.35, up from prior expectation of $4.20-$4.35. The midpoint of the revised guided range is $4.30, which is in line with the current Zacks Consensus Estimate for fiscal 2019.
Capital expenditure for fiscal 2019 is expected in the range of $1.65-$1.75 billion.
Zacks Rank
Atmos Energy currently has a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here.
Other Utility Releases
NextEra Energy, Inc. (NEE - Free Report) reported first-quarter 2019 adjusted earnings of $2.20 per share, beating the Zacks Consensus Estimate of $2.01 by 9.4%.
FirstEnergy Corp. (FE - Free Report) reported first-quarter 2019 operating earnings of 67 cents per share, which beat the Zacks Consensus Estimate of 66 cents by 1.52%.
Dominion Energy Inc. (D - Free Report) reported first-quarter 2019 operating earnings of $1.10 per share, lagging the Zacks Consensus Estimate of $1.12 by 1.8%.
Breakout Biotech Stocks with Triple-Digit Profit Potential
The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.
Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +98%, +119% and +164% in as little as 1 month. The stocks in this report could perform even better.
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