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AES Corp (AES) Q2 Earnings Miss Estimates, Revenues Down Y/Y
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AES Corporation’s (AES - Free Report) second-quarter 2019 adjusted earnings of 26 cents per share missed the Zacks Consensus Estimate of 27 cents by 3.7%. However, earnings grew 4% from the year-ago quarter’s 25 cents per share.
Barring one-time adjustment, the company delivered GAAP earnings of 2 cents per share in the reported quarter compared with 15 cents in the prior-year period.
Highlights of the Release
AES Corp generated total revenues of $2.48 billion in the second quarter, down 2.1% year over year. The top line also lagged the Zacks Consensus Estimate of $2.50 million by 1%.
Total cost of sales was $1,981 million in the second quarter, up 2.3% year over year. General and administrative expenses were $49 million, 40% higher than the year-ago quarter’s $35 million.
Operating income stood at $502 million, down 16.3% from $600 million in the year-ago period.
Interest expenses summed $273 million, up 3.8% from $263 million in the year-earlier period.
Highlights of the Quarter
AES Corp announced the merger with Simple Energy, which is now the market-leading provider of cloud-based energy solutions in the United States, serving 74 electric and gas utilities. The combined entity will be called Uplight.
The company continued to enhance its utilities business by investing in new technologies and grid modernization. This is evident from the recently-filed $1.2-billion plan at Indianapolis Power & Light (IPL) with the Indiana Utility Regulatory Commission.
Financial Condition
AES Corp reported cash and cash equivalents of $1,169 million as of Jun 30, 2019, compared with $1,166 million as of Dec 31, 2018.
Non-recourse debt totaled $14,753 million as of Jun 30, 2019, up from $13,986 million as of Dec 31, 2018.
In the second quarter of 2019, cash from operating activities was $324 million compared with the year-ago quarter’s $399 million.
Total capital expenditures during the second quarter amounted to $566 million, which increased from $499 million incurred in the year-ago quarter.
The AES Corporation Price, Consensus and EPS Surprise
For 2019, AES Corp reaffirmed its 2019 Adjusted EPS guidance mid-point of $1.34 and narrowed the range from $1.28-$1.40 to $1.30-$1.38. It also reaffirmed its average annual growth rate target of 7-9% through 2022.
AES Corp also reaffirmed its 2019 Parent Free Cash Flow expectation of $700-$750 million.
American Electric Power Co., Inc. (AEP - Free Report) reported second-quarter 2019 adjusted earnings per share of $1.00, surpassing the Zacks Consensus Estimate of 98 cents by 2%.
NextEra Energy (NEE - Free Report) reported second-quarter 2019 adjusted earnings of $2.35 per share, beating the Zacks Consensus Estimate of $2.28 by 3.1%. Moreover, earnings were up 12.9% on a year-over-year basis.
CMS Energy Corporation (CMS - Free Report) reported second-quarter 2019 adjusted earnings per share of 33 cents, down 32.7% year over year. The bottom line also missed the Zacks Consensus Estimate of 44 cents by 25%.
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AES Corp (AES) Q2 Earnings Miss Estimates, Revenues Down Y/Y
AES Corporation’s (AES - Free Report) second-quarter 2019 adjusted earnings of 26 cents per share missed the Zacks Consensus Estimate of 27 cents by 3.7%. However, earnings grew 4% from the year-ago quarter’s 25 cents per share.
Barring one-time adjustment, the company delivered GAAP earnings of 2 cents per share in the reported quarter compared with 15 cents in the prior-year period.
Highlights of the Release
AES Corp generated total revenues of $2.48 billion in the second quarter, down 2.1% year over year. The top line also lagged the Zacks Consensus Estimate of $2.50 million by 1%.
Total cost of sales was $1,981 million in the second quarter, up 2.3% year over year. General and administrative expenses were $49 million, 40% higher than the year-ago quarter’s $35 million.
Operating income stood at $502 million, down 16.3% from $600 million in the year-ago period.
Interest expenses summed $273 million, up 3.8% from $263 million in the year-earlier period.
Highlights of the Quarter
AES Corp announced the merger with Simple Energy, which is now the market-leading provider of cloud-based energy solutions in the United States, serving 74 electric and gas utilities. The combined entity will be called Uplight.
The company continued to enhance its utilities business by investing in new technologies and grid modernization. This is evident from the recently-filed $1.2-billion plan at Indianapolis Power & Light (IPL) with the Indiana Utility Regulatory Commission.
Financial Condition
AES Corp reported cash and cash equivalents of $1,169 million as of Jun 30, 2019, compared with $1,166 million as of Dec 31, 2018.
Non-recourse debt totaled $14,753 million as of Jun 30, 2019, up from $13,986 million as of Dec 31, 2018.
In the second quarter of 2019, cash from operating activities was $324 million compared with the year-ago quarter’s $399 million.
Total capital expenditures during the second quarter amounted to $566 million, which increased from $499 million incurred in the year-ago quarter.
The AES Corporation Price, Consensus and EPS Surprise
The AES Corporation price-consensus-eps-surprise-chart | The AES Corporation Quote
Guidance
For 2019, AES Corp reaffirmed its 2019 Adjusted EPS guidance mid-point of $1.34 and narrowed the range from $1.28-$1.40 to $1.30-$1.38. It also reaffirmed its average annual growth rate target of 7-9% through 2022.
AES Corp also reaffirmed its 2019 Parent Free Cash Flow expectation of $700-$750 million.
Zacks Rank
AES Corp currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Recent Utility Releases
American Electric Power Co., Inc. (AEP - Free Report) reported second-quarter 2019 adjusted earnings per share of $1.00, surpassing the Zacks Consensus Estimate of 98 cents by 2%.
NextEra Energy (NEE - Free Report) reported second-quarter 2019 adjusted earnings of $2.35 per share, beating the Zacks Consensus Estimate of $2.28 by 3.1%. Moreover, earnings were up 12.9% on a year-over-year basis.
CMS Energy Corporation (CMS - Free Report) reported second-quarter 2019 adjusted earnings per share of 33 cents, down 32.7% year over year. The bottom line also missed the Zacks Consensus Estimate of 44 cents by 25%.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce "the world's first trillionaires," but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>