DTE Energy Company (DTE - Analyst Report) reported fourth quarter and full-year 2012 earnings. In the fourth quarter, the company posted operating earnings of 85 cents per share, in line with the Zacks Consensus Estimate. However, earnings were below the year-ago figure of 89 cents per share.
Including one-time charges of 38 cents per share, GAAP earnings per share reported by the company were 47 cents per share versus 88 cents in the year-ago quarter.
In full-year 2012, operating earnings were $3.94 per share, up from $3.75 per share in the year-ago period. The figure was also ahead of the Zacks Consensus Estimate by a penny.
Including one-time charges of 39 cents per share, GAAP earnings in 2012 were $3.55 per share versus $4.18 per share in full-year 2011.
The results were driven by normal winter weather, ongoing growth at Power & Industrial Projects and continued cost reductions in Corporate & Other. However, these increases were partially offset by market opportunities at Energy Trading in 2011 that did not recur in 2012.
Total revenue of DTE Energy in the fourth quarter of 2012 was $2.3 billion, up from the year-ago figure of $2.2 billion. However, the figure was lower than the Zacks Consensus Estimate by $79 million.
In full-year 2012, the top-line figure was $8.8 billion, down from $8.9 billion in full-year 2011. The figure was also below the Zacks Consensus Estimate by $236 million.
Operating income in the quarter under review was $267 million, down 22.8% year over year. Fuel, purchased power and gas expenses were $949 million, up 14.5% year over year.
Quarterly Segment Update
Electric Utility: Segment earnings during the reported quarter were $66 million or 38 cents per share, down from $89 million or 52 cents per share in the prior-year quarter.
Gas Utility: The segment generated operating income of $55 million or 32 cents per share compared with $41 million or 24 cents per share in the year-ago quarter.
Gas Storage and Pipelines: Segment profit was $13 million or 8 cents per share, down from $15 million or 9 cents per share.
Power and Industrial Projects: The segment posted a profit of $12 million, up from $11 million in the year-ago period.
Energy Trading: The segment posted a profit of $9 million or 5 cents per share, compared with $16 million or 9 cents per share in the prior-year quarter.
Corporate and Other: Loss in the quarter was $8 million or 5 cents per share, compared with a loss of $20 million or approximately 12 cents per share in the prior-year quarter.
The company continues to maintain its previously announced guidance of $3.85 to $4.15 per share for 2013. The company plans to continue to increase its operating earnings in the range of 5% to 6% in the long term.
Profits from DTE Energy met the Zacks Consensus Estimate; however the top line missed the expectation. Going forward, the growth momentum is expected to be maintained by beneficial regulatory policies in Michigan, higher authorized rates for its regulated business and growth opportunities in its un-regulated businesses.
Also, the company maintained its trend of increasing the dividend in 2012. Going forward, the company intends to continue to pay attractive dividends to its shareholders. Besides focusing on its financial goals, the company also plans to invest in new businesses with Michigan-based suppliers.
In 2012, the company spent $826 million with Michigan-based suppliers versus $598 million spent in 2011. As Michigan companies deliver quality products at a competitive price, we believe this arrangement will be favorable for the company.
Overall, the primary aim of the company is to reach new levels of financial, operational and reliability excellence during the upcoming year. DTE Energy currently retains a Zacks Rank #2 (Buy).
Detroit, Michigan-based DTE Energy Company is a holding company with subsidiaries engaged in regulated and unregulated energy businesses. Detroit Edison Company and Michigan Consolidated Gas Company are its largest regulated subsidiaries.
DTE Energy’s unregulated businesses include gas pipelines and storage, unconventional gas exploration, development and production; power and industrial projects, coal transportation and marketing, and energy marketing and trading operations.
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