Energy services holding company
AGL Resources Inc.
) reported strong second quarter 2013 earnings, due to higher
energy use on the back of lower-than-expected temperatures, as
against the unusually warm climate of the year ago period.
AGL Resources - which became the largest domestic natural
gas-only distribution entity with about 4.5 million customers
across seven states following the Dec 2011 acquisition of
Naperville, IL-based Nicor Inc. - announced earnings per share of
38 cents (excluding merger-related expenses and wholesale
services), above the Zacks Consensus Estimate of 27 cents.
Moreover, AGL Resources' earnings per share rose by 8.6% from an
adjusted profit of 35 cents in the second quarter of the previous
Total operating revenues, at $904.0 million, were ahead of the
Zacks Consensus Estimate of $740.0 million and were also up from
the year-ago level of $686.0 million.
The segment, comprising seven utilities, reported earnings before
interest and taxes (EBIT) of $109.0 million, up from $100.0
million achieved during the second quarter of 2012. The result
was positively influenced by favorable weather conditions and
enhanced revenues from AGL Resources' regulatory infrastructure
Comprising SouthStar Energy Services, Nicor Services, Nicor
Solutions and Nicor Advanced Energy, this segment achieved an
EBIT of $12.0 million down from the year- ago profit of $14.0
million in the year-earlier period. The quarter's performance was
hurt by higher operations and maintenance expenses.
The unit, which includes Sequent Energy Management, reported a
profit of $11.0 million, as against a loss of $9.0 million
recorded in the prior-year quarter. Hedge gain of roughly $5.0
million along with better commercial activities and lower
operating expenses aided the result.
This segment broke even during the period under review as
compared to a profit of $2.0 million in the year-ago period. The
decline was on account of higher operating expenses along with
volatile natural gas prices.
This segment generated loss of $1.0 million in the reported
quarter, in line with the year-earlier period.
AGL Resources management projects its earnings for 2013 to follow
the high end of the range $2.50 - $2.70 per share that was
AGL Resources currently carries a Zacks Rank #2 (Buy), implying
that it is expected to outperform the broader U.S. equity market
over the next one to three months.
There are certain other natural gas distribution utilities
Chesapeake Utilities Corporation
MDU Resources Group Inc.
) that offer value and are worth buying now. All these companies
sport a Zacks Rank #2 (Buy).
CHESAPEAKE UTIL (CPK): Free Stock Analysis
AGL RESOURCES (GAS): Free Stock Analysis
MDU RESOURCES (MDU): Free Stock Analysis
QUESTAR (STR): Free Stock Analysis Report
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