Consolidated Edison Inc.
) posted third quarter 2013 earnings from ongoing operations of
$1.48 per share, beating the Zacks Consensus Estimate of $1.41 by
5%. The quarterly result was also up 2.8% from the year-ago
profit of $1.43 per share. The upside came on the back of higher
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Including the effects of its lease in/lease out transactions and
the net mark-to-market effects of the competitive energy
businesses (CEBs), the company registered GAAP earnings of $1.58
per share compared with $1.50 in the year-ago quarter.
Consolidated Edison reported revenues of $3,484.0 million, up
1.3% year over year. However, the top line missed the Zacks
Consensus Estimate of $3,492.0 marginally by 0.2%. The results
reflect rise in electric, gas and steam sales.
The company's largest top-line generator, Electric revenues were
up 0.4%. Gas revenues increased 4.2% and Steam revenues were up
5.9%. Non-utility revenues increased 6.1% in the reported
The company achieved a new peak electricity delivery record of
13,322 megawatts in New York City and Westchester on Jul 19,
Con Edison's utility subsidiaries, Consolidated Edison Company of
New York, Inc. (CECONY) and Orange and Rockland Utilities, Inc.
(O&R), as of Sep 30 2013, incurred response and restoration
costs for Superstorm Sandy of $471.0 million and $92.0 million,
respectively (including capital expenditures of $143.0 million
and $15.0 million, respectively).
Despite the cost cutting initiatives, total operating expenses
were up 1.6% year over year to $2,629.0 million. Purchased power
expenses increased 1.7% year over year.
Cash and temporary cash investments were $74.0 million, down from
$394 million as of Dec 31, 2012. Long-term debt was $10,493.0
million, up from $10,062.0 million as of Dec 31, 2012.
Consolidated Edison increased its earnings from ongoing
operations forecast for 2013 to a range of $3.70 to $3.80 versus
its prior expectation of $3.65 to $3.85 per share.
) adjusted earnings of $1.42 per share for the third quarter of
2013 were well ahead of the Zacks Consensus Estimate of $1.21 by
17.4% and the year-ago quarterly earnings of $1.00 by 42.0%. The
upside was driven by robust cost management initiatives along
with favorable tax benefits.
American Electric Power Company Inc.
) reported third quarter 2013 operating earnings of $1.10 per
share, beating the Zacks Consensus Estimate of $1.08 by 1.9%. The
quarterly figure also improved 7.8% from the year-ago profit of
$1.02. This improved performance reflects positive returns from
the investments made in the company's regulated operations.
Though the top line for Consolidated Edison marginally missed the
Zacks Consensus Estimate, the bottom line succeeded in beating
the mark. The company is focused on energy efficiency initiatives
and aggressive oil-to-gas conversion program that will lower
costs while improving air quality. Also, the company continues to
invest heavily in infrastructure improvement.
However, we remain concerned about lower demand for electricity,
earnings dilutive issuances and regulatory risks. Also, the
current liquidity position poses a risk for the company.
Consolidated Edison currently has a Zacks Rank #4 (Sell). In the
near term, we would advise investors to accumulate its short-term
Zacks Rank #1 (Strong Buy) peer
UNS Energy Corp.