) posted operating earnings from continuing operation of 18 cents
per share in the third quarter of 2013, in line with the Zacks
Consensus Estimate. Earnings however jumped considerably from the
year-ago profit level of 4 cents, backed by continued execution
of significant midstream and other infrastructure investments.
NiSource recorded GAAP earnings of 16 cents per share compared
with 5 cents per share in the prior year.
Gross revenue during the quarter increased 14.0% year over year
to $1,083.0 million from $949.6 million. The top-line rise came
on the back of higher contributions across the company's
segments, comprising Gas Distribution, Gas Transportation and
Storage, Electric Operations and Other segments.
Highlights of the Release
Total operating expenses increased almost 10% year over year to
$666.6 million. The increase was mainly due to a 5.7% spike in
operating and maintenance expenses and an 18.7% increase in
depreciation and amortization expenses.
However, the company's operating income surged 47.9% year over
year to $183.7 million during the quarter.
As of Sep 30, 2013, NiSource had cash and cash equivalents of
$14.9 million, down from $36.3 million as of Dec 31, 2012.
Long-term debts (excluding debts due within a year and including
current portion) as of Sep 30, 2013 were $7,630.3 million versus
$7,326.3 million as of Dec 31, 2012. The company's $340 million
forward sale equity issuance, completed on Sep 10, 2012, added
approximately 24 million common shares outstanding.
Cash flow from operating activities in the first nine months of
2013 increased 12.2% to $1,067.7 million from $951.7 million in
the comparable prior-year period.
NiSource remains well on track to meet its 2013 earnings
expectation of $1.50 to $1.60 per share. The company also stated
that its operating units are executing well on an enhanced
capital investment program totaling approximately $2 billion in
2013. NiSource remains focused on earnings-accretive
infrastructure replacement and modernization programs.
At the Peer
The Zacks Ranked #2 (Buy)
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
level of $1.02. This improved performance reflects positive
returns from the investments made in the company's regulated
We appreciate NiSource's capital expenditure program of $2
billion for the year, nearly 75% of which is focused on accretive
and other revenue-generating investments. This will likely
benefit the company's top-line, thereby expanding margins.
In the first nine months of 2013, NiSource was able to register a
0.5% increase in its gas customers and a 0.3% increase in
electricity customers. The growth in the customer base was also
accompanied by an increase in sales volume in its electric
operations; the gas business was however an exception. The
development plans undertaken by NiSource will increase
reliability of services and hence attract more customers.
Merrillville, Ind. based NiSource is an energy holding company
founded in 1912. Along with its subsidiaries, the company
provides natural gas, electricity and other products and services
in the U.S. The company currently has a Zacks Rank #3 (Hold).
Other well-placed companies in the space right now are
Alliant Energy Corp.
Brookfield Infrastructure Partners L.P.
), both carrying a Zacks Rank #2 (Buy).
AMER ELEC PWR (AEP): Free Stock Analysis
BROOKFIELD INFR (BIP): Free Stock Analysis
ALLIANT ENGY CP (LNT): Free Stock Analysis
NISOURCE INC (NI): Free Stock Analysis Report
To read this article on Zacks.com click here.