) announced fourth-quarter 2012 pro forma earnings of 56 cents
per share, missing the Zacks Consensus Estimate by 3 cents and
deteriorating 24.3% from the year-ago figure.
On a GAAP basis, the company reported quarterly earnings of 55
cents per share versus 64 cents per share a year ago. The penny's
difference between GAAP and pro forma earnings was due to costs
including settlement charges associated with the NSTAR merger.
The company's full-year 2012 earnings of $2.28 per share missed
the Zacks Consensus Estimate by a penny and dropped 4.2% from
last year's earnings.
Yearly GAAP earnings per share were $1.89 versus $2.22 in 2011.
The variance between GAAP and pro forma earnings was owing to
settlement charges and allied costs related to the NSTAR merger.
Fourth quarter total revenue of $1.7 billion missed the Zacks
Consensus Estimate by roughly $0.2 billion. However, quarterly
revenue increased 57.7% year over year.
Northeast Utilities' full-year 2012 total revenue was $6.3
billion, down 6.2% from the Zacks Consensus Estimate but up 40.5%
year over year.
Fourth Quarter Sales Volumes
Northeast Utilities' overall retail electric sales in the fourth
quarter increased 1.2% year over year to 13,111 Gigawatt hours
(GWh). The company's quarterly natural gas sales were 27,492
million cubic feet (MMcf), up 10.2% year over year.
This segment's quarterly earnings of $68.6 million decreased 3.7%
from $71.2 million in the prior-year quarter primarily due to a
higher effective tax rate.
Electric Distribution and Generation:
Earnings from this segment totaled $80.3 million in
fourth-quarter 2012 compared with $54.2 million in the prior-year
quarter. This earnings upside was aided by the addition of
results from NSTAR Electric distribution.
Natural Gas Distribution:
This segment consists of Yankee Gas Services Company and NSTAR
Gas Company. In the quarter under review, this segment's earnings
were $22.5 million, up 104.5% year over year attributable to the
addition of NSTAR Gas and cold weather conditions.
NU parent and other businesses:
This segment's quarterly earnings were $5.4 million versus a loss
of $4 million in the year-ago quarter. The increase in earnings
was primarily driven by a decline in interest expenses and
positive results related to the addition of NSTAR Communications.
Electric Utility Subsidiaries
Connecticut Light and Power Company
's quarterly earnings were $72.5 million, down 12.8% year over
year due to a higher effective tax rate, and increase in pension
and maintenance costs. But these negatives were partially offset
by a higher transmission rate base.
reported fourth quarter earnings of $33.7 million. In the second,
third and fourth quarters, the company's total earnings were
In this quarter,
Public Service Company of New Hampshire
earned $27.2 million compared with $25.5 million in the year-ago
quarter. The growth in quarterly earnings was driven by changes
in distribution rates.
Western Massachusetts Electric Company
's quarterly earnings were $15.1 million, up 8.5% year over year.
On the cost side, in fourth quarter Northeast Utilities' total
operating expenses increased 53.1% year over year to $1.35
billion due to higher fuel and power costs, operations and
maintenance expenses, and depreciation costs.
The company's operating income in the reported quarter totaled
$331.4 million, up 79.2% year over year.
Its quarterly interest expenses increased 40% year over year to
$83.6 million, indicating an increase in long-term debt.
As of Dec 31, 2012, Northeast Utilities had cash balance of $45.7
million compared with $6.6 million as of Dec 31, 2011.
Long-term debt as of Dec 31, 2012 was $7.2 billion versus $4.6
billion as of Dec 31, 2011.
Cash provided by operating activities for full-year 2012 was
$1.16 billion, more than $0.97 billion in 2011.
Capital expenditure for the year increased to $1.47 billion from
$1.07 billion in the prior year.
Full-Year 2013 Guidance
Northeast Utilities affirmed its full-year 2013 earnings guidance
in the range of $2.40 to $2.60 per share.
Other Utility Company Releases
) posted fourth-quarter 2012 earnings per share of 64 cents,
falling short of the Zacks Consensus Estimate by a penny.
Quarterly earnings were also lower than the year-ago figure of 82
cents by 21.9%.
) reported fourth-quarter 2012 earnings of $1.72 per share,
beating the Zacks Consensus Estimate of $1.41. Earnings were also
more than 94 cents per share earned in the year-ago quarter.
) announced fourth-quarter 2012 pro forma earnings of 49 cents
per share, beating the Zacks Consensus Estimate by 3 cents.
However, quarterly earnings were 31% lower than the year-ago
We are cautious about the impacts of natural calamities, over
dependence on transmission and distribution businesses, stringent
regulations, and risks related to delay and cancellation of
several important projects, which may challenge Northeast
Utilities' forthcoming performance.
However, we consider the NSTAR merger as a positive move for
Northeast Utilities' future performance along with increasing
scale of operations and widening of customer base. The company
has already experienced the positive effects in both third and
fourth quarter results.
Hartford, CT and Boston, MA-based Northeast Utilities provides
energy delivery services to residential, commercial and
industrial customers in Connecticut, New Hampshire and
Massachusetts. The company currently has a Zacks Rank #4
ENTERGY CORP (ETR): Free Stock Analysis
EXELON CORP (EXC): Free Stock Analysis Report
NORTHEAST UTIL (NU): Free Stock Analysis
PPL CORP (PPL): Free Stock Analysis Report
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