NV Energy Beats on Earnings, Misses Sales - Analyst Blog

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Diversified utility NV Energy Inc .'s ( NVE ) third quarter 2013 operating earnings per share were 90 cents, a cent higher than the Zacks Consensus Estimate. However, earnings were 4 cents or 4.2% lower than the comparable year-ago figure of 94 cents.

GAAP earnings in the quarter were 79 cents compared with 94 cents in the comparable year-ago period. The difference between operating and GAAP earnings was due to regulatory disallowance and reserves related to the Sep 2013 decision by the Public Utilities Commission of Nevada of 9 cents and merger related cost of 2 cents.

Revenues


Operating revenues were $1,009 million, falling short of the Zacks Consensus Estimate of $1,013 million by 0.4%.

Operational Highlights

Total operating expenses increased 5.9% year over year to $651 million primarily owing to an increase in the cost of fuel used for power generation.

The decline in revenue and increase in expenses impacted the operating margins of the company. Operating margin in the reported quarter contracted 437 basis points year over year.

Financial Update

As of Sep 30, 2013, NV Energy had a cash balance of $0.4 billion compared with $0.3 billion as of Dec 31, 2012.

Long-term debt as of Sep 30, 2013 was $4.79 billion versus $4.7 billion as of Dec 31, 2012.

The company continues to generate cash. Free cash flow in the first nine months of 2013 was $285.9 million, up 11.5% from the year-ago period.

Guidance

NV Energy revised its full-year 2013 earnings downwards to the range of $1.18 to $1.22 per share from $1.25 to $1.35. The cut in the earnings guidance was primarily due to the regulatory disallowance and reserves recorded in the reported quarter.

Other Company Releases

American Electric Power Co. Inc. ( AEP ) reported third quarter earnings of $1.10 per share, beating the Zacks Consensus Estimate of $1.08 by 5.19%.

DTE Energy Company ( DTE ) reported third quarter 2013 earnings per share of $1.13, lagging the Zacks Consensus Estimate of $1.24 by 8.9%.

Our View

NV Energy continues with its positive earnings streak, registering positive earnings surprises in six out of the last seven quarters.

During the second quarter the company entered into a definite agreement to merge with MidAmerican Energy Holdings Company, a subsidiary of Berkshire Hathaway Inc. ( BRK.A ). The company has succeeded in securing its shareholders' approval for the merger. This is an important step for the completion of the transaction.

The company currently has a Zacks Rank #3 (Hold).



AMER ELEC PWR (AEP): Free Stock Analysis Report

BERKSHIRE HTH-A (BRK.A): Free Stock Analysis Report

DTE ENERGY CO (DTE): Free Stock Analysis Report

NV ENERGY INC (NVE): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of The NASDAQ OMX Group, Inc.



This article appears in: Investing , Business , Earnings , Stocks

Referenced Stocks: AEP , DTE , NVE

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