) reported its second-quarter 2012 results with pro forma earnings
per share of 98 cents, beating the Zacks Consensus Estimate of 80
cents per share and the year-ago figure of 94 cents.
The company reported GAAP earnings per share of 25 cents versus
$2.09 in the year-ago quarter. The variance of 73 cents between
GAAP and pro forma earnings per share was due to a non-cash charge
related to a write-down on the company's investment in the Rockies
Total revenue of Sempra Energy in the second quarter of 2012 was
$2.1 billion, down 13.7% year over year and also below the Zacks
Consensus Estimate of $215 million.
In the reported quarter, Sempra Utilities' top line decreased to
$1.83 billion from $1.92 billion in the year-ago quarter.
Energy-related businesses generated revenues of $251 million
compared with $500 million in the year-ago quarter.
San Diego Gas & Electric:
Quarterly earnings for San Diego Gas & Electric (SDG&E)
were $95 million compared with $71 million in the year-ago quarter,
primarily due to higher earnings related to the Sunrise Powerlink
transmission line project.
Southern California Gas Company (SoCalGas):
The segment generated earnings of $53 million, down $6 million year
Sempra South American Utilities:
The segment recorded earnings of $38 million, down from $314
million in the second quarter of 2011. The decline was attributable
to a write-up in value of the company's South American utility
The segment recorded earnings of $43 million compared with $35
million last year.
The segment recorded earnings of $24 million, up from $4 million in
the second quarter of 2011. The increase was primarily due to an
increase in solar and wind assets.
Sempra Natural Gas:
The segment recorded a loss of $14 million versus a profit of $47
million in second-quarter 2011. Including a charge of $179 million
related to the Rockies Express Pipeline, the segment reported a
loss of $193 million.
Parent & Other:
Segment earnings were $2 million versus a loss of $27 million in
the year-ago quarter.
As of June 30, 2012, cash and cash equivalents were $221 million
versus $392 million at the end of June 30, 2011. Long-term debt
increased to approximately $10.3 billion at the end of the reported
period from $9.6 billion at the end of the second quarter of 2011.
Sempra Energy reaffirmed its fiscal 2012 pro forma earnings
guidance range of $4 to $4.30 per share. However, including the
pipeline charge of 73 cents and a tax benefit of 19 cents per
share, the company's GAAP earnings per share were in the range of
$3.46 to $3.76 per share.
Sempra's Earnings surpassed our expectation by 18 cents. Going
forward, the company continues to make progress with its major
infrastructure projects. In June this year, the company's Sunrise
Powerlink project came online. The project is expected to help in
meeting the power demand and improve reliability of the regional
Moreover, the company's diversified basket of businesses insulates
its operations to a significant degree from regulatory rate risks.
However, the above positives are offset due to a lack of any
near-term positive triggers, along with near-term trepidation in
natural gas prices and pending regulatory cases.
The company presently retains a short-term Zacks #3 Rank (Hold)
that corresponds with our long-term Neutral recommendation on the
Sempra Energy is a southern California-based energy services
holding company involved in the sale, distribution, storage, and
transportation of electricity and natural gas. The company's
businesses are broadly divided into Sempra Utilities, Sempra
International and Sempra U.S. Gas & Power.
Some of the company's main competitors are
MDU Resources Group Inc.
MDU RESOURCES (MDU): Free Stock Analysis Report
SEMPRA ENERGY (SRE): Free Stock Analysis Report
UGI CORP (UGI): Free Stock Analysis Report
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