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American Electric (AEP) Q1 Earnings Hit by Warm Weather

American Electric Power Co., Inc.AEP reported first-quarter 2016 operating earnings of $1.02 per share, missing the Zacks Consensus Estimate of $1.06 by 3.8%.

Earnings also dropped 20.3% from the year-ago figure owing to an unseasonably winter that led to weak residential sales and low power prices.

American Electric Power Company Inc. (AEP) EPS BNRI & Surprise Percent - Last 5 Quarters | FindTheCompany

Total Revenue

American Electric Power's first-quarter revenues of $4,044.9 million decreased 14% from $4,701.3 million in the year-ago quarter.

Quarterly Highlights of the Release

Operating expenses incurred in the reported quarter were $1,745 million compared with $1,794.5 million a year ago.

Operating income in first-quarter 2016 was $892.9 million, down 20.1% from $1,117.2 million a year ago.

Quarterly Segmental Performance

Vertically Integrated Utility Operations: Operating earnings in the quarter decreased 21.7% to $277.6 million from $299.3 million a year ago. The downside was driven by mild temperatures, lower margins from wholesale energy sales, higher operations and maintenance expenses, and an unfavorable change in a regulatory provision.

Transmission & Distribution Utilities: Operating earnings were $108 million in the quarter, up from $97.2 million a year ago, reflecting favorable rate changes.

AEP Transmission Holdco: This segment generated an operating income of $43.9 million, up from $35.8 million in the first quarter of 2015, backed by increased transmission investment.

Generation and Marketing: Operating earnings were $70.7 million, down from $183 million in the first quarter of 2015. The decrease was due to lower capacity revenue and energy margins.

Financial Update

As of Mar 31, 2016, American Electric Power had $190.4 million in cash and cash equivalents compared with $176.4 million as of Dec 31, 2015.

Long-term debt was $17.75 billion as of Mar 31, 2016, compared with $17.74 billion as of Dec 31, 2015.

Guidance

American Electric Power Company reiterated its 2016 operating earnings guidance of $3.60 to $3.80 per share.

Zacks Rank

American Electric Power currently carries a Zacks Rank #3 (Hold).

Peer Release

DTE Energy Company DTE reported first-quarter 2016 operating earnings per share of $1.52, in line with the Zacks Consensus Estimate. Reported earnings, however, dropped 7.9% from the year-ago figure of $1.65.

Upcoming Releases

Public Service Enterprise Group Inc. PEG is scheduled to report first-quarter 2016 results on Apr 29, 2016.

Duke Energy Corp. DUK is scheduled to report first-quarter 2016 results on May 3, 2016.

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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 Nasdaq, Inc.


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

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