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Edison International (EIX) Lags Q1 Earnings and Revenues

Edison International EIX reported first-quarter 2016 results, wherein adjusted earnings of 82 cents per share came in below of the Zacks Consensus Estimate of 89 cents by 7.9%. The quarterly number also declined 8.9% from 90 cents a year ago due to weak performance at Southern California Edison (“SCE”).

Total Revenues

Edison International's first-quarter revenues were $2,440 million, lagging the Zacks Consensus Estimate of $2,515 million by 3%. Quarterly revenues were also lower than the year-ago level of $2,512 million by 2.9%.

Operational Highlights

In the reported quarter, total operating expenses increased 0.9% to $1,992 million on account of higher purchased power and fuel expenses, as well as depreciation and amortization expenses.

Total fuel and power purchase cost was $794 million, up from $786 million in the year-ago period. Total operations and maintenance expenses decreased 1.1% to $629 million.

Operating income was down 16.7% to $448 million in the reported quarter.

Interest expenses were $140 million, lower than $143 million in the first quarter of 2015.

Segment Results

SCE’s first-quarter adjusted earnings were 88 cents per share, down 5.4% from the year-ago figure of 93 cents. Earnings in the reported quarter declined due to lower California Public Utilities Commission or CPUC-related revenues from the execution of the 2015 General Rate Case decision as well as higher income taxes and expenses.

Edison International Parent and Other’s first-quarter 2016 core loss of 6 cents per share was wider than the year-ago loss of 3 cents per share.

Financial Update

As of Mar 31, 2016, cash and cash equivalents were $137 million, down from $161 million as of Dec 31, 2015. Long-term debt was $11.24 billion, higher than the 2015-end level of $10.88 billion.

Net cash from operating activities during the quarter was $853 million, compared with $964 million a year ago. Total capital expenditure amounted to $951 million during the first quarter 2016, down from $1,268 million in the year-ago period.
 
Guidance

The company reaffirmed its core earnings in the range of $3.81 to $4.01 per share for 2016.

Management expects average annual rate base growth of 7% in the 2015–2017 time frame.

The company had earlier projected capital expenditure of $8.0–$8.3 million over 2016–2017 at SCE.

Peer Releases

CMS Energy Corporation CMS reported first-quarter 2016 adjusted earnings per share of 59 cents, missing the Zacks Consensus Estimate of 68 cents by 13.2%. Quarterly earnings also plunged 19.2% from the year-ago figure of 73 cents.

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.

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 warm winter that led to weak residential sales and low power prices.

Zacks Rank

Edison International presently carries a Zacks Rank #2 (Buy).

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CMS ENERGY (CMS): Free Stock Analysis Report
 
EDISON INTL (EIX): Free Stock Analysis Report
 
DTE ENERGY CO (DTE): Free Stock Analysis Report
 
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