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Sempra Energy (SRE) Q3 Earnings In Line, Retains '17 EPS View

Sempra Energy’s SRE third-quarter 2017 adjusted earnings per share (EPS) of $1.04 came in line with the Zacks Consensus Estimate. Earnings rose 2% from the prior-year quarter figure of $1.02.

GAAP earnings were 22 cents per share in the quarter, compared with $2.46 a year ago.

Total Revenues

In the quarter under review, total revenues were $2,679 million, up 5.7% year over year on higher contributions from both the energy-related businesses (up 48.3%) and utilities (0.6%). However, total revenues missed the consensus mark of $2,776.1 million by 3.5%.

Sempra Energy Price, Consensus and EPS Surprise


Sempra Energy Price, Consensus and EPS Surprise | Sempra Energy Quote

Segment Update

San DiegoGas & Electric (SDG&E): Quarterly loss for this segment were $28 million as against with the year-ago earnings of $183 million. The downside was driven by an after-tax impairment related to cost recovery for the 2007 San Diego wildfires.

Southern California Gas Company (SoCalGas): The segment registered earnings of $7 million in the third quarter compared with break-even earnings in the year-ago quarter.

Sempra South American Utilities: The segment recorded earnings of $42 million in the third quarter, down from $46 million in the prior-year quarter.

Sempra Mexico: The segment reported earnings of $66 million, compared with earnings of $332 million recorded in the prior-year quarter. This is driven by the absence of the $350 million after-tax re-measurement gain related to the GdC acquisition in last year’s third quarter.

Sempra Renewables: The segment recorded quarterly earnings of $15 million, down from $17 million in the prior-year quarter.

Sempra LNG & Midstream: The segment recorded a loss of $4 million against the year-ago quarter’s earnings of $77 million. This was due to the absence the $78 million after-tax gain from the sale of EnergySouth in the prior-year quarter.

Financial Update

As of Sep 30, 2017, Sempra Energy’s cash and cash equivalents were $189 million, compared with $349 million as of Dec 31, 2016.

Long-term debt was $14,803 million as of Sep 30, 2017 compared with $14,429 million at 2016 end.

Cash flow from operating activities was $2,710 million at the end of third-quarter 2017, up from $1,691 million at the end of the prior-year quarter.

In the third quarter, the company’s capital expenditures, investments and acquisition of businesses worth $1,091 million compared with $2,247 million in the prior-year period.


Sempra Energy reiterated its 2017 earnings per share guidance. The company continues to expect to generate earnings in the band of $5.00-$5.30.

Zacks Rank

Sempra Energy currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Recent Peer Release

Entergy Corporation ETR reported third-quarter 2017 operational earnings of $2.35 per share beating the Zacks Consensus Estimate of $2.24 by 4.9%. However, the reported number improved 1.7% from the year-ago figure.

CMS Energy Corporation CMS reported third-quarter 2017 adjusted earnings per share of 62 cents, which surpassed the Zacks Consensus Estimate of 55 cents by 12.7%. Quarterly earnings however dropped 11.4% from the year-ago figure of 70 cents.

FirstEnergy Corporation FE reported third-quarter 2017 operating earnings of 97 cents per share, beating the Zacks Consensus Estimate of 86 cents by 12.8%. Quarterly earnings were also up 7.7% year over year.

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