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NiSource (NI) Q2 Earnings Top but Revenues Lag, Trims View

Zacks Equity Research
Updated

NiSource Inc. NI reported second-quarter 2016 operating earnings of 8 cents per share, surpassing the Zacks Consensus Estimate of 7 cents by 14.3%.

The company reported GAAP earnings of 9 cents per share. In the year-ago period, it had incurred a loss of 23 cents per share on a GAAP basis.

The difference between GAAP and operating earnings was due to the impact of a penny related to one-time non-recurring items.

Revenues

In the second quarter of 2016, NiSource's gross revenues of $893 million lagged the Zacks Consensus Estimate of $928 million by 3.8%.

However, revenues were up from $891.4 million reported in the prior-year quarter.

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Quarterly Highlights

NiSource's Gas Distribution sales increased 5.4% year over year to 193 million dekatherms (MMDth). Electric Operation sales grew 2.1% to 4,061 gigawatt hours.

Total operating expenses were $523.8 million, down 2.8%, primarily due to lower operation and maintenance expenses, and other taxes.

Interest expenses were $86 million, down 12.4% from the year-ago figure of $98.2 million.

NISOURCE INC Price, Consensus and EPS Surprise

NISOURCE INC Price, Consensus and EPS Surprise | NISOURCE INC Quote

Financial Position

As of Jun 30, 2016, NiSource's cash and cash equivalents were $15.7 million, compared with $15.5 million as of Dec 31, 2015.

In the first six months of 2016, net cash from operating activities (continuing operation) was $487.1 million, compared with $1,115.5 million in the year-ago period.

NiSource's capital expenditure in the first six months of 2016 was $672.5 million, up 21.2% from $554.7 million in the year-ago period.

Guidance

NiSource narrowed its 2016 earnings guidance of $1.00 to $1.10 per share to therange of $1.05 to $1.10.The company projects long-term annual earnings and dividend growth of 4–6%.

Management expects to invest nearly $1.5 billion in 2016 to strengthen and modernize existing infrastructure in all seven states of operation.

Upcoming Peer Releases

Spark Energy, Inc. SPKE is scheduled to report second-quarter 2016 results on Aug 11 before the market opens. The Zacks Consensus Estimate stands at 29 cents.

Avista Corp. AVA is scheduled to report second-quarter 2016 results on Aug 3 before the market opens. The Zacks Consensus Estimate stands at 43 cents.

CenterPoint Energy, Inc. CNP is scheduled to report second-quarter 2016 results on Aug 5 before the market opens. The Zacks Consensus Estimate stands at 20 cents.

Zacks Rank

NiSource currently has a Zacks Rank #3 (Hold).

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