Consolidated Edison Inc. (ED) announced its fourth quarter results of fiscal 2009 with earnings per share (EPS) of 67 cents, which fell short of both the Zacks Consensus EPS Estimate of 77 cents and the year-ago EPS of 72 cents. EPS was affected by the dilutive effect of a higher weighted average number of common shares outstanding of 278.2 million compared to 274.2 million shares in the prior-year quarter.
However, Consolidated Edison surpassed its year-ago quarterly GAAP EPS of 58 cents by 15 cents in the fourth quarter. The EPS variations reflect the year-over-year differences, where Con Edison of New York benefited from 36 cents per share as higher rates authorized higher recovery of costs and 1 cent from miscellaneous items. This was offset by 23 cents from higher operations and maintenance expense, 17 cents from depreciation, 5 cents from capital expenditure reserve and 2 cents from interest expense. The net effect was a 10-cent shortfall in EPS year over year while the Orange and Rockland utilities remained steady. In the Competitive Energy businesses, EPS was boosted by 18 cents from net mark-to-market effects, 2 cents from gain on sale of generation projects, and 5 cents from higher earnings from continuing operations.
Consolidated Edison in fiscal 2009 reported EPS of $3.09 beating fiscal 2008 EPS of $3.00. Although this fell 6 cents short of the Zacks Consensus EPS estimate. Earnings were boosted by lower fuel expenses and purchased power cost but was offset by higher operations and maintenance expense, and depreciation.
In the reported quarter, Consolidated Edison witnessed a 9.2% spike year over year in revenues to $3.3 billion from $3 billion in the year-ago quarter. The upside came from Electricity and Non-utility segments which rose year-over-year by 5.3% and 62% respectively. However gas and stream segments fell year-over-year 7.1% and 21.9%, respectively.
Consolidated Edison expects EPS from ongoing operations for fiscal 2010 in the range $3.10 – $3.30. The forecast reflects capital investments of $2.3 billion, substantially all of which will be spent on the company’s regulated utilities. The company also expects to issue common stock worth between $300 million and $500 million and long-term debt between $600 million and $900 million to finance its expansion plans.
New York City-based Consolidated Edison is a diversified utility holding company with subsidiaries engaged in both regulated and unregulated businesses. Consolidated Edison’s regulated businesses operate through two subsidiaries — Consolidated Edison Company of New York (Con Edison of New York) and Orange and Rockland Utilities (O&R).
Con Edison of New York is a regulated utility in New York City and Westchester County. O&R serves electric and gas customers in southeastern New York State, northern New Jersey, and northeastern Pennsylvania. Consolidated Edison’s unregulated businesses operate through three subsidiaries – Consolidated Edison Development (engaged in infrastructure development), Consolidated Edison Energy (supplies energy in the wholesale market), and Consolidated Edison Solutions (provides retail energy).
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