Integrated energy company Entergy Corporation (ETR) provided a preliminary operating earnings expectation of $1.75 per share for the second quarter of 2011 on both an as-reported and operational basis.
Entergy is slated to release its second quarter numbers for 2011 on August 2, 2011.
The guidance of the company is 12 cents higher than the Zacks Consensus expectation of $1.63 per share. The guidance reflects a 4-cent increase from the year-ago quarterly earnings of $1.71 on an operational basis. On a reported basis, earnings in the year-ago quarter were $1.65 per share.
The expected year-over-year improvement in operating performance for the second quarter of 2011 is attributable to higher earnings at Utility and Parent & Other. This would be partially offset by lower results at Entergy Wholesale Commodities. Earnings in the second quarter of 2011 also reflect accretion from Entergy’s share repurchase programs.
Segment Details
Utility
The increase in second quarter 2011 earnings was driven by higher sales volume, higher rates and lower interest expense. Utility sales volume growth reflected a favorable quarter-over-quarter weather variance and higher industrial sales.
Entergy Wholesale Commodities
The quarter-over-quarter decrease in earnings at Entergy Wholesale Commodities was driven by lower net revenue. Lower pricing on its nuclear fleet was the primary factor in net revenue. Also contributing to the lower results was a higher effective income tax rate arising from a Michigan state tax law change.
Parent & Other
Parent & Other’s results improved for the quarter due primarily to lower income tax expense.
Fiscal 2011 Guidance
Entergy has affirmed its previously issued 2011 earnings guidance of $6.35 to $6.85 per share. The Zacks Consensus Estimates for fiscal year 2011 stands at $6.60 per share, respectively.
New Orleans, Louisiana based Entergy is an integrated energy company engaged primarily in electric power production and retail distribution operations. Entergy owns and operates power plants with approximately 30,000 megawatts of electric generating capacity, and it is the second-largest nuclear generator in the United States. Entergy delivers electricity to 2.7 million utility customers in Arkansas, Louisiana, Mississippi and Texas.
Entergy Corporation currently retains a Zacks #3 Rank (short-term Hold rating). The company competes with American Electric Power Company Inc. (AEP), CenterPoint Energy Inc. (CNP) and Southern Company (SO).
