Northeast Utilities (NU) reported fourth quarter 2009 EPS of 48 cents, up from the Zacks Consensus Estimate of 41 cents and last year’s earnings of 46 cents. For the full year 2009, the company reported earnings of $1.91 per share, above the Zacks Consensus Estimate of $1.85 and 2008 earnings of $1.86. Earnings per share in both the periods were positively impacted by the issuance of about 19 million additional NU common shares in March 2009. 

During 2009, the company’s business segments performed very well, except for weak results at its four distribution businesses. The distribution segment was affected by the weak economic conditions, despite a tight control on operating costs and continued investment in energy infrastructure. 

Segment Earnings 

Transmission segment earnings in the quarter and the year improved 28% and 19%, respectively, to $44.4 million and $164.3 million, driven by a higher level of investment in transmission facilities. Distribution and Generation segment posted earnings of $39.2 million (up 9%) in the quarter and $159.2 million (up 6%) for the year. 

Competitive Businesses segment, through holding company NU Enterprises, Inc. (NUEI), earned $4.2 million (down 2%) in the quarter and $15.8 million (down 21%) for the year, due to improved operating margins and the absence of 2008 a net charge of $3.2 million related to the adoption of accounting guidance for fair value measurements. 

Revenue & Sales 

Net revenue declined 9% year over year to $1.3 billion in the quarter and 6% year over year to $5.4 billion for the year. 

Northeast Utilities’ electric sales were down 2% in the quarter and down 3.5% for the year. On a weather-adjusted basis, electric sales were down 1.7% in the quarter and 2.1% in 2009. Yankee Gas Services Company firm natural gas sales were up 3.8% in the fourth quarter and up 6.9% for the year. On weather-adjusted basis, Yankee Gas firm sales increased 5.8% in the quarter and 5% in 2009.
 
Net expenses at NU Parent and Other Companies were $3.1 million (flat) in the quarter and $9.3 million (down from $41.4 million) in 2009. 

Outlook 

Northeast Utilities re-affirmed its full-year 2010 earnings guidance of $1.80 to $2.00 per share. The guidance reflects Distribution and Generation segment earnings of 95 cents – $1.05, Transmission segment earnings of 90 – 95 cents, Competitive Business segment earnings of 0 – 5 cents and NU Parent and other expenses of approximately 5 cents per share.
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