Electricity producer and distributor Sempra Energy (SRE) Thursday morning provided earnings forecast for fiscal 2010 and fiscal 2013. The earnings outlook for the full-year 2010 was above the current analysts' expectations. The announcement was made at the company's financial analyst conference in New York. Last month, while announcing its fourth quarter results, the company reaffirmed its earnings guidance for fiscal 2009.
The San Diego, California-based company noted that it expects fiscal 2010 earnings to be in a range of $5.00 to $5.25 per share. This represents a 15% increase over its fiscal 2009 guidance of $4.35 to $4.60, reaffirmed while announcing its fourth quarter results last month.
On average, eleven analysts polled by Thomson Reuters currently expect the company to earn $4.91 per share for fiscal 2010. Analysts' estimate typically excludes special items.
Looking far ahead to fiscal 2013, the company said it expects earnings to be in a range of $5.65 to $5.95 per share. Sempra Energy also anticipates annual capital expenditures to average about $2.4 billion from 2009 through 2013.
Additional, the company revealed that its Chairman and Chief Executive Officer Donald Felsinger and other key executives would provide an update on Sempra Energy's strategic plan, while also providing the company's detailed capital-expenditure plan as well as business segment-wise earnings guidance. This would be provided via a live webcast at 1 p.m. ETD Thursday.
The utility sector is more or less protected from general factors such as consumer sentiment amid severe economic downturn, as it is difficult for people to live without their services. They are highly regulated and have less competition as the territories are more or less insulated from peers, resulting in only one electricity provider in most towns. Also, their revenues are consistent as customers pay the bills in time for continuity of service.
According to the Energy Information Administration, consumption of electricity fell 1% in the fourth quarter and is forecast to decline 0.5% this year before rebounding in 2010.
Last month, Sempra Energy reported a year-over-year increase in profit for the fourth quarter, boosted by strong performances from its utility, generations and pipeline operations amid a slowing economy. The company's quarterly earnings also came in ahead of analysts' expectations. Net income was $319 million or $1.30 per share, up from $289 million or $1.10 per share in the prior-year quarter. Total revenues declined to $2.29 billion from $3.11 billion in the same quarter last year. At that time, Sempra Energy also reaffirmed its earnings outlook for fiscal 2009.
Sempra Energy reaffirmed its fiscal 2009 earnings outlook to be in a range of $4.35 to $4.60 per share. The Street currently expects earnings of $4.40 per share for 2009.
Sempra Energy also last month increased its dividend by 11% to $1.56 per share, on an annualized basis, from $1.40 per share. The first quarterly installment of the new dividend is payable April 15, 2009, to shareholders of record on March 19, 2009.
Among Sempra Energy's peers, San Francisco, California-based PG & E Corp. (PCG) also reaffirmed its fiscal 2009 earnings from operations in a range of $3.15 to $3.25 per share. Analysts currently estimate earnings of $3.17 per share for the full year 2009.
On Wednesday, Sempra Energy revealed that David Messer, president and chief executive officer of RBS Sempra Commodities has resigned. RBS Sempra is the company's commodities-marketing joint venture with The Royal Bank of Scotland (RBS.L). Messer worked for Sempra Energy and its predecessor companies for 11 years and 26 years in the financial sector.
Sempra Energy, a Fortune 500 energy services company, serves the largest customer base of any energy utility in the U.S. With 13,600 employees worldwide, Sempra Energy companies develop energy infrastructure, operate utilities, and provide related products and services to more than 29 million consumers worldwide. Its California utilities, San Diego Gas & Electric Co. and Southern California Gas Co., serve more than 20 million consumers.
In Thursday's regular trading session, SRE is currently trading at $42.84, down $0.09 or 0.21% on a volume of 0.86 million shares. In the past 52-week period, the stock has been trading in a range of $34.29 to $59.96.
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