Dominion Tops On Q3 Earnings & Revenues; Keeps View

Dominion Resources Inc. (D – Free Report) reported third-quarter 2016 operating earnings of $1.14 per share, beating the Zacks Consensus Estimate of $1.04 by 9.6%. Earnings were also above management’s guidance range of 95 cents to $1.10 per share.

Moreover, operating earnings increased 10.7% from $1.03 per share a year ago. The decline was due to the impact of milder weather, a planned refueling outage at Millstone and share dilution.

GAAP earnings were $1.10 per share compared with $1.00 per share in the year-ago quarter. The difference between GAAP and operating earnings in the reported quarter was due to transaction costs associated with the Dominion Questar combination and Dominion’s investments in nuclear decommissioning trust funds.

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Total Revenue

Dominion’s operating revenues of $3,132 million in the third quarter marginally surpassed the Zacks Consensus Estimate of $3,131 million. Moreover, revenues were up nearly 5.4% year over year.

Highlights of the Release

Total operating expenses in the quarter increased 8.2% year over year to $2,000 million. The increase in total expenses was primarily due to a 37.9% surge in other operations and maintenance expenses.

Interest and related charges in the reported quarter were $237 million, up 3.1% from the year-ago quarter.

Dominion Virginia Power recorded 1% year-over-year growth in its customer base. Warmer-than-expected temperatures led to a 6.3% year-over-year upside in electricity sales volumes to 24,065 Gwh in the third quarter.

DOMINION RES VA Price, Consensus and EPS Surprise

DOMINION RES VA Price, Consensus and EPS Surprise | DOMINION RES VA Quote

Segment Update

Dominion Virginia Power recorded net income of $139 million or 22 cents per share in the third quarter of 2016, up 11.2% year over year.

Dominion Energy recorded earnings of $135 million or 21 cents per share, down 11.8%.

Dominion Generation’s earnings were up 66.7% to $650 million or $1.04 per share.

Corporate and Others incurred a wider loss of $208 million than the year-ago loss of $57 million.

Financial Update

Dominion exited third-quarter 2016 with cash and cash equivalents of $251 million, down from $607 million as of Dec 31 2015.

Long-term debt as of Sep 30, 2016 was $24.4 billion compared with $23.5 billion at the end of 2015.

Cash from operating activities in first nine months of 2016 was $3.39 billion, down 1.9% from $3.45 billion in the year-ago period.

Looking Ahead