Sempra Energy’s SRE third-quarter 2015 adjusted earnings per share came in at $1.00, ahead of the Zacks Consensus Estimate of 83 cents by 20.5%. Earnings, however, declined 28.6% from $1.39 per share in the prior-year quarter, primarily due to seasonally lower earnings at the company’s subsidiary, Southern California Gas Co. (SoCalGas).

Considering the expenses related to the liquefied natural gas (“LNG”) development, GAAP earnings were 99 cents per share in the quarter compared with $1.39 a year ago.
 

Total Revenues

In the quarter under review, total revenues were $2,481 million, down 11.9% year over year due to lower revenues at energy-related businesses (down 23.9% year over year) and utilities (down 10.2%).

Segment Update

San Diego Gas & Electric (SDG&E): Quarterly earnings were $170 million compared with $157 million in the year-ago quarter. This is mainly due to higher CPUC base margin and earnings from electric transmission operations.

Southern California Gas Company (SoCalGas): The segment incurred a loss of $8 million, as against earnings of $98 million in third-quarter 2014. The downward movement mainly reflects seasonality of revenues that had a $113 million negative impact for the quarter.

Sempra South American Utilities: The segment recorded earnings of $43 million in the third quarter, up from $32 million in the prior-year period. This reflects higher operating earnings along with lower income tax expenses.

Sempra Mexico: The segment recorded earnings of $63 million, on par with the year-ago level.

Sempra Renewables: The segment recorded quarterly earnings of $15 million, down from $17 million a year ago.

Sempra Natural Gas: The segment earned $1 million in the third quarter compared with $26 million in the prior-year period owing to the Louisiana state income-tax benefit in 2014.

Financial Update

As of Sep 30, 2015, Sempra Energy’s cash and cash equivalents were $697 million, compared with $570 million as of Dec 31, 2014.

Long-term debt was $12,527 million as of Sep 30, 2015 compared with $12,167 million at 2014 end.

In the quarter, cash flow from operating activities was $2,089 million in the first nine months of 2015, up from $1,661 million in the year-ago period.

In the third quarter, the company’s capital expenditures and investments were $783 million compared with $839 million in the prior-year period.

Guidance

Sempra Energy lifted its 2015 adjusted earnings guidance to $4.95−$5.15 per share from its earlier projection of $4.60−$5.00 per share.

Peer Releases

Jackson, MI-based CMS Energy Corp. CMS reported third-quarter 2015 adjusted earnings per share of 53 cents, surpassing the Zacks Consensus Estimate of 49 cents by 8.2%. Quarterly earnings surged 55.9% from the year-ago figure.

PG&E Corp.’s PCG adjusted operating earnings per share of 84 cents in the third quarter of 2015 missed the Zacks Consensus Estimate of 92 cents by 8.7%. The reported figure also declined 51.4% from a year ago.

Edison International EIX reported third-quarter 2015 results, wherein adjusted earnings of $1.16 per share came in ahead of the Zacks Consensus Estimate of $1.10 by 5.5%.

Zacks Rank

Sempra Energy currently has a Zacks Rank #3 (Hold).

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