Thursday, February 21, 2019

OGE Beats Expectations with Q3 Earnings

By Tom Kleckner

OGE Energy beat expectations last week, reporting third-quarter earnings of $205 million ($1.02/share), up from a year ago, when it earned $183 million ($0.92/share).

A Zacks Investment Research survey of analysts had projected earnings of 96 cents/share.

“Good companies grow, and that is clearly what we are doing,” CEO Sean Trauschke said during a Nov. 8 conference call with analysts.

OGE’s regulated utility, Oklahoma Gas & Electric, contributed 92 cents/share during the quarter, thanks to new rates in Oklahoma, favorable weather and increased customer demand.

OG&E crews at work | OGE Energy

The Oklahoma City company also received earnings of 14 cents/share from Enable Midstream Partners, a gas-gathering and processing joint venture with Texas utility CenterPoint Energy.

Enable said Nov. 7 that it processed record amounts of natural gas during the third quarter. OGE holds a 25.7% limited-partnership interest and a 50% management interest in Enable, while CenterPoint owns a 54.1% share.

OGE increased and narrowed its year-end guidance to $1.59 to $1.61/share, up from $1.43 to 1.53/share.

OGE shares finished the week at $38.08/share, up almost 16% since the beginning of the year.

CenterPoint Earnings Drop 4 Cents

CenterPoint reported third-quarter earnings on Nov. 7 of $153 million ($0.35/share), a drop from a year earlier, when it earned $169 million ($0.39/share).

Revenues totaled $2.2 billion, up from $2.1 billion a year ago, thanks to increased rates and a growing customer base.

CenterPoint Energy

CenterPoint Energy EV | CenterPoint Energy

CEO Scott Prochazka told analysts during a conference call that the Houston-based company in October completed the equity and fixed rate debt components of the financing for its $6 billion acquisition of Indiana utility Vectren. Prochazka said the acquisition is still expected to close in the first quarter of 2019 and has targets in place “that are in line” with an $50 million to $100 million in pretax earnings by 2020.

CenterPoint’s share price lost 51 cents following the earnings announcement, finishing the week at $28.16.