Energy services holding company AGL Resources Inc. (NYSE:GAS) reported weak first-quarter 2016 results as a warmer-than-normal weather dampened its gas distribution business.
AGL Resources – which expects to close its merger with electric utility Southern Company (NYSE:SO) in the second half of 2016 – announced adjusted earnings per share of $1.30. The bottom line missed the Zacks Consensus Estimate of $1.64 and also deteriorated from the year-ago adjusted profit of $1.34.
Total operating revenues, at $1,334 million were also below the year-ago figure of $1,721 million.
Segmental Performance
Distribution Operations: The segment, comprising seven utilities, reported earnings before interest and taxes (EBIT) of $234 million, up from $228 million in the first quarter of 2015.
Retail Operations: Comprising SouthStar Energy Services, Nicor Services, Nicor Solutions and Nicor Advanced Energy, this segment achieved an EBIT of $80 million as against $87 million a year ago.
Wholesale Services: The unit, which includes Sequent Energy Management, earned $44 million for the quarter, compared with $56 million profit in the corresponding period of 2015.
Midstream Operations: This segment, mainly comprising natural gas storage facilities, reported a loss of $1 million, narrower than last year’s loss of $2 million.
Operating Expenses
The company’s total operating cost was $986 million, reflecting a decrease of 27% from $1,357 million in the year-ago quarter.
Zacks Rank
AGL Resources currently sports a Zacks Rank #3 (Hold).
Meanwhile, one can look at better-ranked players in the same industry like Atmos Energy Corp. (NYSE:ATO) and ONE Gas Inc. (NYSE:OGS) . Both these stocks sport a Zacks Rank #2 (Buy).
SOUTHERN CO (SO): Free Stock Analysis Report
AGL RESOURCES (GAS): Free Stock Analysis Report
ATMOS ENERGY CP (ATO): Free Stock Analysis Report
ONE GAS INC (OGS): Free Stock Analysis Report
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