Edison Pushes Past Estimate – Analyst Blog

Edison International's (EIX) adjusted EPS of $1.09 in the third quarter of fiscal 2009 pushed past the Zacks Consensus Estimate of $1.05 by 4 cents. However, adjusted EPS for the quarter fell short of the year-ago $1.46 EPS.

On a GAAP basis, the company reported quarterly EPS of $1.23, compared to $1.33 in the year-ago quarter. The discrepancy between GAAP and adjusted EPS were due to non-cash accounting benefit from the final regulatory approval to transfer its Mountainview power plant to utility rate base.

Edison's revenue fell 14.7% year-over-year to $3.7 billion from $4.3 billion. The downside was more prominent in electric utility revenue (83.7% of total revenues), which decreased 11.6% year-over-year. Competitive power generation revenues fell 27.2% to $592 million. Financial services and other revenues were only $7 million in the reported quarter from $14 million in the year-ago quarter.

Southern California Edison's (SCE) GAAP EPS in the reported quarter was $1.06, compared to $0.72 last year. Core earnings were 92 cents per share, versus 87 cents year-over-year. This increase was primarily due to higher operating income associated with the utility's 2009 General Rate Case (GRC) and lower non-operating expenses, partially offset by higher income tax expense. SCE also recorded a non-core benefit of 14 cents per share in the quarter to reflect the non-cash accounting benefit from the final regulatory approval to transfer its Mountainview power plant to utility rate base. SCE recorded a 15-cent per share non-core charge in the third quarter 2008 resulting from the California Public Utilities Commission (CPUC) performance-based ratemaking decision.

Edison Mission Group's (EMG) reported GAAP EPS of 19 cents per share, compared to 66 cents per share in the year-ago quarter. Core earnings were 19 cents per share, against 64 cents in the year-ago quarter. Core earnings declined primarily from lower income at its coal- and gas-fired projects, driven by lower energy prices and from lower trading income. Core results for the year-ago period included a 5-cent per share charge related to power contracts with Lehman Brothers and excluded 2 cents per share from discontinued operations.

Edison International parent company and other reported a loss of 2 cents per share, compared to a 5-cent loss in the third quarter of 2008.

Edison International reported cash and cash equivalents of $2.4 billion at the end of first nine months of fiscal 2009 from $3.9 billion at year-end fiscal 2008. The company reported $2.1 billion in cash from operating activities for nine months, compared to $1.6 billion at the end of the first nine months of fiscal 2008. Long term debt decreased to $10.4 billion for nine months from $11 billion at the end of fiscal 2008.

Edison International narrowed its core earnings guidance of $2.90 – $3.20 per share for fiscal 2009 to $2.95 – $3.15. Similarly, the company updated its 2009 GAAP earnings guidance from $2.18 – $2.48 to $2.23 – $2.43.