(RTTNews) - Natural gas and electricity provider Dominion Resources Inc. (D: News ) on Friday reported a 17% increase in profit for the third quarter from last year, helped by higher contributions from the company's regulated electric utility and gas transmission businesses as well as its unregulated retail energy marketing operations. Excluding items, operating earnings for the quarter topped analysts' consensus estimate.

Looking ahead, the company provided operating earnings outlook for the fourth quarter below analysts' consensus estimate, but reaffirmed its outlook for fiscal year 2009 operating earnings, citing year-to-date results and the company's limited sensitivity to commodity price changes. The company also reiterated its operating earnings outlook for fiscal year 2010.

Dominion serves retail energy customers in 12 states with a portfolio of more than 27,500 megawatts of generation, 1.1 trillion cubic feet equivalent of proved natural gas and oil reserves, 14,000 miles of natural gas transmission, gathering and storage pipeline, and 6,000 miles of electric transmission lines. The company also operates the nation's largest natural gas storage systems with 975 billion cubic feet of storage capacity.

Third-Quarter Results

The Richmond, Virginia-based company's reported earnings for the third quarter increased to $594 million, or $1.00 per share, from $508 million, or $0.87 per share, in the year-ago period.
Excluding items, operating earnings for the latest quarter rose to $592 million, or $0.99 per share, from $545 million or $0.94 per share, in the prior-year quarter. While announcing its financial results for the second quarter in July, Dominion had forecast operating earnings in a range of $0.88-$0.93 per share. On average, ten analysts polled by Thomson Reuters expected the company to report earnings of $0.90 per share for the quarter. Analysts' estimates typically exclude special items.

The factors that contributed to the higher operating earnings for the quarter as compared to the prior year include contributions from the regulated electric utility and gas transmission businesses as well as unregulated retail energy marketing operations, and a lower effective income tax rate. These were partially offset by unfavorable weather in the regulated electric service territory, lower merchant generation margins and lower contributions from producer services.

The company noted that drivers which compared favorably to its operating earnings guidance for the third quarter include higher contributions from gas transmission operations, higher contributions from unregulated retail energy marketing operations, lower financing costs and a lower effective income tax rate. These were partially offset by unfavorable weather in the regulated electric service territory.

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