Spectra Energy Corp. (SE), an operator of natural gas-related energy assets, Friday, said it expects more than 20% earnings growth for fiscal 2010, but its forecasts came in below analysts' estimates. The stock was trading down more than 2% in morning trade.
For fiscal 2010, the company expects ongoing earnings per share of $1.42. On average, 15 analysts polled by Thomson Reuters expect a profit of $1.49 per share for the full-year 2010. Analysts' forecast typically excludes one-time items.
The company further said it sees compound annual earnings per share growth rate of 8% to 10% for 2010-2012. Spectra Energy said it is maintaining annual dividend of at least $1.00 per share.
The company also said $900 million of capital expansion projects will be placed into service by year-end, delivering returns on capital employed, or ROCE, of greater than 12%. Further, the company projects 2010-2014 capital expansion program of at least $5 billion with average ROCE in 12% to 14% range.
According to Spectra Energy, its dependable earnings from solid, fee-based businesses support an attractive dividend. The company also expects growth from these businesses to continue unabated based on the numerous projects it contracted last year.
Spectra Energy is scheduled to announce its fourth-quarter results on February 4. Wall Street analysts expect the company to report a profit of $0.33 per share for the quarter on revenues of $1.2 billion.
The company had said earlier that it was on track to meet the financial goals it has set for fiscal 2009. The company continues to expect full-year ongoing earnings per share of $1.15. For fiscal 2009, analysts project a loss of $1.17 per share with revenue estimate of $4.42 billion.
For the sequential third quarter, Spectra Energy reported a sharp decline in its profit, hurt by lower revenues and other income, amid a weak commodity pricing environment. The company reported net income from controlling interests of $191 million or $0.30 per share, compared to $296 million or $0.48 per share in the prior-year quarter. Ongoing net income was $190 million or $0.30 per share, down from $302 million or $0.49 per share last year. Spectra also reported third-quarter operating revenues of $933 million, down from $1.08 billion in the prior-year quarter.
Among others in the sector, Houston, Texas-based natural gas exploration and production company El Paso Corp. (EP) expects fiscal 2010 net income in the range of $0.53- $0.73 per share, and adjusted net income in the range of $0.75 - $0.95 per share. Analysts expect the company to earn $0.90 per share for fiscal 2010.
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