Energy service provider Piedmont Natural Gas Company, Inc. (PNY), Wednesday reported fiscal 2009 earnings that came in above analysts forecasts helped largely by lower operations and maintenance expenses, as well as higher margins. Looking ahead, the company also reaffirmed its earnings outlook for 2010.
Piedmont's net income for 2009 rose to $122.8 million from $110 million last year. Earnings per share rose to $1.67 from $1.49 per share in the previous year, above the $1.58 per share projected by six analysts polled by Thomson Reuters. Analysts' estimates typically exclude special items.
Operating revenues were $1.64 billion, down from $2.09 billion last year.
Gross customer additions were 12,600, a growth rate of 1.3%. The decline in gross customer additions from 20,500 in 2008 reflects the slowdown in the new construction market as a result of the economic recession.
System throughput for 2009 advanced to 217 million dekatherms, from 210 million dekatherms in the previous year primarily due to colder weather and increased deliveries to power generation customers.
Results from the company's interest in SouthStar Energy Services, contributed $24.6 million pre-tax income, up from $18.3 million in the previous year, helped primarily by increased contributions from the management of storage and transportation assets, margin impacts from lower of cost or market inventory adjustments, and higher average customer usage due to colder weather.
For the year, margin increased by $8.6 million due to the company's 2008 general rate case in North Carolina and continued customer growth in three-state service area. Operations and maintenance expenses declined $2.7 million primarily due to lower pension and medical expenses and contract labor expense.
Piedmont on December 17 declared a quarterly dividend on common stock of $0.27 cents per share, payable January 15, 2010, to holders of record on December 28, 2009.
Looking ahead, Piedmont Natural Gas reaffirmed its fiscal year 2010 earnings outlook of $1.90 to $2.00 per share, which includes an expected $0.42 gain in the first quarter of 2010 related to the company's sale of one-half of its ownership interest in SouthStar Energy Services to AGL Resources.
Currently, three analysts expect the company to report earnings of $1.72 per share for 2010.
PNY is currently up $0.49 or 1.89% and trades at $26.47.
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