Summary
CenterPoint Energy, Inc. (CNP) reported its first quarter 2019 financial results, marked by the significant completion of the Vectren merger in February 2019. For the three months ended March 31, 2019, the company reported income available to common shareholders of $140 million, or $0.28 per diluted share, a decrease from $165 million, or $0.38 per diluted share, in the prior year's quarter. This decline was primarily attributed to increased losses on indexed debt securities related to ZENS, higher interest expenses due to increased debt financing for the Vectren acquisition, and increased preferred stock dividend requirements. The integration of Vectren has broadened CenterPoint Energy's operational footprint and diversified its service offerings, though it has also led to increased operating and integration costs, including merger-related severance and incentive compensation expenses. Despite these integration costs, the company's core utility operations, particularly in natural gas distribution, showed resilience with improved operating income in several segments due to rate increases and customer growth, partially offset by higher operating expenses and the impact of regulatory adjustments related to tax reform.
Financial Highlights
46 data points| Revenue | $2.23B |
| Cost of Revenue | $47.00M |
| Gross Profit | $2.18B |
| Operating Expenses | $2.02B |
| Operating Income | $211.00M |
| Net Income | $169.00M |
| EPS (Basic) | $0.28 |
| EPS (Diluted) | $0.28 |
| Shares Outstanding (Basic) | 501.52M |
| Shares Outstanding (Diluted) | 503.94M |
Key Highlights
- 1Net income available to common shareholders decreased to $140 million ($0.28/share) in Q1 2019 from $165 million ($0.38/share) in Q1 2018.
- 2The company completed the acquisition of Vectren Corporation for approximately $6 billion in cash on February 1, 2019, significantly expanding its operational base and creating two new reportable segments.
- 3Operating income for the Houston Electric T&D segment decreased by $31 million year-over-year, primarily due to lower usage from a return to normal weather and higher Merger-related severance costs.
- 4CenterPoint Energy's Natural Gas Distribution segment saw an $11 million increase in operating income, driven by rate increases, favorable weather and usage, and customer growth.
- 5Energy Services segment reported a significant turnaround, moving from an operating loss of $26 million in Q1 2018 to an operating income of $33 million in Q1 2019, largely due to favorable mark-to-market accounting for derivatives.
- 6CenterPoint Energy's consolidated effective tax rate decreased to 12% from 22% in the prior year, primarily due to remeasurement of state tax liabilities post-Merger and increased amortization of regulatory deferred income taxes.
- 7Capital expenditures for the first quarter of 2019 were $667 million, with significant planned expenditures for the remaining nine months of the year across various segments to support infrastructure investments.