Summary
Southern Company's (SO) third-quarter 2020 results show a slight decrease in net income attributable to common shareholders, primarily due to milder weather impacting retail electric revenues and higher depreciation expenses, partially offset by lower income taxes and the absence of prior year impairment charges. For the nine months ended September 30, 2020, net income saw a significant decrease compared to the prior year, largely driven by the substantial gain on the sale of Gulf Power recorded in the first quarter of 2019. The company's core utilities, Alabama Power, Georgia Power, and Mississippi Power, experienced mixed results, with Georgia Power recording a notable charge related to the ongoing construction of Plant Vogtle Units 3 and 4. Southern Power continues its strategy of developing renewable energy projects, completing the acquisition of the Beech Ridge II wind facility and advancing construction on other wind and battery storage projects. Southern Company Gas reported improved net income year-over-year, benefiting from base rate increases and infrastructure investments, though wholesale gas services faced headwinds from lower commercial activity and derivative losses. Southern Company managed its liquidity effectively amidst the COVID-19 pandemic, with temporary measures to support customers being implemented. The company's significant capital expenditures are largely directed towards construction programs, including the ongoing development of Plant Vogtle. While the company is navigating economic disruptions from the pandemic, its regulated nature and cost recovery mechanisms provide some stability. Investors should monitor the progress and cost management of the Plant Vogtle project, as well as the evolving impact of the COVID-19 pandemic on customer demand and operational costs.
Financial Highlights
45 data points| Revenue | $5.62B |
| Cost of Revenue | $71.00M |
| Gross Profit | $5.55B |
| Operating Expenses | $3.79B |
| Operating Income | $1.83B |
| Net Income | $1.28B |
| EPS (Basic) | $1.18 |
| EPS (Diluted) | $1.18 |
| Shares Outstanding (Basic) | 1.06B |
| Shares Outstanding (Diluted) | 1.06B |
Key Highlights
- 1Southern Company reported a consolidated net income attributable to common shareholders of $1.25 billion for Q3 2020, a slight decrease from $1.32 billion in Q3 2019.
- 2Year-to-date net income attributable to common shareholders was $2.7 billion for 2020, significantly down from $4.3 billion in 2019, largely due to the gain on the sale of Gulf Power in the prior year.
- 3Retail electric revenues for the consolidated entity decreased by 6.0% in Q3 2020 and 5.7% year-to-date, impacted by milder weather and reduced customer usage partly due to COVID-19.
- 4Georgia Power recorded a pre-tax charge of $149 million ($111 million after tax) in Q2 2020 related to the revised capital cost forecast for Plant Vogtle Units 3 and 4.
- 5Southern Power completed the acquisition of the Beech Ridge II wind facility and continued construction on other renewable energy projects, demonstrating ongoing investment in its growth strategy.
- 6Southern Company Gas reported improved net income year-over-year, with gas distribution operations benefiting from rate increases and infrastructure investments.
- 7The company maintained adequate liquidity and access to capital markets throughout the period, despite economic disruptions caused by the COVID-19 pandemic.