Pinnacle West Capital Corp Earnings: Beats Estimates

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S&P 500 (NYSE:SPY) component Pinnacle West Capital Corporation (NYSE:PNW) reported net income above Wall Street’s expectations for the fourth quarter. Pinnacle West Capital, through its subsidiaries, provides retail and wholesale electric services.

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Pinnacle West Capital Earnings Cheat Sheet for the Fourth Quarter

Results: Net income for Pinnacle West Capital Corporation rose to $12.1 million (11 cents per share) vs. $5.2 million (7 cents per share) in the same quarter a year earlier. This is a more than twofold rise from the year-earlier quarter.

Revenue: Fell 2.3% to $667.9 million from the year-earlier quarter.

Actual vs. Wall St. Expectations: Pinnacle West Capital Corporation beat the mean analyst estimate of 5 cents per share. Analysts were expecting revenue of $667.2 million.

Quoting Management: “Disciplined cost management, concentration on our core electricity business and superior operational performance by our dedicated employees – particularly in the areas of customer service, reliability and safety – produced sound financial results,” said Pinnacle West Chairman, President and Chief Executive Officer Don Brandt. Brandt added that the Company’s 2011 results exceeded its earnings guidance. The Company had projected that on-going earnings would be near the top of its guidance range of $2.75 to $2.90 per share. The actual results were due, in part, to lower than expected operating and maintenance costs, and cooler than normal weather that increased retail sales in the fourth quarter by a similar amount as the year-ago period.

Key Stats:

Revenue has fallen for the past three quarters. In the third quarter, revenue declined 1.3% to $1.12 billion while the figure fell 2.5% in the second quarter from the year earlier.

The company has beaten estiamtes for two quarters in a row. In the third quarter, it topped expectations with net income of $2.24 versus a mean estimate of net income of $2.10 per share.

Looking Forward: Analysts seem more positive about the company’s results for the next quarter than sixty days ago. The average estimate for the first quarter of the next fiscal year has moved from a loss of 10 cents a share to a loss of 5 cents over the last sixty days. The average estimate for the fiscal year has seen a bump from $2.87 per share sixty days ago to $2.90.

(Company fundamentals provided by Xignite Financials. Earnings estimates provided by Zacks)

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To contact the reporter on this story: Derek Hoffman at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com

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