CMS Energy Profits Fall Despite Higher Revenue
JACKSON (WWJ) -- CMS Energy (NYSE: CMS), the Jackson-based utility holding company, Thursday reported second quarter revenue of $1.41 billion, up from $1.33 billion a year earlier.
For the six months, revenue was $3.39 billion, up from $3.08 billion a year earlier.
Net income for the quarter was $80 million or 29 cents a share, down from $100 million or 37 cents a share a year earlier. Operating expenses rose 9.4 percent in the quarter from a year earlier, to $1.17 billion, overcoming the 7.8 percent revenue increase.
For the six months, net income was $224 million or 83 cents a share, up from $167 million or 62 cents a share a year earlier.
CMS earnings were below a mean analyst earnings prediction of 34 cents a share. Still, the top line beat expectations, so the company's stock rose Thursday.
CMS Energy reaffirmed its guidance for 2013 adjusted earnings of $1.63 to $1.66 per share, consistent with the company's long-term plan of 5 percent to 7 percent annual earnings per share growth.
As part of its continuing focus on providing customers with safe, reliable and affordable energy, CMS Energy also announced that it will be accelerating a series of cost reductions that should allow it to avoid both electric and gas base rate increases through 2014, while investing more than $1.5 billion in its utility operations in energy reliability, smart energy, renewable energy and customer service.
"We're focused on providing customers with safe, reliable and affordable service," said John Russell, CMS Energy's president and chief executive officer. "Our plan to accelerate several cost reduction measures should allow us to avoid electric and gas base rate increases and hold down prices. We're a leader in our industry when it comes to reducing operating costs to benefit customers."
Russell noted during the quarter Consumers Energy's first-ever uncontested settlement of an electric rate case, in addition to a 12 percent natural gas fuel price reduction compared to one year ago. The company remains committed to holding average base rate increases for its 3 million customers at or below the rate of inflation for the next five years.
In reviewing recent major events, Russell said that the company took a major step toward development of its $750 million natural gas plant in Thetford Township, Genesee County, by filing a certificate of necessity application with the Michigan Public Service Commission. The company also contracted with GE for 62 wind turbine generators for its second wind park, the Cross Winds Energy Park, with construction scheduled to begin in the fourth quarter of 2013. Consumers Energy remains the state's leader in renewable energy and is on track to meet the 10 percent renewable energy standard in Michigan's energy reform law by 2015.
