Fortis (FTS) Misses Q2 EPS by 4c

Fortis (NYSE: FTS) reported Q2 EPS of $0.54, $0.04 worse than the analyst estimate of $0.58.

• Second quarter 2019 net earnings of $1.66 per common share. The results were impacted by weather.
• After-tax gain on sale of Waneta Expansion Hydroelectric Project ("Waneta Expansion") of $484 million
• Adjusted net earnings2 of $0.54 per common share
• 2019 capital expenditure plan increased by $0.6 billion to $4.3 billion
• Utilized $142 million at-the-market common equity program to fund incremental 2019 capital plan

"Fortis continues to deliver on its organic growth strategy with additional investment in renewable energy and electric transmission. The $0.6 billion increase in our 2019 capital plan is driven by Tucson Electric Power's investment in the Oso Grande Wind Project, which is the Corporation's largest wind generation investment to date, and by ITC's purchased and expected purchase of additional transmission assets in Michigan and Iowa," said Barry Perry, President and Chief Executive Officer, Fortis. "We are also pleased that FortisBC recently entered into its first term supply agreement to produce liquefied natural gas ("LNG") for export to China. This agreement is an unprecedented development in Canada's LNG export industry and was made possible by the completion of the Tilbury LNG expansion project in British Columbia."

Outlook

Over the long term, Fortis is well positioned to enhance shareholder value through the execution of its capital expenditure plan, the balance and strength of its diversified portfolio of utility businesses, and growth opportunities within and proximate to its service territories.

The Corporation's $17.3 billion five-year capital plan is expected to increase rate base from $26.1 billion in 2018 to $35.5 billion in 2023, translating into a five-year compound average growth rate of 6.3%. The five-year capital plan addresses system capacity and improves safety and reliability for the benefit of customers through investments that enhance resiliency and improve the performance of the electricity grid. The plan also addresses natural gas system capacity and gas line network integrity, increases cybersecurity protection and will enable the grid to deliver cleaner energy.

Fortis expects long-term sustainable growth in rate base to support continuing growth in earnings and dividends. Fortis is targeting average annual dividend growth of approximately 6% through 2023. This dividend guidance takes into account many factors, including the expectation of reasonable outcomes for regulatory proceedings at the Corporation's utilities, the successful execution of the five-year capital plan, and management's continued confidence in the strength of the Corporation's diversified portfolio of utilities and record of operational excellence.

For earnings history and earnings-related data on Fortis (FTS) click here.

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