Pinnacle West Capital (NYSE: PNW) reported Q2 EPS of $1.48, in-line with the analyst estimate of $1.48. Revenue for the quarter came in at $974.12 million versus the consensus estimate of $956.72 million.

“Second-quarter results were in line with our expectations, and we remain well positioned to meet our financial commitments for the full year,” said Pinnacle West Chairman, President and Chief Executive Officer Don Brandt. “We will continue investing in and deploying advanced grid technologies, like battery storage and microgrids, to provide our customers with more clean energy options while maintaining reliability and managing costs.

Our recent RFP to equip existing APS solar plants with battery storage, and our APS Solar Communities program, which offers rooftop solar to limited- and moderate-income customers, both underscore our ongoing commitment to Arizona.”

The 2018 second-quarter results comparison was adversely impacted by the following major factors:

• Higher operations and maintenance expenses decreased earnings by $0.23 per share compared with the prior-year period. The increased costs were primarily due to higher planned outage and operating costs, including at the Four Corners Power Plant to install added emission controls; an increase in transmission, distribution and customer service costs at APS; and an increase in public outreach costs at the parent company level primarily associated with the Company’s position on the Steyer-funded ballot initiative.
• Other operating expenses, including higher depreciation and amortization and increased taxes other than income taxes, reduced results by $0.19 per share compared with the prior-year period, largely because of higher property values, changes in rates and increased plant in service.
• The effects of weather variations adversely impacted earnings by $0.08 per share compared to the year-ago period. Residential cooling degree-days (a measure of the effects of weather) were 10 percent less than in last year’s second quarter, which was marked by one of the hottest June’s on record, but still 4.7 percent higher than normal 10-year averages.
• Retail electricity sales contributed to a decrease of $0.03 per share compared to a year ago, due in part to the impacts of energy efficiency and distributed generation. The sales decrease was partially offset by solid customer growth of 1.6 percent.

GUIDANCE:

Pinnacle West Capital sees FY2018 EPS of $4.35-$4.55, versus the consensus of $4.47.

For earnings history and earnings-related data on Pinnacle West Capital (PNW) click here.