Southern Company Suffers Q2 Earnings Loss
Thursday, August 9th, 2018
Southern Company reported a second quarter 2018 loss of $154 million, or 15 cents per share, compared with a loss of $1.38 billion, or $1.38 per share, in the second quarter of 2017. For the six months ended June 30, 2018, Southern Company reported earnings of $784 million, or 77 cents per share, compared with a loss of $723 million, or 73 cents per share, for the same period in 2017.
Excluding the items described in the "Net Income – Excluding Items" table below, Southern Company earned $815 million, or 80 cents per share, during the second quarter of 2018, compared with $728 million, or 73 cents per share, during the second quarter of 2017. For the six months ended June 30, 2018, excluding these items, Southern Company earned $1.71 billion, or $1.69 per share, compared with earnings of $1.38 billion, or $1.39 per share, for the same period in 2017.
|
Non-GAAP Financial Measures |
Three Months Ended June |
Year-to-Date June |
|||
|
Net Income - Excluding Items (in millions) |
2018 |
2017 |
2018 |
2017 |
|
|
Net Income (Loss) - As Reported |
$(154) |
$(1,381) |
$784 |
$(723) |
|
|
Estimated Loss on Plants Under Construction |
1,060 |
3,012 |
1,105 |
3,120 |
|
|
Tax Impact |
(270) |
(896) |
(281) |
(937) |
|
|
Loss on Plant Scherer Unit 3 |
- |
- |
- |
33 |
|
|
Tax Impact |
- |
- |
- |
(13) |
|
|
Acquisition, Disposition, and Integration Impacts |
172 |
9 |
233 |
13 |
|
|
Tax Impact |
4 |
(4) |
(1) |
(5) |
|
|
Wholesale Gas Services |
32 |
28 |
(108) |
(86) |
|
|
Tax Impact |
(11) |
(11) |
25 |
35 |
|
|
Litigation Settlement |
(24) |
- |
(24) |
- |
|
|
Tax Impact |
6 |
- |
6 |
- |
|
|
Earnings Guidance Comparability Items: |
|||||
|
Equity Return Related to Kemper IGCC Schedule Extension |
- |
(24) |
- |
(47) |
|
|
Tax Impact |
- |
(5) |
- |
(9) |
|
|
Adoption of Tax Reform |
- |
- |
(31) |
- |
|
|
Net Income – Excluding Items |
$815 |
$728 |
$1,708 |
$1,381 |
|
|
Average Shares Outstanding – (in millions) |
1,014 |
998 |
1,012 |
996 |
|
|
Basic Earnings Per Share – Excluding Items |
$0.80 |
$0.73 |
$1.69 |
$1.39 |
|
|
NOTE: For more information regarding these non-GAAP adjustments, see the footnotes accompanying the Financial Highlights page of the earnings package. |
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Earnings drivers year-over-year for the second quarter of 2018 were positively influenced by effects of constructive regulatory outcomes and weather at our state regulated electric utilities, and increased contributions from Southern Power's renewables fleet. These impacts were partially offset by increases in depreciation and amortization, as well as operations and maintenance costs. Earnings for the second quarter 2018 were also significantly affected by an approximately $1.1 billion charge ($0.8 billion after-tax) related to Georgia Power's construction of Plant Vogtle Units 3 and 4.
"Southern Company's premier, state-regulated electric and gas franchise operations, along with our competitive generation subsidiary, Southern Power, continued to perform well during the second quarter," said Chairman, President and CEO Thomas A. Fanning. "This consistency in our core operations remains the cornerstone for delivering on our long-term financial objectives as we continue to build America's energy future."
Second quarter 2018 operating revenues were $5.63 billion, compared with $5.43 billion for the second quarter of 2017, an increase of 3.6 percent. For the six months ended June 30, 2018, operating revenues were $12.00 billion, compared with $11.20 billion for the corresponding period in 2017, an increase of 7.1 percent.
