Sempra Energy, owner of two California utilities, said Tuesday that its first-quarter earnings rose 14% because of soaring profit from trading natural gas and other commodities.
The San Diego company reported net income of $255 million in the quarter that ended March 31, up from $223 million in the same period last year. Sempra's prior-year profit included a one-time $59-million gain on the resolution of tax issues.
Per-share earnings of 98 cents beat the average estimate from Wall Street analysts of 85 cents a share, according to Thomson Financial. Revenue totaled $3.3 billion, versus $2.7 billion in the year-earlier quarter.
"Sempra Energy knocked the ball over the fence again," Wachovia Securities analyst Samuel Brothwell said Tuesday in a research note. Even so, Sempra's shares fell 81 cents to $45.32.
The company's commodities business drove the strong results, reporting first-quarter profit of $116 million, a fourfold increase from $29 million a year earlier. The unregulated unit trades natural gas, power, petroleum products and metals.
Sempra Chief Executive Donald Felsinger called the commodities results outstanding, and during a conference call with analysts, he added, "At these returns, we will put all available capital into this business."
First-quarter profit at Sempra's Southern California Gas Co. unit fell 29% to $49 million from $69 million a year earlier. The 2005 quarter included one-time gains on a favorable rate-making decision and a tax issue.
The gas company's revenue rose to $1.4 billion, a 16% jump from $1.2 billion.
San Diego Gas & Electric Co., the state's third-largest electricity utility, reported profit of $47 million for the first quarter, a 20% decline that Sempra attributed to a one-time gain that boosted the year-earlier first quarter. Revenue rose more than 16% to $718 million.