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What Factors Triggered NiSource’s 2Q16 Earnings?

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Nov. 20 2020, Updated 5:23 p.m. ET

NiSource beats earnings estimates

NiSource (NI) reported its 2Q16 earnings on August 2, 2016. It reported net operating earnings of $0.08 per share in the quarter, compared to earnings of $0.18 per share in the same period last year.

NiSource’s earnings in 2Q16 were positively impacted by favorable rate increases during the quarter.

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Earnings highlights

NiSource’s earnings in 2Q16 were driven by favorable regulatory actions and utility infrastructure investments. In the quarter, NiSource’s earnings were positively impacted by a rise of nearly 3% in electric distribution revenue compared to 2Q15. This gain was partially offset by a fall of nearly 2% in gas distribution revenue compared to 2Q15.

NiSource’s persistent investments in both gas and electric distribution infrastructure are expected to grow its rate base significantly. As a result, its earnings are likely to benefit from rate cases in the next few years.

Narrowed guidance

NiSource’s management has narrowed its 2016 earnings guidance to $1.05–$1.10 per share from $1.0–$1.10 per share. The rise of the guidance midpoint is the result of management’s expectation of favorable rate case results. The midpoint of the new guidance reflects annual earnings growth of nearly 14%—more than double the industry average—compared to 2015.

Duke Energy (DUK) is expected to report its second-quarter earnings on August 4, while Exelon (EXC) will announce its earnings on August 9, 2016.

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