Duke Energy: Earnings
Duke Energy (DUK) finished 2016 on a strong note and posted annual earnings growth of 3.3%. For the quarter ended December 31, 2016, Duke reported earnings of $0.81 per share, which was in line with analyst estimates. In 4Q15, Duke reported earnings of $0.87 per share.
Duke reported adjusted earnings of $4.69 per share for the full year 2016 against last year’s adjusted earnings of $4.54 per share. Duke Energy’s management provided a 2017 earnings guidance range of $4.50 to $4.70 per share.
As earlier discussed, favorable weather positively impacted 4Q16 earnings, partially offsetting the unfavorable impacts of higher operations and maintenance expenses during the quarter. 2016 was an important year for Duke Energy, as the utility (XLU) completed the acquisition of Piedmont Natural Gas and sold its international business in 4Q16.
Contribution from Piedmont Natural Gas boosted gas utilities’ performance during the quarter and added $0.10 per share to the overall earnings. Duke Energy’s midstream investments, primarily in the Atlantic Coast Pipeline, resulted in higher earnings compared to 4Q15.
Duke Energy management also announced a 25% increase in its current capital spending plan to $37 billion for the next five years. The spending is likely to expand its regulated rate base and may improve long-term earnings. Duke’s increasing concentration of regulated operations may improve earnings stability going forward, ultimately benefiting return on equity.
Read how Duke Energy’s dividends are placed this year in Duke Energy’s Dividends: Your Outlook for 2017.