Hydro One earns $194-million in Q3
HYDRO ONE Ltd. has released its financial and operating results for the third quarter ended Sept. 30, 2018.
Third quarter highlights:
• Favourable weather coupled with continued efficiencies in operation, maintenance and administrative (OM&A) costs led to earnings per share (EPS) of 33 cents and adjusted EPS of 38 cents, compared to 37 cents and 40 cents, respectively, in the prior year when regulatory catch-up revenues and a lower effective tax rate had previously boosted earnings.
• Following Hydro One’s motion to review and vary regarding a 2017 deferred tax asset ruling, the Ontario Energy Board (OEB) granted the motion and the matter will now return back to the OEB for further consideration.
• Transmission rate application for 2019 filed with the OEB, seeking an increase close to inflation.
“Hydro One continues to produce strong quarterly financial results coupled with continuously improving operational and customer service metrics. The positive figures highlight the underlying strength of the business and the unwavering dedication at all levels of the organization to improve the company’s core functions. The entire team is also excited with the progress the company is making with the Avista merger and is looking forward to the approaching close of the transaction,” said Paul Dobson, acting president and chief executive officer. “Finally, the management team has enjoyed spending time with the new board of directors during the quarter and the focused discussions on areas that are a priority for our customers and shareholders.
The experience has been mutually beneficial and Hydro One has seen a benefit from the unique perspectives and depth of experience the new board brings to the table.”
(See H Table 1 on page 33)
For the three months ended Sept. 30, 2018, the company reported net income attributable to common shareholders of $194-million (2017 — $219-million), an 11.4-per-cent decrease from last year, and EPS of 33 cents (2017 — 37 cents). Adjusted EPS, which exclude the impact of $33-million costs related to the Avista transaction, was 38 cents for the quarter.
Revenues, net of purchased power, for the third quarter were higher than last year by 3.1 per cent. This reflects increased transmission and distribution revenues due to higher energy consumption resulting from favourable weather, partially offset by lower transmission revenues driven by timing of Ontario Energy Board’s decision on the 2017/2018 transmission rate filing resulting in recognition of year-to-date revenues in the third quarter of 2017.
The comparability of third quarter earnings was positively impacted by lower costs related to the acquisition of Avista, savings related to a new information technology (IT) outsourcing contract and lower customer program costs, partially offset by one-time corporate support costs. Higher financing charges, primarily due to the revaluation of the deal-contingent foreign exchange forward contract and increased interest expense on long-term debt and convertible debentures issued in August, 2017, contributed to the overall decrease in net income in the third quarter of 2018.
We seek Safe Harbor.
Erika Flores condensed this news release (email@example.com).
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