Despite issues related to the coronavirus pandemic, Xcel Energy’s third quarter profits rose 13% and beat Wall Street forecasts, buoyed by electricity rate increases in several states.
COVID-19 has significantly reduced commercial and industrial electricity demand nationwide, while increasing residential use as office workers work from home. It’s a pattern that could be seen again in Minneapolis-based Xcel’s third quarter earnings report.
Commercial and industrial electricity sales were down 3.8% in the third quarter compared to a year ago, the utility said on Thursday. But weather-adjusted residential sales rose 3.7%.
Xcel posted quarterly earnings of $603 million, or $1.14 per share, up from $527 million, or $1.01 a share, in the same period a year ago. Stock analysts on average were expecting profits off $1.09 per share.
“Xcel Energy achieved strong third quarter results, despite the ongoing pandemic and has launched important new initiatives to support our customers, employees and communities through these challenging times,” Xcel CEO Ben Fowke said in a statement.
Xcel is Minnesota’s largest electric utility and second-largest natural gas provider. The company’s other primary market is Colorado, plus it also operates in Wisconsin, Texas, New Mexico, the Dakotas and a slice of Michigan’s Upper Peninsula.
The company’s third quarter sales of $3.18 billion were shy of analysts’ forecasts of $3.39 billion, but were 6% above a year ago.
Xcel’s stock Thursday morning was trading at $69.39, down 1%.
The company’s third quarter profit increase stemmed largely from favorable regulatory decisions in Colorado, Wisconsin, Texas and New Mexico.
Xcel on Thursday also narrowed its 2020 earnings guidance from a range of $2.73 to $2.83, to $2.75 to $2.81 per share. The company also said it has initiated 2021 earnings guidance of $2.90 to $3 per share, which is consistent with its long-term growth objective.