Despite Higher Top and Bottom Lines, PG&E Cuts Guidance

PG&E Corp. reported that its revenue rose a better-than-expected 6.7% in the June quarter, as the company benefited from the timing of a case related to its utility prices.

Still, the San Francisco-based utility lowered its earnings guidance for the year, mostly due to the timing of a separate pending gas transmission rate case.

For the year, PG&E now expects earnings of $2.90 to $3.10 a share, down from its previous range of $3.50 to $3.70 a share. Analysts had called for $3.43 a share.

The company has been aiming to update its gas-pipeline system and move beyond the fatal 2010 natural-gas pipeline explosion in San Bruno, Calif., that killed eight people and leveled part of a neighborhood. In April, California's pipeline-safety regulator slapped PG&E with fines totaling $1.6 billion for the explosion.

The California Public Utilities Commission adopted new rules earlier this month that narrow the price gap between low power users and higher-use residential customers of PG&E and other utilities. PG&E will also be able to charge more customers time-of-use rates, in which prices during high-demand afternoon periods can be double what they are late at night.

Overall, PG&E reported a profit of $406 million, up from $271 million a year earlier. On a per-share basis, after the payout of preferred dividends, earnings rose to 83 cents from 57 cents a year ago.

Excluding items, earnings from operations were 91 cents a share, up from 69 cents a share a year earlier. The increase was due mostly to the timing of a decision in the 2014 general rate case, which had happened in the third quarter last year. Growth in the rate base authorized in the decision contributed to the difference.

Operating revenues increased to $4.22 billion from $3.95 billion.

Analysts polled by Thomson Reuters had forecast 72 cents a share in earnings and $3.94 billion in revenue.

Shares were inactive premarket and have fallen about 2% this year.

Write to Angela Chen at [e-mail]

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