Edison earnings decline 27% in the fourth quarter
California utility owner Edison International said Wednesday that its fourth-quarter profit fell 27% compared with the previous year’s final quarter, when earnings were inflated by one-time gains.
Rosemead-based Edison posted net income of $211 million, or 64 cents a share, for the quarter that ended Dec. 31, down from $288 million, or 87 cents, for the same period of 2006. On average, analysts had expected earnings of 58 cents a share, according to Thomson Financial.
For the full year, the company earned $1.1 billion, down from $1.2 billion in 2006, when tax and investment gains boosted Edison’s results.
“We’re mildly pleased” with the results, said Travis Miller, an analyst at Morningstar Investment Services in Chicago, who rated Edison shares at four stars out of five and owned none.
“We see good growth both in the regulated operations with the California infrastructure needs and also in the generation operation simply because of rising energy prices,” Miller said.
Chairman and Chief Executive John Bryson summed up 2007 as “a very good year” for Edison. “It produced good results in 2007, and more importantly, I think we further established the foundation for excellent growth over the next five years,” he said.
The company expects 2008 profit of $3.61 to $4.01 a share, Bryson said. Edison’s 2007 earnings were $3.31 a share.
Bryson highlighted what he called a record year of infrastructure investment at flagship subsidiary Southern California Edison and said the utility made progress on long-term initiatives such as the company’s smart meter project.
The electric utility, which serves more than 13 million people in Central and Southern California, earned $120 million in the fourth quarter, down 24%. For the full year, the utility’s profit fell nearly 9%, to $707 million.
Bryson said the utility expected to double what it collected from ratepayers -- an amount known as its rate base -- during the next five years. The growth would include some expensive projects, such as building transmission lines, and other increased costs, provided that the California Public Utilities Commission approves the projects and the rate hikes that would accompany them.
Edison Mission Group, an unregulated subsidiary that owns and invests in power plants, had $99 million in profit for the year’s final quarter, down 12% from $113 million in the fourth quarter of 2006. The group’s full-year earnings rose 23%, to $412 million.
The company’s earnings were reported before markets opened, and Edison shares fell $1.31 on Wednesday to close at $51.05.
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elizabeth.douglass@latimes.com
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Bloomberg News was used in compiling this report.
