Stronger performance from its wholesale services, energy investments and corporate segments helped drive AGL Resources Inc.'s 4Q2008 net income to $74 million and earnings of 97 cents/share, compared with net income of $66 million and earnings of 86 cents/share in 4Q2007, the company said Thursday.
Earnings guidance for 2009 has been set at $2.65-2.75/share, CEO John W. Somerhalder II said during a conference call with analysts. The Atlanta-based company's earnings per share was $2.84 in 2008 and $2.72 in 2007.
"We take a long-term view of managing our business and, despite the near-term challenges of a receding economy, we are taking steps now to build a stronger foundation for future growth," Somerhalder said. "For 2009 we have established what we believe to be realistic expectations for the year, given the current environment, and our team is extremely focused on achieving those goals."
AGL's wholesale services segment reported 4Q2008 net income of $38 million, compared with $18 million in 4Q2007.
Lower customer usage, partially offset by customer growth and higher pipeline replacement revenues at Atlanta Gas Light and Elizabethtown Gas, resulting in a flat year for AGL's distribution operations segment, and the coming months are expected to bring much of the same, Somerhalder said.
"We do not expect to see a significant turnaround in customer growth in our service areas throughout 2009, so we will continue to focus our efforts on cost containment and on seeking regulatory relief where appropriate," Somerhalder said.
AGL is developing two salt dome storage caverns at the Golden Triangle Storage facility in Beaumont, TX, and plans for a third facility not far away to be called Triple Diamond Storage. Each of the Golden Triangle caverns will offer 6 Bcf of working capacity, expandable to 8 Bcf later. In August AGL said increases in labor and materials and commodity prices would drive the cost of the Golden Triangle project 10-20% higher than a previous estimate of $265 million (see NGI, Aug. 11, 2008). On Thursday Somerhalder said construction is on schedule and costs "continue to be within the range we've discussed previously."
AGL also said it will change the ticker symbol for its common stock on the New York Stock Exchange to AGL from ATG effective at the start of trading on Monday (Feb. 9).
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