Nicor Inc’s gas distribution and other energy-related businesses saw higher operating income in the first quarter, helping the Naperville, IL-based company to net income of $60.5 million ($1.33/share) in 1Q2010, an increase of 38% compared with $43.8 million (96 cents) in 1Q2009.
“Our consolidated results for the first quarter were solid, especially considering the difficult economic conditions that we are operating in,” CEO Russ Strobel said during a conference call with analysts Monday. “Our gas distribution business and other energy ventures are performing in line with our expectations.”
Nicor reiterated its previously announced 2010 earnings guidance of $3.10-3.30.
“Our continued focus on managing costs and enhancing our already industry-leading operating efficiency metrics will enable us to remain on track to meet our full year outlook for [the gas] business,” Strobel said. At the same time, Nicor’s tropical shipping business “continues to face challenges due to economic conditions in its service territories,” he said. Nicor is actively managing costs and is taking action “on all fronts,” including addressing head count, Strobel said.
Gas distribution operating income increased $39.4 million in 1Q2010 compared to the prior year period, reflecting lower operating and maintenance expenses, higher gas distribution margins and higher depreciation expense, Strobel said. Nicor’s other energy ventures reported a $1.8 million increase in operating income during the quarter, due primarily to higher operating income at the company’s retail energy-related products and services businesses, partially offset by lower operating income at Nicor’s wholesale natural gas marketing business. Nicor’s shipping unit reported a $7.1 million earnings decrease in 1Q2010 compared with 1Q2009 results, due primarily to lower average rates.
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