ST. LOUIS – Ameren Corp., energized by solid results from its Illinois operations, finished 2016 on a profit surge, but the results were still negative in the eyes of Wall Street.
St. Louis-based Ameren, parent of utility Ameren Illinois, reported revenue of $1.36 billion for the 2016 fourth quarter, which missed analysts' estimates of $1.57 billion. Earnings per share for the quarter came in at 13 cents, 2 cents shy of Wall Street's hopes for 15 cents.
Ameren's management, however, found plenty to be positive about: Revenue for the fourth quarter was up 3.66 percent over this time in 2015. And while overall operating revenue for the full year was down $22 million at $6.076 billion compared to $6.098 billion in 2015, net income rose 4.5 percent to $653 million for 2016 contrasted with $630 million in 2015. That was worth $2.68 per share for the year, up 3.5 percent over the $2.59 earned in 2015.
Ameren Illinois' earnings for the whole of 2016 contributed $126 million, up $3 million over 2015. A bigger boost came from the utility's natural gas distribution earnings which, thanks in part to a rate increase, jumped 59 percent to $59 million for the year, compared to a $37 million profit in 2015.
Ameren Transmission, which handles stringing new wires in major infrastructure projects in Illinois and elsewheere, also powered through 2016 to finish with a 40 percent earnings boost: it pocketed $117 million, up from $83 million in 2015.
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Discussing the results with analysts, Ameren Corp. managers said they were pleased with the “constructive regulatory framework” in Illinois, which allowed it to earn fair and timely returns on its operations and investments.
And those investments were ramped up significantly: of some $2.1 billion spent on utility infrastructure in 2016, $1.3 billion went to federally regulated and Illinois-regulated electric and natural gas transmission projects.
“In 2016, we again delivered solid earnings growth,” said Warner L. Baxter, Ameren Corp's chairman, president and CEO. “Our team continued to successfully execute all elements of our strategy, including allocating capital to jurisdictions with modern, constructive regulatory frameworks.”
Looking ahead to 2017, Ameren Corp says it expects earnings per share in a range of $2.65 to $2.85. Looking even further out, the company predicts its earnings per share to expand at between a 5 percent and 8 percent compound annual rate through 2020.
Ameren Corp shareholders will also cash in sooner than that. The company has announced a 44-cent fourth quarter 2016 dividend, payable March 31, and that adds up to an annual dividend worth $1.76.