El Paso Corp Earnings Cheat Sheet: Two Straight Quarters of Profit Broken by a Loss

S&P 500 (NYSE:SPY) component El Paso Corporation (NYSE:EP) reported its results for the third quarter. El Paso is an energy company that provides natural gas and related energy products.

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El Paso Earnings Cheat Sheet for the Third Quarter

Results: Reported a loss of $368 million (48 cents per diluted share) in the quarter. El Paso Corporation had a net income of $142 million or 19 cents per share in the year earlier quarter.

Actual vs. Wall St. Expectations: EP reported adjusted net income of 18 cents per share. By that measure, the company fell short of mean estimate of 26 cents per share.

Quoting Management: “Our businesses are delivering excellent operational results,” said Doug Foshee, chairman, president and chief operating officer of El Paso Corporation. “With the TGP 300 Line expansion now in service, we have completed what was an $8 billion backlog of pipeline projects, the largest in our company’s history. And we continue to add new projects to meet our customers’ infrastructure needs. The latest is another Marcellus-related expansion on TGP, bringing our total Marcellus expansions to $1.3 billion. E&P continues to hit on all cylinders, generating rapid oil production growth, through continued activity in the Eagle Ford, Wolfcamp, Altamont, and South Louisiana Wilcox programs. We expect this growth to continue given our leading positions in some of the most exciting and prolific areas in North America. We’re of course very excited about our pending sale to Kinder Morgan, Inc. Our focus between now and the successful conclusion of that transaction remains on delivering excellent operational results.”

Key Stats:

The company fell short of forecasts after beating estimates in the previous two quarters. In the second quarter, it topped the mark by one cent, and in the first quarter, it was ahead by 2 cents.

The company’s loss in the latest quarter follows profits in the previous three quarters. The company reported a profit of $262 million in the second quarter, a profit of $62 million in the first quarter and $71 million in the fourth of the last fiscal year.

Looking Forward: For the next quarter, analysts are growing pessimistic about the company’s expected results. The average estimate for the fourth quarter is 29 cents per share, dropping from 31 cents a month ago. The average estimate for the fiscal year is now $1.10 per share, down from $1.12 sixty days ago.

Competitors to Watch: Kinder Morgan Inc (NYSE:KMI), El Paso Pipeline Partners, L.P. (NYSE:EPB), Kinder Morgan Energy Partners LP (NYSE:KMP), Southern Union Company (NYSE:SUG), Enterprise Products Partners L.P. (NYSE:EPD), Enterprise GP Hldgs. L.P. (EPE), Spectra Energy Partners, LP (NYSE:SEP), Blue Dolphin Energy Co. (NASDAQ:BDCO), Copano Energy, L.L.C. (NASDAQ:CPNO), and Atlas Pipeline Partners, L.P. (NYSE:APL).

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(Source: Xignite Financials)