NRG Energy, Inc. Earnings Cheat Sheet: Beats the Street on Profit Rise

S&P 500 (NYSE:SPY) component NRG Energy, Inc. (NYSE:NRG) reported net income above Wall Street’s expectations for the second quarter. NRG Energy, Inc. owns and operates power generation facilities and is involved in the transacting in trading of fuel and transportation services and related products.

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NRG Energy Earnings Cheat Sheet for the Second Quarter

Results: Net income for the electric utilities company rose to $618 million ($2.53 per share) vs. $211 million (81 cents per share) in the same quarter a year earlier. This is a more than twofold rise from the year earlier quarter. Adjusted earnings were reported as $517 million ($2.12 per share). The company recognized a tax benefit of $608 million in the quarter.

Revenue: Rose 6.8% to $2.28 billion from the year earlier quarter.

Actual vs. Wall St. Expectations: NRG beat the mean analyst estimate of 37 cents per share. It fell short of the average revenue estimate of $2.43 billion.

Quoting Management: “Our relentless focus on execution across the Company has resulted in solid financial results for the second quarter, enabling the Company to generate substantial free cash flow even after investing close to $700 million year-to-date in our exciting growth projects,” commented David Crane, NRG President and Chief Executive Officer. “We are in a good position now to complete the simplification of our capital structure in a way that allows the Company to optimize the allocation of capital for the benefit of all of its stakeholders.”

Key Stats:

A year-over-year revenue increase last quarter snaps a streak of four consecutive quarters of revenue declines. The worst quarter in that span was the fourth quarter of the last fiscal year, which saw a 15.2% decrease.

The company has now beaten estimates the last two quarters. In the first quarter, it topped expectations with net income of 28 cents versus a mean estimate of net income of 15 cents per share.

NRG’s profit in the latest quarter follows losses in the previous two quarters. The company reported a net loss of $260 million in the first quarter and a loss of $15 million in the fourth quarter of the last fiscal year.

Gross margins grew 62.3 percentage points to 100%. The growth appeared to be driven by falling costs, as the figure fell 100% from the year earlier while revenue rose 6.8%.

Competitors to Watch: Dynegy Inc. (NYSE:DYN), Constellation Energy Group, Inc. (NYSE:CEG), The AES Corporation (NYSE:AES), Genon Energy Inc (NYSE:GEN), Calpine Corporation (NYSE:CPN), Edison International (NYSE:EIX), NextEra Energy, Inc. (NYSE:NEE), Xcel Energy Inc. (NYSE:XEL), The Southern Company (NYSE:SO), and Exelon Corporation (NYSE:EXC).

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(Source: Xignite Financials)