Southern Company Powering Forward Amid Q1 Revenue Dip: Details

Zinger Key Points
  • Q1 operating revenue dips by 2.6%, but operating income surges by 40%.

Southern Company SO reported a first-quarter 2024 operating revenue decline of 2.6% year-over-year to $6.646 billion, missing the consensus of $6.558 billion. 

Operating revenues: Alabama Power $1.791 billion (+8.7% Y/Y), Georgia Power $2.398 billion (+10.2% Y/Y), Mississippi Power $342 million (-12.3% Y/Y), Southern Power $473 million (-6.9% Y/Y) and Southern Company Gas $1.707 billion (-9% Y/Y).

“All our businesses experienced a strong start to 2024,” said Chairman, President and CEO Christopher C. Womack.

“This performance was driven by a variety of factors, including investments in our state-regulated utilities, weather that was less mild than the first quarter of last year and higher weather-adjusted sales in our electric utilities’ commercial customer class, a fact that speaks to strong local economies and increased usage by many existing data center customers.”

Operating expenses decreased 6.1% Y/Y to $4.94 billion in the quarter. Adjusted EPS improved to $1.03, from $0.79 YoY, beating the consensus of $0.90.

Adjusted earnings drivers were higher utility revenues, partially offset by increased interest expense and depreciation and amortization.

Total Regulated Utility Customers increased 0.9% Y/Y, with Total Traditional Electric +1.2% and Southern Company Gas +0.5%. Kilowatt-Hour Sales declined by 0.4% Y/Y, with Retail sales up 1.7% and Wholesale sales down 15.5%.

Operating income rose 40% Y/Y to $1.7 billion, and the margin expanded by 683 bps to 25.6%.

Net cash from operating activities for the quarter totaled $1.31 billion, up from $844 million a year ago.

Cash, cash equivalents, and restricted cash stood at $832 million.

Price Action: SO shares are trading higher by 1.53% at $75.66 at the last check Thursday.

Photo by Fre Sonneveld for Unsplash

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