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AES' Q4 Earnings Outpace Estimates, Revenues Decline Y/Y

The AES Corporation’s AES fourth-quarter 2023 adjusted earnings of 73 cents per share beat the Zacks Consensus Estimate of 69 cents by 5.8%. The bottom line also improved 49% from 49 cents reported in the year-ago quarter.

The company generated a GAAP loss of 15 cents per share compared with a loss of $1.35 in the fourth quarter of 2022.

For 2023, AES reported adjusted earnings of $1.76 per share, beating the Zacks Consensus Estimate of $1.73 by 1.7%. The bottom line also improved 5.4% from $1.67 reported in 2022.

Total Revenues

Total revenues were $2.97 billion in the reported quarter, down 3% year over year due to lower regulated revenues. The top line also missed the Zacks Consensus Estimate of $3.10 billion by 4.3%.

For 2023, AES reported total revenues of $12.67 billion, lagging the Zacks Consensus Estimate of $12.80 billion by 1%. However, the top line improved 0.4% from $12.62 billion reported in 2022.

The AES Corporation Price, Consensus and EPS Surprise

The AES Corporation Price, Consensus and EPS Surprise
The AES Corporation Price, Consensus and EPS Surprise

The AES Corporation price-consensus-eps-surprise-chart | The AES Corporation Quote

Highlights of the Release

The total cost of sales was $2.47 billion in the reported quarter, down 0.9% year over year.

The operating income totaled $494 million, down 12.3% from $563 million in the year-ago period.

Interest expenses amounted to $353 million, up 16.1% from $304 million in the prior-year quarter.

The company's backlog for renewable energy projects was 12.3 gigawatts (GW) as of Dec 31, 2023, including 5.1 GW under construction.

Financial Condition

AES had cash and cash equivalents of $1.43 billion as of Dec 31, 2023, compared with $1.37 billion as of Dec 31, 2022.

Non-recourse debt totaled $18.48 billion as of Dec 31, 2023, up from $17.85 billion as of Dec 31, 2022.

During 2023, AES generated cash from operating activities worth $3.03 billion compared with the year-ago figure of $2.72 billion.

Total capital expenditure for the fourth quarter was $2.43 billion, up substantially from $1.84 million recorded in the year-ago quarter.

2024 Guidance

AES initiated its 2024 earnings guidance. It expects adjusted earnings per share to be in the range of $1.87-$1.97. The Zacks Consensus Estimate for the same is pegged at $1.90, lower than the mid-point of the guided range.

AES raised its average annual earnings growth target to 7-9% through 2027 from 6-8%.

Zacks Rank

AES currently carries a Zacks Rank #4 (Sell).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Recent Utility Releases

NiSource NI reported fourth-quarter 2023 operating earnings of 53 cents per share, which surpassed the Zacks Consensus Estimate of 52 cents by 1.9%. The bottom line increased 6% from the year-ago quarter’s recorded figure of 50 cents.

Operating revenues of $1.42 billion missed the Zacks Consensus Estimate of $1.58 billion by 10.3%. The top line also decreased 3.4% from the prior-year quarter’s figure of $1.7 billion.

FirstEnergy FE reported fourth-quarter 2023 operating earnings of 62 cents per share, which surpassed the Zacks Consensus Estimate of 60 cents by 3.3%. The bottom line increased 24% from the year-ago quarter’s figure of 50 cents.

Operating revenues of $3.15 billion missed the Zacks Consensus Estimate of $3.29 billion by 4.2%. The top line also declined 0.9% from $3.18 billion recorded in the year-ago quarter.

PG&E Corporation’s PCG adjusted earnings per share (EPS) of 47 cents in the fourth quarter of 2023 surpassed the Zacks Consensus Estimate of 45 cents by 4.4%. The bottom line improved 80.8% from the year-ago quarter’s reported figure.

In the fourth quarter, PCG reported total revenues of $7,041 million compared with $5,370 million in the year-ago period. Operating revenues also beat the Zacks Consensus Estimate of $6,431.6 million by 9.5%.

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