Allentown, Pa.-headquartered PPL Corp. is still the most profitable utility in Canada and the U.S., despite its recurring EBITDA margin falling 0.5 percentage points to 54.0% of recurring revenues in the 2019 second quarter.
Strong operational performance at its regulated utilities helped PPL book higher earnings of 58 cents per share, which beat the consensus estimate by 2 cents.
However, the U.K.'s planned exit from the EU is injecting some uncertainty to the company's future earnings. "We recognize the recent weakness in the exchange rates and continue to monitor potential impacts to our earnings projections; however independent forecast of future exchange rates remain within the range of presumptions used for 2021 projections," Senior Vice President and CFO Joseph Bergstein Jr. told analysts and investors during the Aug. 6 earnings call.
The diversified energy company reaffirmed its 2019 earnings from ongoing operations forecast of $2.30 per share to $2.50 per share.
NextEra Energy Inc. placed second with a recurring EBITDA margin of 51.7%, down from 51.9% in the comparable 2018 quarter.
The company grew second-quarter adjusted EPS by approximately 13% year over year and expects to meet overall objectives for 2019. NextEra continues to expect full-year adjusted EPS at or near the top of its previously disclosed compound annual growth rate target of 6% to 8%, off the 2018 base of $7.70 per share.
Algonquin Power & Utilities Corp. landed in the third spot with a recurring EBITDA margin of 45.5% in the most recent quarter. The company reported solid earnings for the period, with adjusted EBITDA growing 18% year over year.
Dominion Energy Inc. recorded the largest negative change at 4.2 percentage points. Dominion had a recurring EBITDA margin of 43.3% of recurring revenues, compared with 47.5% in the prior-year period.
The company reported operating earnings of 77 cents per share in the most recent quarter, which was in line with the S&P Global Market Intelligence consensus estimate and was above Dominion's midpoint for its quarterly guidance range.
Dominion continues to target full-year 2019 operating EPS in the range of $4.05 to $4.40.
Rounding up the list is Xcel Energy Inc., which had a recurring EBITDA margin of 33.5% of recurring revenues. This represents a drop of 0.7 percentage point from the year-ago period.
The diversified energy company posted lower operating earnings of 52 cents per share, which also missed the consensus estimate for the quarter. Despite this decrease, Xcel Energy continues to target full-year 2019 earnings in the range of $2.55 per share to $2.65 per share.
Most of the utilities on the list saw lower recurring EBITDA margin in the second quarter. Those that saw positive gains include Atmos Energy Corp., Duke Energy Corp. and Sempra Energy.