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AES Surpasses Q3 Earnings Estimates, Revenues Increase Y/Y

AES reports revenues of $3,036 million for the third quarter, which increase 19.3% year over year and beat the Zacks Consensus Estimate by 21.6%.

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This story originally appeared on Zacks

The AES Corporation’s AES third-quarter 2021 adjusted earnings of 50 cents per share from continuing operations exceeded the Zacks Consensus Estimate of 45 cents by 11.1%. Moreover, earnings improved 19.1% from 42 cents reported in the year-ago quarter.

The company reported GAAP earnings of 48 cents per share against a loss of 50 cents incurred in the third quarter of 2020.

- Zacks

The year-over-year bottom-line improvement can be attributed to higher contributions from renewables growth and the Southland portfolio in the United States. Also, higher impairments and losses on the sale of businesses in 2020 boosted third-quarter earnings on a comparable basis.

Total Revenues

Total revenues came in at $3,036 million in the reported quarter, which improved 19.3% year over year due to higher electric as well as natural gas revenues. Revenues also beat the Zacks Consensus Estimate of $2,496 million by 21.6%.

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

Total cost of sales was $2,276 million for the third quarter, up 27.2% year over year.

Operating income came in at $760 million, up 0.5% from $756 million in the year-ago period.

Interest expenses totaled $242 million, down 16.6% from $290 million in the year-earlier period.

As of Sep 30, 2021, the company completed the construction or the acquisition of 643 megawatts (MW) of renewables and energy storage. Moreover, AES Corp signed or agreed to acquire 4,000 MW of renewables and energy storage, as of Sep 30, 2021, under long-term power purchase agreements, bringing the company's backlog to 9,213 MW,

Financial Condition

It had cash and cash equivalents of $1,411 million as of Sep 30, 2021 compared with $1,089 million on Dec 31, 2020.

Non-recourse debt totaled $15,124 million as of Sep 30, 2021, up from $15,005 million on Dec 31, 2020.

During the first nine months of 2021, the company generated cash from operating activities worth $1,379 million compared with the year-ago period’s $2,087 million.

Total capital expenditure for the third quarter amounted to $535 million, which increased from $413 million incurred in the year-ago period.

Guidance

For 2021, the company reaffirmed its EPS guidance in the range of $1.50-$1.58 but now expects it to be at the low end of the range. The Zacks Consensus Estimate for earnings for the current year is pegged at $1.55, just above the mid-point of the guided range.

The company reaffirmed the 7-9% average annual growth target through 2025.

Zacks Rank

AES Corp. currently has a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Recent Utility Releases

American Electric Power AEP reported third-quarter 2021 adjusted earnings per share of $1.43, which missed the Zacks Consensus Estimate of $1.44 by 0.7%.

NextEra Energy NEE reported third-quarter 2021 adjusted earnings of 75 cents per share, which exceeded the Zacks Consensus Estimate of 72 cents by 4.2%.

Public Service Enterprise Group Incorporated PEG, or PSEG, reported third-quarter 2021 adjusted operating earnings of 98 cents per share, which surpassed the Zacks Consensus Estimate of 92 cents per share by 6.5%.



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