Dominion Q3 Profit Tops Estimates; Dominion Midstream To Buy Questar Pipeline

(RTTNews) - Dominion Resources (D) reported third-quarter operating earnings of $716 million or $1.14 per share compared to $611 million or $1.03 per share, last year. On average, 14 analysts polled by Thomson Reuters expected the company to report profit per share of $1.07 for the quarter. Analysts' estimates typically exclude special items. The company said the increase in operating earnings was primarily attributable to an increase in electric sales from warmer weather, lower capacity expenses, revenues from regulated growth projects, and a lower tax rate. Third-quarter reported earnings was $690 million or $1.10 per share compared to $593 million or $1.00 per share, prior year.

Third quarter operating revenue increased to $3.13 billion from $2.97 billion, a year ago. Analysts expected revenue of $3.26 billion, for the quarter.

Separately, Dominion Midstream Partners, LP (DM), and Dominion Resources, Inc. announced an agreement in which Dominion Midstream will acquire Questar Pipeline, LLC, from Dominion for consideration of approximately $1.725 billion, including indebtedness of Questar Pipeline as part of the transaction value. Dominion plans to use proceeds from the Questar Pipeline dropdown into Dominion Midstream to retire outstanding debt.

Dominion expects fourth-quarter operating earnings in the range of $0.90-$1.05 per share. The company said positive drivers for its fourth-quarter include a return to normal weather, increased revenues from growth projects, the addition of Dominion Questar, lower capacity expenses and the absence of a Millstone refueling outage. Analysts polled by Thomson Reuters expect the company to report profit per share of $1.03.

The company maintained its previously issued 2016 operating earnings guidance of $3.60-$4.00 per share. Analysts polled by Thomson Reuters expect the company to report profit per share of $3.78.