OGE quarterly income up 31.4%, revenue and per share earnings beat estimates

Oklahoma City-based OGE Energy Corp. saw energy sales normalize in the second quarter, but quarterly income reached $112.9 million, better than the $85.9 million in the same quarter of 2020. Earnings per share of 56 cents beat the consensus estimate of 53 cents.

Revenue in the second quarter for the regulated utility with operations in Arkansas and Oklahoma was $577.4 million, up from the $503.5 million in the same period of 2020, and better than the consensus estimate of $558.12 million.

“Our strong customer growth of 1.3% over the last year reflects the combination of highly affordable rates and our ability to service commercial expansion in our markets,” OGE Energy Corp. Chairman, President and CEO Sean Trauschke said in the earnings report posted Thursday (Aug. 5). “When combined with our full slate of business and economic development activity, we remain on track for sustained load growth of approximately 1% going forward, with many additional opportunities still ahead.”

Net income in the first half of 2021 was $165.6 million, a wide swing from the $405.9 million loss in the same period of 2020. Revenue in the first half of the year is $2.208 billion, significantly higher than the $934.8 million in the same period of 2020.

The higher revenue was driven primarily by the higher cost of fuel – which was passed on to residential, commercial and industrial customers – during the extreme winter weather in February. The cost of fuel and distribution costs in the first half of 2021 was $1.546 billion, almost five times the $272.4 million in the same period of 2020. The per kilowatt cost of energy in the first half of 2021 was 10.547 cents, up from 1.902 cents in the same period of 2020.

Following are system revenue sales by category in the quarter and first half of 2021.
• Residential
Second quarter 2021: $184.2 million
Second quarter 2020: $208.4 million

First half 2021: $757.5 million
First half 2020: $380.7 million

• Commercial
Second quarter 2021: $112.2 million
Second quarter 2020: $116.1 million

First half 2021: $421.9 million
First half 2020: $210.2 million

• Industrial
Second quarter 2021: $38.7 million
Second quarter 2020: $45.7 million

First half 2021: $186.4 million
First half 2020: $88.3 million

• Total System Sales Revenue
Second quarter 2021: $402.9 million
Second quarter 2020: $451 million

First half 2021: $1.718 billion
First half 2020: $834.5 million

The company maintains its 2021 net income guidance of between approximately $352 million and $373 million, or $1.76 to $1.86 per average diluted share. Company shares (NYSE: OGE) opened Thursday at $34.18. During the past 52 weeks the share price has ranged between $35.46 and $28.25.

OGE Energy is the parent company of Oklahoma Gas and Electric Company, a regulated electric utility with approximately 871,000 customers in Oklahoma and western Arkansas. OGE holds a 25.5% limited partner interest and a 50% general partner interest of Enable Midstream Partners, LP.