Yahoo Finance Public Service Enterprise's first-quarter profit drags as interest cost weighs
April 30 (Reuters) - Public Service Enterprise Group posted a fall in first-quarter profit on Tuesday, as higher interest expenses and unfavorable weather weighed on the electric and gas utility.
Interest rates in the U.S. have hit multi-decadal highs since the Federal Reserve began hiking rates last year, leading to higher borrowing costs.
The Newark, New Jersey-based company's operating and maintenance costs, which include restoration costs due to bad weather, rose 5.4%, while interest expenses climbed about 13.8% to $205 million in the first quarter.
New Jersey and other states in the eastern half of the U.S. experienced a massive winter storm at the start of the year which knocked out power for many homes and businesses.
"On the operations side, PSE&G met the challenge of quickly restoring service to tens of thousands of customers following a severe rain and windstorm early in the year..." said CEO Ralph LaRossa.
The utility's electricity and natural gas distribution segment, PSE&G, posted a revenue of $2.33 billion in the first quarter compared with $2.29 billion last year.
Peer FirstEnergy, which also provides electric services to customers in New Jersey and other states, missed Wall Street estimates for first-quarter profit last week, dragged by higher interest expenses and milder weather.
The company said net income for the first quarter fell to $532 million, or $1.06 per share, from $1.29 billion, or $2.58 per share, a year ago.
Operating revenues for the January-March quarter fell to $2.76 billion from $3.76 billion a year ago.
The company provides electric and gas services to about 4.3 million customers across New Jersey and also operates nuclear-generating assets through its PSEG Power segment.
Public Service Enterprise reaffirmed its full-year adjusted profit forecast of $3.60 to $3.70 per share, compared with analysts' expectations of $3.67 per share, according to LSEG data.
Adjusted earnings came in line with analysts' estimates at $1.31 per share, but was below the $1.39 per share in the same period last year. (Reporting by Vallari Srivastava in Bengaluru; Editing by Vijay Kishore)
