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ATCO, Canadian Utilities earnings down slightly in Q4'17

Canadian Utilities Ltd. on Feb. 22 recorded fourth-quarter 2017 adjusted earnings of C$162 million, or 60 Canadian cents per share, compared with C$166 million, or 62 Canadian cents per share, for the same period in 2016.

The S&P Capital IQ consensus normalized EPS estimate for the most recent quarter was 62 Canadian cents.

The company attributed lower adjusted earnings in 2017 mainly to lower contributions from the electricity generation businesses.

Fourth-quarter 2017 earnings attributable to class A and class B shares was reported at C$64 million, compared to C$196 million in the comparable quarter of 2016.

On a full-year basis, the company booked adjusted earnings of C$602 million, or C$2.23 per share for 2017, compared to C$590 million, or C$2.21 per share, for full-year 2016.

The S&P Capital IQ consensus normalized EPS estimate for 2017 was C$2.27.

The company posted earnings attributable to Class A and class B shares of C$483 million for 2017, compared to C$620 million in 2016. Canadian Utilities' capital investment in 2017 totaled C$1.70 billion, out of which 99% was invested in assets that earn a return under a regulated business model or are under commercially secured long-term contracts, the company said.

On the same day, Canadian Utilities parent ATCO Ltd. reported fourth-quarter 2017 adjusted earnings of C$92 million, 80 Canadian cents per share, compared to C$94 million, or 82 Canadian cents per share, in the corresponding quarter of 2016.

The S&P Capital IQ consensus normalized EPS estimate for the fourth quarter of 2017 was 84 Canadian cents.

Strong earnings in the company's regulated utility businesses were impacted by lower contributions from ATCO's non-regulated businesses as persistent weak commodity prices impacted financial results in ATCO Structures & Logistics Ltd., the company said.

During 2017, ATCO's capital investment totaled C$1.82 billion, out of which 95% was invested in assets that earn a return under a regulated business model or are secured under long-term contracts. The company plans to invest an additional C$4.4 billion in regulated utility and commercially secured capital growth projects in the 2018-to-2020 period, which are expected to contribute significant earnings, cash flow and create long-term value for share owners.

Earnings attributable to class I and class II shares were C$12 million in 2017, compared to earnings attributable to class I and class II shares of C$100 million during the fourth quarter of 2016.

On a full-year basis, the company posted C$335 million, or C$2.93 per share, in 2017 adjusted earnings, compared to C$360 million, or C$3.15 per share in 2016. Earnings attributable to class I and class II shares for 2017 fell to C$203 million compared to C$340 million during 2016.

The S&P Capital IQ consensus normalized EPS estimate for 2017 was C$2.96.

Additionally, Canadian Utilities in December 2017 sold a 24.5% ownership stake in ATCO Structures & Logistics to ATCO for C$140 million, giving ATCO 100% ownership.