TransCanada Results Beat As Keystone Vote Looms

(RTTNews) - Energy infrastructure company TransCanada Corp. (TRP.TO, TRP) reported Friday a profit for the first quarter that decreased from last year, despite revenue growth, reflecting higher income tax expense. Both comparable earnings per share and quarterly revenues topped analysts' expectations.

"An unseasonably cold winter resulted in strong demand for our critical pipeline and power infrastructure assets and underscores their importance and value to the North American economy," President and CEO Russ Girling said in a statement.

Recent reports indicate a number of prominent U.S. senators are pushing for a binding vote on the company's massive Keystone XL pipeline in May. The pipeline would transport crude tar sands from Canada down towards the Gulf of Mexico.

The Obama administration has not supported the project, but the president's union backers are urging the White House to get behind Keystone as a means to generate hundreds of thousands of jobs.

The Calgary, Canada-based company reported net income of C$412 million or C$0.58 per share for the first quarter, lower than C$446 million or C$0.63 per share in the prior-year quarter.

Comparable earnings for the quarter was C$422 million or C$0.60 per share, compared to C$370 million or C$0.52 per share in the year-ago quarter.

The company noted that higher earnings from the NGTL System, Keystone, Bruce Power, U.S. Power, and Natural Gas Storage all contributed to the increased results.

On average, 10 analysts polled by Thomson Reuters expected the company to report earnings of C$0.59 per share for the quarter. Analysts' estimates typically exclude one-time items.

Revenues for the quarter grew to C$2.88 billion from C$2.25 billion in the same quarter last year, and topped four Wall Street analysts' consensus estimate of C$2.60 billion.

Natural gas pipeline revenues for the quarter grew to C$1.22 billion from last year's C$1.16 billion, and liquids pipelines revenue increased to C$359 million from C$271 million in the year-ago quarter. Energy revenues increased to C$1.31 billion from C$824 million last year.

Income from equity investments surged to C$135 million from C$93 million in the prior-year quarter. Total operating and other expenses were C$2.03 billion, up from C$1.49 billion a year ago. Income tax expense for the quarter was $221 million, compared to $115 million last year.

Funds generated from operations for quarter totaled C$1.02 billion, up 20 percent from C$916 million in the prior-year quarter.

TransCanada's board also declared a quarterly dividend of C$0.48 per share for the second quarter, payable on July 30 to shareholders of record at the close of business on June 30, 2014.

TRP closed Thursday's regular trading session at $46.70, up $0.05 on a volume of 0.60 million shares, while TRP.TO closed on the TSX at C$51.18, down C$0.06 on a volume of 0.69 million shares.