Power company PG&E beats second-quarter profit estimates on higher rates

(Reuters) – Power company PG&E (NYSE:) Corp beat second-quarter profit estimates on Thursday, helped by higher service rates.

The company has benefited from increased electricity rates after the California Public Utilities Commission (CPUC) last year approved PG&E’s infrastructure plan that led to higher customer bills.

Revenue at the company’s electric segment rose 15.7% from a year earlier, while expenses from its wildfire fund fell by a third.

The company, however, slashed its 2024 GAAP earnings forecast, citing costs related to unrecoverable interest expenses and wildfire liabilities.

PG&E has been blamed for sparking numerous wildfires over the years, including some of California’s deadliest. The liability claims related to wildfires have caused substantial financial burden on the company, which has now been making investments to improve the reliability of its power grid.

The company’s full-year earnings are expected to be in the range of $1.11 to $1.17 per share, compared with its prior forecast of $1.15 to $1.20.

On an adjusted basis, PG&E reported a profit of 31 cents per share in the second quarter, beating analysts’ average estimate of 30 cents, according to LSEG.

PG&E Corp is the parent organization of Pacific Gas and Electric Company, an energy utility that serves about 16 million people across a 70,000-square-mile area in Northern and Central California.

Shares were trading up 1.8% premarket.