Power company PG&E misses first-quarter profit estimates on higher expenses
April 24 (Reuters) - PG&E Corp (PCG.N), opens new tab missed first-quarter profit estimates on Thursday, as the power company was hurt by higher operating and interest expenses.
Higher-for-longer interest rates push up borrowing costs for utility companies, which typically need more capital for expenses such as maintaining the grid.
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PG&E said its interest expenses rose 2.7% to $734 million in the first quarter from a year earlier.
Multiple wildfires scorched tens of thousands of acres across Los Angeles in January in what is now expected to be the most costly natural disaster in U.S. history. The area's electric utilities have also come under increasing scrutiny.
PG&E plans to construct nearly 700 miles of underground powerlines and 500 miles of other wildfire safety system upgrades between 2025 and 2026.
PG&E said that average residential electric rates were lower in March than they were a year earlier and it expects natural gas delivery rates to remain flat in 2025.
The company's total operating revenue was $5.98 billion in the quarter, missing analysts' estimate of $6.14 billion, according to data compiled by LSEG.
For the quarter ended March 31, the company's total operating expenses were up 3.8% at $4.76 billion.
The Oakland, California-based company reaffirmed its forecast for adjusted core earnings to be between $1.48 and $1.52 per share. Analysts have expected $1.50 per share.
The utility also said it added nearly 3,000 customers in the quarter to its electric grid system.
On an adjusted basis, PG&E reported a profit of 33 cents per share, compared with the average analyst estimate of 34 cents.
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