(Reuters) – U.S. electric and gas utility CMS Energy reported a drop in its fourth-quarter profit on Thursday, hurt by higher operating expenses.
U.S. natural gas futures rose 44.5% in 2024, resulting in higher operating costs for utilities like CMS Energy.
Total operating expenses for the fourth quarter rose to $1.56 billion from $1.54 billion in the year-ago period, the company said.
Additionally, higher for longer interest rates can push up borrowing costs for utilities, which typically incur major capital expenditures.
The company’s interest charges were at $180 million in the quarter, 4.7% higher than a year earlier.
Its revenue rose 2% from a year earlier to $1.99 billion in the quarter ended December 31, but missed analysts’ average estimate of $2.22 billion, according to LSEG data.
CMS Energy raised its 2025 forecast for adjusted earnings to between $3.54 and $3.60 per share, versus $3.52 to $3.58 previously. Analysts had estimated them at $3.59 per share.
The utility firm also increased its annual dividend by 11 cents to $2.17 per share.
The Jackson, Michigan-based firm said net income available to common stockholders fell to $262 million or 87 cents per share in the fourth quarter, from $306 million or $1.05 per share in the same period last year.
(Reporting by Pooja Menon in Bengaluru; Editing by Milla Nissi)
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