SouthStar Parent Reports Increase In Competitive Retail Customer Count, Favorable Margins
May 7, 2019 Email This Story Copyright 2010-19 EnergyChoiceMatters.com
Reporting by Paul Ring • email@example.com
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Southern Company, the ultimate parent of SouthStar Energy Services and related retail energy brands, recently reported earnings for the quarter ending March 31, 2019.
Southern Company's gas marketing services segment includes retail suppliers, such as SouthStar, providing energy-related products and services to natural gas markets and participants in customer choice programs. The segment does not include wholesale gas marketing, which is in a separate segment.
Southern's gas marketing services segment was serving 701,000 energy customers as of March 31, 2019, versus 697,000 as of December 31, 2018 and 779,000 a year ago.
Gas marketing services' customers are primarily located in Georgia and Illinois. Also included are customers in Ohio contracted through an annual auction process to serve for 12 months beginning April 1 of each year. At March 31, 2019 and 2018, there were approximately 70,000 and 140,000 contracted customers, respectively.
Gas marketing services' market share of gas customers in Georgia was 28.8% as of March 31, 2019, versus 29.0% as of December 31, 2018 and 29.2% a year ago.
The gas marketing services segment's volumes were as follows:
Gas marketing services volumes
(mmBtu in millions)
Three Months Ended March 31
Georgia 15 16
Illinois 6 6
Other 8 10
Large C&I 4 4
Total 33 36
Gas marketing services reported Adjusted Operating Margin of $115 million for the first quarter of 2019, versus $128 million a year ago. Excluding a $25 million decrease attributable to the 2018 disposition of Pivotal Home Solutions, adjusted operating margin increased $12 million, which primarily reflects favorable margins and recovery of prior period hedge losses.
Gas marketing services reported operating income of $84 million for the first quarter of 2019, versus $33 million a year ago.
Gas marketing services reported net income of $61 million for the first quarter of 2019, versus $13 million a year ago. This increase primarily relates to a $64 million decrease in operating expenses, partially offset by a $13 million decrease in adjusted operating margin and a $3 million increase in income tax expense.
Gas marketing services reported operating revenues of $229 million for the first quarter of 2019, versus $271 million a year ago