Energy company El Paso (NYSE:EP) posted another quarter of ugly results today, adding to a year-long string of disappointments. The natural gas firm is battling weak production and exploration output while also trying to clean up its debt-laden balance sheet.
Including restructuring and asset impairment charges, El Paso lost $146 million, or $0.24 a share. That's a much larger loss than the $69 million ($0.12 a share) loss it produced in the same quarter last year. Excluding charges, it lost a penny a share, missing analysts' expectations for a profit of $0.02. Revenues were $1.54 billion, below last year's $1.69 billion.
Across the company's divisions, earnings growth was hard to come by. El Paso's pipeline unit is its largest segment, and while the unit's operating income was up, its adjusted earnings before interest and taxes fell to $278 million from $302 million. Its production business generated operating income of $103 million, down from 2002's Q3 income of $179 million. And its troubled trading division, which is a business El Paso is working to exit completely, produced losses of $70 million (which is actually better than the prior year's $132 million loss).
El Paso's balance sheet sports close to $24 billion in debt, versus $1.6 billion in cash as of Sept. 30. The company's been reducing its debt by selling some assets and its interests in other development and production projects. By shedding assets during the third quarter, El Paso was able to pare its debt down by $710 million.
Looking ahead, El Paso sees its misfortunes continuing. Including special items, the energy company now forecasts a loss greater than its original estimate of a loss of $2.65-$2.35 a share for the year.
