Dominion Resources, Inc. (NYSE:D) is one the country's largest utilities and just turned in a solid first quarter. But there's a lot going on at this utility giant. So much so, that you need to listen carefully to what management says to get a full understanding of what's going on under the headlines...

Let's take a look at Dominion's latest earnings conference call to uncover the deeper story about the state of its business.

At the high end
Dominion's operating earnings of $0.99 per share were, "... at the top of our guidance range of $0.85 per share to $1 per share," According to CFO Mark McGettrick. Weather added a nickel to operating earnings and good results in the natural gas drilling business added $0.04. Merchant power, however, was a negative, as lower prices for power in New England hampered results.

All in, though, it was a good start to the year. McGettrick stated that second quarter operating earnings are expected to fall in the range of, "... $0.65 per share to $0.75 per share," up from $0.62 last year. Dominion continues to see full-year operating earnings in the range of $3.50 to $3.85, so the company is still on track.

A hint of growth?
One of the more subtle takeaways came from a quick comment from CEO Thomas Farrell: "Virginia Power experienced a new record peak demand of 21,651 megawatts on February 20, exceeding the previous winter peaks by 9% and the previous record summer peak by 8%."

Power lines are another growth area for utilities like Dominion. Source: ReubenGBrewer, via Wikimedia Commons.

Virginia Power makes up about a quarter of the company's earnings before interest and taxes. It is the regulated utility core around which everything else is built. The new records hint at the strength of this business. The expectation is that Virginia Power has the potential to grow its customer base at around 2% annually over time. That may not sound like much, but it means this segment of the company should provide a solid foundation for years to come, with record demand a clear indication of that potential.

What you got cooking?
So what's going up on that foundation? Plenty. According to the CEO, a "1,358 megawatt combined cycle facility in Brunswick County ..." is, "... on budget and on time for a mid-2016 commercial operation date." Another plant is, "... scheduled for commercial operation in late 2018," if it's approved.

But that's not all that's going on. Dominion is also building solar plants, natural gas pipelines, and power lines. At this point, most if not all of the company's big projects are progressing as expected. On average, Dominion plans to spend roughly $3.2 billion annually on capital projects that should add nicely to the top and bottom lines through 2020.

How about that MLP?
One of the more interesting aspects of Dominion right now is sister company Dominion Midstream Partners LP (NYSE: DM). This is the limited partnership that Dominion set up to own its Cove Point liquefied natural gas, or LNG, facility. According to McGettrick everything is going as planned, explaining that results were, "... all consistent with management's expectations." In fact, Dominion Midstream declared a distribution of $0.175 per unit.

Also worthwhile to note was the sale, or drop down, of Dominion Carolina Gas Transmission from Dominion Resources. According to McGettrick, "The acquisition is supportive of management's plan to grow limited partner distributions at a 22% compound annual rate through the end of the decade." The goal is an, "... annualized distribution rate of $0.85 per unit ..." by the fourth quarter.

As a big unit holder and the partnership's general partner, hitting these targets pushes more money up to Dominion Resources. So it's nice to see things going as planned.

And Cove Point?
While that's all well and good, the cornerstone of the LP is Cove Point, an LNG export facility that isn't up and running yet. According to CEO Farrell, "Construction is continuing at the site and is on time and on budget." So more good news on the construction front.

Construction at Cove Point. Source: Acroterion, via Wikimedia Commons.

However, this is a big project to keep an eye on. For starters, it will have a huge impact on Dominion Midstream's results when it's finally up and running, supported by long-term contracts that have already been signed. Secondly, it will be among the first operating LNG export facilities in the United States. And that means there's good potential for expansion projects that could lead to further growth. Although the biggest impact will be on Dominion Midstream, success here will roll up to Dominion Resources pretty quickly. That makes construction progress at Cove Point the big issue to watch at Dominion Midstream.

Altogether Dominion Resources had a good quarter that supports its full-year expectations. Capital projects continue on pace and as planned. And, perhaps more important, there's plenty of opportunity for continued growth ahead at this giant energy player.

This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium advisory service. We’re motley! Questioning an investing thesis -- even one of our own -- helps us all think critically about investing and make decisions that help us become smarter, happier, and richer.