Sempra Energy to take $200 million charge on sale of stakes in 2 Argentine gas businessesadmin
Electric and gas utility Sempra Energy on Wednesday said it plans to sell interests in two Argentine natural gas distributors due to continuing disputes with the Argentine government. The company will book a $200 million charge as a result.
Excluding the charge and other items related to asset sales, the company raised its projection for earnings from continuing operations in 2006 to more than $4 per share, up from an earlier estimate of $3.50 to $3.70 per share. Sempra attributed the improved forecast to increased profitability at its commodities business.
Analysts polled by Thomson Financial forecast earnings of $3.66 per share, excluding certain items.
“The decision to sell our Argentine investments is a continuation of our strategy to shed non-strategic assets and focus on growing our natural gas infrastructure and marketing businesses and our California utilities,” said Sempra Chairman and Chief Executive Donald E. Felsinger.
Sempra owns 37 percent of Camuzzi Gas Pampeana SA and 39 percent of Camuzzi del Sur SA, both based in Buenos Aires. The interests are reflected in Sempra’s financial statements as investments. Income from the investments has been recognized using the equity method of accounting.
The $200 million charge is expected to be recorded in the fourth quarter. Sempra said its divestiture of the interests will not materially affect its balance sheet or net equity.
Shares rose $1.35, or 2.4 percent, to $56.64 in morning trading on the NYSE.