Xcel Energy posts Q1 profit beat as cost-cutting measures bear fruit
April 25 (Reuters) - Xcel Energy posted a better-than-expected first-quarter profit on Thursday, as the electric and natural gas utility benefited from lower operating expenses due to cost-cutting initiatives and lower natural gas costs.
Xcel has been embroiled in legal battles over its role in the Texas Smokehouse Creek blaze that raged in Texas, with two lawsuits claiming that it was negligent in maintaining electrical infrastructure.
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The firm had said last month that its facilities were likely to have started the fire, the largest on record in the state, and recorded a related $215 million pre-tax charge during the quarter.
"We are navigating changes in weather and climate-induced impacts on our operations. Wildfire mitigation and system resiliency will continue to be priorities going forward," CEO Bob Frenzel said.
Still, the firm, which serves 3.7 million customers across eight U.S. states, reported an adjusted quarterly profit of 88 cents, above Wall Street expectations of 78 cents, according to LSEG data.
Its operating expenses were $2.97 billion, 15.3% lower than the prior year as the cost of natural gas sold and transported shrunk by 44% year over year.
The company said lower operation and maintenance costs were primarily due to decreased labor and benefit expenses.
Xcel cut over 4% of its workforce in 2023 and had eliminated 159 roles as well as offered buyouts to 400 employees last quarter amid inflationary pressures.
(Reporting by Kabir Dweit in Bengaluru; Editing by Savio D'Souza)