Sempra Energy Posts Slight Gain

Sempra Energy, the parent of two major California utilities, on Tuesday reported a slight gain in second-quarter earnings despite weaker results from its energy trading unit.

The San Diego-based company also reiterated its profit outlook for 2002 and 2003 and noted it had very little exposure to its struggling energy trading rivals Williams Cos. and Dynegy Inc., both of which have seen the value of their stock plunge this week.

Sempra said it earned $147 million, or 71 cents a share, up 7.3% from $137 million, or 66 cents, a year ago, aided by higher earnings from utility units Southern California Gas Co. and San Diego Gas & Electric. Revenue fell 28% to $1.37 billion.

Analysts were expecting earnings of 63 cents, according to research firm Thomson First Call.

Sempra Energy Trading’s earnings plunged 70% to $21 million, due mainly to lower prices and reduced volatility in the U.S. natural gas and power markets.

The company reiterated earnings guidance given in April of $2.65 a share for 2002 and $2.90 a share for 2003.

Sempra Energy Resources, the company’s wholesale power generation subsidiary, reported net income of $34 million, compared with a year-ago loss of $9 million.

The company said the improvement was primarily due to the sale of power to the California Department of Water Resources under a 10-year contract.

Sempra shares fell 95 cents to $16 on the New York Stock Exchange.

Other California company earnings included:

* Avery Dennison Corp. reported a 23% increase in second-quarter profit to $73.8 million, or 74 cents a share, on stronger orders, better pricing and productivity gains, but said that current economic conditions had made it cautious about the second half of 2002.

The Pasadena-based maker of adhesive products and labels said excluding its acquisition of Germany’s Jackstadt, earnings were 76 cents, beating analysts’ estimates of 72 cents. Sales rose 10% to $1.06 billion.

Avery said it expects earnings of 68 cents to 73 cents for the third quarter and $2.74 to $2.85 a share for the full year, excluding acquisition-related charges.

* California Pizza Kitchen Inc. said second-quarter earnings rose 30% to $4.3 million, or 23 cents a share, on a 25% jump in revenue to $75.6 million. The results matched analysts’ estimates that were increased last month when the company raised its outlook.

* Edwards Lifesciences Corp.’s second-quarter profit rose 27% to $21.5 million, or 35 cents a share, a penny better than analysts expected. Revenue fell 10% to $172.8 million, hurt by the divestiture of a unit and the effect of foreign exchange.

* 99 Cents Only Stores said second-quarter net income increased 24% to $13.5 million, or 9 cents a share, on a 23% rise in sales to $167.9 million.

* McKesson Corp. said fiscal first-quarter profit rose 11% to $117.3 million, or 39 cents a share, boosted by sales of higher-margin generic drugs and favorable purchasing terms from drug makers. The results were a penny better than analysts’ estimates. Revenue rose 17% to $13.63 billion.

* Smart & Final Inc. said earnings fell 42% to $2.1 million, or 7 cents a share, from $3.6 million, or 12 cents, on a restated basis, as sales edged up 3% to $476 million.