Sempra forecast for fiscal ’08 is lower than analysts’

Sempra Energy, parent of Southern California Gas Co. and San Diego Gas & Electric Co., on Thursday issued a forecast for 2008 earnings that was below Wall Street expectations.

Net income will be $3.85 to $4.05 a share in 2008, San Diego-based Sempra said in a statement before a presentation to analysts. That projection falls short of analysts’ consensus forecast of $4.15 a share, according to a Thomson Financial poll.

Last month, Sempra raised its guidance for 2007 earnings to a range of $3.75 to $3.95 from an earlier forecast of $3.50 to $3.70. Analysts predict profit of $3.83 a share for the year.

The company, which got about one-third of its profit from trading gas and other commodities last year, divested assets to focus on building electricity transmission lines, gas pipelines and import terminals for liquefied natural gas.

Shares of Sempra fell 48 cents to $61.43.

Sempra typically establishes cautious forecasts, then adjusts them as the year progresses based partly on results from commodities trading, said Paul Justice, an analyst at Morningstar Investment Service in Chicago. The company last year raised its annual earnings forecast three times.

Sempra’s net income rose 53% last year to $1.41 billion, or $5.38 a share, exceeding $1 billion for the first time as it sold power plants and other units to fund its expansion.

Capital spending of about $2.1 billion was forecast for this year, compared with $2.16 billion in 2006.

“This is a high-quality capital program,” Sempra President Neal Schmale said during the presentation for analysts, which was broadcast on the Internet.

The company targeted 60% of the spending for its utilities, 20% for its LNG business and 20% for pipelines and gas storage.

Sempra may earn greater returns from building new energy projects than from acquisitions, Chief Executive Don Felsinger told analysts.

Bloomberg News and the Associated Press were used in compiling this report.