Evansville-based Vectren Corp. (NYSE: VVC) is reporting first quarter net income of $48.3 million, down from $57 million during the same period the previous year. Despite the dip, Chief Executive Officer Carl Chapman says the results are "on track" for the utility.
"Our utility group results reflect the continued investment in our gas infrastructure program in both Indiana and Ohio," said Chapman. "Our Energy Services business performed very well in the quarter, as did Infrastructure Services’ distribution operation as the strong demand for utility distribution infrastructure replacement continues."
Chapman added sustained low oil prices have created headwinds for the utility’s infrastructure services transmission operation by increasing competition and lowering margins for transmission pipeline work. The utility expects those issues to continue through most of the year.
"We remain confident in the long term outlook as new pipeline projects are still scheduled to get underway in late 2016 and beyond, which should result in some reduction in competition for pipeline maintenance work."
Last last month, Vectren announced it had begun a multi-year pipeline replacement program throughout the state, which would be a $41 million investment in 2016.