This Day On The Street
Continue to site
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here

Financial And Risk Management Crucial For Power Utilities, Finds Frost & Sullivan

MOUNTAIN VIEW, Calif., April 4, 2013 /PRNewswire/ -- Energy companies face a challenging environment of overcapacity, unpredictable oil prices, protectionism, geopolitical tensions, high debt-to-GDP ratios, winding down of national stimulus initiatives, unemployment, and fluctuating currencies. To add value to shareholders, it is vital that utilities achieve excellence in financial and risk management through improved working capital management practices and greater focus on free cash flow generation.

New analysis from Frost & Sullivan's ( Financial Assessment of the Power Systems Industry research reveals that oil and gas production as well as electric distribution companies exhibited the highest profitability. Grid distribution and multi-utilities, in particular, saw heightened activity. Other segments covered in the research include electric power transmission and control, natural gas transmission, oil and gas equipment, rig and service, and oil rig service companies.

For more information on this analysis, please email Britni Myers, Corporate Communications, at, with your full name, company name, job title, telephone number, company email address, company website, city, state and country.

Frost & Sullivan conducted an extensive ratio analysis to rank the companies in the power sector on the basis of different financial and risk management parameters. The ratios of the leading companies ranked within the top 33 percent, indicating that sound financial management plays a key role in the success of a business.

"High-performance enterprises diminish uncertainty in demand recovery and risks in customer refinancing through operative measures and customer partnerships," said Frost & Sullivan Business and Financial Services Analyst K. Vinod Cartic. "They follow supply chain management best practices to leverage the economies of scale and minimize raw material price volatility and procurement risks."

Successful utilities use commodity derivatives to hedge raw material risks, and also reduce currency exchange fluctuation liabilities through local production. In addition, they employ derivative-based hedging to mitigate the risks of converting receivables and liabilities, as well as purchases and sales, in foreign currencies.

1 of 3

Check Out Our Best Services for Investors

Action Alerts PLUS

Portfolio Manager Jim Cramer and Director of Research Jack Mohr reveal their investment tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
Quant Ratings

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
Stocks Under $10

David Peltier uncovers low dollar stocks with serious upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
14-Days Free
Only $9.95
14-Days Free
Dividend Stock Advisor

David Peltier identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Updates with exact steps to take - BUY, HOLD, SELL
Trifecta Stocks

Every recommendation goes through 3 layers of intense scrutiny—quantitative, fundamental and technical analysis—to maximize profit potential and minimize risk.

Product Features:
  • Model Portfolio
  • Intra Day Trade alerts
  • Access to Quant Ratings
Real Money

More than 30 investing pros with skin in the game give you actionable insight and investment ideas.

Product Features:
  • Access to Jim Cramer's daily blog
  • Intraday commentary and news
  • Real-time trading forums
Only $49.95
14-Days Free
14-Days Free


Chart of I:DJI
DOW 17,888.35 +168.43 0.95%
S&P 500 2,102.63 +22.22 1.07%
NASDAQ 5,156.3060 +47.64 0.93%

Free Reports

Top Rated Stocks Top Rated Funds Top Rated ETFs