CLEVELAND, Aug. 10, 2015 /PRNewswire/ -- Gas Natural Inc. (NYSE MKT: EGAS) ("Gas Natural" or the "Company"), a holding company operating local natural gas utilities serving approximately 68,000 customers in six states, reported financial results for the second quarter of 2015 ended June 30, 2015. As previously announced, the Company completed the sale of its Wyoming operations on July 1, 2015 for $17 million and the divested unit is reported as discontinued operations.
The Company reported a loss from continuing operations of $1.7 million, or $0.16 loss per share, for the second quarter, compared with a loss of $1.5 million, or $0.14 loss per share, for the first quarter of 2014. On a year-to-date basis, income from continuing operations for the 2015 first half was $2.7 million, or $0.26 per share, compared with $3.0 million, or $0.29 per share, for last year's first half.
Adjusted loss from continuing operations, a non-GAAP number, was $0.6 million, or $0.06 per share, for the second quarter of 2015 compared with $0.6 million loss, or $0.06 loss per share, for the second quarter of 2014. Adjusted loss from continuing operations for the 2015 second quarter excludes $1.1 million non-recurring legal and professional fees, regulatory and other expenses, and a goodwill and asset impairment charge. In the 2014 second quarter, adjusted loss from continuing operations excludes $0.8 million related to an uncollectible accounts expense resulting from a customer's bankruptcy proceeding as well as non-recurring legal and professional fees.
On a year-to-date basis, adjusted income from continuing operations, a non-GAAP number, was
$4.2 million, or $0.40 per share, in the 2015 period compared with $4.3 million, or $0.41 per share, for the prior-year period. See attached table for a reconciliation of GAAP income from continuing operations to non-GAAP adjusted income from continuing operations.
Gregory J. Osborne, Gas Natural's President and Chief Executive Officer, commented, "We continue to advance our strategy to expand in underserved markets and rationalize assets for redeployment to areas where we can focus on growth, quality customer service and solid returns on investments. Although full service utility throughput was down 19% primarily due to warmer weather in North Carolina and Montana, we still achieved customer growth in Ohio, North Carolina and Maine, while also realizing the early benefits of the September 2014 activation of Phase 1 of the Loring pipeline. It is noteworthy that we are just beginning to tap the potential of our Maine and Ohio pipeline assets. We also brought the sale of our Wyoming operations to a very successful conclusion on July 1, providing us new capital to make investments in markets with the highest and most profitable growth potential."
Natural Gas Operations Segment Review
The Natural Gas Operations segment reported $14.8 million in revenue for the 2015 second quarter, a decrease of $4.2 million, or 22%, from the prior year quarter, which was attributable to multiple factors. Ohio market revenue declined $1.3 million largely due to lower natural gas prices passed on to customers. Revenue from the Montana market declined $2.1 million due to significantly warmer weather compared with the prior-year period. Revenue from the North Carolina market decreased by $1.5 million primarily due to a $534,000 downward adjustment to sales volume used to calculate unbilled revenue in North Carolina and decreased volume due to warmer weather. These decreases were partially offset by a $0.8 million increase in revenue from the Company's Maine market, which was the result of continued customer growth, as well as colder weather in Maine.
For the first half of 2015, revenue decreased 12.9% to $66.0 million, with the changes largely driven by the same factors affecting the second quarter. The decrease was partially offset by a volume increase in Maine and revenue from the Loring pipeline in Maine, which became operational in September 2014.
Income Statement -- Natural Gas Operations Segment | |||||||
Three Months Ended June 30, |
Six Months Ended June 30, | ||||||
($ in thousands) |
2015 |
2014 |
2015 |
2014 | |||
Natural Gas Operations |
|||||||
Operating revenues |
$14,768 |
$18,977 |
$66,047 |
$75,784 | |||
Gas purchased |
7,474 |
10,671 |
41,335 |
50,518 | |||
Gross margin |
7,294 |
8,306 |
24,712 |
25,266 | |||
Operating expenses |
8,206 |
8,334 |
16,984 |
16,154 | |||
Operating (loss) income |
(912) |
(28) |
7,728 |
9,112 | |||
Other income |
136 |
193 |
341 |
301 | |||
Income before interest and taxes |
(776) |
165 |
8,069 |
9,413 | |||
Interest expense |
(620) |
(644) |
(1,291) |
(1,309) | |||
Income before income taxes |
(1,396) |
(479) |
6,778 |
8,104 | |||
Income tax benefit (expense) |
528 |
161 |
(2,533) |
(3,034) | |||
Net loss (income) |
$ (868) |
$ (318) |
$ 4,245 |
$ 5,070 |
Gross margin for the second quarter of 2015 decreased to $7.3 million compared with $8.3 million in the prior-year quarter. The decrease was driven by an adjustment of additional disallowed gas cost in Ohio mandated by the Public Utilities Commission of Ohio (PUCO), the downward adjustment to sales volume for unbilled revenue in North Carolina, which were partially offset by customer growth and colder weather in Maine. On a year-to-date basis, gross margin decreased by $0.6 million to $24.7 million primarily due to the Ohio PUCO adjustment and warmer weather in Montana, which was offset in part by customer growth in the North Carolina and Maine markets, along with colder weather in Maine.
Operating expenses decreased by $0.1 million for the quarter. The decrease in operating expenses reflected a reduction in personnel costs, a decrease in outside and professional services costs, board fees and lower bad debt expense, partially offset by a $0.4 million goodwill and asset impairment charge. Depreciation and amortization expense was essentially flat due to decreased capital expenditures that offset amortization of a regulatory asset. For the first half of 2015, the
$0.8 million increase in operating expenses reflected higher outside and professional services costs, an increase in board fees during the first quarter and the goodwill and asset impairment charge, which were partly offset by a decrease in personnel costs and lower bad debt expense. Depreciation and amortization expense increased by $221,000 primarily due to amortization of the aforementioned regulatory asset not present in the prior year period.
The segment reported a 2015 second quarter net loss of $0.9 million compared with a net loss of
$0.3 million in the 2014 quarter. For the 2015 first half, net income for the segment was $4.2 million compared with $5.1 million for the 2014 first half.
Other Operating Segments
Net loss for the Marketing and Production Operations segment improved by $0.8 million to near breakeven in the second quarter of 2015. Revenue decreased by $0.2 million to $1.3 million for the second quarter of 2015, compared with the same period in 2014 and gross margin increased by
$0.1 million to $0.2 million. Most of the impact of lower pricing was offset by higher volumes. For the first half of 2015, the segment was near breakeven compared with a $0.8 million net loss in the prior-year first half.
Net loss for the Corporate and Other Operations segment increased by $0.3 million to $0.6 million compared with net loss of $0.3 million in the prior-year quarter. The change was primarily due to higher administrative and interest costs and expenses related to the sale of the Wyoming operations, partly offset by higher tax benefits in the quarter. For the first half of 2015, the segment recorded a $0.9 million net loss, compared with a $0.7 million net loss in the prior-year first half.
Adjusted EBITDA
Adjusted earnings from continuing operations before interest, taxes, depreciation, amortization, accretion, and non-recurring expenses ("Adjusted EBITDA"), a non-GAAP financial measure, was
$1.7 million and $1.4 million, respectively, in the second quarters of 2015 and 2014. On a year-date basis, the same measure was $12.2 million and $12.0 million in 2015 and 2014, respectively. The Company believes that, when used in conjunction with measures prepared in accordance with U.S. generally accepted accounting principles ("GAAP"), Adjusted EBITDA, which is a non-GAAP measure, helps in the understanding of its operating performance. See the attached tables for important disclosures regarding the Company's use of Adjusted EBITDA, as well as a reconciliation of GAAP income from continuing operations to Adjusted EBITDA.
Balance Sheet and Cash Management
Cash and cash equivalents as of June 30, 2015 were $2.3 million, up from $1.6 million at
December 31, 2014.
Cash provided by operating activities of continuing operations for the six months ended June 30, 2015 was $11.4 million, a $2.3 million increase from the prior-year period. The improvement was primarily due to fluctuations in working capital.
Capital expenditures for the six months ended June 30, 2015 were $5.0 million compared with
$10.7 million in the prior-year period. Capital expenditures in 2015 are expected to be approximately $8 million to $9 million, and are focused on the growth of the Natural Gas Operations segment as well as ongoing construction activities in all of the Company's utility service areas to support expansion, maintenance and enhancement of its gas pipeline systems. This includes expanding its systems in its North Carolina and Maine markets to meet high customer demand in these underserved markets.
Mr. Osborne commented, "We are making excellent progress in our strategy to transform Gas Natural into a benchmark natural gas utility. Our asset rationalization program is moving forward nicely and the capital from these divestitures will put us in an excellent position to expand in markets where we already have a well-established presence and can benefit from low market penetration, market-based rates and rising demand for natural gas. Additionally, our pipeline investments in Ohio and Maine offer significant growth potential that we are just beginning to tap."
He concluded, "Over the last year, under new leadership, we have enhanced operations, improved the control structure and further strengthened the balance sheet. We continue to improve our relationships with regulatory agencies in our markets. All of this will serve us well in the future as we manage our business with a focus on improving returns and increasing shareholder value."
Webcast and Conference Call
Gas Natural will host a conference call and live webcast Tuesday, August 11th at 10:00 a.m. Eastern Time. During the conference call and webcast, management will review the financial and operating results for the second quarter and discuss Gas Natural's corporate strategies and outlook. A question-and-answer session will follow. The teleconference can be accessed by calling (201) 689-8471. The webcast can be monitored on the Company's website at www.egas.com.
A telephonic replay will be available from 1:00 p.m. ET on the day of the teleconference through Tuesday, August 18, 2015. To listen to a replay of the call, dial (858) 384-5517 and enter the conference ID number 13614153. An archive of the webcast will be available on the Company's website at www.egas.com and will include a transcript, once available.
About Gas Natural Inc.
Gas Natural Inc., a holding company, distributes and sells natural gas to end-use residential, commercial, and industrial customers. It distributes approximately 26 billion cubic feet of natural gas to approximately 68,000 customers through regulated utilities operating in Montana, Ohio, Pennsylvania, Maine, North Carolina and Kentucky. The Company's other operations include interstate pipeline, natural gas production, and natural gas marketing. The Company's Montana public utility was originally incorporated in 1909. Its strategy for growth is to expand throughput in its markets, while looking for acquisitions that are either adjacent to its existing utilities or in undersaturated markets.
Gas Natural Inc. regularly posts information on its website at www.egas.net.
Safe Harbor Regarding Forward-Looking Statements
The Company is including the following cautionary statement in this release to make applicable and to take advantage of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 for any forward-looking statements made by, or on behalf of, Gas Natural Inc. Forward-looking statements are all statements other than statements of historical fact, including, without limitation, those that are identified by the use of the words "anticipates," "estimates," "expects," "intends," "plans," "predicts," "believes" and similar expressions. Such statements are inherently subject to a variety of risks and uncertainties that could cause actual results to differ materially from those expressed. Factors that may affect forward-looking statements and the Company's business generally include but are not limited to the Company's ability to successfully integrate the operations of the companies it has recently acquired and consummate additional acquisitions, the Company's continued ability to make dividend payments, the Company's ability to implement its business plan, fluctuating energy commodity prices, the possibility that regulators may not permit the Company to pass through all of its increased costs to its customers, changes in the utility regulatory environment, wholesale and retail competition, the Company's ability to satisfy its debt obligations, including compliance with financial covenants, weather conditions, litigation risks, and various other matters, many of which are beyond the Company's control, the risk factors and cautionary statements made in the Company's public filings with the Securities and Exchange Commission, and other factors that the Company is currently unable to identify or quantify, but may exist in the future. Gas Natural Inc. expressly undertakes no obligation to update or revise any forward-looking statement contained herein to reflect any change in Gas Natural Inc.'s expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.
For more information, contact: |
|
Gas Natural Inc. |
Investor Relations: |
James E. Sprague, Chief Financial Officer |
Deborah K. Pawlowski or Karen L. Howard, Kei Advisors LLC |
Phone: (216) 202-1564 |
Phone: (716) 843-3908 / (716) 843-3942 |
Email: jsprague@egas.net |
FINANCIAL TABLES FOLLOW.
Gas Natural Inc. and Subsidiaries | ||||||||
Consolidated Statements of Operations | ||||||||
(Unaudited) | ||||||||
Three Months Ended June 30, |
Six Months Ended June 30, | |||||||
2015 |
2014 |
2015 |
2014 | |||||
REVENUES |
||||||||
Natural gas operations |
$14,767,783 |
$18,977,005 |
$66,047,513 |
$75,784,368 | ||||
Marketing and production |
1,278,299 |
1,522,914 |
3,731,530 |
6,212,270 | ||||
Total revenues |
16,046,082 |
20,499,919 |
69,779,043 |
81,996,638 | ||||
COST OF SALES |
||||||||
Natural gas purchased |
7,474,085 |
10,671,634 |
41,335,438 |
50,518,238 | ||||
Marketing and production |
1,071,569 |
1,436,158 |
3,378,458 |
5,677,123 | ||||
Total cost of sales |
8,545,654 |
12,107,792 |
44,713,896 |
56,195,361 | ||||
GROSS MARGIN |
7,500,428 |
8,392,127 |
25,065,147 |
25,801,277 | ||||
OPERATING EXPENSES |
||||||||
Distribution, general, and administrative |
6,369,218 |
6,267,338 |
12,986,821 |
12,747,746 | ||||
Maintenance |
287,751 |
319,466 |
615,231 |
624,546 | ||||
Depreciation and amortization |
1,658,495 |
1,678,661 |
3,537,216 |
3,347,983 | ||||
Accretion |
9,897 |
13,050 |
21,077 |
27,278 | ||||
Provision for doubtful accounts |
46,586 |
813,452 |
98,328 |
821,731 | ||||
Taxes other than income |
1,005,294 |
1,039,209 |
2,008,457 |
1,960,395 | ||||
Total operating expenses |
9,377,241 |
10,131,176 |
19,267,130 |
19,529,679 | ||||
OPERATING (LOSS) INCOME |
(1,876,813) |
(1,739,049) |
5,798,017 |
6,271,598 | ||||
Loss from unconsolidated affiliate |
- |
(4) |
- |
(977) | ||||
Other income, net |
38,405 |
158,549 |
316,027 |
259,325 | ||||
Acquisition expense |
- |
(1,869) |
- |
(7,197) | ||||
Interest expense |
(886,099) |
(760,969) |
(1,755,121) |
(1,570,068) | ||||
(Loss) income before income taxes |
(2,724,507) |
(2,343,342) |
4,358,923 |
4,952,681 | ||||
Income tax benefit (expense) |
1,012,433 |
849,843 |
(1,654,240) |
(1,909,635) | ||||
(LOSS) INCOME FROM CONTINUING OPERATIONS |
(1,712,074) |
(1,493,499) |
2,704,683 |
3,043,046 | ||||
Discontinued operations, net of tax |
212,879 |
64,881 |
649,795 |
546,827 | ||||
NET (LOSS) INCOME |
$ (1,499,195) |
$ (1,428,618) |
$ 3,354,478 |
$ 3,589,873 | ||||
Basic weighted shares outstanding |
10,487,610 |
10,468,961 |
10,487,561 |
10,468,961 | ||||
Dilutive effect of stock options |
- |
- |
1,320 |
429 | ||||
Diluted weighted shares outstanding |
10,487,610 |
10,468,961 |
10,488,881 |
10,469,390 | ||||
BASIC AND DILUTED (LOSS) EARNINGS PER SHARE: |
||||||||
Continuing operations |
$ (0.16) |
$ (0.14) |
$ 0.26 |
$ 0.29 | ||||
Discontinued operations |
0.02 |
0.01 |
0.06 |
0.05 | ||||
Net (loss) income per share |
$ (0.14) |
$ (0.13) |
$ 0.32 |
$ 0.34 | ||||
Weighted average dividends declared per common share |
$ - |
$ 0.135 |
$ 0.135 |
$ 0.270 |
Gas Natural Inc. and Subsidiaries | |||
Consolidated Balance Sheets | |||
June 30, |
December 31, | ||
2015 |
2014 | ||
(unaudited) |
|||
ASSETS |
|||
CURRENT ASSETS |
|||
Cash and cash equivalents |
$ 2,328,471 |
$ 1,585,926 | |
Accounts receivable |
|||
Trade, less allowance for doubtful accounts of$286,489and $370,909, respectively |
5,808,510 |
12,095,535 | |
Related parties |
220,876 |
250,101 | |
Unbilled gas |
1,716,361 |
7,630,852 | |
Note receivable, current portion |
726 |
2,070 | |
Inventory |
|||
Natural gas |
3,502,822 |
5,301,895 | |
Materials and supplies |
2,668,307 |
2,300,990 | |
Prepaid income taxes |
431,681 |
431,681 | |
Regulatory assets, current |
3,139,033 |
4,097,822 | |
Deferred tax asset |
602,923 |
635,195 | |
Prepayments and other |
1,019,511 |
986,941 | |
Assets held for sale |
2,712,579 |
802,436 | |
Discontinued operations |
10,483,892 |
11,653,934 | |
Total current assets |
34,635,692 |
47,775,378 | |
PROPERTY, PLANT AND EQUIPMENT |
|||
Property, plant and equipment |
190,571,852 |
187,566,638 | |
Less accumulated depreciation, depletion and amortization |
(47,245,750) |
(45,555,553) | |
PROPERTY, PLANT, & EQUIPMENT, NET |
143,326,102 |
142,011,085 | |
OTHER ASSETS |
|||
Notes receivable, less current portion |
36,528 |
90,345 | |
Regulatory assets, non-current |
1,788,743 |
2,055,404 | |
Debt issuance costs, net of amortization |
877,818 |
1,079,447 | |
Goodwill |
15,872,247 |
16,155,672 | |
Customer relationships, net of amortization |
2,777,986 |
2,927,500 | |
Restricted cash |
1,897,683 |
1,897,677 | |
Other assets |
38,179 |
11,404 | |
Total other assets |
23,289,184 |
24,217,449 | |
TOTAL ASSETS |
$201,250,978 |
$214,003,912 |
Gas Natural Inc. and Subsidiaries | |||
Consolidated Balance Sheets | |||
June 30, |
December 31, | ||
2015 |
2014 | ||
(unaudited) |
|||
LIABILITIES AND CAPITALIZATION |
|||
CURRENT LIABILITIES |
|||
Checks in excess of amounts on deposit |
$ 120,155 |
$ 194,524 | |
Line of credit |
18,700,000 |
28,760,799 | |
Accounts payable |
|||
Trade |
5,194,009 |
14,115,367 | |
Related parties |
24,095 |
170,319 | |
Notes payable, current portion |
530,291 |
542,201 | |
Short-term note payable - related party |
5,000,000 |
- | |
Contingent consideration, current |
671,638 |
671,638 | |
Derivative instruments |
320,190 |
3,023,271 | |
Accrued liabilities |
3,461,371 |
4,860,663 | |
Accrued liabilities - related parties |
82,817 |
111,133 | |
Customer deposits, current |
451,522 |
634,090 | |
Obligation under capital lease, current |
188,224 |
188,224 | |
Regulatory liability, current |
1,446,654 |
925,175 | |
Build-to-suit liability |
6,847,427 |
5,597,287 | |
Other current liabilities |
922,682 |
940,643 | |
Liabilities held for sale |
181,793 |
61,416 | |
Discontinued operations |
540,986 |
544,432 | |
Total current liabilities |
44,683,854 |
61,341,182 | |
LONG-TERM LIABILITIES |
|||
Deferred investment tax credits |
102,662 |
113,193 | |
Deferred tax liability |
12,544,216 |
10,538,394 | |
Asset retirement obligation |
1,217,595 |
1,196,518 | |
Customer advances for construction |
1,024,206 |
993,681 | |
Regulatory liability, non-current |
1,170,136 |
1,089,850 | |
Customer deposits |
949,540 |
949,540 | |
Obligation under capital lease, less current |
1,674,714 |
1,674,714 | |
Contingent consideration, less current |
75,362 |
75,362 | |
Total long-term liabilities |
18,758,431 |
16,631,252 | |
NOTES PAYABLE, less current portion |
39,461,182 |
39,720,860 | |
COMMITMENTS AND CONTINGENCIES |
- |
- | |
STOCKHOLDERS' EQUITY |
|||
Preferred stock; $0.15 par value; 1,500,000 shares authorized, no shares issued or outstanding |
- |
- | |
Common stock; $0.15 par value; |
1,573,352 |
1,573,127 | |
Capital in excess of par value |
63,925,018 |
63,826,341 | |
Retained earnings |
32,849,141 |
30,911,150 | |
Total stockholders' equity |
98,347,511 |
96,310,618 | |
TOTAL CAPITALIZATION |
137,808,693 |
136,031,478 | |
TOTAL LIABILITIES AND CAPITALIZATION |
$201,250,978 |
$214,003,912 |
Gas Natural Inc. and Subsidiaries | |||
Consolidated Statements of Cash Flows | |||
(Unaudited) | |||
Six months ended June 30, | |||
2015 |
2014 | ||
CASH FLOWS FROM OPERATING ACTIVITIES |
|||
Net income |
$ 3,354,478 |
$ 3,589,873 | |
Less incomefrom discontinued operations |
649,795 |
546,827 | |
Incomefrom continuing operations |
2,704,683 |
3,043,046 | |
Adjustments to reconcile incomefrom continuing operations to net cash provided by operating activities: |
|||
Depreciation and amortization |
3,537,216 |
3,347,983 | |
Accretion |
21,077 |
27,278 | |
Amortization of debt issuance costs |
352,758 |
204,019 | |
Provision for doubtful accounts |
98,328 |
821,731 | |
Stock based compensation |
98,902 |
308,330 | |
Loss on goodwill and asset impairment |
393,107 |
- | |
Loss(gain) on sale of assets |
(35,323) |
4,292 | |
Loss from unconsolidated affiliate |
- |
977 | |
Change in fair value of derivative financial instruments |
(135,120) |
- | |
Investment tax credit |
(10,531) |
(10,531) | |
Deferred income taxes |
2,038,094 |
2,181,681 | |
Changes in assets and liabilities |
|||
Accounts receivable, including related parties |
6,066,149 |
4,123,081 | |
Unbilled gas |
5,913,355 |
5,427,211 | |
Natural gas inventory |
1,799,073 |
1,506,674 | |
Accounts payable, including related parties |
(8,378,473) |
(5,277,741) | |
Regulatory assets & liabilities |
(1,038,131) |
(1,505,715) | |
Prepayments and other |
(35,011) |
26,640 | |
Other assets |
(496,983) |
(2,416,331) | |
Other liabilities |
(1,464,268) |
(2,652,233) | |
Net cash provided by operating activities of continuing operations |
11,428,902 |
9,160,392 | |
CASH FLOWS FROM INVESTING ACTIVITIES |
|||
Capital expenditures |
(4,972,609) |
(10,664,364) | |
Proceeds from sale of fixed assets |
49,660 |
33,234 | |
Proceeds from note receivable |
55,161 |
2,252 | |
Restricted cash – capital expenditures fund |
- |
(106) | |
Customer advances for construction |
30,842 |
4,793 | |
Contributions in aid of construction |
195,091 |
988,724 | |
Net cash used in investing activities of continuing operations |
(4,641,855) |
(9,635,467) | |
CASH FLOWS FROM FINANCING ACTIVITIES |
|||
Proceeds from lines of credit |
13,500,000 |
10,350,000 | |
Repayments of lines of credit |
(23,560,799) |
(14,919,000) | |
Repayments of notes payable |
(271,588) |
(3,294,190) | |
Proceeds from notes payable |
5,000,000 |
102,000 | |
Repayments of build-to-suit |
(991,121) |
- | |
Debt issuance costs |
(151,130) |
- | |
Restricted cash – debt service fund |
(6) |
131,376 | |
Exercise of stock options |
45,762 | ||
Dividends paid |
(1,416,488) |
(2,826,793) | |
Net cash used in financing activities of continuing operations |
(7,891,132) |
(10,410,845) | |
DISCONTINUED OPERATIONS |
|||
Operating cash flows |
2,244,634 |
1,253,981 | |
Investing cash flows |
(398,004) |
(203,588) | |
Net cash provided by discontinued operations |
1,846,630 |
1,050,393 | |
NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS |
742,545 |
(9,835,527) | |
Cash and cash equivalents, beginning of period |
1,585,926 |
12,741,197 | |
CASH AND CASH EQUIVALENTS, END OF PERIOD |
$ 2,328,471 |
$ 2,905,670 |
Gas Natural Inc. and Subsidiaries Segments of Operations | |||||||
Three Months Ended June 30, 2015 |
|||||||
Natural Gas |
Marketing & |
Corporate & |
|||||
Operations |
Production |
Other |
Consolidated | ||||
OPERATING REVENUE |
$14,846,487 |
$ 2,404,029 |
$ - |
$ 17,250,516 | |||
Intersegment eliminations |
(78,704) |
(1,125,730) |
- |
(1,204,434) | |||
Total operating revenue |
14,767,783 |
1,278,299 |
- |
16,046,082 | |||
COST OF SALES |
7,552,789 |
2,197,299 |
- |
9,750,088 | |||
Intersegment eliminations |
(78,704) |
(1,125,730) |
- |
(1,204,434) | |||
Total cost of sales |
7,474,085 |
1,071,569 |
- |
8,545,654 | |||
GROSS MARGIN |
7,293,698 |
206,730 |
- |
7,500,428 | |||
OPERATING EXPENSES |
8,232,263 |
222,141 |
949,182 |
9,403,586 | |||
Intersegment eliminations |
(26,345) |
- |
- |
(26,345) | |||
Total operating expenses |
8,205,918 |
222,141 |
949,182 |
9,377,241 | |||
OPERATING LOSS |
$ (912,220) |
$ (15,411) |
$ (949,182) |
$ (1,876,813) | |||
NET LOSS FROM CONTINUING OPERATIONS |
$ (868,587) |
$ (21,636) |
$ (821,851) |
$ (1,712,074) | |||
DISCONTINUED OPERATIONS |
- |
- |
212,879 |
212,879 | |||
NET LOSS |
$ (868,587) |
$ (21,636) |
$ (608,972) |
$ (1,499,195) | |||
Three Months Ended June 30, 2014 |
|||||||
Natural Gas |
Marketing & |
Corporate & |
|||||
Operations |
Production |
Other |
Consolidated | ||||
OPERATING REVENUE |
$19,055,806 |
$ 3,071,792 |
$ - |
$ 22,127,598 | |||
Intersegment eliminations |
(78,801) |
(1,548,878) |
- |
(1,627,679) | |||
Total operating revenue |
18,977,005 |
1,522,914 |
- |
20,499,919 | |||
COST OF SALES |
10,750,435 |
2,985,036 |
- |
13,735,471 | |||
Intersegment eliminations |
(78,801) |
(1,548,878) |
- |
(1,627,679) | |||
Total cost of sales |
10,671,634 |
1,436,158 |
- |
12,107,792 | |||
GROSS MARGIN |
8,305,371 |
86,756 |
- |
8,392,127 | |||
OPERATING EXPENSES |
8,334,948 |
1,401,544 |
420,429 |
10,156,921 | |||
Intersegment eliminations |
(500) |
- |
(25,245) |
(25,745) | |||
Total operating expenses |
8,334,448 |
1,401,544 |
395,184 |
10,131,176 | |||
OPERATING LOSS |
$ (29,077) |
$(1,314,788) |
$ (395,184) |
$ (1,739,049) | |||
NET LOSS FROM CONTINUING OPERATIONS |
$ (317,705) |
$ (849,438) |
$ (326,356) |
$ (1,493,499) | |||
DISCONTINUED OPERATIONS |
- |
- |
64,881 |
64,881 | |||
NET LOSS |
$ (317,705) |
$ (849,438) |
$ (261,475) |
$ (1,428,618) |
Gas Natural Inc. and Subsidiaries Natural Gas Operations | |||||||
Six Months Ended June 30, 2015 |
|||||||
Natural Gas |
Marketing & |
Corporate & |
|||||
Operations |
Production |
Other |
Consolidated | ||||
OPERATING REVENUE |
$66,213,374 |
$ 7,030,500 |
$ - |
$ 73,243,874 | |||
Intersegment eliminations |
(165,861) |
(3,298,970) |
- |
(3,464,831) | |||
Total operating revenue |
66,047,513 |
3,731,530 |
- |
69,779,043 | |||
COST OF SALES |
41,501,299 |
6,677,428 |
- |
48,178,727 | |||
Intersegment eliminations |
(165,861) |
(3,298,970) |
- |
(3,464,831) | |||
Total cost of sales |
41,335,438 |
3,378,458 |
- |
44,713,896 | |||
GROSS MARGIN |
24,712,075 |
353,072 |
- |
25,065,147 | |||
OPERATING EXPENSES |
17,046,186 |
454,897 |
1,828,077 |
19,329,160 | |||
Intersegment eliminations |
(62,030) |
- |
- |
(62,030) | |||
Total operating expenses |
16,984,156 |
454,897 |
1,828,077 |
19,267,130 | |||
OPERATING INCOME (LOSS) |
$ 7,727,919 |
$ (101,825) |
$(1,828,077) |
$ 5,798,017 | |||
NET INCOME (LOSS) FROM CONTINUING OPERATIONS |
$ 4,244,773 |
$ (17,995) |
$(1,522,095) |
$ 2,704,683 | |||
DISCONTINUED OPERATIONS |
- |
- |
649,795 |
649,795 | |||
NET INCOME (LOSS) |
$ 4,244,773 |
$ (17,995) |
$ (872,300) |
$ 3,354,478 | |||
Six Months Ended June 30, 2014 |
|||||||
Natural Gas |
Marketing & |
Corporate & |
|||||
Operations |
Production |
Other |
Consolidated | ||||
OPERATING REVENUE |
$75,949,713 |
$11,001,565 |
$ - |
$ 86,951,278 | |||
Intersegment eliminations |
(165,345) |
(4,789,295) |
- |
(4,954,640) | |||
Total operating revenue |
75,784,368 |
6,212,270 |
- |
81,996,638 | |||
COST OF SALES |
50,683,583 |
10,466,418 |
- |
61,150,001 | |||
Intersegment eliminations |
(165,345) |
(4,789,295) |
- |
(4,954,640) | |||
Total cost of sales |
50,518,238 |
5,677,123 |
- |
56,195,361 | |||
GROSS MARGIN |
25,266,130 |
535,147 |
- |
25,801,277 | |||
OPERATING EXPENSES |
16,154,832 |
1,784,002 |
1,641,835 |
19,580,669 | |||
Intersegment eliminations |
(500) |
- |
(50,490) |
(50,990) | |||
Total operating expenses |
16,154,332 |
1,784,002 |
1,591,345 |
19,529,679 | |||
OPERATING INCOME (LOSS) |
$ 9,111,798 |
$ (1,248,855) |
$(1,591,345) |
$ 6,271,598 | |||
NET INCOME (LOSS) FROM CONTINUING OPERATIONS |
$ 5,069,598 |
$ (828,637) |
$(1,197,915) |
$ 3,043,046 | |||
DISCONTINUED OPERATIONS |
- |
- |
546,827 |
546,827 | |||
NET INCOME (LOSS) |
$ 5,069,598 |
$ (828,637) |
$ (651,088) |
$ 3,589,873 |
Gas Natural Inc. and Subsidiaries Natural Gas Operations | |||||||
Utility Throughput |
|||||||
Three Months Ended June 30, |
Six Months Ended June 30, | ||||||
(in million cubic feet (MMcf)) |
2015 |
2014 |
2015 |
2014 | |||
Full service distribution: |
|||||||
Energy West Montana (MT) |
474 |
617 |
1,800 |
2,212 | |||
Frontier Natural Gas (NC) |
45 |
165 |
516 |
593 | |||
Bangor Gas (ME) |
290 |
290 |
1,130 |
1,069 | |||
Ohio Companies (OH) |
471 |
519 |
2,293 |
2,354 | |||
Public Gas (KY) |
13 |
15 |
88 |
87 | |||
Total full service distribution |
1,293 |
1,606 |
5,827 |
6,315 | |||
Transportation |
2,446 |
2,648 |
5,765 |
5,994 | |||
Bucksport |
285 |
1,803 |
413 |
2,760 | |||
Total volumes |
4,024 |
6,057 |
12,005 |
15,069 |
Heating Degree Days |
||||||||||
Three Months Ended |
Percent Colder (Warmer) | |||||||||
June 30, |
2015 Compared to | |||||||||
Normal |
2015 |
2014 |
Normal |
2014 | ||||||
Great Falls, MT |
1,215 |
1,136 |
1,273 |
(6.50%) |
(10.76%) | |||||
Bangor, ME |
978 |
1,150 |
1,078 |
17.59% |
6.68% | |||||
Elkin, NC |
337 |
327 |
359 |
(2.97%) |
(8.91%) | |||||
Lancaster, OH |
544 |
456 |
544 |
(16.18%) |
(16.18%) | |||||
Jackson, KY |
395 |
344 |
385 |
(12.91%) |
(10.65%) | |||||
Weighted Average |
872 |
813 |
912 |
(6.73%) |
(10.78%) | |||||
Six Months Ended |
Percent Colder (Warmer) | |||||||||
June 30, |
2015 Compared to | |||||||||
Normal |
2015 |
2014 |
Normal |
2014 | ||||||
Great Falls, MT |
4,426 |
3,914 |
4,863 |
(11.57%) |
(19.51%) | |||||
Bangor, ME |
4,554 |
5,603 |
5,117 |
23.03% |
9.50% | |||||
Elkin, NC |
2,454 |
2,609 |
2,793 |
6.32% |
(6.59%) | |||||
Lancaster, OH |
3,397 |
3,775 |
3,922 |
11.13% |
(3.75%) | |||||
Jackson, KY |
2,672 |
2,975 |
3,081 |
11.34% |
(3.44%) | |||||
Weighted Average |
3,901 |
3,916 |
4,379 |
0.39% |
(10.57%) |
Gas Natural and Subsidiaries Reconciliation of GAAP Income from Continuing Operations to Adjusted Income from Continuing Operations(1) | |||||||||||
(in thousands, except per share amounts) |
Three Months Ended |
Six Months Ended | |||||||||
June 30, |
June 30, | ||||||||||
2015 |
2014 |
2015 |
2014 | ||||||||
$ |
per diluted share |
$ |
per diluted share |
$ |
per diluted share |
$ |
per diluted share | ||||
GAAP income from continuing operations |
$(1,712) |
$(0.16) |
$(1,493) |
$(0.14) |
$2,705 |
$ 0.26 |
$3,043 |
$ 0.29 | |||
Add back, after tax: |
|||||||||||
Customer bankruptcy write-off |
- |
- |
673 |
0.06 |
- |
- |
673 |
0.06 | |||
Goodwill and asset impairment charge |
248 |
0.02 |
- |
- |
243 |
0.02 |
- |
- | |||
Non-recurring legal and professional fees |
421 |
0.04 |
176 |
0.02 |
774 |
0.07 |
390 |
0.04 | |||
Non-recurring regulatory and other expenses |
438 |
0.04 |
- |
- |
453 |
0.04 |
237 |
0.02 | |||
Non-GAAP adjusted income from continuing operations(1) |
$ (605) |
$(0.06) |
$ (645) |
$(0.06) |
$4,176 |
$ 0.40 |
$4,343 |
$ 0.41 |
Gas Natural and Subsidiaries Reconciliation of GAAP Income from Continuing Operations to Adjusted EBITDA(1) | |||||||
(in thousands) |
Three Months Ended |
Six Months Ended | |||||
June 30, |
June 30, | ||||||
2015 |
2014 |
2015 |
2014 | ||||
GAAP income from continuing operations |
$(1,712) |
$(1,493) |
$ 2,705 |
$ 3,043 | |||
Add back: |
|||||||
Net interest expense |
886 |
761 |
1,755 |
1,570 | |||
Income taxes |
(858) |
(850) |
1,808 |
1,910 | |||
Depreciation, amortization and accretion |
1,668 |
1,692 |
3,558 |
3,375 | |||
Customer bankruptcy write-off |
- |
1,056 |
- |
1,056 | |||
Goodwill and asset impairment charge |
393 |
- |
393 |
- | |||
Non-recurring legal and professional fees |
667 |
276 |
1,250 |
612 | |||
Non-recurring regulatory and other expenses |
693 |
- |
731 |
385 | |||
Non-GAAP Adjusted EBITDA(1) |
$ 1,737 |
$ 1,442 |
$12,200 |
$11,951 |
(1)Non-GAAP Financial Measures:
The Company believes that, when used in conjunction with GAAP measures, Adjusted Income from Continuing Operations and Adjusted EBITDA, or earnings before interest, taxes, depreciation, amortization, accretion and non-recurring charges, which are non-GAAP measures, allow investors to view its performance in a manner similar to the methods used by management and provides additional insight into its operating results. Adjusted Income from Continuing Operations and Adjusted EBITDA are not calculated through the application of GAAP and are not the required form of disclosure by the Securities and Exchange Commission. As such, these measures should not be considered as a substitute for the GAAP measure of net income and, therefore, should not be used in isolation of, but in conjunction with, the GAAP measure. The use of any non-GAAP measure may produce results that vary from the GAAP measure and may not be comparable to a similarly defined non-GAAP measure used by other companies.
To view the original version on PR Newswire, visit:http://www.prnewswire.com/news-releases/gas-natural-inc-reports-2015-second-quarter-results-300126485.html
SOURCE Gas Natural Inc.
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