Gas Natural Inc. Reports Continued Customer Growth in 2014
- Customer count grew by 4.6% during the year
- Full service distribution throughput increased by 12.4% in 2014
CLEVELAND, March 12, 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 fourth quarter and year ended December 31, 2014. As previously announced, the Company has agreed to sell its Wyoming operations which serve 6,700 customers and are reported as discontinued operations.
Income from continuing operations was $1.2 million, or $0.11 per share, for the fourth quarter, compared with $2.8 million, or $0.27 per share, for the fourth quarter of 2013. Adjusted income from continuing operations, a non-GAAP number, was $3.0 million, or $0.28 per share, for the fourth quarter of 2014 compared with $2.5 million, or $0.24 per share, for the fourth quarter of 2013. The 2014 adjustments reflect the exclusion of non-recurring professional and legal fees related to increased regulatory and legal proceedings of approximately $1.5 million and business combination adjustments of approximately $0.3 million, all after taxes. See attached table for a reconciliation of GAAP income from continuing operations to non-GAAP adjusted income from continuing operations.
For the year, income from continuing operations for 2014 was $2.7 million, or $0.26 per share, compared with $5.9 million, or $0.63 per share for the prior year. Adjusted income from continuing operations, a non-GAAP number, was $5.7 million, or $0.55 per share, for 2014 compared with $6.5 million, or $0.70 per share, for 2013. The 2014 adjustments reflect the exclusion of $2.2 million of non-recurring professional and legal fees related to increased regulatory and legal proceedings, a $0.6 million customer bankruptcy write-off, a $0.1 million gain on marketable securities and business combination adjustments of approximately $0.3 million, all after taxes. 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, noted, "In 2014 we began transforming Gas Natural into a higher quality natural gas utility, with a culture of accountability, transparency and responsible cost discipline, strategically positioned to grow shareholder value. Our 2014 achievements were highlighted by:
- Expanded our customer base by nearly 5%;
- Increased our full service distribution throughput by over 10%;
- Right-sized our operations to ensure we have the right people in the right positions. In fact, we reduced our overall headcount by 12% during the year;
- Entered into long-term market-based rate structures with the utility regulators in Maine and North Carolina;
- Proactively increased transparency with regulators; We believe the quantity and quality of our communications with our regulators and staff has greatly improved;
- Adopted a more comprehensive system of internal controls, separated our corporate offices from our utility offices and enhanced the independence of our Board;
- Activated phase one (the first 60 of 189 miles) of our Loring Pipeline in Lincoln, Maine and initiating service to our anchor customer, Lincoln Paper and Tissue; and
- Began divesting of non-core utility assets, initially in Wyoming, to redeploy those proceeds into core markets.
"While we have been building a solid, sound operational infrastructure, we continued to focus on operational growth to drive future profits."
Natural Gas Operations Segment Review
The Company added 1,854 new customers during the quarter and 2,980 new customers during the year. The Natural Gas Operations segment reported $2.3 million, or 7%, revenue growth in the quarter on increased natural gas prices, which are passed on to customers, along with higher sales volumes driven by growth in the customer base.
Natural Gas Operations Income Statement
| ($ in thousands) |
Three Months Ended |
Year Ended |
||||||
| 2014 |
2013 |
2014 |
2013 |
|||||
| Natural Gas Operations |
||||||||
| Operating revenues |
$ 34,726 |
$ 32,454 |
$ 123,053 |
$ 97,233 |
||||
| Gas purchased |
22,839 |
19,551 |
79,097 |
55,977 |
||||
| Gross margin |
11,887 |
12,903 |
43,956 |
41,256 |
||||
| Operating expenses |
7,851 |
8,352 |
32,074 |
29,395 |
||||
| Operating income |
4,036 |
4,551 |
11,882 |
11,861 |
||||
| Other income |
270 |
185 |
890 |
767 |
||||
| Income before interest and taxes |
4,306 |
4,736 |
12,772 |
12,628 |
||||
| Interest expense |
(724) |
(636) |
(2,619) |
(2,566) |
||||
| Income before income taxes |
3,582 |
4,100 |
10,153 |
10,062 |
||||
| Income tax expense |
(1,280) |
(1,067) |
(3,661) |
(3,242) |
||||
| Net income |
$ 2,302 |
$ 3,033 |
$ 6,492 |
$ 6,820 |
||||
On a full-year basis revenue was up $25.8 million, or 27%, due to increased natural gas prices passed onto customers and higher sales volumes from the customer growth, magnified by the colder weather in the first three months of the 2014 period.
Gross margin for the fourth quarter of 2014 was $11.9 million compared with $12.9 million in the prior-year period due to warmer temperatures for the fourth quarter in all of our markets. On a full year basis, gross margin increased $2.7 million to $44.0 million primarily due to increased sales volumes which were the result of customer growth in Maine, North Carolina and Ohio, amplified by colder weather in all of our markets.
Operating expenses decreased by $0.5 million for the quarter while the full year period increased by $2.7 million. These expenses included increases in allocations of corporate expenses related to the hiring of new corporate personnel and to improving and auditing our internal control environment. Depreciation and amortization expense increased $1.0 million for the year ended December 31, 2014. The increase was primarily the result of capital investment in growth initiatives and the amortization of a regulatory asset.
Other Operating Segments
The Marketing and Production segment reported a net loss of $0.5 million for the fourth quarter of 2014, compared with net income of $0.7 million in the prior-year period. On a full year basis, net loss of the Marketing and Production segment was $1.4 million compared with net income of $1.0 million for the prior year with the reduction primarily due to an increase in customer bankruptcy write-off expense of $1.1 million. The year-over-year comparison was also negatively impacted by an unrealized holding gain on a contingent consideration liability in 2013.
Adjusted EBITDA
Adjusted earnings from continuing operations before interest, taxes, depreciation, amortization, accretion, and non-recurring expenses ("Adjusted EBITDA"), a non-GAAP financial measure, for the fourth quarter of 2014 was $7.1 million compared with Adjusted EBITDA of $5.9 million for the prior-year period. For the full year, Adjusted EBITDA was $19.1 million, compared with $18.7 million in the prior year. 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 December 31, 2014 were $1.6 million, up $0.5 million from September 30, 2014, and down $11.2 million from December 31, 2013.
Cash provided by operating activities was $11.1 million in 2014 compared with $15.4 million in the prior year. The decrease was primarily the result of lower net income.
Capital expenditures for 2014 were $21.6 million compared with $23.5 million in 2013. Capital expenditures in 2015 are expected to be approximately $8 million to $9 million, and will remain focused on the Natural Gas Operations segment and the continued expansion of our natural gas utilities service areas. These expenditures will have an emphasis on the Maine, North Carolina and Ohio markets to meet the high customer interest in natural gas service in those service areas.
Mr. Osborne concluded, "Our energized Gas Natural team is aggressively making the changes necessary to strengthen our foundation and drive growth. We are in a much stronger position now as we enter 2015 to continue to execute our strategic plan and create a stronger and growing natural gas utility focused on delivering shareholder value."
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 28 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 the Maine and North Carolina markets, while looking for acquisitions that are either adjacent to its existing utilities or in under saturated 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: (440) 974-3770 |
Phone: (716) 843-3908 / (716) 843-3942 |
|
| Email: [email protected] |
Email: [email protected] / [email protected] |
|
FINANCIAL TABLES FOLLOW.
| Gas Natural Inc. and Subsidiaries |
||||||||||
| Condensed Consolidated Statements of Operations |
||||||||||
| Three Months Ended |
Year Ended |
|||||||||
| December 31, |
December 31, |
|||||||||
| 2014 |
2013 |
2014 |
2013 |
|||||||
| REVENUE |
||||||||||
| Natural gas operations |
$ 34,725,488 |
$ 32,453,516 |
$123,052,554 |
$ 97,233,112 |
||||||
| Marketing and production |
2,232,744 |
3,832,615 |
9,517,287 |
12,167,241 |
||||||
| Total revenue |
36,958,232 |
36,286,131 |
132,569,841 |
109,400,353 |
||||||
| COST OF SALES |
||||||||||
| Natural gas purchased |
22,838,885 |
19,551,071 |
79,096,553 |
55,977,154 |
||||||
| Marketing and production |
2,082,803 |
3,258,354 |
8,620,826 |
10,052,865 |
||||||
| Total cost of sales |
24,921,688 |
22,809,425 |
87,717,379 |
66,030,019 |
||||||
| GROSS MARGIN |
12,036,544 |
13,476,706 |
44,852,462 |
43,370,334 |
||||||
| OPERATING EXPENSES |
||||||||||
| Distribution, general, and administrative |
5,751,555 |
5,669,779 |
24,769,623 |
21,308,592 |
||||||
| Maintenance |
305,182 |
314,534 |
1,225,491 |
1,142,261 |
||||||
| Depreciation and amortization |
1,426,299 |
1,473,273 |
6,604,569 |
5,550,753 |
||||||
| Accretion |
14,933 |
45,444 |
51,466 |
57,912 |
||||||
| Taxes other than income |
1,066,294 |
1,065,770 |
3,928,018 |
3,671,930 |
||||||
| Provision for doubtful accounts |
282,301 |
689,319 |
1,112,115 |
726,434 |
||||||
| Contingent consideration loss (gain) |
62,000 |
(1,565,000) |
62,000 |
(1,565,000) |
||||||
| Goodwill impairment |
- |
725,744 |
- |
725,744 |
||||||
| Total operating expenses |
8,908,564 |
8,418,863 |
37,753,282 |
31,618,626 |
||||||
| OPERATING INCOME |
3,127,980 |
5,057,843 |
7,099,180 |
11,751,708 |
||||||
| Loss from unconsolidated affiliate |
(350,747) |
- |
(351,724) |
(5,007) |
||||||
| Gain on sale of marketable securities |
- |
- |
183,371 |
- |
||||||
| Acquisition expense |
- |
(27,985) |
(7,197) |
(272,094) |
||||||
| Stock sale expense |
- |
(309,432) |
- |
(309,432) |
||||||
| Other income, net |
(38,443) |
173,567 |
579,214 |
886,832 |
||||||
| Interest expense |
(891,660) |
(796,787) |
(3,226,096) |
(3,176,155) |
||||||
| Income before income taxes |
1,847,130 |
4,097,206 |
4,276,748 |
8,875,852 |
||||||
| Income tax expense |
(646,441) |
(1,299,472) |
(1,547,582) |
(3,023,711) |
||||||
| INCOME FROM CONTINUING OPERATIONS |
1,200,689 |
2,797,734 |
2,729,166 |
5,852,141 |
||||||
| Discontinued operations, net of tax |
450,959 |
417,076 |
1,032,611 |
819,138 |
||||||
| NET INCOME |
$ 1,651,648 |
$ 3,214,810 |
$ 3,761,777 |
$ 6,671,279 |
||||||
| Basic weighted shares outstanding |
10,487,511 |
10,432,256 |
10,478,312 |
9,339,002 |
||||||
| Dilutive effect of stock based compensation |
695 |
- |
505 |
720 |
||||||
| Diluted weighted shares outstanding |
10,488,206 |
10,432,427 |
10,478,817 |
9,339,722 |
||||||
| BASIC AND DILUTED EARNINGS PER SHARE: |
||||||||||
| Continuing operations |
$ 0.11 |
$ 0.27 |
$ 0.26 |
$ 0.63 |
||||||
| Discontinued operations |
$ 0.05 |
$ 0.04 |
$ 0.10 |
$ 0.08 |
||||||
| Net income per share |
$ 0.16 |
$ 0.31 |
$ 0.36 |
$ 0.71 |
||||||
| Dividends paid per common share |
$ 0.14 |
$ 0.14 |
$ 0.55 |
$ 0.55 |
||||||
| Gas Natural Inc. and Subsidiaries |
|||
| Condensed Consolidated Balance Sheets |
|||
| December 31, |
December 31, |
||
| ASSETS |
2014 |
2013 |
|
| CURRENT ASSETS |
|||
| Cash and cash equivalents |
$ 1,585,926 |
$ 12,741,197 |
|
| Marketable securities |
- |
406,134 |
|
| Accounts receivable |
|||
| Trade, less allowance for doubtful accounts of |
|||
| $370,909 and $1,978,358, respectively |
12,111,026 |
12,305,657 |
|
| Related parties |
234,610 |
146,225 |
|
| Unbilled gas |
7,630,852 |
7,172,062 |
|
| Note receivable, current portion |
2,070 |
1,938 |
|
| Inventory |
|||
| Natural gas and propane |
5,301,895 |
4,996,065 |
|
| Materials and supplies |
2,300,990 |
2,285,722 |
|
| Prepaid income taxes |
431,681 |
727,427 |
|
| Prepayments and other |
986,941 |
970,574 |
|
| Regulatory assets, current |
4,097,822 |
1,209,982 |
|
| Deferred tax asset |
635,195 |
1,225,032 |
|
| Assets held for sale |
802,436 |
- |
|
| Discontinued operations |
11,653,934 |
12,032,203 |
|
| Total current assets |
47,775,378 |
56,220,218 |
|
| PROPERTY, PLANT AND EQUIPMENT, NET |
142,011,085 |
124,587,645 |
|
| OTHER ASSETS |
|||
| Notes receivable, less current portion |
90,345 |
93,727 |
|
| Regulatory assets, non-current |
2,055,404 |
452,047 |
|
| Debt issuance costs, net of amortization |
1,079,447 |
1,388,124 |
|
| Goodwill |
16,155,672 |
16,267,377 |
|
| Customer relationships, net of amortization |
2,927,500 |
3,230,333 |
|
| Investment in unconsolidated affiliate |
- |
351,724 |
|
| Restricted cash |
1,897,677 |
1,137,442 |
|
| Other assets |
11,404 |
3,160 |
|
| Total other assets |
24,217,449 |
22,923,934 |
|
| TOTAL ASSETS |
$ 214,003,912 |
$ 203,731,797 |
|
| Gas Natural Inc. and Subsidiaries |
||||||
| Condensed Consolidated Balance Sheets (Cont'd) |
||||||
| December 31, |
December 31, |
|||||
| LIABILITIES AND CAPITALIZATION |
2014 |
2013 |
||||
| CURRENT LIABILITIES |
||||||
| Checks in excess of amounts on deposit |
$ 194,524 |
$ 842,443 |
||||
| Line of credit |
28,760,799 |
24,529,799 |
||||
| Accounts payable |
||||||
| Trade |
14,115,367 |
12,355,605 |
||||
| Related parties |
170,319 |
559,933 |
||||
| Notes payable, current portion |
542,201 |
3,502,190 |
||||
| Contingent consideration, current portion |
671,638 |
671,638 |
||||
| Derivative instruments |
3,023,271 |
- |
||||
| Accrued liabilities |
4,860,663 |
5,751,594 |
||||
| Accrued liabilities, related parties |
111,133 |
- |
||||
| Customer deposits, current |
634,090 |
667,479 |
||||
| Obligation under capital lease - current |
188,224 |
177,570 |
||||
| Regulatory liability - Over-recovered gas purchases |
925,175 |
793,184 |
||||
| Build-to-suit liability |
5,597,287 |
- |
||||
| Other current liabilities |
940,643 |
1,464,646 |
||||
| Liabilities held for sale |
61,416 |
- |
||||
| Discontinued operations |
544,432 |
574,889 |
||||
| Total current liabilities |
61,341,182 |
51,890,970 |
||||
| LONG-TERM LIABILITIES |
||||||
| Deferred investment tax credits |
113,193 |
134,255 |
||||
| Deferred tax liability |
10,538,394 |
9,055,166 |
||||
| Asset retirement obligation |
1,196,518 |
1,145,052 |
||||
| Customer advances for construction |
993,681 |
987,265 |
||||
| Regulatory liabilities, non-current |
1,089,850 |
964,462 |
||||
| Customer deposits |
949,540 |
- |
||||
| Obligation under capital lease, less current portion |
1,674,714 |
1,862,938 |
||||
| Contingent consideration, less current portion |
75,362 |
13,362 |
||||
| Total long-term liabilities |
16,631,252 |
14,162,500 |
||||
| NOTES PAYABLE, less current portion |
39,720,860 |
40,198,552 |
||||
| 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, |
||||||
| Authorized: 30,000,000 and 15,000,000 shares, respectively; |
||||||
| Issued: 10,487,511 and 10,451,678 shares, respectively; |
||||||
| Outstanding: 10,487,511 and 10,451,678 shares, respectively |
1,573,127 |
1,567,752 |
||||
| Capital in excess of par value |
63,826,341 |
63,468,969 |
||||
| Accumulated other comprehensive income |
- |
104,909 |
||||
| Retained earnings |
30,911,150 |
32,338,145 |
||||
| Total stockholders' equity |
96,310,618 |
97,479,775 |
||||
| TOTAL CAPITALIZATION |
136,031,478 |
137,678,327 |
||||
| TOTAL LIABILITIES AND CAPITALIZATION |
$ 214,003,912 |
$ 203,731,797 |
||||
| Gas Natural Inc. and Subsidiaries |
|||
| Condensed Consolidated Statements of Cash Flows |
|||
| Year Ended December 31, |
|||
| CASH FLOWS FROM OPERATING ACTIVITIES |
2014 |
2013 |
|
| Net income |
$ 3,761,777 |
$ 6,671,279 |
|
| Income from discontinued operations |
1,032,611 |
819,138 |
|
| Income from continuing operations |
2,729,166 |
5,852,141 |
|
| Adjustments to reconcile net income to net cash provided by operating activities: |
|||
| Depreciation and amortization |
6,604,569 |
5,550,753 |
|
| Accretion |
51,466 |
57,912 |
|
| Amortization of debt issuance costs |
419,953 |
418,204 |
|
| Provision for doubtful accounts |
1,112,115 |
726,434 |
|
| Stock based compensation |
316,985 |
2,962 |
|
| (Gain) on sale of marketable securities |
(183,371) |
- |
|
| (Gain) on sale of assets |
(28,293) |
(158,320) |
|
| Loss from unconsolidated affiliate |
351,724 |
5,007 |
|
| Unrealized holding loss (gain) on contingent consideration |
62,000 |
(1,565,000) |
|
| Change in fair value of derivative financial instruments |
150,885 |
- |
|
| Investment tax credit |
(21,062) |
(21,062) |
|
| Deferred income taxes |
2,135,786 |
4,024,683 |
|
| Goodwill impairment |
- |
725,744 |
|
| Changes in assets and liabilities: |
|||
| Accounts receivable, including related parties |
(891,338) |
(2,187,452) |
|
| Unbilled gas |
(480,942) |
(3,009,029) |
|
| Natural gas and propane inventory |
(457,611) |
(388,858) |
|
| Accounts payable, including related parties |
1,817,098 |
3,111,116 |
|
| Regulatory assets/liabilities |
(1,938,386) |
1,039,063 |
|
| Prepayments and other |
(24,243) |
1,076,550 |
|
| Other assets |
234,751 |
(464,339) |
|
| Other liabilities |
(815,380) |
642,788 |
|
| Net cash provided by operating activities of continued operations |
11,145,872 |
15,439,297 |
|
| CASH FLOWS FROM INVESTING ACTIVITIES |
|||
| Capital expenditures |
(21,612,680) |
(23,516,923) |
|
| Proceeds from sale of fixed assets |
172,142 |
968,772 |
|
| Proceeds from sale of marketable securities |
421,875 |
- |
|
| Proceeds from note receivable |
3,250 |
8,681 |
|
| Investment in unconsolidated affiliate |
- |
(35,000) |
|
| Restricted cash - capital expenditures fund |
57,441 |
1,264,624 |
|
| Customer advances for construction |
16,900 |
12,028 |
|
| Contributions in aid of construction |
2,262,047 |
1,105,974 |
|
| Net cash used in investing activities of continued operations |
(18,679,025) |
(20,191,844) |
|
| CASH FLOWS FROM FINANCING ACTIVITIES |
|||
| Proceeds from lines of credit |
24,850,000 |
22,519,000 |
|
| Repayment on lines of credit |
(20,619,000) |
(21,848,956) |
|
| Proceeds from notes payable |
102,000 |
- |
|
| Repayments of notes payable |
(3,565,224) |
(633,498) |
|
| Payments of Capital Lease Obligations |
(177,570) |
(167,518) |
|
| Debt issuance costs |
(111,275) |
(7,607) |
|
| Proceeds from issuance of common shares |
- |
16,721,104 |
|
| Exercise of stock options |
45,762 |
159,500 |
|
| Restricted cash - debt service fund |
131,864 |
748,781 |
|
| Dividends paid |
(5,659,098) |
(5,005,827) |
|
| Net cash (used in) provided by financing activities of continued operations |
(5,002,541) |
12,484,979 |
|
| DISCONTINUED OPERATIONS |
|||
| Operating cash flows |
1,924,330 |
658,105 |
|
| Investing cash flows |
(511,434) |
1,738,076 |
|
| Financing cash flows |
(32,473) |
(590,059) |
|
| Net cash provided by discontinued operations |
1,380,423 |
1,806,122 |
|
| NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS |
(11,155,271) |
9,538,554 |
|
| CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD |
12,741,197 |
3,202,643 |
|
| CASH AND CASH EQUIVALENTS, END OF PERIOD |
$ 1,585,926 |
$ 12,741,197 |
|
| Gas Natural Inc. and Subsidiaries |
|||||||||
| Segments of Operations |
|||||||||
| Three Months Ended December 31, 2014 |
|||||||||
| Natural Gas |
Marketing & |
Corporate & |
|||||||
| Operations |
Production |
Other |
Consolidated |
||||||
| OPERATING REVENUES |
$ 35,034,854 |
$ 4,468,888 |
$ - |
$ 39,503,742 |
|||||
| Intersegment eliminations |
(309,366) |
(2,236,144) |
- |
(2,545,510) |
|||||
| Total operating revenue |
34,725,488 |
2,232,744 |
- |
36,958,232 |
|||||
| COST OF SALES |
23,148,251 |
4,318,947 |
- |
27,467,198 |
|||||
| Intersegment eliminations |
(309,366) |
(2,236,144) |
- |
(2,545,510) |
|||||
| Total cost of sales |
22,838,885 |
2,082,803 |
- |
24,921,688 |
|||||
| GROSS MARGIN |
$ 11,886,603 |
$ 149,941 |
$ - |
$ 12,036,544 |
|||||
| OPERATING EXPENSES |
7,176,823 |
321,916 |
736,210 |
8,933,901 |
|||||
| Intersegment eliminations |
(25,337) |
- |
- |
(25,337) |
|||||
| Total operating expenses |
7,850,438 |
321,916 |
736,210 |
8,908,564 |
|||||
| OPERATING INCOME (LOSS) |
$ 4,036,165 |
$ (171,975) |
$ (736,210) |
$ 3,127,980 |
|||||
| DISCONTINUED OPERATIONS, NET OF INCOME TAX |
$ - |
$ - |
$ 450,959 |
$450,959 |
|||||
| NET INCOME (LOSS) |
$ 2,301,884 |
$ (496,818) |
$ (153,418) |
$ 1,651,648 |
|||||
| Three Months Ended December 31, 2013 |
|||||||||
| Natural Gas |
Marketing & |
Corporate & |
|||||||
| Operations |
Production |
Other |
Consolidated |
||||||
| OPERATING REVENUES |
$ 32,462,345 |
$ 6,407,612 |
$ - |
$ 38,869,957 |
|||||
| Intersegment eliminations |
(8,829) |
(2,574,997) |
- |
(2,583,826) |
|||||
| Total operating revenue |
32,453,516 |
3,832,615 |
- |
36,286,131 |
|||||
| COST OF SALES |
19,559,900 |
5,833,351 |
- |
25,393,251 |
|||||
| Intersegment eliminations |
(8,829) |
(2,574,997) |
- |
(2,583,826) |
|||||
| Total cost of sales |
19,551,071 |
3,258,354 |
- |
22,809,425 |
|||||
| GROSS MARGIN |
$ 12,902,445 |
$ 574,261 |
$ - |
$ 13,476,706 |
|||||
| OPERATING EXPENSES |
8,293,655 |
(609,201) |
760,829 |
8,445,283 |
|||||
| Intersegment eliminations |
57,670 |
- |
(84,090) |
(26,420) |
|||||
| Total operating expenses |
8,351,325 |
(609,201) |
676,739 |
8,418,863 |
|||||
| OPERATING INCOME (LOSS) |
$ 4,551,120 |
$ 1,183,462 |
$ (676,739) |
$ 5,057,843 |
|||||
| DISCONTINUED OPERATIONS, NET OF INCOME TAX |
$ - |
$ - |
$ 417,076 |
$ 417,076 |
|||||
| NET INCOME (LOSS) |
$ 3,032,558 |
$ 738,818 |
$ (556,566) |
$ 3,214,810 |
|||||
| Gas Natural Inc. and Subsidiaries |
|||||||||
| Segments of Operations, Continued |
|||||||||
| Year Ended December 31, 2014 |
|||||||||
| Natural Gas |
Marketing & |
Corporate & |
|||||||
| Operations |
Production |
Other |
Consolidated |
||||||
| OPERATING REVENUES |
$ 123,378,718 |
$ 17,605,367 |
$ - |
$ 140,984,085 |
|||||
| Intersegment elimination |
(326,164) |
(8,088,080) |
- |
(8,414,244) |
|||||
| Total operating revenue |
123,052,554 |
9,517,287 |
- |
132,569,841 |
|||||
| COST OF SALES |
79,422,717 |
16,708,906 |
- |
96,131,623 |
|||||
| Intersegment elimination |
(326,164) |
(8,088,080) |
- |
(8,414,244) |
|||||
| Total cost of sales |
79,096,553 |
8,620,826 |
- |
87,717,379 |
|||||
| GROSS MARGIN |
$ 43,956,001 |
$ 896,461 |
$ - |
$ 44,852,462 |
|||||
| OPERATING EXPENSES |
32,176,823 |
2,478,600 |
3,200,757 |
37,856,180 |
|||||
| Intersegment elimination |
(102,898) |
- |
- |
(102,898) |
|||||
| Total operating expenses |
32,073,925 |
2,478,600 |
3,200,757 |
37,753,282 |
|||||
| OPERATING INCOME (LOSS) |
$ 11,882,076 |
$ (1,582,139) |
$ (3,200,757) |
$ 7,099,180 |
|||||
| DISCONTINUED OPERATIONS |
$ - |
$ - |
$ 1,032,611 |
$ 1,032,611 |
|||||
| NET INCOME (LOSS) |
$ 6,491,530 |
$ (1,433,703) |
$ (1,296,050) |
$ 3,761,777 |
|||||
| Year Ended December 31, 2013 |
|||||||||
| Natural Gas |
Marketing & |
Corporate & |
|||||||
| Operations |
Production |
Other |
Consolidated |
||||||
| OPERATING REVENUES |
$ 97,259,443 |
$ 20,260,001 |
$ - |
$ 117,519,444 |
|||||
| Intersegment elimination |
(26,331) |
(8,092,760) |
- |
(8,119,091) |
|||||
| Total operating revenue |
97,233,112 |
12,167,241 |
- |
109,400,353 |
|||||
| COST OF SALES |
56,003,485 |
18,145,625 |
- |
74,149,110 |
|||||
| Intersegment elimination |
(26,331) |
(8,092,760) |
- |
(8,119,091) |
|||||
| Total cost of sales |
55,977,154 |
10,052,865 |
- |
66,030,019 |
|||||
| GROSS MARGIN |
$ 41,255,958 |
$ 2,114,376 |
$ - |
$ 43,370,334 |
|||||
| OPERATING EXPENSES |
29,408,152 |
500,561 |
1,807,747 |
31,716,460 |
|||||
| Intersegment elimination |
(13,744) |
- |
(84,090) |
(97,834) |
|||||
| Total operating expenses |
29,394,408 |
500,561 |
1,723,657 |
31,618,626 |
|||||
| OPERATING INCOME (LOSS) |
$ 11,861,550 |
$ 1,613,815 |
$ (1,723,657) |
$ 11,751,708 |
|||||
| DISCONTINUED OPERATIONS |
$ - |
$ - |
$ 819,138 |
$ 819,138 |
|||||
| NET INCOME (LOSS) |
$ 6,819,661 |
$ 1,036,626 |
$ (1,185,008) |
$ 6,671,279 |
|||||
| Gas Natural Inc. and Subsidiaries |
||||||||
| Natural Gas Operations |
||||||||
| Utility Throughput |
||||||||
| Three Months Ended |
Year Ended |
|||||||
| (in million cubic feet (MMcf)) |
2014 |
2013 |
2014 |
2013 |
||||
| Full Service Distribution Revenues |
||||||||
| Residential |
1,765 |
1,685 |
5,427 |
4,645 |
||||
| Commercial |
1,337 |
2,387 |
4,909 |
4,547 |
||||
| Total full service distribution |
3,102 |
4,072 |
10,336 |
9,192 |
||||
| Transportation |
2,579 |
3,076 |
10,444 |
11,558 |
||||
| Bucksport |
663 |
3,756 |
5,441 |
14,301 |
||||
| Total volumes |
6,344 |
10,904 |
26,221 |
35,051 |
||||
| Heating Degree Days |
||||||||||
| Three Months Ended |
Percent Colder (Warmer) |
|||||||||
| December 31, |
2014 Compared to |
|||||||||
| Normal |
2014 |
2013 |
Normal |
2013 |
||||||
| Great Falls, MT |
2,750 |
2,694 |
2,968 |
(2.04%) |
(9.23%) |
|||||
| Bangor, ME |
2,263 |
2,507 |
2,780 |
10.78% |
(9.82%) |
|||||
| Elkin, NC |
1,244 |
1,603 |
1,570 |
28.86% |
2.10% |
|||||
| Youngstown, OH |
2,223 |
2,150 |
2,255 |
(3.28%) |
(4.66%) |
|||||
| Jackson, KY |
1,624 |
1,787 |
1,714 |
10.04% |
4.26% |
|||||
| Weighted Average |
2,409 |
2,393 |
2,588 |
(0.66%) |
(7.53%) |
|||||
| Year Ended |
Percent Colder (Warmer) |
|||||||||
| December 31, |
2014 Compared to |
|||||||||
| Normal |
2014 |
2013 |
Normal |
2013 |
||||||
| Great Falls, MT |
7,508 |
7,882 |
7,350 |
4.98% |
7.24% |
|||||
| Bangor, ME |
7,047 |
7,859 |
7,786 |
11.52% |
0.94% |
|||||
| Elkin, NC |
4,292 |
4,459 |
4,320 |
3.89% |
3.22% |
|||||
| Youngstown, OH |
6,334 |
6,754 |
6,337 |
6.63% |
6.58% |
|||||
| Jackson, KY |
4,380 |
4,965 |
4,711 |
13.36% |
5.39% |
|||||
| Weighted Average |
6,788 |
7,212 |
6,796 |
6.25% |
6.12% |
|||||
| Gas Natural Inc. 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 |
Year Ended |
|||||||||
| 2014 |
2013 |
2014 |
2013 |
||||||||
| $ |
per |
$ |
per |
$ |
per |
$ |
per |
||||
| GAAP income from continuing operations |
$ 1,201 |
$ 0.11 |
$ 2,798 |
$ 0.27 |
$ 2,729 |
$ 0.26 |
$ 5,852 |
$ 0.63 |
|||
| Add back, after tax: |
|||||||||||
| Customer bankruptcy write-off |
- |
- |
- |
- |
641 |
0.06 |
- |
- |
|||
| Non-recurring legal fees |
794 |
0.08 |
- |
- |
1,179 |
0.11 |
- |
- |
|||
| Non-recurring regulatory and other expenses |
727 |
0.07 |
229 |
0.02 |
1,043 |
0.10 |
1,168 |
0.13 |
|||
| Gain on marketable securities |
- |
- |
- |
- |
(111) |
(0.01) |
- |
- |
|||
| Business combination impairments/adjustments |
251 |
0.02 |
(524) |
(0.05) |
251 |
0.02 |
(524) |
(0.06) |
|||
| Non-GAAP adjusted income from continuing operations(1) |
$ 2,972 |
$ 0.28 |
$ 2,503 |
$ 0.24 |
$ 5,732 |
$ 0.55 |
$ 6,496 |
$ 0.70 |
|||
| Gas Natural Inc. and Subsidiaries |
|||||||
| GAAP Income from Continuing Operations to Adjusted EBITDA Reconciliation(1) |
|||||||
| (in thousands) |
Three Months Ended |
Year Ended |
|||||
| 2014 |
2013 |
2014 |
2013 |
||||
| GAAP income from continuing operations |
$ 1,201 |
$ 2,798 |
$ 2,729 |
$ 5,852 |
|||
| Add back: |
|||||||
| Net interest expense |
892 |
797 |
3,226 |
3,176 |
|||
| Income taxes |
646 |
1,299 |
1,548 |
3,024 |
|||
| Depreciation, amortization and accretion |
1,441 |
1,519 |
6,656 |
5,609 |
|||
| Customer bankruptcy write-off |
- |
- |
1,056 |
- |
|||
| Non-recurring legal fees |
1,307 |
- |
1,942 |
- |
|||
| Non-recurring regulatory and other expenses |
1,197 |
367 |
1,717 |
1,869 |
|||
| Gain on marketable securities |
- |
- |
(183) |
- |
|||
| Business combination impairments/adjustments |
413 |
(839) |
414 |
(839) |
|||
| Non-GAAP Adjusted EBITDA(1) |
$ 7,097 |
$ 5,940 |
$ 19,104 |
$ 18,690 |
|||
(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.
SOURCE Gas Natural Inc.
Related Links
WANT YOUR COMPANY'S NEWS FEATURED ON PRNEWSWIRE.COM?
Newsrooms &
Influencers
Digital Media
Outlets
Journalists
Opted In
Share this article