EX-99.1 2 exhibit991q12017.htm EXHIBIT 99.1 Exhibit


Exhibit 99.1
NEWS RELEASE
RGC RESOURCES, INC.
 
Release Date:
  
February 6, 2017
Contact:
  
Paul W. Nester
 
  
Vice President and CFO
Telephone:
  
540-777-3837


RGC RESOURCES, INC. REPORTS
16% INCREASE IN FIRST QUARTER EARNINGS


ROANOKE, Va. (February 6, 2017)--RGC Resources, Inc. (NASDAQ: RGCO) announced consolidated Company earnings of $2,232,218 or $0.47 per average share outstanding for the quarter ended December 31, 2016. This compares to consolidated earnings of $1,922,790 or $0.40 per average share outstanding for the quarter ended December 31, 2015. CEO John D’Orazio attributed the 16% increase in earnings to improved utility margins associated with the company’s infrastructure replacement programs, increased gas volumes attributed to customer growth, and the investment in the Mountain Valley Pipeline (MVP).

Earnings for the twelve months ending December 31, 2016 were $6,116,294 or $1.28 per share compared to $5,092,829 or $1.08 per share for the twelve months ended December 31, 2015. D’Orazio attributed the 20% increase in earnings to improved utility margins associated with the company’s infrastructure replacement programs, increased gas volumes attributed to customer growth, and the investment in the MVP.

RGC Resources, Inc. provides energy and related products and services to customers in Virginia through its operating subsidiaries Roanoke Gas Company and RGC Midstream, LLC.

From time to time, the Company may publish forward-looking statements relating to such matters as anticipated financial performance, business prospects, technological developments, new products, research and development activities and similar matters. The Private Securities Litigation Reform Act of 1995 provides a safe harbor for forward-looking statements. In order to comply with the terms of the safe harbor, the Company notes that a variety of factors could cause the Company’s actual results and experience to differ materially from the anticipated results or other expectations expressed in the Company’s forward-looking statements.

Net income for the three months ended December 31, 2016 is not indicative of the results to be expected for the fiscal year ending September 30, 2017 as quarterly earnings are affected by the highly seasonal nature of the business and weather conditions generally result in greater earnings during the winter months. Past performance is not necessarily a predictor of future results.

Summary financial statements for the first quarter and twelve months are as follows:







RGC Resources, Inc. and Subsidiaries
Condensed Consolidated Statements of Income
(Unaudited)
 
 
 
Three Months Ended
December 31,
 
Twelve Months Ended
December 31,
 
 
2016
 
2015
 
2016
 
2015
Revenues
 
$
18,788,585

 
$
16,010,056

 
$
61,841,820

 
$
62,949,598

Cost of sales
 
9,397,680

 
7,271,940

 
29,624,117

 
32,627,192

Gross margin
 
9,390,905

 
8,738,116

 
32,217,703

 
30,322,406

Equity in earnings of MVP
 
84,540

 
21,537

 
215,867

 
21,537

Other operating expenses, net
 
5,412,342

 
5,243,937

 
20,776,812

 
20,559,304

Interest expense
 
458,521

 
408,356

 
1,686,486

 
1,523,708

Income before income taxes
 
3,604,582

 
3,107,360

 
9,970,272

 
8,260,931

Income tax expense
 
1,372,364

 
1,184,570

 
3,853,978

 
3,168,102

Net income
 
$
2,232,218

 
$
1,922,790

 
$
6,116,294

 
$
5,092,829

Net earnings per share of common stock:
 
 
 
 
 
 
 
 
Basic
 
$
0.47

 
$
0.40

 
$
1.28

 
$
1.08

Diluted
 
$
0.46

 
$
0.40

 
$
1.28

 
$
1.07

Cash dividends per common share
 
$
0.2175

 
$
0.2025

 
$
0.8250

 
$
0.7800

Weighted average number of common shares outstanding:
 
 
 
 
 
 
 
 
Basic
 
4,796,396

 
4,748,279

 
4,778,699

 
4,734,962

Diluted
 
4,807,031

 
4,752,179

 
4,787,124

 
4,738,380


Condensed Consolidated Balance Sheets
(Unaudited)
 
 
 
December 31,
Assets
 
2016
 
2015
Current assets
 
$
21,453,170

 
$
21,104,828

Total property, plant and equipment, net
 
135,780,493

 
121,308,922

Other assets
 
18,728,080

 
12,490,905

Total Assets
 
$
175,961,743

 
$
154,904,655

Liabilities and Stockholders’ Equity
 
 
 
 
Current liabilities
 
$
28,756,950

 
$
27,614,707

Long-term debt
 
41,135,426

 
31,854,285

Deferred credits and other liabilities
 
48,788,676

 
41,371,592

Total Liabilities
 
118,681,052

 
100,840,584

Stockholders’ Equity
 
57,280,691

 
54,064,071

Total Liabilities and Stockholders’ Equity
 
$
175,961,743

 
$
154,904,655