-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GEgLt/NpGC/DXGCrXRVpPlWhOYTLprl0ZD1iwJ0XOLJdgIrfGISY9laJcixdhYOM sNdmWhUZj6hjQK4riA/QHw== 0000108985-96-000014.txt : 19960514 0000108985-96-000014.hdr.sgml : 19960514 ACCESSION NUMBER: 0000108985-96-000014 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19960331 FILED AS OF DATE: 19960513 SROS: NASD FILER: COMPANY DATA: COMPANY CONFORMED NAME: YORK WATER CO CENTRAL INDEX KEY: 0000108985 STANDARD INDUSTRIAL CLASSIFICATION: WATER SUPPLY [4941] IRS NUMBER: 231242500 STATE OF INCORPORATION: PA FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-00690 FILM NUMBER: 96561374 BUSINESS ADDRESS: STREET 1: 130 E MARKET ST CITY: YORK STATE: PA ZIP: 17405 BUSINESS PHONE: 7178453601 MAIL ADDRESS: STREET 1: PO BOX 15089 10-Q 1 QUARTERLY REPORT SECURITIES AND EXCHANGE COMMISSION Washington, D. C. 20549 FORM 10-Q QUARTERLY REPORT UNDER SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For Quarter Ended March 31, 1996 Commission File No. 0-690 THE YORK WATER COMPANY (Exact name of Registrant as specified in its Charter) PENNSYLVANIA 23-1242500 (State or other jurisdiction of (I.R.S. Employer incorporation or organization) Identification No.) 130 East Market Street, York, Pennsylvania 17401 (Address of principal executive offices) (Zip Code) Registrant's telephone number including Area Code 717-845-3601 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES X NO Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date. Common stock, $10 par value 639,225 Shares outstanding as of March 31, 1996 THE YORK WATER COMPANY PART I - FINANCIAL INFORMATION Item 1. Financial Statements Balance Sheet (Unaudited) As Of As of Mar.31, 1996 Dec. 31, 1995 UTILITY PLANT, at original cost $89,379,798 $88,710,279 Less-Reserve for depreciation 12,307,773 11,890,730 77,072,025 76,819,549 OTHER PHYSICAL PROPERTY: Less-Reserve for depreciation of $56,549 in 1996 and $55,291 in 1995 424,922 426,180 CURRENT ASSETS: Receivables, less reserves of $90,000 in 1996 and in 1995 2,248,622 2,443,129 Recoverable income taxes - 96,123 Materials and supplies, at cost (first-in, first-out) 279,896 299,637 Prepaid expenses 92,039 115,392 Deferred income taxes 61,377 61,377 2,681,934 3,015,658 OTHER LONG-TERM ASSETS: Prepaid pension cost 1,562,062 1,530,238 Deferred debt expense 498,581 495,594 Deferred rate case expense 23,559 42,499 Notes receivable 1,024,617 1,046,118 Deferred regulatory assets 6,362,664 6,302,127 Other 842,657 781,743 10,314,140 10,198,319 $90,493,021 $90,459,706 THE YORK WATER COMPANY Balance Sheet (Unaudited) As Of As Of Mar.31, 1996 Dec. 31, 1995 CAPITALIZATION Common stock $ 6,392,254 $ 6,373,743 Capital surplus 13,658,639 13,554,042 Earnings retained in the business 1,788,022 1,843,982 21,838,915 21,771,767 LONG-TERM DEBT 6.25% Ind. Dev. Auth. Rev. Refund Bonds, due 2000 4,300,000 4,300,000 10.05% Senior Notes, Series C, due 2020 6,500,000 6,500,000 10.17% Senior Notes, Series A, due 2019 6,000,000 6,000,000 9.6% Senior Notes, Series B,due 2019 5,000,000 5,000,000 8.43% Senior Notes,Series D,due 2022 7,500,000 7,500,000 4.75% Ind. Dev. Auth. Rev. Refunding Bonds, due 2009 2,700,000 2,700,000 32,000,000 32,000,000 CURRENT LIABILITIES Short-term borrowings 4,195,000 4,164,000 Accounts payable 176,897 342,610 Dividends payable 468,585 468,053 Accrued taxes 78,081 34,833 Advance water revenues 183,332 183,398 Accrued interest 505,273 697,261 Other accrued expenses 1,104,511 1,112,406 6,711,679 7,002,561 DEFERRED CREDITS Customers' advances for construction15,945,869 15,913,616 Contributions in aid of construction 4,579,105 4,576,923 Deferred income taxes 7,976,055 7,753,441 Deferred regulatory liabilities 1,441,398 1,441,398 29,942,427 29,685,378 $90,493,021 $90,459,706 THE YORK WATER COMPANY Statements of Income (Unaudited) (Unaudited) Three Months Ended March 31 1996 1995 WATER OPERATING REVENUES Residential $2,202,573 $2,095,687 Commercial and industrial 1,151,396 1,290,280 Other 320,430 309,041 3,674,399 3,695,008 OPERATING EXPENSES Operation and maintenance 784,023 754,120 Administrative and general 769,640 838,809 1,553,663 1,592,929 Depreciation 403,600 377,480 Taxes other than income taxes 258,005 249,537 Federal and state income taxes 270,468 329,654 2,485,736 2,549,600 Operating Income 1,188,663 1,145,408 INTEREST EXPENSE AND OTHER EXPENSE/(INCOME) Interest on long-term debt 679,738 693,175 Interest on interim bank loans 75,375 27,051 Allowance for funds used during construction (35,114) (79,257) Other income, net (49,010) (57,635) 670,989 583,334 Net Income $ 517,674 $ 562,074 Earnings Per Share $0.81 $0.89 Cash Dividends Per Share $0.90 $0.90THE YORK WATER COMPANY Statements of Cash Flows
(Unaudited) (Unaudited) Three Months Three Months Ended Ended March 31, 1996 March 31, 1995 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 517,674 $ 562,074 Adjustments to reconcile net income to net cash provided by operating activities Depreciation 403,600 377,480 Provision for losses on accounts receivable 22,500 22,500 Increase (decrease) in deferred income taxes (including regulatory assets and liabilities) 162,077 (142,136) Changes in assets and liabilities: Decrease in accounts receivable 172,007 75,959 Decrease in recoverable income taxes 96,123 - Decrease in materials and supplies 19,741 54,197 (Increase) decrease in prepaid expenses and prepaid pension costs (8,471) 21,028 Decrease in accounts payable, accrued expenses and other liabilities (173,142) (612,757) (Decrease) increase in accrued interest and taxes (148,740) 259,817 (Increase) decrease in other assets (18,073) 73,909 Net cash provided by operating activities 1,045,296 692,071 CASH FLOWS FROM INVESTING ACTIVITIES: Construction expenditures (681,706) (988,823) Customers' advances for construction and contributions in aid of construction 34,435 706,983 Net cash used in investing activities (647,271) (281,840) CASH FLOWS FROM FINANCING ACTIVITIES: Net borrowings under line-of-credit agreements 31,000 22,000 Issuance of common stock under dividend reinvestment plan 104,697 100,995 Issuance of common stock under employee stock purchase plan 18,411 17,079 Dividends paid (573,634) (566,714) Decrease in notes receivable 21,501 16,409 Net cash used in financing activities (398,025) (410,231) Net increase in cash and cash equivalents - - Cash and cash equivalents at beginning of period - - Cash and cash equivalents at end of period $ - $ - Supplemental disclosures of cash flow information: Cash paid during the year for: Interest, net of amounts capitalized $ 905,735 $ 792,468 Income taxes 86,735 43,219
THE YORK WATER COMPANY Notes to Interim Financial Statements 1. Interim Financial Information The interim financial statements are unaudited but, in the opinion of management, reflect all adjustments necessary for a fair presentation of results for such periods. These financial statements should be read in conjunction with the financial statements and notes thereto contained in the Company's Annual Report to Shareholders for the year ended 1995. 2. Earnings Per Share Earnings per share for the three months ended March 31, 1996 and 1995 were based on weighted average shares outstanding of 638,770 and 631,121, respectively. THE YORK WATER COMPANY Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations Results of Operations Three Months Ended March 31, 1996 Compared with Three Months Ended March 31, 1995 Water operating revenues for the three months ended March 31, 1996 decreased $20,609 or .6% compared to the three months ended March 31, 1995. The decrease resulted primarily from lower consumption in the commercial and industrial sectors during the first three months of 1996 compared to the same period in 1995. Operating expenses, exclusive of depreciation and taxes, for the three months ended March 31, 1996 decreased $39,266 or 2.5%. The decline in expense was primarily due to reduced cable meter reading charges and a retroactive charge for postretirement benefits in 1995 resulting from the implementation of a new accounting standard. The decline was partially offset by an increase in maintenance expenses for structures and equipment. Depreciation expense for the three months ended March 31, 1996 increased $26,120 or 6.9% over 1995 as a result of increased plant investment throughout 1995. Federal and state income taxes for the three months ended March 31, 1996 decreased $59,186 or 18% compared to the three months ended March 31, 1995 principally as a result of a decrease in taxable income. In addition, a 1% reduction in the state income tax rate accounts for some of the decrease in taxes. Interest on long-term debt for the three months ended March 31, 1996 decreased $13,437 or 1.9% compared to the three months ended March 31, 1995. The decrease was related to the issuance of $4,300,000 5% Revenue Refunding Bonds to replace a like amount of bonds with an interest rate of 6.25% during the fourth quarter of 1995. Interest on short-term debt for the three months ended March 31, 1996 increased $48,324 when compared to the same period in 1995. The increase is due primarily to an increase in short-term debt outstanding during the three months ended March 31, 1996. Allowance for funds used during construction for the three months ended March 31, 1996 decreased $44,143 or 55.7% when compared to the three months ended March 31, 1995. The decrease was due to the completion of a major construction project during 1995. The 1996 allowance was at a more normal level. Rate Developments The Company is in the process of filing a written application for a rate increase with the PPUC. The application is expected to be submitted on May 9, 1996. Liquidity and Capital Resources During the first three months of 1996, the per capita volume of water sold did not significantly change compared to the first three months of 1995. The Company does not anticipate any change in the level of water usage which would have a material impact on future results of operations. During the three months ended March 31, 1996, the Company had $681,706 of construction expenditures. The Company financed such expenditures through internally generated funds, customers' advances, short-term borrowings, and proceeds from the issuance of common stock under its dividend reinvestment plan (stock issued in lieu of cash dividends) and employee stock purchase plan. The Company anticipates annual construction expenditures for 1996 and 1997 of approximately $5,457,000 and $3,662,000, respectively. The Company plans to finance such expenditures with a common stock subscription, internally generated funds, customers' advances short-term borrowings and proceeds from the issuance of common stock under its dividend reinvestment plan (stock issued in lieu of cash dividends) and employee stock purchase plan. The Company will be submitting an application with the PPUC proposing increases in rates to provide a fair rate of return on the capital expenditures associated with its 1996 and 1997 construction projects. During the first quarter of 1996, net cash used in investing and financing activities exceeded net cash provided by operating activities. The Company anticipates that during the remainder of 1996 net cash used in investing and financing activities will again exceed net cash provided by operating activities. Borrowings against the Company's lines of credit, proceeds from the issuance of common stock under its dividend reinvestment plan and employee stock purchase plan, a common stock subscription and customers' advances are used to satisfy the need for additional cash. The York Water Company Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations As of March 31, 1996, current liabilities exceeded current assets by $4,029,745. As of December 31, 1995, current liabilities exceeded current assets by $3,986,903. Generally, the Company finances a portion of its construction expenditures with borrowings against its lines of credit until such borrowings reach an amount which would justify issuing permanent financing. Accordingly, current liabilities frequently exceed current assets on the Company's balance sheets. Short-term borrowings from lines of credit as of March 31, 1996 were $4,195,000. The Company maintains lines of credit aggregating $11,000,000. Loans granted under these lines of credit bear interest based on the prime or Libor rates. The Company is not required to maintain compensating balances on its lines of credit. THE YORK WATER COMPANY SIGNATURES Pursuant to the requirements of the Securities Exchange Act of the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. THE YORK WATER COMPANY William T. Morris Principal Executive Officer Date: May 10, 1996 Jeffrey S. Osman Principal Financial and Accounting Officer Date: May 10, 1996 EX-27 2 FINANCIAL DATA SCHEDULE
UT 0000108985 YORK WATER COMPANY 3-MOS DEC-31-1996 MAR-31-1996 PER-BOOK 77,072,025 424,922 2,681,934 6,884,804 3,429,336 90,493,021 6,392,254 13,658,639 1,788,022 21,838,915 0 0 32,000,000 4,195,000 0 0 0 0 0 0 32,459,106 90,493,021 3,674,399 270,468 2,215,268 2,485,736 1,188,663 49,010 1,237,673 719,999 517,674 0 517,674 573,634 85,813 1,045,296 .81 .81
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