-----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, NIpZZJjBweFrpK1PDs1jk6GmR8gn0Wg0yFhCFFbQKRReQmGqZLSvmATOZRT92gkS y7UoubF0YGHvS/INVstvqg== 0000108985-97-000011.txt : 19970507 0000108985-97-000011.hdr.sgml : 19970507 ACCESSION NUMBER: 0000108985-97-000011 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 19970331 FILED AS OF DATE: 19970506 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: 97596113 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 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, 1997 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 727,209 Shares outstanding as of March 31, 1997 THE YORK WATER COMPANY PART I - FINANCIAL INFORMATION Item 1. Financial Statements Balance Sheet (Unaudited) As Of As of Mar.31, 1997 Dec. 31, 1996 UTILITY PLANT, at original cost $94,099,446 $93,492,775 Less-Reserve for depreciation 13,557,663 13,158,637 80,541,783 80,334,138 OTHER PHYSICAL PROPERTY: Less-Reserve for depreciation of $61,584 in 1997 and $60,326 in 1996 419,887 421,145 CURRENT ASSETS: Cash and Cash Equivalents 465,800 694,491 Receivables, less reserves of $90,000 in 1997 and in 1996 2,479,160 2,523,510 Recoverable income taxes - 159,203 Materials and supplies, at cost 303,656 302,821 Prepaid expenses 131,009 221,402 Deferred income taxes 61,377 61,377 3,441,002 3,962,804 OTHER LONG-TERM ASSETS: Prepaid pension cost 1,717,798 1,680,286 Deferred debt expense 465,577 474,049 Deferred rate case expense 121,243 142,385 Notes receivable 949,184 990,448 Deferred regulatory assets 7,834,938 7,827,988 Other 968,672 903,191 12,057,412 12,018,347 $96,460,084 $96,736,434 THE YORK WATER COMPANY Balance Sheet (Unaudited) As Of As Of Mar.31, 1997 Dec. 31, 1996 CAPITALIZATION Common stock, par value $10 per share, authorized 1,200,000 shares in 1997 and in 1996, outstanding 727,209 shares in 1997 and 725,131 shares in 1996 $ 7,272,093 $ 7,251,308 Capital surplus 18,641,666 18,524,331 Earnings retained in the business 2,340,701 2,227,118 28,254,460 28,002,757 LONG-TERM DEBT 5.0% Ind. Dev. Auth. Rev. Refund Bonds, due 2010 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 600,000 1,237,000 Accounts payable 166,665 376,469 Dividends payable 532,437 531,977 Accrued taxes 570,153 117,668 Advance water revenues 170,477 164,256 Accrued interest 483,774 675,761 Other accrued expenses 413,575 391,483 2,937,081 3,494,614 DEFERRED CREDITS Customers' advances for construction15,604,420 15,471,245 Contributions in aid of construction 5,606,358 5,606,358 Deferred income taxes 9,605,783 9,744,675 Deferred regulatory liabilities 1,528,582 1,528,582 Deferred employee benefits 923,400 888,203 33,268,543 33,239,063 $96,460,084 $96,736,434 THE YORK WATER COMPANY Statements of Income (Unaudited) (Unaudited) Three Months Ended March 31 1997 1996 WATER OPERATING REVENUES Residential $2,351,598 $2,202,573 Commercial and industrial 1,252,868 1,151,396 Other 402,410 320,430 4,006,876 3,674,399 OPERATING EXPENSES Operation and maintenance 796,010 784,023 Administrative and general 702,284 769,640 1,498,294 1,553,663 Depreciation 388,084 403,600 Taxes other than income taxes 263,297 258,005 Federal and state income taxes 402,096 270,468 2,551,771 2,485,736 Operating Income 1,455,105 1,188,663 INTEREST EXPENSE AND OTHER EXPENSE/(INCOME) Interest on long-term debt 679,738 679,738 Interest on interim bank loans 16,351 75,375 Allowance for funds used during construction (3,225) (35,114) Other income, net (3,958) (49,010) 688,906 670,989 Net Income $ 766,199 $ 517,674 Earnings Per Share $1.05 $0.81 Cash Dividends Per Share $0.90 $0.90 THE YORK WATER COMPANY Statements of Cash Flows
(Unaudited) (Unaudited) Three Months Three Months Ended Ended March 31, 1997 March 31, 1996 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 766,199 $ 517,674 Adjustments to reconcile net income to net cash provided by operating activities Depreciation 388,084 403,600 Provision for losses on accounts receivable 22,500 22,500 (Decrease) increase in deferred income taxes (including regulatory assets and liabilities) (145,842) 162,077 Changes in assets and liabilities: Decrease in accounts receivable 21,850 172,007 Decrease in recoverable income taxes 59,203 96,123 (Increase) decrease in materials and supplies (835) 19,741 Decrease (increase) in prepaid expenses and prepaid pension costs 52,881 (8,471) Decrease in accounts payable, accrued expenses, other liabilities and deferred employee benefits (145,834) (173,142) Increase (decrease) in accrued interest and taxes 260,498 (148,740) Increase in other assets (12,915) (18,073) Net cash provided by operating activities 1,365,789 1,045,296 CASH FLOWS FROM INVESTING ACTIVITIES: Acquisitions of temporary investments (1,333,000) - Maturities of temporary investments 1,333,000 - Construction expenditures (617,423) (681,706) Customers' advances for construction and contributions in aid of construction 133,175 34,435 Net cash used in investing activities (484,248) (647,271) CASH FLOWS FROM FINANCING ACTIVITIES: Net (repayments) borrowings under line-of-credit agreements (637,000) 31,000 Issuance of common stock under dividend reinvestment plan 119,587 104,697 Issuance of common stock under employee stock purchase plan 18,533 18,411 Dividends paid (652,616) (573,634) Decrease in notes receivable 41,264 21,501 Net cash used in financing activities (1,110,232) (398,025) Net decrease in cash and cash equivalents (228,691) - Cash and cash equivalents at beginning of period 694,491 - Cash and cash equivalents at end of period $ 465,800 $ - Supplemental disclosures of cash flow information: Cash paid during the year for: Interest, net of amounts capitalized $ 884,852 $ 905,735 Income taxes 60,614 86,735 /TABLE 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 1996. 2. Earnings Per Share Earnings per share for the three months ended March 31, 1997 and 1996 were based on weighted average shares outstanding of 726,697 and 638,770, 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, 1997 Compared with Three Months Ended March 31, 1996 Water operating revenues for the three months ended March 31, 1997 increased $332,477 or 9.0% compared to the three months ended March 31, 1996. The increase resulted primarily from an increase in rates of 6.0% approved by the Pennsylvania Public Utility Commission (PPUC) effective September 5, 1996. Consumption was up in both the residential and industrial sectors, despite an overall decline. Operating expenses, exclusive of depreciation and taxes, for the three months ended March 31, 1997 decreased $55,369 or 3.6%. Decreases in maintenance of structures, maintenance of pumping equipment and meter reading expenses, as well as a workers compensation credit caused the favorable variance. Increases in power costs and filter plant equipment maintenance partially offset the variance. Federal and state income taxes for the three months ended March 31, 1997 increased $131,628 or 48.7% compared to the three months ended March 31, 1996 principally as a result of an increase in taxable net income. Interest on short-term debt for the three months ended March 31, 1997 declined $59,024 when compared to the same period in 1996. The decline is due to a decrease in the average short-term debt outstanding from approximately $4,290,000 in 1996 to approximately $932,000 in 1997. Allowance for funds used during construction was $31,889 lower during the three months ended March 31, 1997 when compared to the three months ended March 31, 1996. In 1996, interest was capitalized on two large main extensions, the Loganville standpipe, and the basin covers. No such large projects occurred during the first three months of 1997. Other income, net for the first three months of 1997 decreased $45,052 or 91.9% when compared to the first three months of 1996. The decrease was due to increased donations and a 1996 adjustment to amortization of debt expense. Rate Developments Within the last several years the Company has filed written applications for rate increases with the PPUC and has been granted rate relief as a result of such requests. The most recent formal rate request was filed by the Company on May 9, 1996 seeking a $1,534,393 increase in annual revenues. Effective September 5, 1996, the PPUC authorized an increase in rates designed to produce approximately $960,000 in additional annual revenues, an increase of approximately 6.0%. Liquidity and Capital Resources During the first three months of 1997, the per capita volume of water sold did not significantly change compared to the first three months of 1996. 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 first quarter of 1997, the Company had $617,423 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. During the first quarter of 1997, net cash used in investing and financing activities exceeded net cash provided by operating activities. The Company anticipates that during the remainder of 1997 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 (stock issued in lieu of cash dividends) and employee stock purchase plan, and customers' advances are used to satisfy the need for additional cash. As of March 31, 1997, current assets exceeded current liabilities by $503,921. Short-term borrowings from lines of credit as of March 31, 1997 were $600,000. The Company maintains lines of credit aggregating $15,000,000. Loans granted under these lines of credit bear interest based on the prime or Libor rates plus basis points, as defined. The Company is not required to maintain compensating balances on its lines of credit. On May 5, 1997, the Company's shareholders approved amendments to the existing Articles of Incorporation. The approved amendments (i) increased the authorized capital stock of the Company from 1,200,000 shares of common stock, par value $10.00 to 6,500,000 shares, divided into 6,000,000 shares of common stock, without par value, and 500,000 shares of Series Preferred Stock, without par value; (ii) eliminate the concept of par value of the capital stock; and (iii) delete certain provisions relating to dividends and shares in distribution and common stock in order to allow for the possible future issuance of Series Preferred Stock. On May 5, 1997, the Company's Board of Directors declared a four- for-one stock split for shareholders of record on June 2, 1997, in conjunction with the increase in authorized shares. The declared stock split is subject to the approval of the PPUC. The Company's management expects to receive PPUC approved registration of its four-for-one stock split on May 22, 1997. Shareholders of record will receive three additional shares of common stock for each share owned. The transaction will have no effect on total stockholders' equity. Recently Issued Accounting Standards In February 1997, the Financial Accounting Standards Board issued Statement of Financial Accounting Standards No. 128 (SFAS 128), "Earnings Per Share." SFAS 128 establishes standards for computing and presenting earnings per share. SFAS 128 is effective for financial statements issued for periods ending after December 15, 1997. This statement is not expected to have a material impact on the Company's financial statements. In February 1997, FASB issued Statement of Financial Accounting Standards No. 129, "Disclosure of Information about Capital Structure" (SFAS 129). SFAS 129 establishes standards for disclosing information about an entity's capital structure. SFAS 129 is effective for financial statements issued for periods ending after December 15, 1997. This statement is not expected to have a material impact on the Company's financial statements. 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 6, 1997 Jeffrey S. Osman Principal Financial and Accounting Officer Date: May 6, 1997 EX-27 2
UT 0000108985 YORK WATER CO 3-MOS DEC-31-1997 MAR-31-1997 PER-BOOK 80541783 419887 3441002 8421758 3635654 96460084 7272093 18641666 2340701 28254460 0 0 32000000 600000 0 0 0 0 0 0 35605624 96460084 4006876 402096 2149675 2551771 1455105 3958 1459063 692864 766199 0 766199 652616 871725 1365789 1.05 1.05
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