-----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, Wd8zh0xmVivhbnAji4iSDp+0n7sDnTAZibQ8yTx6Jn4weKgFrhGfwb5AuZNvT/ib 6sXH+alXOKq3UfT4S+OJ8A== 0000108985-00-000012.txt : 20000515 0000108985-00-000012.hdr.sgml : 20000515 ACCESSION NUMBER: 0000108985-00-000012 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 2 CONFORMED PERIOD OF REPORT: 20000331 FILED AS OF DATE: 20000512 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: SEC FILE NUMBER: 000-00690 FILM NUMBER: 627259 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, 2000 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, No par value 3,002,920 Shares outstanding as of March 31, 2000 THE YORK WATER COMPANY PART I - FINANCIAL INFORMATION Item 1. Financial Statements Balance Sheets (Unaudited) As Of As of Mar. 31, 2000 Dec. 31, 1999 UTILITY PLANT, at original cost $109,870,292 $108,804,699 Less-Reserve for depreciation 17,514,517 17,079,631 92,355,775 91,725,068 OTHER PHYSICAL PROPERTY: Less-Reserve for depreciation of $77,037 in 2000 and $75,721 in 1999 514,497 515,813 CURRENT ASSETS: Receivables, less reserves of $130,000 in 2000 and $120,000 in 1999 2,664,117 2,753,260 Recoverable income taxes - 5,702 Materials and supplies, at cost 379,550 390,440 Prepaid expenses 184,871 225,106 Deferred income taxes 88,655 81,836 3,317,193 3,456,344 OTHER LONG-TERM ASSETS: Prepaid pension cost 2,001,413 1,977,883 Deferred debt expense 387,090 396,190 Deferred rate case expense 90,590 105,688 Notes receivable 1,018,369 783,794 Deferred regulatory assets 8,247,053 8,296,669 Other 1,406,077 1,342,661 13,150,592 12,902,885 $109,338,057 $108,600,110 THE YORK WATER COMPANY Balance Sheets (Unaudited) As Of As Of Mar. 31, 2000 Dec. 31, 1999 CAPITALIZATION Common stock, no par value, authorized 31,000,000 shares, out- standing 3,002,920 shares in 2000 and 2,989,091 shares in 1999 $ 28,298,599 $ 28,099,197 Earnings retained in the business 3,504,158 3,418,257 Treasury stock, 38,000 shares in 2000 and 1999 (687,800) (687,800) 31,114,957 30,829,654 LONG-TERM DEBT 1.0% Pennvest Loan, due 2019 756,600 765,943 5.0% Industrial Development Authority Revenue Refunding Bonds, Series 1995, 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 4.40% Industrial Development Authority Revenue Refunding Bonds, Series 1994, due 2009 2,700,000 2,700,000 32,756,600 32,765,943 CURRENT LIABILITIES Short-term borrowings 740,486 1,431,118 Current portion of long-term debt 37,231 34,057 Accounts payable 517,281 600,993 Dividends payable 537,262 534,889 Accrued taxes 407,105 31,458 Advance water revenues 18,014 18,173 Accrued interest 480,230 676,687 Other accrued expenses 413,030 396,771 3,150,639 3,724,146 DEFERRED CREDITS Customers' advances for construction 17,910,140 17,054,497 Contributions in aid of construction 8,658,845 8,658,845 Deferred income taxes 12,357,124 12,109,748 Deferred regulatory liabilities 1,793,839 1,823,447 Deferred employee benefits 1,595,913 1,633,830 42,315,861 41,280,367 $109,338,057 $108,600,110 THE YORK WATER COMPANY Statements of Income (Unaudited) (Unaudited) Three Months Three Months Ended Ended Mar. 31, 2000 Mar. 31, 1999 WATER OPERATING REVENUES Residential $2,663,753 $2,460,272 Commercial and industrial 1,262,604 1,225,187 Other 574,818 473,258 4,501,175 4,158,717 OPERATING EXPENSES Operation and maintenance 957,114 883,763 Administrative and general 886,528 848,310 Depreciation and amortization 418,429 413,286 Taxes other than income taxes 335,759 266,771 2,597,830 2,412,130 Operating income 1,903,345 1,746,587 INTEREST EXPENSE AND OTHER INCOME Interest on long-term debt 677,060 679,738 Interest on interim bank loans 22,320 786 Allowance for funds used during construction (20,203) (13,261) Other income, net (35,700) (19,073) 643,477 648,190 Income before income taxes 1,259,868 1,098,397 Federal and state income taxes 456,585 398,838 Net income $ 803,283 $ 699,559 Basic Earnings Per Share $0.27 $0.23 Cash Dividends Per Share $0.24 $0.24 THE YORK WATER COMPANY Statements of Shareholders' Investment Earnings Retained Common in the Treasury Stock Business Stock Balance, December 31, 1999 $28,099,197 $3,418,257 $(687,800) Net Income - 803,283 - Cash Dividends - (717,382) - Issuance of common stock under dividend reinvest- ment plan 179,867 - - Issuance of common stock under employee stock purchase plan 19,535 - - Balance, March 31, 2000 $28,298,599 $3,504,158 $(687,800) THE YORK WATER COMPANY Statements of Cash Flows (Unaudited) (Unaudited) Three Months Three Months Ended Ended Mar. 31, 2000 Mar. 31, 1999 CASH FLOWS FROM OPERATING ACTIVITIES: Net income $ 803,283 $ 699,559 Adjustments to reconcile net income to net cash provided by operating activities Depreciation 418,429 413,286 Provision for losses on accounts receivable 32,500 29,250 Increase in deferred income taxes (including regulatory assets and liabilities) 260,565 226,185 Changes in assets and liabilities: Decrease in accounts receivable 56,643 53,827 Decrease in recoverable income taxes 5,702 - Decrease in materials and supplies 10,890 23,243 Decrease (increase) in prepaid expenses and prepaid pension costs 16,705 (5,526) (Decrease) increase in accounts payable, accrued expenses, other liabilities and deferred employee benefits (99,982) 98,086 Increase (decrease) in accrued interest and taxes 179,190 (98,817) (Increase) decrease in other assets (21,866) 52,559 Net cash provided by operating activities 1,662,059 1,491,652 CASH FLOWS FROM INVESTING ACTIVITIES: Construction expenditures (1,065,172) (1,065,681) Customers' advances for construction and contributions in aid of construction 855,643 222,569 Net cash used in investing activities (209,529) (843,112) CASH FLOWS FROM FINANCING ACTIVITIES: Repayments of long-term debt (9,343) - Net repayments under line-of- credit agreements (690,632) - Issuance of common stock under dividend reinvestment plan 179,867 190,961 Issuance of common stock under employee stock purchase plan 19,535 19,395 Dividends paid (717,382) (700,235) (Increase) decrease in notes receivable (234,575) 32,620 Net cash used in financing activities (1,452,530) (457,259) Net increase in cash and cash equivalents - 191,281 Cash and cash equivalents at beginning of period - 257,706 Cash and cash equivalents at end of period $ - $ 448,987 Supplemental disclosures of cash flow information: Cash paid during the year for: Interest, net of amounts capitalized $ 871,334 $ 859,251 Income taxes 53,897 44,641 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 December 31, 1999. 2. Basic Earnings Per Share Basic earnings per share for the three months ended March 31, 2000 and 1999 were based on weighted average shares outstanding of 2,999,510 and 2,988,884, respectively. 3. Certain items from the prior year statements have been reclassified for comparative purposes. 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, 2000 Compared with Three Months Ended March 31, 1999 Water operating revenues for the three months ended March 31, 2000 increased $342,458 or 8.2% compared to the three months ended March 31, 1999. The increase resulted from both a 5.3% rate increase approved by the Pennsylvania Public Utility Commission (PPUC) effective October 1, 1999, and an increase in consumption of water due to an increase in customers. Residential consumption increased 2.5%, while commercial and industrial consumption increased by 1.9%. Other revenues including public consumption and fire service increased in 2000 compared to 1999. Operating expenses for the first three months of 2000 increased $185,700 or 7.7% compared to the same period in 1999. Increased main and service line maintenance primarily due to highway relocation was the largest factor in the increase. Additionally, realty taxes, general insurance, and rate case expenses increased in 2000 compared to 1999. These increases were partially offset by declines in Y2K expenses, legal fees, and deferred compensation provisions. Interest on interim bank loans increased $21,534 through March 2000 compared to March 1999 due to an increase in short-term debt outstanding in 2000. The average short-term debt outstanding in 2000 and 1999 was $1,098,856 and $48,611, respectively. Other income, net increased by $16,627 for the first three months of 2000 compared to the first three months of 1999 due to the recognition of additional interest income on Mt. Zion and Windsor water district notes. Federal and state income taxes for the period ended March 31, 2000 were $57,747 or 14.5% higher than the period ended March 31, 1999 due to an increase in taxable income. 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 request was filed in April 1999. Effective October 1, 1999, the PPUC authorized an increase in rates designed to produce approximately $651,000 in additional annual operating revenues, an increase of 5.3%. Liquidity and Capital Resources During the first three months of 2000, the per capita volume of water sold did not significantly change compared to the first three months of 1999. 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 2000, the Company had $1,065,172 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 2000, net cash provided by operating activities equaled net cash used in investing and financing activities. The Company anticipates that during the remainder of 2000 net cash used in investing and financing activities will 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 expected to be used to satisfy the need for additional cash. As of March 31, 2000, current assets exceeded current liabilities by $157,434. Short-term borrowings from lines of credit as of March 31, 2000 were $740,486. The Company maintains lines of credit aggregating $16,000,000. 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. Certain statements contained herein and elsewhere in this Form 10-Q which are not historical facts are forward-looking statements made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements address activities or events which the Company expects will or may occur in the future. The Company cautions that a number of important factors could cause the actual results to differ materially from those expressed in any forward-looking statements made on behalf of the Company. Year 2000 This statement constitutes a year 2000 readiness disclosure by The York Water Company, under the Year 2000 Information and Disclosure Act. The "year 2000" issue had no impact on the Company's operations. The Company incurred costs of year 2000 remediation of approximately $142,100. The Company will continue to monitor this issue, but does not expect it to have a significant impact on the Company's operations. PART II. OTHER INFORMATION Item 2. Changes in Securities and Use of Proceeds The Company's 5.00% Industrial Development Authority Revenue Refunding bonds Series 1995 have a mandatory tender date of June 1, 2000. The bonds will be remarketed and the interest rate redetermined to 6.00% on June 1, 2000. Under the terms of the bonds, existing bond holders may elect to retain their bonds at the 6.00% interest rate. All bonds not retained by current bond holders are guaranteed to be remarketed. The newly issued bonds will mature on June 1, 2010. Item 6. Exhibits and Reports on Form 8-K The Company filed two reports on Form 8-K on March 29, 2000. The first reported the termination of KPMG LLP as the Company's principal accountants, and the second reported the Board recommendation of Stambaugh-Ness P.C. as independent auditors of the Company subject to shareholder approval. THE YORK WATER COMPANY SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, 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 12, 2000 Jeffrey S. Osman Principal Financial and Accounting Officer Date: May 12, 2000 EX-27 2
UT 0000108985 YORK WATER CO 3-MOS DEC-31-2000 MAR-31-2000 PER-BOOK 92355775 514497 3317193 8724733 4425859 109338057 27610799 0 3504158 31114957 0 0 32756600 740486 0 0 37231 0 0 0 44688783 109338057 4501175 456585 2597830 3054415 1446760 35700 1482460 679177 803283 0 803283 717382 871725 1662059 .27 .27
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