Delaware | 001-11590 | 51-0064146 | ||
(State or other jurisdiction of incorporation) |
(Commission File Number) | (IRS Employer Identification No.) |
909 Silver Lake Boulevard, Dover, Delaware |
19904 |
|
(Address of principal executive offices) | (Zip Code) |
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Chesapeake Utilities Corporation |
||||
/s/ Beth W. Cooper | ||||
Beth W. Cooper | ||||
Senior Vice President and Chief Financial Officer | ||||
| A record-high net income of $26.1 million, or $2.73 per share, in 2010, compared to
$15.9 million and $2.15 per share in 2009. |
| Excluding the impact of the FPU merger and merger-related costs, Chesapeakes legacy
businesses generated net income of $17.2 million, or $2.44 per share, in 2010, compared to
$15.3 million, or $2.20 per share, in 2009. The $0.24 per share increase generated by
Chesapeakes legacy businesses in 2010 represents an 11-percent growth in earnings per
share. |
| FPUs net income increased by $7.5 million as a result of the inclusion of a full years
results and improved performance, generating an increase of $0.22 per share in 2010. |
| The decrease in merger-related costs added $0.12 per share in 2010. |
1
| Operating income from the Delmarva propane distribution operations for the fourth
quarter of 2010 increased by $884,000, compared to the same period in 2009, due primarily
to higher volumes from the colder-than-normal weather, the timing of deliveries and
increased retail margins. |
||
| The rate increase for Chesapeakes Florida division, effective in January 2010,
contributed approximately $470,000 to gross margin for the quarter ended December 31, 2010. |
||
| Three-percent growth in residential customers for the Delmarva natural gas distribution
operation generated $115,000 in additional gross margin in the fourth quarter of 2010,
compared to the same period in 2009. Gross margin from commercial and industrial customers
for the Delmarva natural gas distribution operation also increased by $186,000 in the
fourth quarter of 2010, due primarily to the addition of 10 large commercial and industrial
customers. Combined with the other new large commercial and industrial customers added
during the first three quarters of the year, these new large commercial and industrial
customers will generate an estimated annual margin of $748,000, of which $196,000 has been
reflected in 2010s results. The customer additions enable the Company to further extend
the Delmarva natural gas distribution and transmission infrastructure, bringing
cost-effective and environmentally-friendly natural gas to new areas on the Delmarva
Peninsula and creating additional opportunities for future growth. |
|
Colder temperatures on the Delmarva Peninsula and in Florida during the fourth
quarter and year ended 2010, compared to the same periods in 2009, contributed additional
gross margin of $472,000 and $927,000 respectively. Additionally, given that only two months
of FPUs results were included in Chesapeakes consolidated 2009 gross margin, the appropriate
comparison for 2010 for the weather impact on FPU is also normal weather. Higher-than-normal
heating and cooling degree-days contributed $3.0 million in margin in 2010. The Company uses
historical results as the normal weather for this analysis.
|
||
| Eastern Shore Natural Gas Company (ESNG), the Companys natural gas transmission
subsidiary, generated additional gross margin of $140,000 from new transportation services
commencing in late 2009 and during 2010. The new transportation services in 2010 will
generate estimated annual margin of $332,000, of which $56,000 has been recognized in 2010. |
||
Although not affecting the Companys results in 2010, ESNG completed the eight-mile mainline
extension in December 2010 to interconnect with the Texas Eastern Transmission, LP (TETLP)
pipeline. ESNG commenced its new transportation services to the Companys Delaware and
Maryland Divisions in January 2011. These new services will generate gross margin of $2.4
million in 2011, $3.9 million in 2012 and $4.3 million annually thereafter. ESNGs
interconnection will provide the Delmarva natural gas distribution operation with access to
new sources of natural gas supply from other natural gas production regions, including the
Appalachian production region, thereby providing increased reliability and diversity of
supply. This new service will also provide the Delaware and Maryland divisions additional
upstream transportation capacity to meet current customer demands and to increase their
supply options as these divisions plan for sustainable growth. |
|||
| On December 30, 2010, ESNG filed a base rate proceeding with the Federal Regulatory
Energy Commission in accordance with the terms of the settlement agreement from its prior
base rate base proceeding in 2008. ESNG expects the base rate proceeding to be completed
in 2011. |
||
| Included in FPUs results for the fourth quarter of 2010 is an additional accrual of
$250,000 for the regulatory risk associated with FPUs natural gas earnings, merger benefits and
recovery of the purchase premium. The Company is required to detail known benefits,
synergies, cost savings and cost increases resulting from the FPU merger and present the
information in a come-back filing to the Florida PSC by April 29, 2011 (within 18 months
of the merger). We are currently in discussions with the Florida OPC and the Florida PSC regarding the benefits and cost savings of the merger, current and
expected earnings levels as well as the recovery of approximately $34.9 million in purchase
premium and $2.2 million in merger-related costs. The additional accrual during the fourth
quarter, which brings the total accrual to $750,000, was recorded based on managements
assessment of FPUs current earnings, the regulatory environment in Florida and progress of
the current discussions. |
2
(in thousands) | ||||
Gross margin for the year ended December 31, 2009 |
$ | 74,296 | ||
Factors contributing to the gross margin increase for the year ended December 31, 2010: |
||||
Margin from FPU operations |
46,239 | |||
Change in rates |
2,244 | |||
Net customer growth |
1,116 | |||
New transportation services |
995 | |||
Favorable weather |
612 | |||
Other |
215 | |||
Gross margin for the year ended December 31, 2010 |
$ | 125,717 | ||
| FPUs natural gas and electric distribution operations generated $37.1 million and
$18.4 million, respectively, in gross margin for the year ended December 31, 2010. Gross
margin from FPUs natural gas and electric distribution operations included in the
Companys results in 2009 were $6.4 million and $2.8 million, respectively. Gross margin
for FPUs natural gas distribution operation in 2010 includes a $750,000 accrual for the regulatory
risk associated with FPUs natural gas earnings, merger benefits and recovery of the
purchase premium previously described and the impact of the $8.0 million rate increase from
the rate settlement in 2009. Gross margin for FPUs natural gas distribution operation in
2010 also includes $148,000 generated from the 700 new customers added by the purchase of
the operating assets of Indiantown Gas Company. |
||
| An annual rate increase of approximately $2.5 million for Chesapeakes Florida natural
gas distribution operation was approved by the Florida PSC in December 2009 and became
effective in January 2010. The rate increase in 2010, net of the impact from the interim
rate increase in 2009, generated additional gross margin of $2.2 million for the year. |
3
| Net customer growth of $1.1 million in 2010 is due primarily to two-percent growth in
residential customers on the Delmarva Peninsula, which generated $512,000 in additional
gross margin, and $587,000 in gross margin generated from new commercial and industrial
customers added on the Delmarva Peninsula. In 2010, the Delmarva natural gas distribution
operations added 10 large commercial and industrial customers with total expected annual
margin of $748,000, of which $196,000 was recognized in 2010. The addition of certain
commercial and industrial customers in 2010 also positioned us to further extend our
natural gas distribution and transmission infrastructure in southern Delaware to serve
other potential customers in the same area. |
||
| New transportation services implemented by ESNG in November 2009, May 2010 and November
2010 as a result of system expansion projects generated an additional $1.1 million in gross
margin in 2010 compared to 2009. These expansion projects added 9,623 Mcfs of firm service
per day with estimated annualized gross margin of $1.6 million,
of which $1.2 million has
been reflected in 2010s results. New transportation service for an industrial customer for
the period from November 2009 to October 2012 generated additional gross margin of $329,000
in 2010. Offsetting these margin increases were decreased margins of $341,000 for the year resulting
from transportation service contracts, which expired in November 2009 and April 2010, and a
decrease in interruptible service to an industrial customer. |
||
| Colder weather on the Delmarva Peninsula generated an additional $365,000 in gross
margin for the Delaware division, as heating degree-days increased by 102, or two percent,
compared to 2009. Residential heating rates for our Maryland division are
weather-normalized, and we typically do not experience an impact on gross margin from the
weather for our residential customers in Maryland. Colder weather in Florida also
increased gross margin for Chesapeakes Florida natural gas distribution division by
$247,000 in 2010. |
(in thousands) | ||||
Gross margin for the year ended December 31, 2009 |
$ | 29,565 | ||
Factors contributing to the gross margin increase for the year ended December 31, 2010: |
||||
Margin from FPU operations |
7,001 | |||
Volume increase weather and other |
1,077 | |||
Natural gas marketing |
(1,030 | ) | ||
Propane wholesale marketing |
(441 | ) | ||
Decreases in retail margin per gallon |
(399 | ) | ||
Miscellaneous fees and other |
340 | |||
Gross margin for the year ended December 31, 2010 |
$ | 36,113 | ||
4
| FPUs unregulated energy operation, which is primarily its propane distribution
operation, generated $10.0 million in gross margin in 2010. Gross margin from FPUs
unregulated energy operation and Chesapeakes Florida propane distribution operation in
2009 was $3.0 million. All of Chesapeakes Florida propane distribution operations were
transferred to FPU after the merger. |
||
| Increased gross margin from the addition of 436 community gas system customers in 2010
and 1,000 additional customers acquired in February 2010 as part of the purchase of the
operating assets of a propane distributor serving Northampton and Accomack counties in
Virginia contributed $170,000 and $235,000 to 2010 gross margin, respectively. Also
contributing to the increase in gross margin was two-percent colder weather on the Delmarva
Peninsula in 2010, as compared to 2009, as well as the timing of propane deliveries to bulk
customers. The cumulative impact of the colder weather and the timing of deliveries
resulted in increased gross margin of $672,000. |
||
| In 2010, gross margin for the Companys unregulated natural gas marketing subsidiary,
PESCO, decreased by $1.0 million. Spot sales decreased from 2009, due
primarily to the absence of spot sales to one industrial customer. Spot sales are not
predictable and, therefore, are not included in our long-term financial plans or forecasts. |
||
| The Companys propane wholesale marketing subsidiary, Xeron, experienced a $441,000
decrease in gross margin in 2010 as a result of a 13-percent decrease in trading volume.
|
||
| Inventory and swap adjustments for the 2008/2009 winter Pro Cap program of $1.8 million
as a result of a sharp decline in inventory prices in late 2008, lowered the propane
inventory cost of our Delmarva propane distribution operation during the first half of 2009
and generated higher retail margins during this period. During 2010, the retail margins
returned to more normal levels, resulting in a lower retail margin per gallon, and
decreasing gross margin by $399,000 for the Delmarva propane distribution operation. |
||
| Other fees increased by $340,000 in 2010, due primarily to continued growth and
increased customer participation in various customer pricing programs offered by the
Delmarva propane distribution operation. |
5
| An increase in long-term interest expense of $1.3 million is related to interest on
FPUs first mortgage bonds. |
| Interest expense from a new term loan facility was $491,000 for the year. In January
2010, we redeemed two series of FPU bonds, the 4.9 percent and 6.85 percent series, by
using $29.1 million of this new short-term loan facility to reduce the amount of the FPU
secured long-term debt and to maintain compliance with the covenants in our unsecured
senior notes. |
| Additional interest expense of $730,000 is related to interest on deposits from FPUs
customers. |
6
(in thousands) | ||||
Gross margin for the three months ended December 31, 2009 |
$ | 27,017 | ||
Factors contributing to the gross margin increase for the three months ended December 31, 2010: |
||||
Margin from FPU operations |
4,958 | |||
Increased customer consumption |
332 | |||
Net customer growth |
326 | |||
Change in rates |
325 | |||
Favorable weather |
212 | |||
New transportation services |
112 | |||
Other |
(21 | ) | ||
Gross margin for the three months ended December 31, 2010 |
$ | 33,261 | ||
| FPUs natural gas and electric distribution operations generated gross margin of
$9.8 million and $4.4 million, respectively, for the quarter ended December 31, 2010.
Gross margin from FPUs natural gas and electric distribution operations included in the
Companys results in the fourth quarter of 2009 were $6.4 million and $2.8 million,
respectively. Colder temperatures in Florida in November and December 2010, compared to
the same period in 2009, generated $422,000 in additional gross margin. Gross margin for
FPUs natural gas distribution operation in the fourth quarter of 2010 also includes
$99,000 generated from the 700 new customers added in conjunction with the purchase of the
operating assets of Indiantown Gas Company. Gross margin for FPUs natural gas
distribution operation in the fourth quarter of 2010 reflects the additional accrual of
$250,000 recorded for the regulatory risk associated with FPUs natural gas earnings, merger benefits
and recovery of the purchase premium previously described. |
||
| Increased consumption, particularly by commercial and industrial customers on both the
Delmarva Peninsula and in Florida, generated additional gross margin of $332,000 for the
quarter. |
||
| Three-percent growth in residential customers for the Delmarva natural gas distribution
operation generated $115,000 in additional gross margin in the fourth quarter of 2010,
compared to the same period in 2009. Gross margin from commercial and industrial customers
for the Delmarva natural gas distribution operation also increased by $186,000 in the
fourth quarter of 2010, due primarily to the addition of 10 large commercial and industrial
customers. Combined with other new large commercial and industrial customers added during
the first three quarters of the year, these new large commercial and industrial customers
will generate an estimated annual margin of $748,000, of which $196,000 has been reflected
in 2010s results. Also contributing to this increase is $25,000 in additional gross
margin generated from customer growth in Chesapeakes Florida natural gas distribution
division. |
||
| Gross margin for Chesapeakes Florida division increased by $470,000 in the fourth
quarter of 2010, compared to the same period in 2009, from an annual rate increase of
approximately $2.5 million approved by the Florida PSC in 2009 (effective in January 2010).
Changes in customers rates and rate classifications, primarily for certain Delmarva
natural gas distribution commercial and industrial customers with negotiated rates, lowered
gross margin by $150,000 in the fourth quarter of 2010. |
||
| New transportation services implemented by ESNG in November 2009, May 2010 and November
2010 as a result of its system expansion projects generated an additional $200,000 to gross
margin in the fourth quarter of 2010 compared to the same period in 2009. These expansion
projects added 9,623 Mcfs of service per day with estimated annual gross margin of $1.6
million. New transportation service for an industrial customer for the period from November
2009 to October 2012 generated additional gross margin of $25,000 in the fourth quarter of
2010, compared to the same period in 2009. Offsetting these margin increases were decreased margins of $58,000 for the year resulting
from transportation service contracts, which expired in November 2009 and April 2010, and a
decrease in interruptible service to an industrial customer. |
7
| Colder weather on the Delmarva Peninsula generated an additional $146,000 of gross
margin as heating degree-days increased by five percent for the fourth quarter of 2010
compared to the same period in 2009. Colder weather during the fourth quarter of 2010
contributed to an increase in gross margin of $66,000 by Chesapeakes Florida division. |
(in thousands) | ||||
Gross margin for the three months ended December 31, 2009 |
$ | 9,272 | ||
Factors contributing to the gross margin increase for the three months ended December 31, 2010: |
||||
Volume increase weather and other |
853 | |||
Margin from FPU operations |
648 | |||
Increase in retail margin per gallon |
630 | |||
Natural gas marketing |
(451 | ) | ||
Propane wholesale marketing |
(292 | ) | ||
Miscellaneous fees and other |
175 | |||
Gross margin for the three months ended December 31, 2010 |
$ | 10,835 | ||
| Increased gross margin for the Delmarva propane distribution operation resulted from the
addition of 444 community gas system customers and approximately 1,000 customers added by
the acquisition of the operating assets of a propane distributor in Virginia in February
2010, which generated $38,000 and $91,000 in gross margin for the fourth quarter,
respectively. Five-percent colder weather on the Delmarva Peninsula, as well as the timing
of propane deliveries to bulk customers, further increased gross margin by $718,000. |
||
| FPUs unregulated energy operation, which is primarily its propane distribution
operation, generated $2.6 million in gross margin in the fourth quarter of 2010. Gross
margin from FPUs unregulated energy operation and Chesapeakes Florida propane
distribution operation in the fourth quarter of 2009 was $1.9 million. All of Chesapeakes
Florida propane distribution operation was transferred to FPU after the merger. |
||
| Higher retail margins per gallon during the fourth quarter of 2010 generated additional
gross margin of $630,000. |
||
| In the fourth quarter of 2009, PESCO benefited from increased spot sales to customers on
the Delmarva Peninsula. The absence of spot sales to one industrial customer on the
Delmarva Peninsula decreased PESCOs gross margin by $451,000 during the quarter. Spot
sales are not predictable and, therefore, are not included in our long-term financial plans
or forecasts. |
8
| Xeron experienced a $292,000 decrease in gross margin during the fourth quarter of 2010
compared to the same period in 2009. Xerons trading volumes decreased by 10 percent in
the fourth quarter of 2010 compared to the same period in 2009. |
||
| Other fees increased by $175,000 in the fourth quarter of 2010, due primarily to
continued growth and increased customer participation in various customer pricing programs
offered by the Delmarva propane distribution operation. |
9
Fourth Quarter | Year to Date | |||||||||||||||
2010 | 2009 | 2010 | 2009 | |||||||||||||
Operating Revenues |
||||||||||||||||
Regulated energy |
$ | 72,155 | $ | 52,677 | $ | 269,934 | $ | 139,099 | ||||||||
Unregulated energy |
42,775 | 36,737 | 146,793 | 119,973 | ||||||||||||
Other |
2,829 | 2,301 | 10,819 | 9,713 | ||||||||||||
Total Operating Revenues |
117,759 | 91,715 | 427,546 | 268,785 | ||||||||||||
Operating Expenses |
||||||||||||||||
Regulated energy cost of sales |
38,894 | 25,660 | 144,217 | 64,803 | ||||||||||||
Unregulated energy and other cost of sales |
33,386 | 28,506 | 116,098 | 95,467 | ||||||||||||
Operations |
20,486 | 15,886 | 75,335 | 50,706 | ||||||||||||
Transaction-related costs |
481 | 948 | 660 | 1,478 | ||||||||||||
Maintenance |
2,096 | 1,498 | 7,484 | 3,430 | ||||||||||||
Depreciation and amortization |
5,040 | 4,353 | 20,758 | 11,588 | ||||||||||||
Other taxes |
3,188 | 2,206 | 11,064 | 7,577 | ||||||||||||
Total operating expenses |
103,571 | 79,057 | 375,616 | 235,049 | ||||||||||||
Operating Income |
14,188 | 12,658 | 51,930 | 33,736 | ||||||||||||
Other income (loss), net of other expenses |
(12 | ) | 144 | 195 | 165 | |||||||||||
Interest charges |
2,222 | 2,330 | 9,146 | 7,086 | ||||||||||||
Income Before Income Taxes |
11,954 | 10,472 | 42,979 | 26,815 | ||||||||||||
Income tax expenses |
4,841 | 4,282 | 16,923 | 10,918 | ||||||||||||
Net Income |
$ | 7,113 | $ | 6,190 | $ | 26,056 | $ | 15,897 | ||||||||
Weighted Average Common Shares Outstanding: |
||||||||||||||||
Basic |
9,516,370 | 8,659,935 | 9,474,554 | 7,313,320 | ||||||||||||
Diluted |
9,622,832 | 8,755,998 | 9,582,374 | 7,440,201 | ||||||||||||
Earnings Per Share of Common Stock: |
||||||||||||||||
Basic |
$ | 0.75 | $ | 0.71 | $ | 2.75 | $ | 2.17 | ||||||||
Diluted |
$ | 0.74 | $ | 0.71 | $ | 2.73 | $ | 2.15 | ||||||||
10
(in thousands, except degree-day data) | Fourth Quarter | Year to Date | ||||||||||||||
Chesapeake and Subsidiaries | 2010 | 2009 | 2010 | 2009 | ||||||||||||
Gross Margin (1) |
||||||||||||||||
Regulated Energy |
$ | 33,261 | $ | 27,017 | $ | 125,717 | $ | 74,296 | ||||||||
Unregulated Energy |
10,835 | 9,272 | 36,113 | 29,565 | ||||||||||||
Other |
1,383 | 1,260 | 5,401 | 4,654 | ||||||||||||
Total Gross Margin |
$ | 45,479 | $ | 37,549 | $ | 167,231 | $ | 108,515 | ||||||||
Operating Income (Loss) |
||||||||||||||||
Regulated Energy |
$ | 11,149 | $ | 10,346 | $ | 43,509 | $ | 26,900 | ||||||||
Unregulated Energy |
3,176 | 2,925 | 7,908 | 8,158 | ||||||||||||
Other |
(137 | ) | (613 | ) | 513 | (1,322 | ) | |||||||||
Total Operating Income |
$ | 14,188 | $ | 12,658 | $ | 51,930 | $ | 33,736 | ||||||||
Heating Degree-Days Delmarva
Peninsula |
||||||||||||||||
Actual |
1,810 | 1,726 | 4,831 | 4,729 | ||||||||||||
10-year average (normal) |
1,605 | 1,573 | 4,528 | 4,462 | ||||||||||||
Heating Degree-Days Florida |
||||||||||||||||
Actual |
558 | 297 | 1,501 | 911 | ||||||||||||
10-year average (normal) |
325 | 316 | 919 | 863 | ||||||||||||
Cooling Degree-Days Florida |
||||||||||||||||
Actual |
166 | 336 | 2,859 | 2,770 | ||||||||||||
10-year average (normal) |
275 | 276 | 2,718 | 2,694 |
(1) | Gross margin is determined by deducting the cost of sales from operating revenue.
Cost of sales includes the purchased fuel cost for natural gas, electricity and propane and the
cost of labor spent on direct revenue-producing activities. Gross margin should not be considered
an alternative to operating income or net income, which is determined in accordance with Generally
Accepted Accounting Principles (GAAP). Chesapeake believes that gross margin, although a non-GAAP
measure is useful and meaningful to investors as a basis for making investment decisions. It
provides investors with information that demonstrates the profitability achieved by the Company
under its allowed rates for regulated operations and under its competitive pricing structure for
non-regulated segments. Chesapeakes management uses gross margin in measuring its business units
performance and has historically analyzed and reported gross margin information publicly. Other
companies may calculate gross margin in a different manner. |
11
(in thousands) | Fourth Quarter | Year to Date | ||||||
FPU Stand-alone | 2010 | 2010 | ||||||
Gross Margin (1) |
||||||||
Regulated Energy |
||||||||
Natural Gas |
$ | 9,802 | $ | 37,057 | ||||
Electric |
4,364 | 18,390 | ||||||
Unregulated Energy |
||||||||
Propane and other |
2,575 | 9,968 | ||||||
Total Gross Margin |
$ | 16,741 | $ | 65,415 | ||||
Operating Income |
||||||||
Regulated Energy |
||||||||
Natural Gas |
$ | 3,296 | $ | 12,323 | ||||
Electric |
557 | 4,475 | ||||||
Unregulated Energy |
||||||||
Propane and other |
368 | 1,573 | ||||||
Total Operating Income |
$ | 4,221 | $ | 18,371 | ||||
(1) | Gross margin is determined by deducting the cost of sales from operating
revenue. Cost of sales includes the purchased fuel cost for natural gas, electricity and propane
and the cost of labor spent on direct revenue-producing activities. Gross margin should not be
considered an alternative to operating income or net income, which is determined in accordance with
Generally Accepted Accounting Principles (GAAP). Chesapeake believes that gross margin, although
a non-GAAP measure, is useful and meaningful to investors as a basis for making investment
decisions. It provides investors with information that demonstrates the profitability achieved by
the Company under its allowed rates for regulated operations and under its competitive pricing
structure for non-regulated segments. Chesapeakes management uses gross margin in measuring its
business units performance and has historically analyzed and reported gross margin information
publicly. Other companies may calculate gross margin in a different manner. |
12
For the Three Months Ended December 31, 2010 | For the Three Months Ended December 31, 2009 | |||||||||||||||||||||||||||||||
Chesapeake | Chesapeake | FPU NG | FPU Electric | |||||||||||||||||||||||||||||
Delmarva NG | Florida NG | FPU NG | FPU Electric | Delmarva NG | Florida NG | Distribution | Distribution | |||||||||||||||||||||||||
Distribution | Division | Distribution | Distribution | Distribution | Division | (2) | (2) | |||||||||||||||||||||||||
Operating Revenues (in thousands) |
||||||||||||||||||||||||||||||||
Residential |
$ | 11,571 | $ | 1,155 | $ | 5,197 | $ | 10,990 | $ | 10,398 | $ | 888 | $ | 4,172 | $ | 13,559 | ||||||||||||||||
Commercial |
7,654 | 971 | 7,883 | 11,156 | 6,911 | 792 | 6,568 | 11,198 | ||||||||||||||||||||||||
Industrial |
1,144 | 1,082 | 2,109 | 1,708 | 1,140 | 1,016 | 1,898 | 2,361 | ||||||||||||||||||||||||
Other (1) |
5,292 | 563 | 2,225 | (2,263 | ) | 3,869 | 421 | (1,498 | ) | (2,241 | ) | |||||||||||||||||||||
Total Operating Revenues |
$ | 25,661 | $ | 3,771 | $ | 17,414 | $ | 21,591 | $ | 22,318 | $ | 3,117 | $ | 11,140 | $ | 24,877 | ||||||||||||||||
Volumes (in Mcfs/MWHs) |
||||||||||||||||||||||||||||||||
Residential |
684,329 | 97,507 | 311,130 | 73,363 | 586,870 | 66,075 | 237,500 | 70,959 | ||||||||||||||||||||||||
Commercial |
559,230 | 341,672 | 784,158 | 81,512 | 502,352 | 300,450 | 682,423 | 79,269 | ||||||||||||||||||||||||
Industrial |
1,000,019 | 3,206,128 | 510,577 | 13,770 | 815,685 | 2,912,077 | 440,797 | 13,130 | ||||||||||||||||||||||||
Other |
31,940 | | 192,229 | (7,175 | ) | 106,105 | | 172,722 | (3,631 | ) | ||||||||||||||||||||||
Total |
2,275,518 | 3,645,307 | 1,798,094 | 161,470 | 2,011,012 | 3,278,602 | 1,533,442 | 159,727 | ||||||||||||||||||||||||
Average customers |
||||||||||||||||||||||||||||||||
Residential |
48,027 | 13,439 | 47,525 | 23,644 | 46,582 | 13,197 | 46,461 | 23,600 | ||||||||||||||||||||||||
Commercial |
5,036 | 1,166 | 4,532 | 7,366 | 5,011 | 1,116 | 4,448 | 7,423 | ||||||||||||||||||||||||
Industrial |
181 | 59 | 658 | 3 | 149 | 61 | 564 | 3 | ||||||||||||||||||||||||
Other |
4 | | | | 8 | | 2 | | ||||||||||||||||||||||||
Total |
53,248 | 14,664 | 52,715 | 31,013 | 51,750 | 14,374 | 51,475 | 31,026 | ||||||||||||||||||||||||
(1) | Operating revenues from Other sources include unbilled revenue, under (over)
recoveries of fuel cost, conservation revenue, other miscellaneous charges, fees for billing
services provided to third-parties and adjustments for pass-through taxes . |
|
(2) | Operating revenue, volume and average customer information for FPU-Natural Gas
Distribution and FPU-Electric Distribution are presented for comparative purposes only. They
include the FPU results from the period prior to the merger with Chesapeake, which are not included
in Chesapeakes consolidated results. |
13
For the Twelve Months Ended December 31, 2010 | For the Twelve Months Ended December 31, 2009 | |||||||||||||||||||||||||||||||
Chesapeake | Chesapeake | FPU NG | FPU Electric | |||||||||||||||||||||||||||||
Delmarva NG | Florida NG | FPU NG | FPU Electric | Delmarva NG | Florida NG | Distribution | Distribution | |||||||||||||||||||||||||
Distribution | Division | Distribution | Distribution | Distribution | Division | (2) | (2) | |||||||||||||||||||||||||
Operating Revenues (in thousands) |
||||||||||||||||||||||||||||||||
Residential |
$ | 46,041 | $ | 4,716 | $ | 23,026 | $ | 51,498 | $ | 51,309 | $ | 3,682 | $ | 20,248 | $ | 43,805 | ||||||||||||||||
Commercial |
27,896 | 3,726 | 35,280 | 45,332 | 31,943 | 3,043 | 30,293 | 39,139 | ||||||||||||||||||||||||
Industrial |
3,766 | 4,610 | 8,433 | 7,705 | 3,696 | 4,260 | 6,600 | 7,555 | ||||||||||||||||||||||||
Other (1) |
3,162 | 1,847 | (1,240 | ) | (10,452 | ) | 2,268 | 1,376 | (2,789 | ) | (8,335 | ) | ||||||||||||||||||||
Total Operating Revenues |
$ | 80,865 | $ | 14,899 | $ | 65,499 | $ | 94,083 | $ | 89,216 | $ | 12,361 | $ | 54,352 | $ | 82,164 | ||||||||||||||||
Volumes (in Mcfs/MWHs) |
||||||||||||||||||||||||||||||||
Residential |
2,881,073 | 392,845 | 1,329,598 | 347,040 | 2,747,162 | 318,417 | 1,157,074 | 316,306 | ||||||||||||||||||||||||
Commercial |
2,145,143 | 1,314,146 | 3,156,894 | 332,323 | 2,073,884 | 1,157,931 | 2,942,812 | 316,412 | ||||||||||||||||||||||||
Industrial |
3,020,907 | 13,490,494 | 2,066,605 | 66,580 | 2,446,993 | 13,264,646 | 1,795,756 | 64,950 | ||||||||||||||||||||||||
Other |
232,653 | | 12,723 | (6,287 | ) | 373,825 | | 28,641 | 6,250 | |||||||||||||||||||||||
Total |
8,279,776 | 15,197,485 | 6,565,820 | 739,656 | 7,641,864 | 14,740,994 | 5,924,283 | 703,918 | ||||||||||||||||||||||||
Average customers |
||||||||||||||||||||||||||||||||
Residential |
47,638 | 13,427 | 47,626 | 23,589 | 46,717 | 13,267 | 46,781 | 23,679 | ||||||||||||||||||||||||
Commercial |
5,048 | 1,135 | 4,498 | 7,374 | 5,019 | 1,114 | 4,466 | 7,405 | ||||||||||||||||||||||||
Industrial |
172 | 59 | 622 | 3 | 143 | 62 | 539 | 2 | ||||||||||||||||||||||||
Other |
5 | | | | 10 | | | | ||||||||||||||||||||||||
Total |
52,863 | 14,621 | 52,746 | 30,966 | 51,889 | 14,443 | 51,786 | 31,086 | ||||||||||||||||||||||||
(1) | Operating revenues from Other sources include unbilled revenue, under (over)
recoveries of fuel cost, conservation revenue, other miscellaneous charges, fees for billing
services provided to third-parties and adjustments for pass-through taxes . |
|
(2) | Operating revenue, volume and average customer information for FPU-Natural Gas
Distribution and FPU-Electric Distribution are presented for comparative purposes only. They
represent the FPU results from the period prior to the merger with Chesapeake and, therefore, they
are not included in Chesapeakes consolidated results. |
14
December 31, | December 31, | |||||||
Assets | 2010 | 2009 | ||||||
(in thousands, except shares and per share data) | ||||||||
Property, Plant and Equipment |
||||||||
Regulated energy |
$ | 500,689 | $ | 462,061 | ||||
Unregulated energy |
61,313 | 61,334 | ||||||
Other |
16,989 | 16,049 | ||||||
Total property, plant and equipment |
578,991 | 539,444 | ||||||
Less: Accumulated depreciation and amortization |
(121,628 | ) | (107,318 | ) | ||||
Plus: Construction work in progress |
5,394 | 4,461 | ||||||
Net property, plant and equipment |
462,757 | 436,587 | ||||||
Investments, at fair value |
4,036 | 1,959 | ||||||
Current Assets |
||||||||
Cash and cash equivalents |
1,643 | 2,818 | ||||||
Accounts receivable (less allowance for uncollectible
accounts of $1,194 and $1,609, respectively) |
88,074 | 69,773 | ||||||
Accrued revenue |
14,978 | 12,838 | ||||||
Propane inventory, at average cost |
8,876 | 7,901 | ||||||
Other inventory, at average cost |
3,084 | 3,149 | ||||||
Regulatory assets |
51 | 448 | ||||||
Storage gas prepayments |
5,084 | 6,144 | ||||||
Income taxes receivable |
6,748 | 2,614 | ||||||
Deferred income taxes |
2,191 | 724 | ||||||
Prepaid expenses |
4,613 | 5,853 | ||||||
Mark-to-market energy assets |
1,642 | 2,379 | ||||||
Other current assets |
245 | 147 | ||||||
Total current assets |
137,229 | 114,788 | ||||||
Deferred Charges and Other Assets |
||||||||
Goodwill |
35,613 | 34,095 | ||||||
Other intangible assets, net |
3,459 | 3,951 | ||||||
Long-term receivables |
155 | 440 | ||||||
Regulatory assets |
23,884 | 20,100 | ||||||
Other deferred charges |
3,860 | 3,891 | ||||||
Total deferred charges and other assets |
66,971 | 62,477 | ||||||
Total Assets |
$ | 670,993 | $ | 615,811 | ||||
15
December 31, | December 31, | |||||||
Capitalization and Liabilities | 2010 | 2009 | ||||||
(in thousands, except shares and per share data) | ||||||||
Capitalization |
||||||||
Stockholders equity |
||||||||
Common stock, par value $0.4867 per share (authorized 25,000,000 and 12,000,000 shares, respectively) |
$ | 4,635 | $ | 4,572 | ||||
Additional paid-in capital |
148,159 | 144,502 | ||||||
Retained earnings |
76,805 | 63,231 | ||||||
Accumulated other comprehensive loss |
(3,360 | ) | (2,524 | ) | ||||
Deferred compensation obligation |
777 | 739 | ||||||
Treasury stock |
(777 | ) | (739 | ) | ||||
Total stockholders equity |
226,239 | 209,781 | ||||||
Long-term debt, net of current maturities |
89,642 | 98,814 | ||||||
Total capitalization |
315,881 | 308,595 | ||||||
Current Liabilities |
||||||||
Current portion of long-term debt |
9,216 | 35,299 | ||||||
Short-term borrowing |
63,958 | 30,023 | ||||||
Accounts payable |
65,541 | 51,462 | ||||||
Customer deposits and refunds |
26,317 | 25,046 | ||||||
Accrued interest |
1,789 | 1,887 | ||||||
Dividends payable |
3,143 | 2,959 | ||||||
Accrued compensation |
6,784 | 5,341 | ||||||
Regulatory liabilities |
9,009 | 8,295 | ||||||
Mark-to-market energy liabilities |
1,492 | 2,514 | ||||||
Other accrued liabilities |
10,393 | 7,017 | ||||||
Total current liabilities |
197,642 | 169,843 | ||||||
Deferred Credits and Other Liabilities |
||||||||
Deferred income taxes |
80,031 | 66,008 | ||||||
Deferred investment tax credits |
243 | 335 | ||||||
Regulatory liabilities |
3,734 | 4,393 | ||||||
Environmental liabilities |
10,587 | 11,104 | ||||||
Other pension and benefit costs |
18,199 | 15,088 | ||||||
Accrued asset removal cost Regulatory liability |
35,092 | 33,214 | ||||||
Other liabilities |
9,584 | 7,231 | ||||||
Total deferred credits and other liabilities |
157,470 | 137,373 | ||||||
Total Capitalization and Liabilities |
$ | 670,993 | $ | 615,811 | ||||
16
17
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