-----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, TaQm8Wh8msJRA9G+oK7blsug8oCWcI1bs7IGSQK+vEQBwMv1Q3JdEfcxP4PeKbN0 IUNrlxhxaJmajoptgyAlNg== 0000024751-01-500076.txt : 20010905 0000024751-01-500076.hdr.sgml : 20010905 ACCESSION NUMBER: 0000024751-01-500076 CONFORMED SUBMISSION TYPE: 10QSB/A PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 20010630 FILED AS OF DATE: 20010904 FILER: COMPANY DATA: COMPANY CONFORMED NAME: CORNING NATURAL GAS CORP CENTRAL INDEX KEY: 0000024751 STANDARD INDUSTRIAL CLASSIFICATION: NATURAL GAS TRANSMISSION & DISTRIBUTION [4923] IRS NUMBER: 160397420 STATE OF INCORPORATION: NY FISCAL YEAR END: 0930 FILING VALUES: FORM TYPE: 10QSB/A SEC ACT: 1934 Act SEC FILE NUMBER: 000-00643 FILM NUMBER: 1730119 BUSINESS ADDRESS: STREET 1: 330 W WILLIAM ST STREET 2: P O BOX 58 CITY: CORNING STATE: NY ZIP: 14830 BUSINESS PHONE: 6079363755 MAIL ADDRESS: STREET 1: 330 W WILLIAM STREET STREET 2: P O BOX 58 CITY: CORNING STATE: NY ZIP: 14830 10QSB/A 1 qsb.txt AMENDED/CORRECTED 10QSB U.S. SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-QSB QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES AND EXCHANGE ACT OF 1934 For Quarter Ended June 30, 2001 0-643 Corning Natural Gas Corp (Commission file Number (Exact name of registrant as specified in its charter) New York 16-0397420 (State or other jurisdiction of (IRS Employer ID No) incorporation or organization) 330 W William Street, PO Box 58, Corning, New York 14830 (Address of principal executive offices) 607-936-3755 (Registrant's telephone number, including area code) Indicate by checkmark whether the registrant (1) filed all reports required to be filed by Section 13 Or 15(d) of the Exchange Act of 1934 during the past 12 months and (2) has been subject to such filing requirements for at least the past 90 days. Yes ___X___ No ______. Number of shares of Common Stock outstanding at the end of the quarter-460,000. There is only one class of Common Stock and no Preference Stock outstanding. CORNING NATURAL GAS CORPORATIONFORM 10-QSB FOR THE QUARTER ENDED JUNE 30, 2001 Management's Discussion & Analysis As the Company's business is seasonal, the interim results should not be used as an indication of what results of the fiscal year 2001 may be. Consolidated revenue of $5,579,400 for the quarter increased $275,700 from the same quarter last year due primarily to an increase in Gas Company revenue. Gas Company revenue increased $615,600 due primarily to an increase in the cost of gas at the wellhead, which is billed to customers. Increases and decreases in gas costs are passed through to customers, and are profit-neutral to the company. Consolidated net loss for the quarter was $121,600 compared to a loss of $65,200 in the same quarter the previous year. Earnings from gas operations decreased $24,700 primarily as a result of a one time billing adjustment in April 2000. The Appliance Company earnings of $19,400 compared to $37,900 in the same quarter last year as a result of slowed sales. Corning Realty experienced a loss of $32,600 for the quarter for the same reason, slowed sales. The Tax Center International and The Foodmart Plaza contributed an additional $59,400 to consolidated earnings for the quarter. Corning Mortgage the newest business segment, experienced a loss of $4,900 for the quarter, having just received its license approval from the New York State banking authority in November 2000. The Company finances its capital additions as well as gas purchased through a combination of internally generated funds and short-term borrowing. The Company has $7,500,000 available through lines of credit at local banks, the terms of which are disclosed in the Companys latest annual report on form 10-KSB. It is expected that current capital resources will continue to be sufficient for planned operations. Segment Overview: The following table reflects the year to date results of the segments consistent with the Company's internal financial reporting process. The following results are used in part, by management, both in evaluating the performance of, and in allocating resources to, each of these segments. Gas Appliance Tax Corning Foodmart Corning Total Company Corp. Center Realty Plaza Mortgage Revenue: 2001: 22,373,290 1,732,069 363,349 3,005,736 180,533 --- 27,654,977 2000: 14,668,666 1,864,939 262,920 3,294,560 210,149 --- 20,301,234 Net income (loss): (1) 2001: 547,063 181,160 100,380 (128,081) 1,648 (19,475) 682,695 2000: 435,210 184,626 54,865 (57,795) 25,024 --- 641,930 Interest Income: 2001: 41,535 78,454 5,867 --- --- --- 125,856 2000: 1,549 67,565 553 --- --- --- 69,667 Interest Expense: 2001: 714,616 5,610 757 120,249 66,540 --- 907,772 2000: 816,167 10,269 1,495 108,083 67,944 --- 1,003,958 Total assets: (2) 2001: 25,736,947 3,264,555 302,569 1,918,984 1,092,223 186,869 32,502,147 2000: 21,034,895 3,262,784 227,440 2,051,620 1,212,094 --- 27,788,833 Depreciation and amortization: 2000: 365,225 173,527 9,569 135,338 24,550 --- 708,209 2000: 355,229 179,098 8,523 127,061 23,678 --- 693,278 Income tax expense: 2001: 359,478 97,937 51,711 (65,966) (2,485) (9,330) 431,345 2002: 285,969 104,983 20,734 (29,940) (2,848) --- 378,898 (1) Before elimination of intercompany interest. (2) Total assets include property, plant and equipment, accounts receivable, inventories, cash and other amounts specifically related to each identified segment. Interest income and expense are displayed in the segment in which they have been earned or incurred. Segment interest expense other than the Gas Company is included within unregulated expenses in the consolidated statements of income. In June 1998, June 1999 and June 2000 the Financial Accounting Standards Board ("FASB") issued Statements of Financial Accounting Standards ("SFAS") No. 133, "Accounting for Derivative Instruments and Hedging Activities", SFAS No. 137, "Accounting for Derivative Instruments and Hedging Activities- Deferral of the Effective Date of FASB Statement No. 133" and SFAS No. 138, "Accounting for Certain Derivative Instruments and Certain Hedging Activities, an Amendment of FASB Statement No. 133". These Statements establish accounting and reporting standards requiring that every derivative instrument (including certain derivative instruments embedded in other contracts) be recorded in the balance heet as either an asset or liability measured at its fair value. These statements require that changes in the derivative's fair value be recognized currently in earnings unless specific hedge accounting criteria are met. Special accounting for qualifying hedges allows a derivate's gains and losses to offset related results on the hedged item in the statement of operations, and requires that the Company must formally document, designate and assess the effectiveness of transactions that receive hedge accounting. During the first quarter of 2001, the Company adopted Statement of Financial Accounting Standards ("SFAS") No. 133, Accounting for Derivative Instruments and Hedging Activities. The Company has not identified any derivatives that meet the criteria for a derivative instrument and does not participate in any hedging activities. As a result, management of the Company concluded that there was no material effect on the Companys consolidated financial position, results of operations or cash flows resulting from the adoption of SFAS No. 133 during the nine months ended June 30, 2001. The Financial Accounting Standards Board has approved for issuance Statement of Financial Accounting Standards ("SFAS") No. 141, "Business Combinations" and No. 142 "Goodwill and Other Intangible Assets". Both statements are scheduled to be published in July 2001. SFAS No. 141 will require that the purchase method of accounting be used for all business combinations initiated after June 30, 2001 and that the use of the pooling-of-interest method is no longer allowed. SFAS No. 142 requires that upon adoption, amortization of goodwill will cease and instead, the carrying value of goodwill will be evaluated for impairment on an annual basis. Identifiable intangible assets will continue to be amortized over their useful lives and reviewed for impairment in accordance with SFAS No. 121 "Accounting for the Impairment of Long-Lived Assets and for Long-Lived Assets to be Disposed of", SFAS No. 142 is effective for fiscal years beginning after December 15, 2001; however, the Company may elect early adoption of this statement on October 1, 2001, the beginning of its 2002 fiscal year. The Company is evaluating the impact of the adoption of these standards and has not yet determined the effect of adoption on its financial position and results of Operations. The information furnished herewith reflects all adjustments, which are in the opinion of management necessary to a fair statement of the results for the period. Certain information and footnote disclosures normally included in financial statements prepared in accordance with accounting principals generally accepted in the United States of America have been condensed or omitted pursuant to SEC rules and regulations, although the Company believes the disclosures which are made are adequate to make the informationpresented not misleading. The condensed consolidated financial statements contained herein should be read in conjunction with the consolidated financial statements and notes thereto included in the Company's latest annual report on Form 10-KSB. These unaudited interim financial statements have not been examined or certified by a firm of certified public accountants. There were no sales of unregistered securities (debt or equity) during the quarter ending June 30, 2001. SIGNATURES In accordance with the requirements of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized. Date: August 14, 2001 /S/ THOMAS K. BARRY Thomas K. Barry, Chairman of the Board, President and CEO. Date: August 14, 2001 /S/GARY K. EARLEY Gary K. Earley, Treasurer CORNING NATURAL GAS CORPORATION AND SUBSIDIARY Consolidated Balance Sheets June 30, 2001 September 30, 2000 ----------------- ------------------ Unaudited Assets - ------ Utility plant: Utility property, plant and $22,836,047 $22,251,342 equipment: Non-utility - property, 4,230,606 4,176,447 plant and equipment Less accumulated depreciation 10,270,079 9,734,579 Total plant utility and 16,796,574 16,693,210 non-utility net Investments: Marketable securities available 1,274,120 1,334,094 for sale at fair value Investment in joint venture 184,209 174,794 Total investments 1,458,329 1,508,888 Current assets: Cash and cash equivalents 203,765 257,035 Customer A/R, less allowance 1,964,606 1,310,689 for uncollectibles Gas stored underground, at 484,476 2,194,436 average cost Gas and appliance inventories 637,796 638,891 Prepaid expenses 635,894 529,905 ---------- ---------- Total current assets 3,926,537 4,930,956 ---------- ---------- Deferred debits and other assets: Regulatory assets: Income taxes recoverable 1,016,661 1,016,661 through rates Prepaid pension costs 2,066,365 1,833,979 Unrecovered gas costs 475,463 1,362,394 Goodwill net of amortization 1,651,895 1,763,338 Unamortized debt issuance cost 333,590 349,759 Other 791,841 512,708 ---------- ---------- Total deferred debits and 6,335,815 6,838,839 other assets ---------- ---------- Total assets 28,517,255 29,971,893 ========== ========== CORNING NATURAL GAS CORPORATION AND SUBSIDIARY Consolidated Balance Sheets Capitalization and liabilities: June 30, 2001 September 30, 2000 - ------------------------------- ----------------- ------------------ Unaudited Common stockholders' equity: Common stock(common stock $5.00 par value per share. Authorized 1,000,000 shares;issued and outstanding 460,000 shares) 2,300,000 2,300,000 Other paid-in capital 653,346 653,346 Retained earnings 2,201,701 1,967,389 Accumulated other comprehensive income-net unrealized gain on securities availablefor sale (net of income taxes) 30,830 130,790 Total common stockholders' quity 5,185,877 5,051,525 ---------- ---------- Long-term debt, less current 10,918,934 11,429,421 installments Current liabilities: Current portion of long term debt 579,808 374,335 Borrowings under lines-of-credit 3,574,692 5,175,359 Accounts payable 1,654,329 1,715,628 Accrued expenses 583,011 591,221 Customer deposits and accrued 410,352 674,458 interest Deferred income taxes 120,103 120,103 Accrued general taxes 382,787 119,331 Supplier refunds 78,809 294,676 Prepaid income taxes 154,610 (354,619) Dividends payable 149,500 149,500 ---------- ---------- Total current liabilities 7,688,001 8,859,992 ---------- ---------- Deferred credits and other liabilities: Deferred income taxes 2,460,407 2,448,994 Deferred compensation and post-retirement benefits 2,163,785 2,089,854 Other 100,251 92,107 Total deferred credits and other liabilities 4,724,443 4,630,955 ---------- ---------- Total capitalization and liabilities $28,517,255 $29,971,893 =========== =========== Corning Natural Gas Corporation Condensed Consolidated Statements of Income Unaudited Form 10 QSB Quarter Ended Nine Months Ended June 30,2001 June 30,2000 June 30,2001 June 30,2000 ------------- ------------- ------------- ------------- Utility Operating Revenues $ 3,953,065 $ 3,350,548 $ 22,373,290 $ 14,668,666 ------------- ------------- ------------- ------------ Cost and Expense Operating Expenses 3,963,692 3,267,838 20,753,402 13,129,784 Interest Expense 230,251 264,382 714,616 816,167 Income Tax (68,668) (41,793) 359,478 292,651 Other Deductions, Net 2,792 5,830 24,764 8,052 ------------- ------------- ------------- ------------ Total Costs and Expenses 4,128,067 3,496,257 21,852,260 14,246,654 Utility Operating Income (Loss) (175,002) (145,709) 521,030 422,012 ------------- ------------- ------------- ------------ Other Income 12,027 7,390 26,118 13,189 Corning Natural Gas Appliance Corp. Operating Revenues 459,080 549,325 1,810,522 1,932,505 Depreciation 56,753 57,616 173,529 179,099 Operating Expense 372,104 428,810 1,357,896 1,463,793 Federal Income Tax 10,786 25,037 97,937 104,983 Equity in Earnings of Assoc. Cos. 21,857 35,270 (45,614) 22,099 ------------- -------------- ------------- ------------ Net Income of Appliance Corp. 41,294 73,132 135,546 206,729 ------------- -------------- ------------- ------------ Net Income (Loss) $ (121,681) $ (65,187) $ 682,694 $ 641,930 ============= ============== ============= ============ Earnings (Loss) Per Share-basic & diluted $ (0.265) $ (0.142) $ 1.484 $ 1.396 Dividends Per Share $ 0.650 $ 0.650 $ 0.975 $ 0.975 Dividends Declared $ 299,000 $ 299,000 $ 448,500 $ 448,500 Shares of common stock outstanding were 460,000 at June 30, 2001 Earnings per share=Net Income as shown above divided by 460,000 shares. Dividends per share=Dividends declared divided by shares outstanding at the time. CORNING NATURAL GAS CORPORATION Statement of Comprehensive Income(Loss) Unaudited Form 10 QSB Quarter Ended Nine Months Ended June 30,2001 June 30,2000 June 30,2001 June 30,2000 ------------ ------------ ------------ ----------- Net Income(loss) $ (121,680) $ (65,187) $ 682,695 $ 641,930 Other comprehensive income(loss), net of tax: Unrealized gains(losses) on securities: (11,732) 14,769 99,960 95,121 Comprehensive Income(loss) (133,412) (50,418) 782,655 737,051 CORNING NATURAL GAS CORPORATION AND SUBSIDIARY Consolidated Statements of Cash Flows For the Nine Months Ended June 30, 2001 & 2000 Unaudited Form 10 QSB June 30, 2001 June 30, 2000 ------------- ------------- Cash flows from operating activities: Net income $ 682,695 $ 641,930 Adjustments to reconcile net income to net cash(used in)provided by operating activities: Depreciation and amortization 708,209 693,278 Loss(gain) on sale of marketable securities 59,974 (30,489) Deferred income taxes 11,413 0 Gain on joint venture (9,415) 0 Changes in assets and liabilities: Increase (decrease) in: Accounts receivable (653,917) 381,409 Gas stored underground 1,709,960 (912,135) Gas and appliance inventories 1,095 17,842 Prepaid expenses (105,989) (105,925) Unrecovered gas costs 886,931 (401,713) Prepaid income taxes 509,229 259,712 Deferred income tax asset 0 87,926 Deferred charges-pension and other (158,455) (240,568) Other assets (279,133) 37,676 Increase(decrease) in: Accounts payable (61,299) 509,069 Customer deposit liability (264,106) 0 Accrued general taxes 263,456 99,740 Supplier refunds due customers (215,868) 20,909 Other liabilities and deferred credits (65) 86,101 -------------- ------------- Net cash provided by operating activities 3,084,715 1,144,762 -------------- ------------- Cash flows from investing activities: Capital expenditures, net of minor disposals (783,803) (866,067) -------------- ------------- Net cash used in investing activities (783,803) (866,067) -------------- ------------ Cash flows from financing activities: Net borrowings under lines-of-credit (1,600,667) 591,947 Dividends paid (448,500) (448,500) Repayment of long-term debt (305,015) (334,600) -------------- ------------- Net cash used in financing activities (2,354,182) (191,153) -------------- ------------- Net (decrease) increase in cash (53,270) 87,542 Cash and cash equivalents at beginning of period 257,035 205,787 -------------- ------------- Cash and cash equivalents at end of period $ 203,765 $ 293,329 ============== ============= Supplemental disclosures of cash flow information: Cash paid during the period for: Interest $ 54,072 337,148 Income taxes 153,618 231,500 ============== ============= -----END PRIVACY-ENHANCED MESSAGE-----