8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

Form 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported) August 5, 2014

SOUTHWEST GAS CORPORATION

(Exact name of registrant as specified in its charter)

California	1-7850	88-0085720
(State or other jurisdiction of	(Commission	(I.R.S. Employer
incorporation or organization)	File Number)	Identification No.)
5241 Spring Mountain Road
Post Office Box 98510
Las Vegas, Nevada		89193-8510
(Address of principal executive offices)		(Zip Code)

Registrant's telephone number, including area code: (702) 876-7237

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

[ ] Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02        Results of Operations and Financial Condition.

On August 5, 2014, Southwest Gas Corporation (the Company) released summary financial information to the general public, including the investment community, regarding the Company’s operating performance for the quarter, six, and twelve months ended June 30, 2014.  A copy of the Company’s press release and summary financial information is attached hereto as Exhibit 99.

This Form 8-K and the attached exhibit are provided under Item 2.02 of Form 8-K and are furnished to, but not filed with, the Securities and Exchange Commission.

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 hereunto duly authorized.

	SOUTHWEST GAS CORPORATION
Date: August 5, 2014
	/s/ GREGORY J. PETERSON
	Gregory J. Peterson
	Vice President/Controller and
	Chief Accounting Officer

EXHIBIT INDEX

Exhibit
No.	Description
99	Press Release and summary financial information dated August 5, 2014.

EX-99

August 5, 2014

Media Contact:  Sonya Headen, Las Vegas, NV (702) 364-3411

Shareholder Contact:  Ken Kenny, Las Vegas, NV (702) 876-7237

For Immediate Release

SOUTHWEST GAS CORPORATION

ANNOUNCES SECOND QUARTER 2014 EARNINGS

Las Vegas, Nev. – Southwest Gas Corporation (NYSE: SWX) announced consolidated earnings of $0.21 per basic share for the second quarter of 2014, compared to $0.22 per basic share earned during the second quarter of 2013.  Consolidated net income was $9.6 million for the second quarter of 2014, compared to $10.1 million for the prior-year quarter.  Due to the seasonal nature of the Company’s businesses, results for quarterly periods are not generally indicative of earnings for a complete twelve-month period.

According to Jeffrey W. Shaw, Chief Executive Officer, “Our second quarter 2014 earnings of $0.21 per share were relatively consistent with last year’s second quarter.  NPL, our construction services segment, contributed a solid $7.8 million to the bottom line this quarter as they continue to recover from the effects of extreme weather experienced during the 1st quarter.  The natural gas segment’s contribution to net income of $1.8 million included improved COLI-related income, which offset modestly lower operating results.”  Shaw added, “In June 2014, we received a final decision in our California general rate case authorizing a $7.1 million annual revenue increase and future attrition increases of 2.75% annually for 2015 to 2018.  We’re pleased to have this final decision in hand.”  In conclusion Shaw stated, “During the second half of the

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year, we look forward to the benefits of the recently granted California rate relief and anticipate that NPL’s contribution to net income will continue to improve.”

For the twelve months ended June 30, 2014, consolidated net income was $135 million, or $2.91 per basic share, compared to $149 million, or $3.22 per basic share, during the twelve-month period ended June 30, 2013.  Contribution from both operating segments declined between twelve-month periods with construction services $9.6 million lower.  At NPL, the prior-year period included $3 million of revenue associated with change orders on a fixed-price project.  The current-year period includes approximately $4 million associated with a legal settlement recognized in late 2013 and a $7.5 million increase in general and administrative expenses associated with changes implemented to match NPL’s increased size and complexity.

Natural Gas Operations Segment Results

Second Quarter

Operating margin, defined as operating revenues less the cost of gas sold, increased $4 million between quarters including approximately $2 million of rate relief in California due to a final decision in the California general rate case.  New customers contributed $2 million in operating margin during the second quarter of 2014, as approximately 28,000 net new customers were added during the last twelve months.

Operating expenses for the quarter rose $5.4 million, or 3%, compared to the second quarter of 2013 primarily due to increases in general costs and higher depreciation

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expense resulting from additional plant in service.  The increase was partially offset by declines in employee-related costs, including pension expense.

Other income, which principally includes changes in the cash surrender values of company-owned life insurance (“COLI”) policies and non-utility expenses, increased $1.4 million between quarters primarily due to greater COLI-related income.  The current quarter includes $2.3 million in COLI income, while the prior-year quarter included $1.8 million in COLI income (including net death benefits recognized). In addition, interest income increased between quarters due to under-collected purchased gas adjustment (“PGA”) balances in the current quarter.  Net interest deductions increased $2.2 million between quarters, primarily due to the issuance of $250 million of long-term debt in the fourth quarter of 2013.

Twelve Months to Date

Operating margin increased nearly $18 million between periods including $6 million of combined rate relief.  Customer growth contributed $8 million toward the increase. Incremental margin from customers outside the decoupling mechanisms and other miscellaneous revenues (including amounts associated with recoveries of regulatory assets) contributed the remainder of the increase.

Operating expenses increased $30 million, or 5%, between periods primarily due to higher general costs, legal accruals and expenses (including $5 million in the first quarter of 2014), and uncollectible accounts expense.  Included in the overall increase

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was a $10 million increase in depreciation and amortization expense due largely to plant additions, as well as amortization associated with the recovery of regulatory assets.

Other income increased $4.2 million between periods.  The current twelve-month period reflects $10 million of COLI income (including recognized net death benefits), while the prior twelve-month period included $8.9 million of COLI income (including recognized net death benefits).  COLI-related income in both periods was significantly higher than normal.  In addition, Arizona non-recoverable pipe replacement costs were $1.7 million lower in the current twelve-month period as this pipe replacement activity was substantially completed in 2012.  Net interest deductions increased $3.8 million between the twelve-month periods, primarily due to the issuance of $250 million of long-term debt in the fourth quarter of 2013, partially offset by cost savings from 2013 debt refinancings and redemptions.

Southwest Gas Corporation provides natural gas service to 1,910,000 customers in Arizona, Nevada, and California.

This press release may contain statements which constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995 (Reform Act).  All such forward-looking statements are intended to be subject to the safe harbor protection provided by the Reform Act.  A number of important factors affecting the business and financial results of the Company could cause actual results to differ materially from those stated in the forward-looking statements.  These factors include, but are not limited to, the timing and amount of rate relief, changes in rate design, customer growth rates, conditions in the housing market, the effects of regulation/deregulation, the impacts of construction activity at NPL, and the impacts of stock market volatility.

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SOUTHWEST GAS CONSOLIDATED EARNINGS DIGEST

(In thousands, except per share amounts)

QUARTER ENDED JUNE 30,	2014		2013
Consolidated Operating Revenues	$	453,153	$	411,574
Net Income	$	9,627	$	10,108
Average Number of Common Shares Outstanding		46,502		46,331
Basic Earnings  Per Share	$	0.21	$	0.22
Diluted Earnings Per Share	$	0.21	$	0.22
SIX MONTHS ENDED JUNE 30,	2014		2013
Consolidated Operating Revenues	$	1,061,549	$	1,025,079
Net Income	$	80,410	$	90,881
Average Number of Common Shares Outstanding		46,471		46,291
Basic Earnings Per Share	$	1.73	$	1.96
Diluted Earnings Per Share	$	1.71	$	1.95
TWELVE MONTHS ENDED JUNE 30,	2014		2013
Consolidated Operating Revenues	$	1,987,252	$	1,885,444
Net Income	$	134,849	$	148,969
Average Number of Common Shares Outstanding		46,407		46,214
Basic Earnings Per Share	$	2.91	$	3.22
Diluted Earnings Per Share	$	2.88	$	3.19

 

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SOUTHWEST GAS CORPORATION
SUMMARY UNAUDITED OPERATING RESULTS
(In thousands, except per share amounts)
	THREE MONTHS ENDED					SIX MONTHS ENDED				TWELVE MONTHS ENDED
	JUNE 30,					JUNE 30,				JUNE 30,
	2014			2013		2014		2013		2014		2013
Results of Consolidated Operations
Contribution to net income - gas operations	$	1,798		$	1,964	$	74,397	$	81,256	$	117,310	$	121,877
Contribution to net income - construction services		7,829			8,144		6,013		9,625		17,539		27,092
Net income	$	9,627		$	10,108	$	80,410	$	90,881	$	134,849	$	148,969
Basic earnings per share	$	0.21		$	0.22	$	1.73	$	1.96	$	2.91	$	3.22
Diluted earnings per share	$	0.21		$	0.22	$	1.71	$	1.95	$	2.88	$	3.19
Average outstanding common shares		46,502			46,331		46,471		46,291		46,407		46,214
Average shares outstanding (assuming dilution)		46,948			46,757		46,910		46,704		46,860		46,654
Results of Natural Gas Operations
Gas operating revenues	$	271,479		$	238,869	$	757,972	$	732,469	$	1,325,657	$	1,267,567
Net cost of gas sold		97,985			69,388		289,362		269,996		455,367		414,892
Operating margin		173,494			169,481		468,610		462,473		870,290		852,675
Operations and maintenance expense		97,620			94,935		200,028		192,022		392,920		374,267
Depreciation and amortization		50,524			47,746		102,007		96,065		199,790		189,435
Taxes other than income taxes		10,965			11,073		22,421		22,868		45,104		44,131
Operating income		14,385			15,727		144,154		151,518		232,476		244,842
Other income (deductions)		2,848			1,448		4,460		5,511		11,210		6,990
Net interest deductions		17,059			14,886		34,286		30,564		66,277		62,518
Income before income taxes		174			2,289		114,328		126,465		177,409		189,314
Income tax expense (benefit)		(1,624	)		325		39,931		45,209		60,099		67,437
Contribution to net income - gas operations	$	1,798		$	1,964	$	74,397	$	81,256	$	117,310	$	121,877

SOUTHWEST GAS CORPORATION
SELECTED STATISTICAL DATA
JUNE 30, 2014
FINANCIAL STATISTICS
Market value to book value per share at quarter end		167	%
Twelve months to date return on equity  -- total company		9.5	%
-- gas segment		8.8	%
Common stock dividend yield at quarter end		2.8	%
Customer to employee ratio at quarter end (gas segment)	874 to		1
GAS OPERATIONS SEGMENT
							Authorized
	Authorized			Authorized			Return on
	Rate Base			Rate of			Common
Rate Jurisdiction	(In thousands)			Return			Equity
Arizona	$	1,070,117			8.95	%		9.50	%
Southern Nevada		825,190			6.52			10.00
Northern Nevada		115,933			7.88			9.30
Southern California		159,277			6.83			10.10
Northern California		67,620			8.18			10.10
South Lake Tahoe		25,389			8.18			10.10
Paiute Pipeline Company (1)		84,717			9.47			12.00
(1) Estimated amounts based on rate case settlement.
SYSTEM THROUGHPUT BY CUSTOMER CLASS
	SIX MONTHS ENDED						TWELVE MONTHS ENDED
	JUNE 30,						JUNE 30,
(In dekatherms)		2014			2013			2014		2013
Residential		40,319,220			49,442,113			65,009,789		70,400,054
Small commercial		16,312,996			17,821,572			28,295,929		28,589,277
Large commercial		5,221,057			5,784,018			9,713,100		10,532,472
Industrial / Other		1,480,028			2,917,438			3,583,639		5,277,045
Transportation		40,417,352			50,291,178			93,917,771		103,002,430
Total system throughput		103,750,653			126,256,319			200,520,228		217,801,278
HEATING DEGREE DAY COMPARISON
Actual		982			1,372			1,527		1,826
Ten-year average		1,303			1,338			1,840		1,879
Heating degree days for prior periods have been recalculated using the current period customer mix.