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Previous: EVEREST & JENNINGS INTERNATIONAL LTD, 10-Q, 1995-05-15 |
Next: FEDERAL MOGUL CORP, 10-Q, 1995-05-15 |
<PAGE> 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, 1995 Commission file number 0-449
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FALL RIVER GAS COMPANY
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(Exact name of registrant as specified in its charter)
Massachusetts 04-1298780
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(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Indentification No.)
155 North Main Street, Fall River, Massachusetts 02722
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code 508-675-7811
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"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 close of the period covered by this report.
Class Outstanding at March 31,1995
----- ----------------------------
Common stock,par value of $.83 1\3 1,780,542 shares
<PAGE> 2
<TABLE>
FALL RIVER GAS COMPANY
----------------------
INDEX
-----
<CAPTION>
Page No.
--------
<S> <C>
Part. I. Financial Position
Consolidated Condensed Balance Sheets -
March 31, 1995 and September 30, 1994 1
Consolidated Condensed Statements of Income -
Three & Six Months Ended March 31, 1995
and 1994 2
Consolidated Statments of Cash Flows -
Six Months Ended March 31, 1995 and 1994 3
Management's discussion and Analysis of the
Consolidated Condensed Statements of Income 4
Notes to Consolidated Condensed Financial Statements 5
Part II. Other Information 5
</TABLE>
<PAGE> 3
<TABLE>
PART I. FINANCIAL INFORMATION
-------------------------------------
FALL RIVER GAS COMPANY AND SUBSIDIARY
-------------------------------------
CONSOLIDATED CONDENSED BALANCE SHEETS
-------------------------------------
<CAPTION>
MARCH 31, SEPTEMBER 30,
ASSETS 1995 1994
------ ------------ -----------
<S> <C> <C>
Gas Plant, at original cost $50,699,781 $48,902,815
less accumulated depreciation 16,647,949 15,689,848
------------ -----------
34,051,832 33,212,967
------------ -----------
Rental Property 4,789,814 4,688,718
less accumulated depreciation 2,253,824 2,361,987
------------ -----------
2,535,990 2,326,731
------------ -----------
Other Investments 273,101 241,239
------------ -----------
Current Assets:
Cash 136,255 84,798
Interest-bearing deposits 213,622 276,020
Special deposits 170,700 170,700
Accounts receivable, less allowance for
doubtful accounts of $898,932 as of
3/31/95 and $701,734 as of 9/30/94 7,030,201 2,652,006
Inventories, at average cost
Merchandise 159,091 169,279
Liquefied natural gas and propane 1,455,473 2,906,790
Materials and Supplies 1,096,885 1,027,390
Purchased gas costs deferred 2,554,278 4,596,819
Prepayments 85,245 25,188
------------ -----------
12,901,750 11,908,990
------------ -----------
Deferred Charges:
Installation costs on leased appliances
being amortized over twenty years 1,247,937 1,128,313
Regulatory Asset 343,290 343,290
Other 422,257 464,312
------------ -----------
2,013,484 1,935,915
------------ -----------
$ 51,776,157 $49,625,842
============ ===========
STOCKHOLDERS' INVESTMENT AND LIABILITIES
----------------------------------------
CAPITALIZATION:
Stockholders' investment-
Common stock, par value $.83-1/3 per share,
2,201,334 shares authorized and issued $1,834,445 $1,834,445
Premium paid in on common stock 1,356,043 1,356,043
Retained earnings ($4,374,576 restricted
against payment of cash dividends as
of 3/31/95 and 9/30/94) 12,527,254 11,242,375
------------ -----------
15,717,742 14,432,863
Less Treasury stock, at cost (420,792 shares
as of 3/31/95) 1,418,743 1,418,743
------------ -----------
14,298,999 13,014,120
------------ -----------
Long-term debt, less current sinking
fund requirements
First Mortgage Bonds--8-3/4% Series due 1996 800,000 880,000
-9.44% due 2020 6,500,000 6,500,000
------------ -----------
7,300,000 7,380,000
------------ -----------
Total capitalization 21,598,999 20,394,120
------------ -----------
CURRENT LIABILITIES:
Current sinking fund requirements 160,000 160,000
Notes payable to banks 12,400,000 14,400,000
Accounts Payable 4,556,721 3,273,832
Gas supplier refunds due customers 1,784,969 1,130,603
Accrued taxes 2,535,233 1,499,233
Other 1,892,777 1,955,368
------------ -----------
23,329,700 22,419,036
------------ -----------
DEFERRED CREDITS:
Accumulated deferred income taxes 3,630,933 3,630,933
Unamortized investment tax credits 624,678 643,702
Regulatory Liability 843,378 843,378
Other 1,748,469 1,694,673
------------ -----------
6,847,458 6,812,686
------------ -----------
$ 51,776,157 $49,625,842
============ ===========
</TABLE>
See accompanying notes to consolidated condensed financial statements.
1
<PAGE> 4
<TABLE>
SUMMARIZED FINANCIAL INFORMATION
-------------------------------------
FALL RIVER GAS COMPANY AND SUBSIDIARY
-------------------------------------
CONSOLIDATED CONDENSED STATEMENTS OF INCOME AND RETAINED EARNINGS
-----------------------------------------------------------------
<CAPTION>
Three Months Ended Six Months Ended
March 31 March 31
------------------------------- ------------------------------
1995 1994 1995 1994
----------- ----------- ----------- -----------
<S> <C> <C> <C> <C>
GAS OPERATING REVENUES $19,483,274 $22,382,712 $29,473,061 $33,578,794
----------- ----------- ----------- -----------
OPERATING EXPENSES
Cost of gas sold 12,802,561 15,246,744 18,879,279 22,218,882
Other operation 2,609,739 2,685,422 4,914,092 4,984,718
Maintenance 407,037 411,976 990,165 872,694
Depreciation 767,193 685,698 1,098,139 981,490
General taxes 573,780 597,761 806,458 869,999
Federal income taxes 655,951 837,838 688,858 1,038,150
----------- ----------- ----------- -----------
Total operating expenses 17,816,261 20,465,439 27,376,991 30,965,933
----------- ----------- ----------- -----------
OPERATING INCOME 1,667,013 1,917,273 2,096,070 2,612,861
OTHER INCOME:
Net income of Fall River Gas Appliance
Company, Inc. (a wholly-owned subsidiary) 147,407 154,752 317,433 341,811
Other 5,136 4,728 9,261 7,403
----------- ----------- ----------- -----------
GROSS INCOME 1,819,556 2,076,753 2,422,764 2,962,075
----------- ----------- ----------- -----------
INTEREST EXPENSE AND OTHER:
Interest on long-term debt 174,400 177,901 350,550 357,113
Other interest 195,529 90,204 360,006 192,846
----------- ----------- ----------- -----------
369,929 268,105 710,556 549,959
----------- ----------- ----------- -----------
NET INCOME 1,449,627 1,808,648 1,712,208 2,412,116
RETAINED EARNINGS - BEGINNING OF PERIOD 11,504,956 11,099,674 11,242,375 10,496,206
ADD - Dividends declared
September 20, 1994 and
September 21, 1993, payable
November 15, 1994 and 1993 0 0 427,330 418,427
DEDUCT - Dividends declared 427,330 427,330 854,660 845,757
----------- ----------- ----------- -----------
RETAINED EARNINGS - END OF PERIOD
($4,374,576 restricted against payment of
cash dividends as of 3/31/95 and 3/31/94) 12,527,253 12,480,992 12,527,253 12,480,992
=========== =========== =========== ===========
NET INCOME PER SHARE OF COMMON STOCK (based on
average number of shares outstanding at the
end of the respective periods) 0.81 1.02 0.96 1.35
=========== =========== =========== ===========
WEIGHTED AVERAGE NUMBER OF COMMON SHARES
OUTSTANDING DURING THE PERIOD 1,780,542 1,780,542 1,780,542 1,780,542
CASH DIVIDEND PAID PER COMMON SHARE 0.24 0.24 0.48 0.475
=========== =========== =========== ===========
</TABLE>
See accompanying notes to consolidated condensed financial statements.
2
<PAGE> 5
<TABLE>
FALL RIVER GAS COMPANY AND SUBSIDIARY
-------------------------------------
CONSOLIDATED STATEMENT OF CASH FLOWS
------------------------------------
<CAPTION>
Six Months Ended
March 31
-----------------------------------
1995 1994
------------ -----------
<S> <C> <C>
Cash Provided by (used for)
Operating Activities:
Net income $ 1,712,208 $2,412,116
Items not requiring (providing) cash:
Depreciation 1,271,555 1,140,347
Amortization of Installation Costs 55,326 52,578
Amortization of Investment Tax Credit (19,024) (19,222)
Change in working capital 1,906,963 4,196,371
Other sources, net (190,123) (302,518)
------------ -----------
Net cash provided by
operating activities 4,736,905 7,479,672
------------ -----------
Investing Activities:
Additions to utility property, plant and equipment (1,866,194) (1,471,355)
Additions to nonutility property (374,322) (318,530)
------------ -----------
Net cash used by investing activities (2,240,516) (1,789,885)
------------ -----------
Financing activities:
Cash dividends on common stock (427,330) (427,330)
Retirement of long-term debt through sinking fund (80,000) (80,000)
Increase (Decrease) in notes payable to banks, net (2,000,000) (5,400,000)
------------ -----------
Net cash provided by (used for)
financing activities (2,507,330) (5,907,330)
------------ -----------
Increase (Decrease) in cash ($10,941) ($217,543)
============ ===========
Changes in Components of Working Capital
(excluding cash)
(Increase) decrease in current assets:
Accounts receivable ($4,378,195) ($5,563,627)
Inventories 1,392,010 2,543,901
Prepayments and other (60,057) (76,953)
Deferred gas cost 2,042,541 832,728
Increase (decrease) in current liabilities:
Accounts payable 1,282,889 3,574,405
Accrued taxes 1,036,000 2,771,388
Gas supplier refunds due customers 654,366 77,959
Other (62,591) 36,570
------------ -----------
Change in Working Capital $ 1,906,963 $ 4,196,371
============ ===========
Supplemental disclosure of cash flow information:
Cash paid during year for:
Interest $ 496,489 $ 227,397
Income taxes $ 137,479 $ 87,639
</TABLE>
See accompanying notes to consolidated condensed financial statements.
3
<PAGE> 6
FALL RIVER GAS COMPANY AND SUBSIDIARY
MANAGEMENT'S DISCUSSION AND ANALYSIS
Results of Operations
Gas operating revenues for the six months ended March 31, 1995 decreased
to $29,473,000, $4,106,000 and 12.2% lower than the $33,579,000 recorded for the
comparable period in 1994, with revenues for the second quarter comparisons
reflecting a decrease to $19,483,000, $2,899,000 and 12.9% lower than 1994.
During the six month period, revenues from the cost of gas adjustment clause
(CGAC) and the embedded cost of gas in the base rate decreased by $4,050,000,
with the second quarer comparisons reflecting a decrease of $2,779,000 as a
result of decreased sales volume and a lower CGAC decimal. Increases or
decreases in the cost of gas sold continue to be passed on to our customers,
dollar for dollar, in accordance with the Company's approved CGAC. On top of
the decrease in operating revenues due to the CGAC decimal was a decrease in
firm sales volume due to warmer weather. Degree Days in the quarter comparisons
decreased from 3,395 to 2,911, 14.3%, and for the six months decreased from
5,400 to 4,713, 12.7%.
Total operating expenses, excluding federal and state income taxes, for
the three month period decreased from $19,454,000 to $17,024,000, a decrease of
$2,430,000 and 12.5%, while the six month comparisons reflected a decrease from
$29,712,000 to $26,543,000, a decrease of $3,168,000 and 10.7%. The most
significant operating expense - cost of gas sold - decreased by $3,340,000 and
$2,444,000 for the six month and three month comparisons, respectively, due to
decreased gas costs billed to our customers along with decreased sales volume
as discussed above. Other operating expenses including health benefits,
payroll, and materials and supplies have decreased by $71,000, 1.4%, and
$76,000, 2.8%, for the six and three month comparisons.
Interest expense increased by $161,000, 29.2%, for the six month
comparison and $102,000, 37.9%, for the three month comparison as a result of
increased borrowing and higher short term interest cost.
Capital Resources and Liquidity
The Company's major capital requirement results from upgrading the
efficiency of existing plant as well as to serve additional customers. For the
six months ended March 31, 1995, capital expenditures totalled approximately
$2,000,000.
Cash flow patterns reflect the seasonality of the Company's business.
The greatest demand for cash is in the late fall and winter as construction
projects are brought to completion and accounts receivable balances rise.
Capital expenditures and accounts receivable balances were financed by
internally generated funds and supplemented by short-term borrowings.
See accompanying notes to consolidated financial statements.
4
<PAGE> 7
FALL RIVER GAS COMPANY AND SUBSIDIARY
-------------------------------------
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
------------------------------------------
1. The results of operation for the six month periods ending March 31,
1995 and 1994 are not necessarily indicative of the results to be
expected for the full year.
2. In the opinion of the Company, the accompanying unaudited
consolidated condensed financial statements contain all adjustments
(consisting of only normal recurring accruals) necessary to present
fairly the Company's financial position as of March 31, 1995 and 1994,
and the results of operations for the six months ended and changes in
financial position for the six months then ended.
3. The Company had no shares of its common stock reserved for officers
and employees, options, warrants, conversions or other requirements
at March 31, 1995.
PART II. OTHER INFORMATION
---------------------------
Not applicable.
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.
FALL RIVER GAS COMPANY
----------------------
(Registrant)
Peter H. Thanas
----------------------
(Signature)
Date May 3, 1995 Peter H. Thanas, Treasurer,
----------- Chief Financial and
Accounting Officer
5
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATED CONDENSED FINANCIAL STATEMENTS OF FALL RIVER GAS COMPANY FOR THE
QUARTER ENDED MARCH 31, 1995 AND IS QUALIFIED IN ITS ENTIRELTY BY REFERENCE TO
SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> SEP-30-1995
<PERIOD-START> OCT-01-1994
<PERIOD-END> MAR-31-1995
<EXCHANGE-RATE> 1
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 34,051,832
<OTHER-PROPERTY-AND-INVEST> 2,809,091
<TOTAL-CURRENT-ASSETS> 12,901,750
<TOTAL-DEFERRED-CHARGES> 2,013,484
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 51,776,157
<COMMON> 1,834,445
<CAPITAL-SURPLUS-PAID-IN> 1,356,043
<RETAINED-EARNINGS> 12,527,254
<TOTAL-COMMON-STOCKHOLDERS-EQ> 15,717,742
0
0
<LONG-TERM-DEBT-NET> 7,300,000
<SHORT-TERM-NOTES> 12,400,000
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 160,000
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 16,198,415
<TOT-CAPITALIZATION-AND-LIAB> 51,776,157
<GROSS-OPERATING-REVENUE> 29,473,061
<INCOME-TAX-EXPENSE> 1,495,316
<OTHER-OPERATING-EXPENSES> 25,881,675
<TOTAL-OPERATING-EXPENSES> 27,376,991
<OPERATING-INCOME-LOSS> 2,096,070
<OTHER-INCOME-NET> 326,694
<INCOME-BEFORE-INTEREST-EXPEN> 2,422,764
<TOTAL-INTEREST-EXPENSE> 710,556
<NET-INCOME> 1,712,208
0
<EARNINGS-AVAILABLE-FOR-COMM> 8,152,677
<COMMON-STOCK-DIVIDENDS> 427,330
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> 4,736,905
<EPS-PRIMARY> .96
<EPS-DILUTED> .96
</TABLE>
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