<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 December 31, 1994 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 ."
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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 December 31,1994
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Common stock,par value of $.83 1\3 1,780,542 shares
<PAGE> 2
FALL RIVER GAS COMPANY
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INDEX
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Page No.
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Part. I. Financial Position
Consolidated Condensed Balance Sheets -
December 31, 1994 and September 30, 1994 1
Consolidated Condensed Statements of Income -
Three Months Ended December 31, 1994 and 1993 2
Consolidated Statments of Cash Flows -
Three Months Ended December 31, 1994 and 1993 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
<PAGE> 3
PART I. FINANCIAL INFORMATION
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FALL RIVER GAS COMPANY AND SUBSIDIARY
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CONSOLIDATED CONDENSED BALANCE SHEETS
-------------------------------------
<TABLE>
<CAPTION>
DECEMBER 31, SEPTEMBER 30,
ASSETS 1994 1994
------ ------------- -------------
<S> <C> <C>
Gas Plant, at original cost $ 49,886,911 $ 48,902,815
less accumulated depreciation 15,933,417 15,689,848
------------- ------------
33,953,494 33,212,967
------------- ------------
Rental Property 4,768,231 4,688,718
less accumulated depreciation 2,315,266 2,361,987
------------- ------------
2,452,965 2,326,731
Other Investments 257,345 241,239
Current Assets: ------------ ------------
Cash 93,698 84,798
Interest-bearing deposits 659,696 276,020
Special deposits 170,700 170,700
Accounts receivable, less allowance for
doubtful accounts of $953,365 as of
12/31/94 and $701,734 as of 9/30/94 4,690,963 2,652,006
Inventories, at average cost
Merchandise 108,903 169,279
Liquefied natural gas and propane 3,217,539 2,906,790
Materials and Supplies 1,117,481 1,027,390
Purchased gas costs deferred 5,420,750 4,596,819
Prepayments 203,006 25,188
------------ ------------
15,682,736 11,908,990
------------ ------------
Deferred Charges:
Installation costs on leased appliances
being amortized over twenty years 1,212,188 1,128,313
Regulatory Asset 343,290 343,290
Other 444,554 464,312
------------ ------------
2,000,032 1,935,915
------------ ------------
$ 54,346,572 $ 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 12/31/94 and 9/30/94) 11,504,957 11,242,375
------------ ------------
14,695,445 14,432,863
Less Treasury stock, at cost (420,792 shares
as of 12/31/94 1,418,743 1,418,743
------------ ------------
13,276,702 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 20,576,702 20,394,120
------------ ------------
CURRENT LIABILITIES:
Current sinking fund requirement 160,000 160,000
Notes payable to banks 17,900,000 14,400,000
Accounts Payable 3,162,011 3,273,832
Gas supplier refunds due customers 2,294,620 1,130,603
Accrued taxes 1,674,343 1,499,233
Other 1,744,591 1,955,368
------------ ------------
26,935,565 22,419,036
------------ ------------
DEFERRED CREDITS:
Accumulated deferred income taxes 3,630,933 3,630,933
Unamortized investment tax credits 634,191 643,702
Regulatory Liability 843,378 843,378
Other 1,725,803 1,694,673
------------ ------------
6,834,305 6,812,686
------------ ------------
$ 54,346,572 $ 49,625,842
============ ============
</TABLE>
See accompanying notes to consolidated financial statements.
1
<PAGE> 4
<TABLE>
SUMMARIZED FINANCIAL INFORMATION
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FALL RIVER GAS COMPANY AND SUBSIDIARY
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CONSOLIDATED CONDENSED STATEMENTS OF INCOME AND RETAINED EARNINGS
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<CAPTION>
Three Months Ended
December 31
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1994 1993
---- ----
<S> <C> <C>
GAS OPERATING EXPENSES 9,989,787 11,196,082
------------ ------------
OPERATING EXPENSES
Cost of gas sold 6,076,718 6,972,138
Other operation 2,304,353 2,299,296
Maintenance 583,128 460,718
Depreciation 330,946 295,792
General taxes 232,678 272,238
Federal income taxes 32,907 200,312
------------ ------------
Total operating expenses 9,560,730 10,500,494
------------ ------------
OPERATING INCOME: 429,057 695,588
OTHER INCOME:
Net income of Fall River Gas Appliance
Company, Inc. (a wholly-owned subsidiary) 170,026 187,059
Other 4,125 2,675
------------ ------------
GROSS INCOME 603,208 885,322
------------ ------------
INTEREST EXPENSE AND OTHER:
Interest on long-term debt 176,150 179,212
Other interest 164,477 102,642
------------ ------------
340,627 281,854
------------ ------------
NET INCOME 262,581 603,468
RETAINED EARNINGS - BEGINNING OF PERIOD 11,242,375 10,496,206
DEDUCT - Dividends declared 0 0
------------ ------------
RETAINED EARNINGS - END OF PERIOD
($4,374,576 restricted against payment of
cash dividends as of 12/31/94 and 12/31/93) 11,504,956 11,099,674
============ ============
NET INCOME PER SHARE OF COMMON STOCK (based on
average number of shares outstanding at the
end of the respective periods) 0.15 0.34
============ ============
WEIGHTED AVERAGE NUMBER OF COMMON SHARES
OUTSTANDING DURING THE PERIOD 1,780,542 1,780,542
CASH DIVIDEND PER COMMON SHARE 0 0
============ ============
</TABLE>
See accompanying notes to consolidated financial statements.
2
<PAGE> 5
FALL RIVER GAS COMPANY AND SUBSIDIARY
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CONSOLIDATED STATEMENT OF CASH FLOWS
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<TABLE>
<CAPTION>
Three Months Ended
December 31
-------------------------------
1994 1993
---- ----
<S> <C> <C>
Cash Provided by (used for)
Operating Activities:
Net Income $262,582 $603,468
Items not requiring (providing) cash:
Depreciation 417,645 362,784
Amoritization of Installation Costs 27,663 26,289
Amoritization of Investment Tax Credit (9,511) (9,612)
Change in working capital (2,364,641) 886,869
Other sources, net (123,472) (250,945)
------------ ------------
Net cash provided by
operating activities (1,789,734) 1,618,853
------------ ------------
Investing Activities
Additions to utility property, plant and equipment (1,028,933) (918,934)
Additions to nonutility property (208,757) (155,402)
------------ ------------
Net cash used by investing activities (1,237,690) (1,074,336)
------------ ------------
Financing activities:
Cash dividends on common stock 0 0
Retirement of long-term debt through sinking fund (80,000) (80,000)
Increase, (Decrease) in notes payable to banks, net 3,500,000 (380,000)
------------ ------------
Increase in cash $392,576 $164,517
============ ============
Changes in Components of Working Capital
(excluding cash)
(Increase) decrease in current assets:
Accounts receivable ($2,038,957) ($2,834,460)
Inventories (340,464) 368,386
Prepayments and other (177,818) (222,411)
Deferred gas cost (823,931) (927,604)
Increase (decrease) in current liabilities:
Accounts payable (111,821) 2,930,961
Accrued Taxes 175,110 964,832
Gas supplier refunds due customers 1,164,017 814,766
Other (210,777) (207,501)
------------ ------------
Change in Working Capital ($2,364,641) $886,869
============ ============
Supplemental disclosure of cash flow information:
Cash paid during year for:
Interest $284,816 $156,680
Income Taxes $70,000 $0
</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 three months ended December 31, 1994
decreased $1,206,000 to $9,990,000, 10.7% lower than the $11,196,000 recorded
for the comparable period in 1993. During the quarter cost of gas (CGA)
revenues increased by $22,000 due to the net differences in our CGA decimal in
the three months ended December 1994 and 1993 respectively. Increases or
decreases in the cost of gas sold continue to be passed on to our firm
customers, dollar for dollar, in accordance with the Company's approved CGA.
In addition to the decrease in operating revenues due to the CGA decimal was a
decrease in firm sales volume due to warmer weather in the quarter comparisons.
Degree days in the quarter comparisons decreased from 2,005 in 1993 to 1,802 in
1994, 1,230,000 in 1994, a reduction of 19.6%.
Total operating expenses, excluding state and federal income taxes,
decreased $738,000 to $9,519,000, 7.2% lower than the comparable period in
1993. The most significant operating expense - cost of gas sold - decreased by
$895,000, 12.8%, to $6,077,000 due to decreased costs billed to our firm
customers, in addition to decreased MCF sales as discussed above. Increases in
health benefits, payroll, and materials and supplies have increased the cost of
other operations by $5,000, .2%, to $2,304,000.
Interest expense increased to $341,000, $59,000 and 20.8% higher than
the comparable figure in 1993. This is the result of higher short term
interest rates while short term borrowing increased to $17,900,000 as of
December 31, 1994 compared to $14,700,000 as of December 31, 1993.
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
three months ended December 31, 1994, capital expenditures totaled
approximately $1,200,000.
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. At
December 31, 1994, the Company had available unsecured bank lines of credit of
$6,600,000.
See accompanying notes to consolidated financial statements.
4
<PAGE> 7
FALL RIVER GAS COMPANY AND SUBSIDIARY
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NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
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1. The results of operation for the three month periods ending
December 31, 1994 and 1993 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 December 31, 1994
and 1993, and the results of operations for the three months ended
and changes in financial position for the three months then eneded.
3. The Company had no shares of its common stock reserved for
officers and employees, options, warrants, conversions or
other requirements at December 31, 1994.
PART II. OTHER INFORMATION
---------------------------
Not applicable.
SIGNATURES
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Pursuant to the requirments 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
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(Registrant)
Peter H. Thanas
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(Signature)
Date February 10, 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
THREE MONTHS ENDED DECEMBER 31, 1994 AND IS QUALIFIED IN ITS ENTIRETY BY
REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1
<CURRENCY> U.S. DOLLARS
<S> <C>
<PERIOD-TYPE> 3-MOS
<FISCAL-YEAR-END> SEP-30-1995
<PERIOD-START> OCT-1-1994
<PERIOD-END> DEC-31-1994
<EXCHANGE-RATE> 1
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 33,953,494
<OTHER-PROPERTY-AND-INVEST> 2,710,310
<TOTAL-CURRENT-ASSETS> 15,682,736
<TOTAL-DEFERRED-CHARGES> 2,000,032
<OTHER-ASSETS> 0
<TOTAL-ASSETS> 54,346,572
<COMMON> 1,834,445
<CAPITAL-SURPLUS-PAID-IN> 1,356,043
<RETAINED-EARNINGS> 11,504,957
<TOTAL-COMMON-STOCKHOLDERS-EQ> 14,695,445
0
0
<LONG-TERM-DEBT-NET> 7,300,000
<SHORT-TERM-NOTES> 17,900,000
<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> 15,709,870
<TOT-CAPITALIZATION-AND-LIAB> 54,346,572
<GROSS-OPERATING-REVENUE> 9,989,787
<INCOME-TAX-EXPENSE> 265,585
<OTHER-OPERATING-EXPENSES> 9,295,145
<TOTAL-OPERATING-EXPENSES> 9,560,730
<OPERATING-INCOME-LOSS> 429,057
<OTHER-INCOME-NET> 174,151
<INCOME-BEFORE-INTEREST-EXPEN> 608,208
<TOTAL-INTEREST-EXPENSE> 340,627
<NET-INCOME> 262,581
0
<EARNINGS-AVAILABLE-FOR-COMM> 7,130,380
<COMMON-STOCK-DIVIDENDS> 0
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> (1,789,734)
<EPS-PRIMARY> .15
<EPS-DILUTED> .15
</TABLE>
