UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 10-Q
(Mark One)
[x] QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1995
OR
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
For the transition period from to
Commission file number 0-1055
FLORIDA PUBLIC UTILITIES COMPANY
(Exact name of registrant as specified in its charter)
Florida 59-0539080
(State or other jurisdiction of (I.R.S. Employer Identification No.)
incorporation or organization)
401 South Dixie Highway, West Palm Beach, FL 33401
(Address of principal executive offices) (Zip Code)
(Registrant's telephone number, including area code) (407) 832-2461
(Former name, former address and former fiscal year, if changed since last
report)
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
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY
PROCEEDINGS DURING THE PRECEDING FIVE YEARS
Indicate by check mark whether the registrant has filed all documents and
reports required to be filed by Sections 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a
plan confirmed by a court. Yes No
APPLICABLE ONLY TO CORPORATE ISSUERS
Indicate the number of shares outstanding of each of the issuer's classes of
common stock, as of the latest practicable date. At April 30, 1995 there were
1,451,826 of $1.50 par value common shares outstanding.
FLORIDA PUBLIC UTILITIES COMPANY
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(in thousands)
March 31, December 31,
1995 1994
ASSETS
Utility Plant 96,793 95,400
Less accumulated depreciation and
amortization 32,461 31,687
Net utility plant 64,332 63,713
Current Assets
Cash and cash equivalents 2,722 2,840
Accounts receivable - net 6,027 6,017
Inventories and prepayments 3,464 2,963
Total 12,213 11,820
Deferred Charges 1,044 1,048
Deferred Income Taxes and Regulatory
Asset 5,644 5,700
Total $83,233 $82,281
CAPITALIZATION AND LIABILITIES
Capitalization
Common shareholders' equity 23,093 22,334
Preferred stock 600 600
Long-term debt 23,500 23,500
Total 47,193 46,434
Current Liabilities
Long-term debt - current portion 673 673
Notes payable 2,500 4,000
Accounts payable 4,721 3,918
Taxes accrued 815 114
Other 3,734 3,103
Customer deposits 3,520 3,502
Total 15,963 15,310
Deferred Credits 6,684 7,283
Deferred Income Taxes and Regulatory
Liability 13,393 13,254
Total $83,233 $82,281
FLORIDA PUBLIC UTILITIES COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
(dollars in thousands, except per share data)
Three Months Ended
March 31,
1995 1994
Revenues
Gas $ 8,310 $ 8,538
Electric 9,175 9,035
Water 356 327
Total revenues 17,841 17,900
Cost of fuel and taxes
based on revenues 10,797 11,428
Operating Margin 7,044 6,472
Operating Expenses
Operations 3,241 3,061
Depreciation 934 903
Taxes other than income taxes 416 434
Income taxes 658 500
Total operating expenses 5,249 4,898
Operating Income 1,795 1,574
Interest Expense (700) (670)
Other Income 18 33
Net Income 1,113 937
Preferred Stock Dividends 7 7
Earnings for Common Stock $ 1,106 $ 930
Earnings Per Share of Common Stock $ .76 $ .65
Dividends Per Common Share $ .29 $ .29
Weighted Average Common Shares
Outstanding 1,449,807 1,428,274
FLORIDA PUBLIC UTILITIES COMPANY
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS
(in thousands)
Three Months Ended
March 31,
1994 1995
Cash Flows from Operating Activities
Net income $ 1,113 $ 937
Adjustments to reconcile net income to
net cash provided by operating activities
Depreciation 934 903
Other 223 (852)
Changes in operating assets and liabilities
Accounts receivable (49) 538
Inventories and prepayments (501) (290)
Accounts payable and accrued expenses 2,152 2,334
Underrecovery of fuel costs (667) (35)
Deferred credits 25 2,612
Other (9) (10)
Net cash provided by operating
activities 3,221 6,137
Cash Flows from Investing Activities
Construction expenditures (1,556) (1,277)
Customer advances for construction 69 98
Net cash used by investing
activities (1,487) (1,179)
Cash Flows from Financing Activities
Repayment of short-term borrowings (1,500) (3,000)
Dividends paid (425) (405)
Other 73 64
Net cash used by financing
activities (1,852) (3,341)
Net Increase (Decrease) in Cash and
Cash Equivalents (118) 1,617
Cash and Cash Equivalents at Beginning
of Period 2,840 846
Cash and Cash Equivalents at End of
Period $2,722 $2,463
FLORIDA PUBLIC UTILITIES COMPANY
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
MARCH 31, 1995
1. In the opinion of the Company, the accompanying condensed consolidated
financial statements contain all adjustments (consisting only of normal
recurring accruals) necessary to present fairly the financial
information contained therein. The results of operations are not
necessarily indicative of the results expected for the full year.
2. The First Mortgage Bond indentures provide for restrictions on the
payment of cash dividends. At March 31, 1995, under the most
restrictive provision, approximately $3,500,000 of retained earnings
were unrestricted.
FLORIDA PUBLIC UTILITIES COMPANY
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
FINANCIAL CONDITION AND RESULTS OF OPERATIONS
MARCH 31, 1995
Financial Condition The Company has a $15,000,000 line of credit with its
primary bank of which $2,500,000 is outstanding. The line provides for
interest at LIBOR plus one-half percent. The Company is approved by the
Florida Public Service Commission to borrow up to $15,000,000 on a line of
credit basis, $14,000,000 of which is available for general corporate purposes
with the remaining $1,000,000 reserved as a contingency for major storm
repairs in the Marianna electric division.
Overview The Company is organized into three business segments, natural and
propane gas, electric and water. The gas and electric segments aggregate
approximately 95% of total operating margin.
Contributing to variations in operating margins are the effects of seasonal
weather conditions, the timing of rate increases and the migration of winter
residents and tourists to central and southern Florida during the winter
season.
1995 1994 1993
Natural and Propane Gas
Operating margin $ 4,545 $ 4,126 $ 4,010
Less propane 892 888 848
Less municipal 57 55 55
Remainder $ 3,596 $ 3,183 $ 3,107
Electric
Operating margin $ 2,159 $ 2,034 $1,819
Less industrial interruptible 161 154 122
Remainder $ 1,998 $ 1,880 $ 1,697
Operating Margin Operating margin, defined as gross operating revenues less
cost of fuel and taxes passed-through to customers which are based on
revenues, provides a more meaningful basis for evaluating utility operations
since fuel costs and taxes passed-through to customers have no effect on
results of operations.
Natural and Propane Gas Service Total natural and propane gas service
operating margin increased $419,000 or about 10% in 1995 as compared with
1994. Excluding propane gas operating margin and the natural gas operating
margin of a municipal customer from total gas operating margin, remaining
operating margin increased $413,000 or about 13% as compared with 1994. Such
increase in operating margin is attributable principally to cooler weather in
1995 as compared with 1994 and an interim base rate increase in the natural
gas divisions. An approved final increase in base rates of $1,282,000
annually became effective May 6th.
Total natural and propane gas service operating margin increased $116,000 or
about 3% in 1994 as compared with 1993. Excluding propane gas operating
margin and the natural gas operating margin of a municipal customer from total
gas operating margin, remaining operating margin increased $76,000 or about 2%
as compared with 1993. Such increase in operating margin is principally
attributable to an increase of 5% in natural gas consumption and a 6% decrease
in the cost of propane.
Electric Service In 1995, total electric service operating margin increased
$125,000 or about 6% as compared with 1994. Excluding the two industrial
interruptible customers, operating margin increased $118,000 or approximately
6%. Other than industrial customers, the increase is principally due to a 2%
increase in customers and a 2% increase in consumption.
Total electric service operating margin increased $215,000 or about 12% in
1994 as compared with 1993. Excluding the two industrial interruptible
customers, operating margin increased $183,000 or about 11% in 1994 as
compared with 1993. Other than industrial customers, the increase is
principally due to a 7% increase in consumption and a 2% increase in
customers.
Operating Expense In 1995, operating expenses, excluding cost of fuel and
taxes passed-through to customers, increased almost 3% as a percent of
operating margin. Expenses have generally increased in all classifications of
expense with administrative and general expenses and other operating expenses
accounting for most of the increase. Contributing to such increase was an
increase in payroll costs, expensing of overheads no longer appropriate to
capitalize and an increase in the accrual for storm damages in the Marianna
electric division. Taxes other than income taxes decreased due principally to
a reduction in ad valorem taxes.
In 1994, operating expenses, excluding cost of fuel and taxes based on
revenues, increased about 1.6% as a percent of operating margin. Expenses
have generally increased in all operating areas and in all classifications of
expense.
Income taxes were provided for at approximately the same rate in both three-
month periods. The difference between the periods in the apparent rate is due
mainly to amortization of investment tax credits.
Interest expense increased about 4% due principally to higher rates in 1995
versus 1994.
Cash Flows Net cash provided by operating activities decreased $2,916,000 due
primarily to insurance settlement proceeds, net of income taxes, of $1,629,000
received in 1994 and an increase of $632,000 in underrecovery of fuel costs in
1995.
PART II.
OTHER INFORMATION
Item 4. Submission of matters to a vote of security holders.
(a) The annual meeting of stockholders was held on April 18, 1995.
(b) Directors elected: Constant A. Benoit, Jr. and F. C. Cressman.
Directors continuing: E. James Carr, Jr., Daniel Downey,
John T. English, Gordon Jerauld and Robert T. Terry.
(c) None.
(d) None.
Item 6. Exhibits and reports on Form 8-K.
(a) None.
(b) Reports on Form 8-K:
There were no reports on Form 8-K filed for the quarter ending
March 31, 1995.
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.
FLORIDA PUBLIC UTILITIES COMPANY
(Registrant)
By /s/ Jack Brown
Jack Brown
Treasurer
(DULY AUTHORIZED OFFICER
AND
CHIEF FINANCIAL OFFICER)
Date: May 11, 1995
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