FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended June 30, 1995 Commission File Number 0-6028
BIRMINGHAM UTILITIES, INC.
(Exact name of registrant as specified in its charter)
CONNECTICUT 06-0878647
(State of other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
230 Beaver Street, Ansonia, Connecticut 06401
(Address of principal executive office (Zip Code)
(Registrant's telephone number
including area code) (203) 735-1888
None
(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
Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.
Class Outstanding at July 31, 1995
Common stock, no par value 749,867
ITEM I. FINANCIAL STATEMENTS
<TABLE>
BIRMINGHAM UTILITIES, INC.
BALANCE SHEETS
As of June 30, 1995, December 31, 1994 and June 30, 1994
<CAPTION>
(Unaudited) (Unaudited)
June 30, Dec. 31, June 30,
1995 1994 1994
<S> <C> <C> <C>
ASSETS:
Utility Plant $16,135,087 $15,739,122 $15,543,247
Accumulated depreciation (4,960,058) (4,771,536) (4,656,937)
11,175,029 10,967,586 10,886,310
Current Assets:
Cash 108,541 58,812 128,898
Accounts receivable, net
of allowance for doubtful
accounts 772,700 838,981 757,638
Accrued utility revenue 594,233 384,057 355,374
Materials & supplies 63,503 45,449 51,469
Prepayments 113,659 39,426 105,019
Total current assets 1,652,636 1,366,725 1,398,398
Note receivable 1,013,222 1,213,222 1,213,222
Deferred Charges 759,252 728,307 601,209
Unamortized debt expense 212,896 220,362 228,467
Income taxes recoverable 372,247 372,247 366,139
Other assets 388,867 378,031 354,672
2,746,484 2,912,169 2,763,709
$15,574,149 $15,246,480 $15,048,417
STOCKHOLDERS' EQUITY AND LIABILITIES
Stockholders' Equity:
Common Stock, no par
value, authorized
2,000,000 shares;
issued and outstanding
749,867 and 749,168
shares in 1995 and 1994,
respectively. $ 2,149,482 $ 2,142,318 $ 2,142,318
Retained earnings 1,032,284 1,077,185 1,011,857
3,181,766 3,219,503 3,154,175
Note Payable 1,696,783 1,625,000 1,512,500
Long-term debt 4,703,189 4,703,753 4,703,753
6,399,972 6,328,753 6,216,253
Current Liabilities:
Short Term Notes and
Current portion of
note payable 408,717 165,000 75,000
Accounts payable and
accrued liabilities 690,258 575,421 636,772
Total current liabilities 1,098,975 740,421 711,772
Customers' advances for
construction 1,258,913 1,158,455 1,187,848
Contributions in aid
of construction 719,736 719,736 707,184
Income taxes refundable 202,641 202,641 210,213
Deferred income taxes 1,134,727 1,135,558 1,013,847
Deferred income on
dispositions of land 1,577,419 1,741,413 1,847,125
$15,574,149 $15,246,480 $15,048,417
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
BIRMINGHAM UTILITIES, INC.
STATEMENTS OF INCOME AND RETAINED EARNINGS
FOR THE THREE AND SIX MONTHS ENDED JUNE 30, 1995 AND 1994
(Unaudited)
<CAPTION>
Three Months Ended Six Months Ended
June 30, June 30,
1995 1994 1995 1994
<S> <C> <C> <C> <C>
Operating Revenue $1,060,095 $ 991,960 $2,043,551 $1,989,598
Operating Expenses:
Operations and Maintenance 224,928 185,700 424,780 373,759
Purchased Water 185,574 182,933 356,163 360,051
Administrative and General 254,790 250,994 529,901 508,036
Depreciation 93,471 85,500 188,023 171,000
Taxes Other Than Income 133,980 127,080 266,335 260,800
Taxes on Income 19,847 15,698 5,150 36,021
Total Operating Expense 912,590 847,905 1,770,352 1,709,667
Operating Income 147,505 144,055 273,199 279,931
Amortization of Prior Years'
Deferred Income on Land
Dispositions, net (Net
of income taxes of $20,625
and $40,251 in 1995 and
$18,904 and $47,137 in
1994 for the three months
and six months,
respectively) 27,832 29,926 54,248 66,176
175,337 173,981 327,447 346,107
Other income, net 33,632 18,134 69,878 31,556
Income before interest
expense 208,969 192,115 397,325 377,633
Interest and
Amortization of Debt
Discount & Expense 156,220 132,228 308,920 260,272
Income from dispositions
of land, net (net of
income taxes of $32,935
in 1995) -0- -0- 46,494 -0-
Net Income 52,749 59,887 134,899 117,391
Retained earnings,
beginning 1,069,435 1,041,870 1,077,185 1,074,266
Dividends paid 89,900 89,900 179,800 179,800
Retained earnings,
ending $1,032,284 $1,011,857 $1,032,284 $1,011,857
Earnings per share $.07 $.08 $.18 $.16
Dividends per share $.12 $.12 $.24 $.24
The accompanying notes are an integral part of these financial statements.
</TABLE>
<TABLE>
BIRMINGHAM UTILITIES, INC.
STATEMENTS OF CASH FLOWS
SIX MONTHS ENDED JUNE 30, 1995 AND 1994
(Unaudited)
<CAPTION>
Six Months Ended Six Months Ended
June 30, 1995 June 30, 1994
<S> <C> <C>
Cash flows from operating activities
Net Income $134,899 $117,391
Adjustments to reconcile net income
to net cash provided by
operating activities:
Depreciation and amortization 204,516 207,457
Amortization of deferred income,
net of tax (54,248) (66,176)
Income from current year
land dispositions, net of tax (46,494) - 0 -
Increases and decreases in assets
and liabilities:
Accounts receivable and
accrued utility revenue (143,895) 6,438
Materials and supplies (18,054) (1,578)
Prepayments (75,233) (52,744)
Accounts payable and accrued
expenses 114,837 33,553
Other assets and deferred
charges, net (50,758) (90,570)
Deferred income taxes (63,133) (7,352)
Customer advance (refund)
for construction 100,458 58,352
Total Adjustments (32,004) 87,380
Net cash flows provided by
operating activities 102,895 204,771
Cash flows from investing
activities:
Net construction expenditures (395,965) (440,315)
Proceeds from sale of utility plant 499 981
Proceeds from land dispositions 200,000 - 0 -
Net Cash flows used in investing
activities (195,466) (439,334)
Cash flows from financing activities:
Increase in current note payable 243,717 75,000
Increase in long-term debt 71,219 401,561
Dividends paid (179,800) (179,800)
Dividends Reinvested 7,164 - 0 -
Net Cash flows provided by
financing activities: 142,300 296,761
Net increase in cash 49,729 62,198
Cash, beginning 58,812 66,700
Cash, ending $108,541 $128,898
Supplemental disclosure of
cash flow information:
Cash paid for
Interest $301,402 $272,218
Income Taxes $60,575 $21,200
Supplemental disclosure of
non-cash flow information:
The Company receives
contributions of plant from
builders and developers.
These contributions of plant
are reported in utility
plant and in customers'
advances for construction.
The contributions are deducted
from construction expenditures
to determine cash expenditures
by the Company.
Gross Plant, additions $395,965 $440,315
Customer Advance, net (100,458) (58,352)
Capital Expenditures, net $295,50 $381,963
The accompanying notes are an integral part of these financial statements.
</TABLE>
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
Note A. - UNAUDITED STATEMENTS
The statements as of and for the three months and six months ended June
30, 1995 and June 30, 1994 are prepared without audit, however, in the
opinion of management, all material adjustments for a fair statement of
results have been made. The balance sheet as of December 31, 1994 has been
audited. Certain amounts from prior years have been reclassified in the
financial statements to conform with the 1995 presentation.
Note B. - SEASONALITY OF REVENUE
The Company's business of selling water is to a certain extent
seasonal because water consumption normally increases during the drier and
warmer summer months. Accordingly, the results of operations for the three
months and six months ended June 30, 1995 and June 30, 1994, if annualized,
do not necessarily reflect annual results.
Note C. - ACCRUED UTILITY REVENUE
Accrued Utility Revenue at June 30, 1995 includes $212,151 in costs
incurred by the Company to date on a Main replacement project required by the
State of Connecticut. The Company's costs are reimbursable to the Company by
the State of Connecticut. - See Note G - Accounts Payable and Accrued
Expenses.
Note D. - PREPAYMENTS
<TABLE>
<CAPTION>
Prepayments consist of:
June 30, Dec. 31, June 30,
1995 1994 1994
<S> <C> <C> <C>
Insurance $ 56,571 $ 6,405 $ 43,643
Legal & accounting fees 26,053 3,702 30,449
Other prepaid expenses 31,035 29,319 30,927
$113,659 $39,426 $105,019
</TABLE>
The fluctuation in total prepayments as of the ends of the periods noted
was caused primarily by the fluctuation in prepaid insurance. Insurance
premium payments are made during the first quarter, since January 1 is the
beginning of the policy period, and amortized throughout the year.
The fluctuation in "Legal and Accounting Fees" reflects certain large,
expenses which regularly occur in the first quarter and are amortized over
the remaining part of the year to better match costs to the annual time
period benefitted.
Note E. - NOTE RECEIVABLE:
In September 1992, the Company modified a 1990 agreement with a real
estate developer to provide for the sale of approximately 152 acres of land
to the developer. The modified agreement provided for the $1,213,222 unpaid
balance of the purchase price to be paid on April 10, 1995, and to bear
interest at 6% through December 31, 1993 and thereafter at a variable rate
equal to the current prime rate (9.00% at June 30, 1995) (the "Mortgage
Debt"). The Mortgage Debt is secured by a mortgage lien in favor of the
Company on the 152 acres (the "Mortgage"). The buyers are jointly and
severally liable on the obligation. The Mortgage was further amended in
December 1994 to provide for an interim payment of $200,000 on the principal
of the Mortgage Debt by March 31, 1995 and extended the maturity of the
balance of the Mortgage Debt to November 30, 1995.
Under the prevailing Connecticut banking and real estate markets,
practical realization of the original Mortgage Debt is dependent upon the
developer's success in obtaining necessary financing and governmental and
regulatory approvals, none of which were or are assured. Accordingly, the
sale has been accounted for under the installment method.
Note F. - LONG TERM DEBT
<TABLE>
<CAPTION>
June 30, Dec. 31, June 30,
1995 1994 1994
<S> <C> <C> <C>
First mortgage bonds,
Series E 9.64% due
September 2011 $4,700,000 $4,700,000 $4,700,000
Note Payable 1,696,783 1,625,000 1,512,500
Other 3,189 3,753 3,753
$6,399,972 $6,328,753 $6,216,253
</TABLE>
First Mortgage Bonds
Pursuant to its Amended and Restated Mortgage Indenture, the Company has
outstanding, a series of first mortgage bonds in the amount of $4,700,000 due
on September 1, 2011. The terms of the Indenture provide for, among other
things, annual sinking fund requirements commencing September 1, 1997, and
limitations on (a) payment of cash dividends and (b) incurrence of long-term
indebtedness. Pursuant to this agreement, approximately $148,091 was
available to pay dividends at June 30, 1995, after the quarterly dividend
payment made on that date. Interest is payable semi-annually on the first
day of March and September. The indenture is secured by a lien on all of the
Company's utility property other than excess land available for sale.
There are no maturities of bonds until September 1, 1997, when the
Company is required to begin payments of $94,000 on each September 1, until
the bonds are paid in full.
Note Payable
In April 1994, the Company entered into a ten year credit facility with
Fleet Bank, N.A. The outstanding balance on the Company's previous line of
credit was converted to a new ten year $1,500,000 term loan. This term loan
is repayable at $75,000 per year for ten years with a $750,000 baloon payment
due at the end of ten years.
Also, a new $1,500,000 two year revolving line of credit was established
to fund additional capital improvements. At the end of the two year
revolving period, the outstanding balance may be converted to a term loan
with the same maturity and payment terms as the original term loan portion of
the facility. Both the term loan and the revolving line of credit are
secured by a lien (subordinate to the lien of the Mortgage Bond Indenture
(see First Mortgage Bonds above) on all of the Company's utility property
other than its excess land available for sale.
The term loan portion of the facility has both fixed and variable
interest rate options. The applicable weighted average interest rate on the
term loan at June 30, 1995 was 8.31%. The Company fixed the rate on this
long-term facility for a five year period at 8.18% on July 26, 1995.
Interest is payable monthly.
The two year revolving line of credit also has various interest rate
options, including a variable rate at 1% above the prime rate and LIBOR rate
options plus 1.9%, fixed for various short term periods including 30, 60, or
90 days. Interest is payable monthly. At June 30, 1995, the outstanding
balance on the two year revolving line of credit was $610,000 and the
weighted average interest rate payable at that time was 8.29%. Only a
portion of the $610,000 balance is carried at long-term since a total of
$212,151 is reimburseable by the State of Connecticut.
(See Note C to the Financial Statements).
The Company has also obtained an additional one year, unsecured line of
credit of up to $600,000 to be used for working capital purposes. The
balance of the working capital line must be reduced to zero for at least one
full month during the course of the year in order for the facility to be
eligible for renewal. The working capital line of credit also provides for
interest rate options, including a variable rate at 0.25% above the prime
rate, a variable rate at 1.75% above the bank's cost of funds (as provided by
the bank), and the LIBOR options also available under the two year revolving
line of credit. The outstanding balance of the working capital line of
credit (which was reduced to zero for one month during 1994) at June 30, 1995
was $83,000 and the interest rate payable at that date was 9.25%.
All three facilities provide that a default under one or under the
Mortgage Bond Indenture is considered a default under the others. They also
provide that the net proceeds from the sale of any of the Company's excess
land must be used to reduce the balance of the two year line of credit first
and then the term loan.
Note G - ACCOUNTS PAYABLE AND ACCRUED EXPENSES
<TABLE>
<CAPTION>
June 30, Dec. 31, June 30,
1995 1994 1994
<S> <C> <C> <C>
Accounts
Payable $193,135 $116,467 $154,581
Accrued Expenses:
Taxes 195,491 182,601 166,244
Interest 151,120 151,130 154,224
Other 150,512 125,223 161,723
$690,258 $575,421 $636,772
</TABLE>
The fluctuation in "Accounts Payable" reflects a $44,000 progress payment
owed to the contractor on a main replacement project, included as a payable
at June 30, 1995. The main replacement is required by the State and the
costs will be reimbursed by the State to the Company. - See Note C - Accrued
Utility Revenue. The fluctuation in "Accrued Interest" reflects primarily
the semi-annual interest payment requirement on the Company's bonds. See
Note F - Long Term Debt, First Mortgage Bonds. The fluctuation in other
accrued expenses also reflects the timing of payments.
Note H - DEFERRED GAINS ON LAND DISPOSITIONS
The DPUC has prescribed a rate making accounting procedure for income from
land dispositions which has the effect of sharing the economic benefits of
such dispositions between rate payers and shareholders over a period of time.
Accordingly, the Company includes in its income in years in which it has a
land disposition only a portion of the income that is realized from such
disposition. The balance of the income is deferred and amortized to the
Company's rate base and equity for rate making purposes, and to income for
financial reporting purposes, over the period of time during which the rate
making procedure is in effect. For the six months ended June 30, 1995 and
1994, $52,248 and $66,176 (net of income taxes), respectively, of such
deferred land disposition gains was included in income.
There was one "land sale" during the first six months of 1995, resulting
from the receipt of a $200,000 instalment payment by a developer - see Note
E, Note Receivable, and Management's Discussion and Analysis - Income from
Disposition of Land, net. The gain recognized from this payment in March,
1995 was $46,494, net of tax. The remaining portion of this gain was
deferred and is to be amortized. There were no land sales in 1994.
Note I - EARNINGS PER SHARE
The Company has only one class of stock outstanding; earnings per share are
computed by dividing the outstanding weighted average shares of common stock,
on a year to date basis through the balance sheet date, into the earnings for
all periods presented. The weighted average shares were 749,176 and 749,172
for the quarter and six month period ended June 30, 1995 and 749,168 for both
the quarter and six months ended June 30, 1994.
Note J - RATE MATTERS
Effective August 4, 1993 and July 20, 1994, the DPUC granted the Company
additional revenues of $75,000 (1.86% increase) and $113,000 (2.75%
increase), respectively.
The Company filed an application for a general rate increase with the DPUC on
July 3, 1995. A decision on this application is anticipated in the fourth
quarter of 1995. The Company is unable to predict the amount of increase
that the DPUC will allow.
Note K - EQUITY
Stock Option Plans
On September 13, 1994, the Company adopted two stock option plans. A
nonemployee director option plan and a key employee option plan. 75,000
shares were authorized under the two plans which provide for options to
purchase common stock of the Company at the fair market value at the date of
the grant. The options vest over various periods. As of December 31, 1994,
options for 54,000 shares had been granted to both directors and employees of
the Company under both plans. The option plans and all options issued were
approved by the Company's shareholders at their Annual Meeting on May 17,
1995 and by the DPUC on May 24, 1995. The shares of the Company stock issued
under the two plans were registered under the Securities Act of 1933 by the
filing of Registration Statements on Form S-8 with the Securities and
Exchange Commission on July 25, 1995.
Dividend Reinvestment Plan
On September 13, 1994, the Company adopted a dividend reinvestment plan
which provides for the issuance and sale of up to 70,000 shares of the
Company's authorized but unissued common stock to its shareholders who elect
to reinvest cash dividends on the Company's existing shares. Shares
available under the plan may be purchased at their fair market value price on
the date of the dividends to be invested in the new shares. The plan was
approved by the DPUC on May 24, 1995 and registration of the shares under the
various applicable securities laws was completed on June 18, 1995.
ITEM II
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS AND FINANCIAL CONDITIONS
RESULTS OF OPERATIONS
Net Income
Net income decreased $7,138 (12%) to $52,749 in the second quarter of
1995 from $59,887 in the second quarter of 1994. For the six months ended
June 30, 1995, net income increased $17,508 (15%) to $134,899 from $117,391
for the first six months of 1994. The decrease in 1995 on a second quarter
comparison to 1994 was primarily caused by the increases in interest expense,
partially offset by the increase in other income, net. The increase for the
six months 1995 compared to 1994 resulted primarily from the land sale in
March, 1995 (See Note H to the Financial Statement) and the increase in other
income, net, partially offset by the increase in interest expense and the
lower level of income from the amortization of prior year gains (See Note
H to the Financial Statements).
Operating Revenues
For the second quarter, 1995, operating revenues increased by $68,135
(7%) over the same period of 1994. This increase was primarily the result of
increased residential, commercial and industrial consumption during the
second quarter of 1995 compared to the second quarter 1994 and the impact in
1995 of the 2.75% rate increase, which became effective on July 20, 1994 (see
Note J to the Financial Statements).
For the six months ended June 30, 1995, operating revenues increased
$53,953 (3%) reflecting the July 20, 1994 rate increase of 2.75%, as well as
increased commercial and industrial water consumption.
Operating Expenses
Operating expenses increased $64,685 (8%) when comparing the second
quarter of 1995 to the second quarter of 1994. The primary contributor to
this increase was a $39,228 increase in operations and maintenance expense.
Operating expenses for the six months increased $60,685 (4%). This was
the result of
- - Operations and Maintenance expense which increased $51,021 (14%). This
increase was due to the increased cost of collection efforts on past due
accounts, primarily during the first quarter 1995.
- - Administrative and General Expense increased $21,865 (4%) reflecting a
4% increase in salary costs, and an increase in supplies expense.
- - Depreciation Expense increased $17,023 as a result of the increase in
utility plant.
- - Reduction in income tax expenses for the six months partially offset the
impact of the increased expenses noted above.
Utility Operating Income and Deferred Land Sale Amortization Income
The total of the Company's utility operating income and the amortization
of prior years' deferred income on land dispositions, net was $175,337 for
the second quarter of 1995 as compared to $173,981 in the same quarter of
1994. For the six months ended June 30, 1995 compared to the same period of
1994, that total decreased $18,660 (5%) reflecting primarily the $11,928
decrease in the amortization of prior years deferred income of land
dispositions.
Other Income, Net
Other Income, net increased $15,498 and $38,322 between 1995 and 1994
for the three months and six months, respectively, due primarily to an
increase in the income from a managed water system, and interest income on
the note receivable, which is accruing at the prime rate.
Interest and Amortization of Debt Discount & Expense
Interest expense during the second quarter and the first six months of
1995 increased $23,922 and $48,648, respectively, over interest expense in
the same periods of 1994. The increase results from both higher interest
rates on the Company's variable rate indebtedness and from higher levels of
debt incurred primarily to finance the construction of utility facilities.
FINANCIAL CONDITION
Total stockholders' equity decreased during the first six months of 1995
from $3,219,503 at December 31, 1994 to $3,181,766 at June 30, 1995 or
$37,737 after the dividend payments of $89,900, 12 cents per share, on that
date. The Company projects that for the year 1995 it will have sufficient
funds available from operations to meet its operational needs. It will not,
however, be able to generate sufficient funds from sales of water to satisfy
all of its construction plans.
Completion of the Company's Long-Term Capital Improvement Program is
dependent upon the Company's ability to raise capital from external sources,
including, for the purpose of this analysis, proceeds from the sale of the
Company's holdings of excess land. The Company believes that by selling
excess lands it can generate sufficient equity capital to support its 10 year
capital budget, currently estimated at $8,246,000. Such land dispositions
are subject to approval by the DPUC.
The Company's present 1995 Capital Budget of $1,128,000 is two tiered.
The first tier includes $281,000 for routine annual expenditures for
services, mains, hydrants and meters which are expected to be financed with
internally generated funds. The 1995 tier one budget also includes $30,000
of capital expenditures for Level "A" Mapping to be used in the process of
protecting the Housatonic Well Field aquifer.
The second tier of the 1995 Capital Budget consists of replacements and
betterments which are part of the Company's Long Term Capital Improvement
Program and includes $817,000 of budgeted plant additions. Plant additions
from this part of the 1995 budget will require external financing in addition
to the Company's line of credit. The second tier plant additions can be, and
portions of it are expected to be, deferred to future years if funds are not
available for their construction in 1995.
The 1990 agreement by and between the Company and a local developer
regarding the installment sale of approximately 152 acres of land in Seymour
was modified in 1994. The 1994 modification provided for an interim payment
of $200,000 on the $1,213,222 unpaid balance on or before March 31, 1995,
which interim payment was received March 29, 1995, and $1,013,222 no later
than November 30, 1995. (See Results of Operations -- Land Dispositions; and
Note 3 to the Financial Statements).
As of June 30, 1995, the Company has approximately 1,425 acres of excess
land available for sale, consisting of land currently classified as Class
III, non-watershed land under the statutory classification system for water
company lands. The Company believes that by selling these excess lands it
can generate sufficient equity capital to support its 10 year capital budget.
Such land dispositions are subject to approval by the DPUC.
The Company is actively pursuing new sales of real property. Because of
the delays required by the regulatory process, however, it does not expect to
be able to consummate any such sales during 1995, even if current discussions
lead to a sales agreement in the near future.
In 1994 the Company entered into a credit facility with Fleet Bank, N.A.
consisting of $1,500,000 of new long term debt due in the year 2004 and a
new, additional, secured, two-year line of credit also in the principal
amount of $1,500,000. The new, secured line of credit is being used to
provide funds to continue the Company's construction program; at the
Company's option it may be converted to an eight year term loan at the end of
the two year revolving period. The Company also obtained an additional one-
year, unsecured line of credit in the amount of $600,000 to be used for
working capital purposes. In April, 1994 when the financing arrangement was
approved by the DPUC, the DPUC prohibited the Company from drawing down funds
under the revolving line of credit, if at the time of or as a result of the
draw down, the amount of the Company's long-term debt (including amounts
outstanding under the two year revolving line of credit) would exceed 67% of
the Company's total capitalization.
The outstanding balance under the two year revolving line of credit at
June 30, 1995 was $610,000. The effect of the limitation noted above, was,
as of June 30, 1995, to limit the Company to additional advances outstanding
under the line of credit in the aggregate amount of approximately $60,000 for
use on budgeted projects until such time as the Company obtains additional
funds or additional equity capital.
In 1994 the Company's Board of Directors approved a common stock
Dividend Reinvestment Plan (the "Plan") pursuant to which share holders will
be entitled to purchase up to 70,000 new shares of the Company's Common Stock
by applying to the purchase price of the new shares cash dividends which
otherwise would be issued by the Company with respect to its existing common
stock. The Dividend Reinvestment Plan provides that the purchase price for
the new shares will be their fair market value at the time of the purchase.
The plan was approved by the DPUC on May 24, 1995. The Company cannot
predict what percentage of its cash dividends will from time to time be
reinvested in new shares of the Company's Common Stock. On June 30, 1995,
$7,164 of the $89,900 dividend paid on that date was reinvested by
shareholders.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings. Not applicable.
Item 2. Changes in Securities. Not applicable.
Item 3. Default Upon Senior Securities. Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
During the second quarter of 1995, the only matters submitted to a vote
of the holders of the Company's common stock, its only class of voting stock,
were submitted at the Company's annual meeting of shareholders held on May
17, 1995, as follows:
a) Election of Directors - All nominees for Director were elected, as
follows:
<TABLE>
<CAPTION>
Votes Cast % of Votes Abstentions
Votes Cast Against or Cast & Broker
Name of Nominee in Favor Withheld in Favor Non-Votes
<S> <C> <C> <C> <C>
Stephen P. Ahern 602,105 2,990 99.51 144,073
Edward G. Brickett 603,105 1,990 99.67 144,073
James E. Cohen 601,505 3,590 99.41 144,073
Betsy Henley-Cohn 603,105 1,990 99.67 144,073
Aldore J. Rivers 603,105 1,990 99.67 144,073
Kenneth E. Schaible 602,981 2,114 99.65 144,073
Charles T. Seccombe 603,105 1,990 99.67 144,073
David Silverstone 602,981 2,114 99.65 144,073
</TABLE>
b) Approval of Auditors - Shareholders approved the appointment of
Dworken, Hillman, LaMorte & Sterczala, P.C. as auditors for the Company to
make the annual audit for the 1995 fiscal year. There were 579,443 shares
voted in favor and 8,998 voted against the approval of apppointment of
Dworken, Hillman, LaMorte & Sterczala, P.C. There were 160,727 abstentions
and broker non-votes.
c) Approval of the Company's Stock Option Plan for Non-Employee
Directors- Shareholders approved the Company's Stock Option Plan for
Non-employee directors; 544,323 shares were voted in favor of the plan
and 44,317 shares were voted against the plan. There were 160,528
abstentions and broker non-votes.
d) Approval of the Company's 1994 Stock Incentive Plan-Shareholders
approved the Company's 1994 Stock Incentive Plan for employees; 569,103
shares were voted in favor of the plan and 29,733 shares were voted
against the plan. There were 150,332 abstentions and broker non-votes.
Item 5. Other Information. None.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits -
(27) Financial Data Schedule (electronic filing only).
(b) Forms 8K
(1) Report dated April 12, 1995 concerning a change in
Registrant's Certifying Accountants.
(2) Report dated May 2, 1995 concerning the termination
by a Developer of the August, 1994 Agreement regarding
his purchase of the 36-acre parcel from the Registrant
for $900,000.
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 of the
undersigned, thereunto duly authorized.
BIRMINGHAM UTILITIES, INC.
Registrant
/s/ Aldore J. Rivers
Date: August 9, 1995 Aldore J. Rivers, President
Date: August 9, 1995 /s/ Paul V. Erwin
Paul V. Erwin, Treasurer
<TABLE> <S> <C>
<ARTICLE> UT
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
REGISTRANT'S JUNE 30, 1995 UNAUDITED BALANCE SHEET, INCOME STATEMENT AND
CASH FLOW STATEMENT, AND NOTES THERETO, AND IS QUALIFIED IN ITS ENTIRTY
BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> JUN-30-1995
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 11,175,029
<OTHER-PROPERTY-AND-INVEST> 1,013,222
<TOTAL-CURRENT-ASSETS> 1,652,636
<TOTAL-DEFERRED-CHARGES> 759,252
<OTHER-ASSETS> 974,010
<TOTAL-ASSETS> 15,574,149
<COMMON> 2,149,482
<CAPITAL-SURPLUS-PAID-IN> 0
<RETAINED-EARNINGS> 1,032,284
<TOTAL-COMMON-STOCKHOLDERS-EQ> 3,181,766
0
0
<LONG-TERM-DEBT-NET> 6,399,972<F1>
<SHORT-TERM-NOTES> 333,717
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 75,000
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 5,583,694
<TOT-CAPITALIZATION-AND-LIAB> 15,574,149
<GROSS-OPERATING-REVENUE> 1,060,095
<INCOME-TAX-EXPENSE> 19,847
<OTHER-OPERATING-EXPENSES> 892,743
<TOTAL-OPERATING-EXPENSES> 912,590
<OPERATING-INCOME-LOSS> 147,505
<OTHER-INCOME-NET> 61,464
<INCOME-BEFORE-INTEREST-EXPEN> 208,969
<TOTAL-INTEREST-EXPENSE> 156,220
<NET-INCOME> 52,749
0
<EARNINGS-AVAILABLE-FOR-COMM> 52,749
<COMMON-STOCK-DIVIDENDS> 89,900
<TOTAL-INTEREST-ON-BONDS> 0<F2>
<CASH-FLOW-OPERATIONS> 228,118
<EPS-PRIMARY> .07
<EPS-DILUTED> .07
<FN>
<F1>See Note F to financial statements; includes long term note payable.
<F2>Not reported on an interim basis.
</FN>
</TABLE>
