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Chesapeake Utilities Corp. Reports Operating Results (10-Q)
Posted by: gurufocus (IP Logged)
Date: November 4, 2011 06:40PM
Chesapeake Utilities Corp. (CPK) filed Quarterly Report for the period ended 2011-09-30.
Highlight of Business Operations:We recorded an income tax expense of $1.5 million for the quarter ended September 30, 2011, compared to $801,000 for the quarter ended September 30, 2010. The increase is attributable to increased earnings in the third quarter of 2011 compared to the same period in 2010.
Advanced Information Services. In September 2011, BravePoint, our advanced information services subsidiary, released a new product, ProfitZoom, an integrated system encompassing financial, job costing and service management modules, which was designed specifically for the fire protection and specialty contracting industries. ProfitZoom was built as a successor product to another software solution that BravePoint previously marketed and supported for companies in the fire suppression industry. Understanding the needs of the industry and utilizing its technology expertise, BravePoint began developing the ProfitZoom product in 2009. BravePoint incurred $823,000 in additional costs associated with the release and initial implementation of this product in the nine months ended September 30, 2011. BravePoint has successfully implemented this product for three customers, and two additional customers have executed sales contracts with implementations scheduled for December 2011 and January 2012. Several other sales proposals are under consideration by other potential customers.
We recorded an income tax expense of $12.6 million for the first nine months of 2011, compared to $12.1 million for the same period in 2010. The period-over-period increase in income tax expense is primarily a function of higher earnings for the period.
Our energy businesses are weather-sensitive and seasonal. We normally generate a large portion of our annual net income and subsequent increases in our accounts receivable in the first and fourth quarters of each year due to significant volumes of natural gas, electricity, and propane delivered by our natural gas, electric, and propane distribution operations to customers during the peak heating season. In addition, our natural gas and propane inventories, which usually peak in the fall months, are largely drawn down in the heating season and provide a source of cash as the inventory is used to satisfy winter sales demand.