RGC Resources Inc. (RGCO, Financial) filed Quarterly Report for the period ended 2010-03-31.
Rgc Resources Inc. has a market cap of $71 million; its shares were traded at around $31.62 with a P/E ratio of 14.7 and P/S ratio of 0.8. The dividend yield of Rgc Resources Inc. stocks is 4.2%.
days. Commercial volumes increased by only 3% as a result of two heavy snows temporarily closing many commercial businesses, a net reduction in commercial customers due to the economy, and the switch of one large commercial customer to transportation service. Industrial usage as represented in the transportation and interruptible categories increased by 15% during the quarter due to increases in production activities of a few of the larger customers and the transfer of a large commercial customer to transportation service. The Company realized approximately $98,000 in additional margin from the growth in customer base charges, which is a flat monthly fee billed to each natural gas customer. As discussed above, carrying cost revenues associated with natural gas inventories declined from last years levels corresponding with the sharp decline of the cost of gas in storage. Carrying cost revenues declined by approximately $257,000 for the quarter. The Company also reversed the WNA accrual of $145,000 recorded in December as discussed above.
Operations expenses increased by $42,356, or 2%, over the same period last year, primarily as a result of higher employee benefit costs. Total employee benefit costs increased by approximately $112,000 over the same period last year due to a $94,000 increase in pension and postretirement medical costs related to the amortization of a higher actuarial loss and $28,000 in higher health insurance premiums. Reductions in contracted and professional services partially offset the increases.
Depreciation expense decreased by $181,530, or 16%, due to the implementation of new depreciation rates as a result of an updated depreciation study approved and implemented in the fourth quarter of last year. If the new rates were reflected in the first quarter of last year, depreciation expense for the quarter would have been $224,550 less. See note 2 above for more information regarding the change in depreciation rates.
Operations expenses increased by $192,207, or 4%, for the six-month period ended March 31, 2010 compared to the same period last year due to higher employee benefit costs partially offset by a greater level of capitalized overheads. Total employee benefit costs increased by approximately $265,000 due to medical insurance premiums, pension costs and postretirement medical costs. $63,000 more in general and administrative and employee benefit overheads were capitalized due to a more than $500,000 increase in the level of capital expenditures compared to the same period last year. Maintenance expenses decreased by $61,567, or 8%, due to reductions in the level of pipeline leak repairs on the Companys distribution system.
Depreciation expense decreased by $361,060, or 16%, due to the implementation of new depreciation rates as a result of an updated depreciation study approved and implemented in the fourth quarter of last year. If the new rates were reflected in the first quarter of last year, depreciation expense for the six-month period ended March 31, 2009 would have been $447,100 less.
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Rgc Resources Inc. has a market cap of $71 million; its shares were traded at around $31.62 with a P/E ratio of 14.7 and P/S ratio of 0.8. The dividend yield of Rgc Resources Inc. stocks is 4.2%.
Highlight of Business Operations:
The commodity price of natural gas has declined from its peak of more than $13.00 per decatherm in the summer of 2008 to under $4.00 per decatherm this past summer and has ranged between $4.00 and $6.50 over the just completed winter heating season. The lower commodity price of natural gas has reduced the gas cost component of the Companys billing rates making natural gas a lower-cost energy source. During this past summer, the Company purchased natural gas for storage at an average price of $4.00 per decatherm compared to $11.00 per decatherm in fiscal 2008. Although the lower natural gas prices will benefit customers by keeping the Companys billing rates low, the decline in the total value of gas in storage has resulted in a significant reduction in carrying cost revenues.days. Commercial volumes increased by only 3% as a result of two heavy snows temporarily closing many commercial businesses, a net reduction in commercial customers due to the economy, and the switch of one large commercial customer to transportation service. Industrial usage as represented in the transportation and interruptible categories increased by 15% during the quarter due to increases in production activities of a few of the larger customers and the transfer of a large commercial customer to transportation service. The Company realized approximately $98,000 in additional margin from the growth in customer base charges, which is a flat monthly fee billed to each natural gas customer. As discussed above, carrying cost revenues associated with natural gas inventories declined from last years levels corresponding with the sharp decline of the cost of gas in storage. Carrying cost revenues declined by approximately $257,000 for the quarter. The Company also reversed the WNA accrual of $145,000 recorded in December as discussed above.
Operations expenses increased by $42,356, or 2%, over the same period last year, primarily as a result of higher employee benefit costs. Total employee benefit costs increased by approximately $112,000 over the same period last year due to a $94,000 increase in pension and postretirement medical costs related to the amortization of a higher actuarial loss and $28,000 in higher health insurance premiums. Reductions in contracted and professional services partially offset the increases.
Depreciation expense decreased by $181,530, or 16%, due to the implementation of new depreciation rates as a result of an updated depreciation study approved and implemented in the fourth quarter of last year. If the new rates were reflected in the first quarter of last year, depreciation expense for the quarter would have been $224,550 less. See note 2 above for more information regarding the change in depreciation rates.
Operations expenses increased by $192,207, or 4%, for the six-month period ended March 31, 2010 compared to the same period last year due to higher employee benefit costs partially offset by a greater level of capitalized overheads. Total employee benefit costs increased by approximately $265,000 due to medical insurance premiums, pension costs and postretirement medical costs. $63,000 more in general and administrative and employee benefit overheads were capitalized due to a more than $500,000 increase in the level of capital expenditures compared to the same period last year. Maintenance expenses decreased by $61,567, or 8%, due to reductions in the level of pipeline leak repairs on the Companys distribution system.
Depreciation expense decreased by $361,060, or 16%, due to the implementation of new depreciation rates as a result of an updated depreciation study approved and implemented in the fourth quarter of last year. If the new rates were reflected in the first quarter of last year, depreciation expense for the six-month period ended March 31, 2009 would have been $447,100 less.
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