Avista Corp. (AVA, Financial) filed Quarterly Report for the period ended 2012-03-31.
Avista Corp has a market cap of $1.54 billion; its shares were traded at around $25.54 with a P/E ratio of 15.3 and P/S ratio of 1. The dividend yield of Avista Corp stocks is 4.4%. Avista Corp had an annual average earning growth of 2.1% over the past 10 years.
Net income for Avista Utilities was $39.5 million for the three months ended March 31, 2012, a decrease from $40.1 million for the three months ended March 31, 2011. Avista Utilities income from operations was $79.1 million for the three months ended March 31, 2012 compared to $79.5 million for the three months ended March 31, 2011. The decrease in net income and income from operations was primarily due to an increase in other operating expenses, and depreciation and amortization, partially offset by an increase in gross margin (operating revenues less resource costs). The decrease in net income from Avista Utilities was also due to an increase in interest expense.
Avista Utilities operating revenues decreased $32.2 million and resource costs decreased $37.1 million, which resulted in an increase of $4.9 million in gross margin. The gross margin on electric sales increased $3.2 million and the gross margin on natural gas sales increased $1.7 million. The increase in electric and natural gas gross margin was primarily due to general rate increases, partially offset by warmer weather that reduced retail loads. For the three months ended March 31, 2012, we recognized a benefit of $4.2 million under the ERM in Washington compared to $4.9 million for the three months ended March 31, 2011.
Ecovas net loss attributable to Avista Corp. was $0.8 million for the three months ended March 31, 2012 compared to net income of $1.7 million for the three months ended March 31, 2011. Operating revenues increased $7.9 million and total operating expenses increased $12.9 million. The increase in operating revenues was primarily due to the acquisitions of Prenova effective November 30, 2011 and LPB effective January 31, 2012, which added $5.2 million to operating revenues for the first quarter of 2012. The increase in total operating expenses primarily reflects increased costs necessary to support ongoing and future business growth, as well as to support the increased revenue volume obtained through the acquisitions. Ecova experienced increases in employee costs, facilities costs, information technology costs and professional fees. In addition, Ecova incurred $1.5 million in transaction and integration costs, and $0.3 million paid for the early termination of an earn-out contract. Depreciation and amortization increased $1.2 million due to intangibles recorded in connection with the acquisitions. As of March 31, 2012, Ecova had 749 expense management customers representing 539,000 billed sites in North America. In the first quarter of 2012, Ecova managed bills totaling $4.4 billion, a decrease of $0.4 billion as compared to the first quarter of 2011. This decrease was due to a decrease in the average value of each bill (due in part to a decline in natural gas prices), partially offset by an increase in accounts managed.
Investing Activities Net cash used in investing activities was $154.3 million for the three months ended March 31, 2012, compared to net cash provided of $0.2 million for the three months ended March 31, 2011. Utility property capital expenditures increased by $8.1 million for the first quarter of 2012 as compared to the first quarter of 2011. In the first quarter of 2012, a significant portion of Ecovas funds held for clients were held as securities available for sale (purchases of $36.5 million and sales of $27.0 million). In the first quarter of 2011, the funds held for clients were in cash and cash equivalents, as well as money market funds. The net cash paid by subsidiaries for acquisitions in the first quarter of 2012 of $50.3 million primarily represents Ecovas acquisition of LPB.
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Avista Corp has a market cap of $1.54 billion; its shares were traded at around $25.54 with a P/E ratio of 15.3 and P/S ratio of 1. The dividend yield of Avista Corp stocks is 4.4%. Avista Corp had an annual average earning growth of 2.1% over the past 10 years.
Highlight of Business Operations:
Utility revenues decreased $32.2 million, after elimination of intracompany revenues of $27.6 million in the first quarter of 2012 and $17.0 million in the first quarter of 2011. Including intracompany revenues, electric revenues decreased $15.9 million and natural gas revenues decreased $5.7 million. Retail electric revenues decreased $3.4 million due to a decrease in volumes sold caused by warmer weather during the first three months of 2012 compared to 2011, partially offset by general rate increases. In addition, sales of fuel decreased $19.3 million (reflecting higher usage of our thermal generating plants and decreased sales of natural gas fuel not used in generation). These decreases in retail electric revenues and sales of fuel were partially offset by an increase in wholesale electric revenues of $6.0 million (due to an increase in volumes, partially offset by a decrease in wholesale prices). Retail natural gas revenues decreased $4.4 million due to a decrease in volumes caused by warmer weather, partially offset by rate increases, while wholesale natural gas revenues decreased $0.7 million.Net income for Avista Utilities was $39.5 million for the three months ended March 31, 2012, a decrease from $40.1 million for the three months ended March 31, 2011. Avista Utilities income from operations was $79.1 million for the three months ended March 31, 2012 compared to $79.5 million for the three months ended March 31, 2011. The decrease in net income and income from operations was primarily due to an increase in other operating expenses, and depreciation and amortization, partially offset by an increase in gross margin (operating revenues less resource costs). The decrease in net income from Avista Utilities was also due to an increase in interest expense.
Avista Utilities operating revenues decreased $32.2 million and resource costs decreased $37.1 million, which resulted in an increase of $4.9 million in gross margin. The gross margin on electric sales increased $3.2 million and the gross margin on natural gas sales increased $1.7 million. The increase in electric and natural gas gross margin was primarily due to general rate increases, partially offset by warmer weather that reduced retail loads. For the three months ended March 31, 2012, we recognized a benefit of $4.2 million under the ERM in Washington compared to $4.9 million for the three months ended March 31, 2011.
Ecovas net loss attributable to Avista Corp. was $0.8 million for the three months ended March 31, 2012 compared to net income of $1.7 million for the three months ended March 31, 2011. Operating revenues increased $7.9 million and total operating expenses increased $12.9 million. The increase in operating revenues was primarily due to the acquisitions of Prenova effective November 30, 2011 and LPB effective January 31, 2012, which added $5.2 million to operating revenues for the first quarter of 2012. The increase in total operating expenses primarily reflects increased costs necessary to support ongoing and future business growth, as well as to support the increased revenue volume obtained through the acquisitions. Ecova experienced increases in employee costs, facilities costs, information technology costs and professional fees. In addition, Ecova incurred $1.5 million in transaction and integration costs, and $0.3 million paid for the early termination of an earn-out contract. Depreciation and amortization increased $1.2 million due to intangibles recorded in connection with the acquisitions. As of March 31, 2012, Ecova had 749 expense management customers representing 539,000 billed sites in North America. In the first quarter of 2012, Ecova managed bills totaling $4.4 billion, a decrease of $0.4 billion as compared to the first quarter of 2011. This decrease was due to a decrease in the average value of each bill (due in part to a decline in natural gas prices), partially offset by an increase in accounts managed.
Investing Activities Net cash used in investing activities was $154.3 million for the three months ended March 31, 2012, compared to net cash provided of $0.2 million for the three months ended March 31, 2011. Utility property capital expenditures increased by $8.1 million for the first quarter of 2012 as compared to the first quarter of 2011. In the first quarter of 2012, a significant portion of Ecovas funds held for clients were held as securities available for sale (purchases of $36.5 million and sales of $27.0 million). In the first quarter of 2011, the funds held for clients were in cash and cash equivalents, as well as money market funds. The net cash paid by subsidiaries for acquisitions in the first quarter of 2012 of $50.3 million primarily represents Ecovas acquisition of LPB.
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