Print Page   |  Close Window     

Southwest Gas Reports Third Quarter 1998 Results

LAS VEGAS, Oct. 29 /PRNewswire/ -- Southwest Gas Corporation (NYSE: SWX) recorded a third quarter 1998 net loss of $0.38 per share, a $0.20 improvement from the $0.58 per share loss reported for the third quarter of 1997. Consolidated net loss for the third quarter of 1998 was $10.9 million, compared to the 1997 third quarter net loss of $15.7 million. Due to the seasonal nature of the business, net losses during the third quarter are normal and not generally indicative of earnings for a complete twelve-month period.

According to Michael O. Maffie, President and Chief Executive Officer, the improvement in operating results was primarily due to growth in operating margin. Operating margin increased $10.2 million, or 15 percent, in the third quarter of 1998 compared to the same period a year ago. Approximately $6 million was due to rate relief. The remainder was due to customer growth as the Company served 58,000, or five percent, more customers than a year ago.

Operating expenses increased $2.5 million, or three percent. Net financing costs decreased slightly despite $173 million in construction expenditures over the past twelve months. Strong cash flows during the first half of 1998, lower interest rates on variable-rate debt, and the issuance of 2.5 million shares of common stock were the primary reasons for the reduction.

For the twelve months ended September 30, 1998, net income was $45.8 million, or $1.65 per share, compared to $11.4 million, or $0.42 per share, during the twelve-month period ended September 30, 1997.

Operating margin increased $76.4 million, or 20 percent, due to improved weather conditions, rate relief, and continued customer growth. Differences in heating demand caused by weather variations between periods resulted in an increase of $33 million. Approximately $22 million pertained to colder-than-normal temperatures in the current period, and the remainder was attributed to the prior period being warmer-than-normal. Rate relief, primarily resulting from a September 1997 general rate case settlement in Arizona, contributed $32 million in additional operating margin to the current period. Customer growth accounted for the remaining $11.4 million.

Operating expenses and net financing costs increased $17.6 million, or five percent, as a result of servicing additional customers.

During the fourth quarter of 1997, Company operating results included the effects of several nonrecurring events. The combined impact of these events was a $4.1 million, or $0.15 per share, after-tax reduction to earnings for the twelve-months ended September 30, 1998.

Southwest Gas Corporation provides natural gas to approximately 1,182,000 customers in Arizona, Nevada, and California. Its service territories are centered in the fastest-growing region of the country.

                  SOUTHWEST GAS CONSOLIDATED EARNINGS DIGEST

    QUARTER ENDED SEPTEMBER 30,     1998                 1997
    Consolidated Operating
     Revenues                  $162,508,000         $128,698,000
    Net Loss                    $10,945,000          $15,686,000
    Average Number of Common
     Shares Outstanding          29,050,000           27,149,000
    Basic and Diluted Loss
     Per Share                        $0.38                $0.58

    NINE MONTHS ENDED SEPTEMBER 30,
    Consolidated Operating
     Revenues                  $648,006,000         $500,867,000
    Net Income (Loss)           $22,494,000          $(6,866,000)
    Average Number of Common
     Shares Outstanding          28,028,000           26,990,000
    Basic and Diluted Earnings
     (Loss) Per Share                 $0.80               $(0.25)

    TWELVE MONTHS ENDED SEPTEMBER 30,
    Consolidated Operating
     Revenues                  $879,149,000         $707,710,000
    Net Income                  $45,829,000          $11,430,000
    Average Number of Common
     Shares Outstanding          27,846,000           26,902,000
    Basic Earnings Per Share          $1.65                $0.42
    Diluted Earnings Per Share        $1.64                $0.42

SOURCE Southwest Gas Corporation
Company News On-Call: http: //www.prnewswire.com/comp/804969.html or fax, 800-758-5804, ext. 804969
CONTACT: Media: Dante Pistone, 702-876-7253, or Shareholder: Laura Hobbs, 702-876-7237, both of Southwest Gas Corporation