LAS VEGAS, Aug. 3 /PRNewswire/ -- Southwest Gas Corporation (NYSE: SWX)
recorded a second quarter 2000 net loss of $0.31 per share, a $0.19 decline
from the $0.12 per share loss reported for the second quarter of 1999.
Consolidated net loss for the second quarter of 2000 was $9.7 million,
compared to the 1999 second quarter net loss of $3.6 million. Due to the
seasonal nature of the business, net losses during the second and third
quarters are normal and not generally indicative of earnings for a complete
According to Michael O. Maffie, President and Chief Executive Officer,
"Record and near record warm weather experienced in the southwest was the
primary reason for the reduction in earnings between periods. Similar record
and near record warm temperatures also occurred throughout the rest of the
country. Temperatures in our service territories were 25 percent above normal
during the past quarter. Last year, during this same time frame, we benefited
from weather that was 34 percent colder-than-normal. Over time, variations in
weather tend to even out and provide overall normal results."
Operating margin decreased $7.1 million, or eight percent, in the second
quarter of 2000 compared to the same period a year ago. Differences in
heating demand between periods was the primary reason for the decrease. The
Company served 64,000, or five percent, more customers than a year ago, which
partially offset the impact of weather on operating margin. The Company's
customer growth rate continues to significantly outpace the industry average.
Operating expenses increased $2.9 million, or three percent, as a result
of servicing additional customers. Net financing costs increased $2.1
million, or 13 percent, due to higher average short-term debt outstanding,
long-term debt issuances to finance construction, and increased interest rates
on variable-rate debt instruments.
For the twelve months ended June 30, 2000, net income was $30.1 million,
or $0.97 per basic share, compared to $38.8 million, or $1.29 per basic share,
during the twelve-month period ended June 30, 1999.
Operating margin decreased $8.9 million, or two percent, between periods.
Customer growth contributed $17 million of incremental margin. However,
differences in heating demand more than offset the impact of customer growth
as temperatures were 14 percent above normal during the current period.
Operating expenses increased $15.5 million, or five percent, as a result
of the continued expansion and upgrading of the gas system to accommodate
customer growth. Net financing costs increased $5.4 million, or eight
percent, as the Company financed the new construction necessary to keep up
with customer growth, and interest rates on variable rate debt instruments
Utility income tax expense, exclusive of changes in pretax income,
decreased $4.6 million between periods. The decrease was attributed to the
favorable resolution of certain federal and state income tax issues during the
current period, and the recognition of income tax liabilities for unrelated
tax issues in the prior period. Prior period results also included after-tax
costs of $3.2 million related to the now terminated merger with ONEOK, Inc.
Southwest Gas Corporation provides natural gas to approximately 1,298,000
customers in Arizona, Nevada, and California. Its service territories are
centered in the fastest-growing region of the country.
This press release may contain statements which constitute "forward-
looking statements" within the meaning of the Securities Litigation Reform Act
of 1995 (Reform Act). All such forward-looking statements are intended to be
subject to the safe harbor protection provided by the Reform Act. A number of
important factors affecting the business and financial results of the Company
could cause actual results to differ materially from those stated in the
forward-looking statements. These factors include, but are not limited to,
the impact of weather variations on customer usage, natural gas prices, the
effects of regulation/deregulation, the timing and amount of rate relief,
changes in capital requirements and funding, acquisitions, and competition.
SOUTHWEST GAS CONSOLIDATED EARNINGS DIGEST
QUARTER ENDED JUNE 30, 2000 1999
Consolidated Operating Revenues $197,634,000 $200,292,000
Net Loss $9,729,000 $3,596,000
Average Number of Common Shares Outstanding 31,289,000 30,621,000
Loss Per Share $0.31 $0.12
SIX MONTHS ENDED JUNE 30,
Consolidated Operating Revenues $494,449,000 $508,317,000
Net Income $15,469,000 $24,670,000
Average Number of Common Shares Outstanding 31,215,000 30,559,000
Basic Earnings Per Share $0.50 $0.81
Diluted Earnings Per Share $0.49 $0.80
TWELVE MONTHS ENDED JUNE 30,
Consolidated Operating Revenues $922,998,000 $940,128,000
Net Income $30,109,000 $38,768,000
Average Number of Common Shares Outstanding 31,100,000 30,123,000
Basic Earnings Per Share $0.97 $1.29
Diluted Earnings Per Share $0.96 $1.28
SOURCE Southwest Gas Corporation
Web site: http: //www.southwestgas.com
Company News On-Call: http: //www.prnewswire.com/comp/804969.html or fax, 800-758-5804, ext. 804969
CONTACT: media, Lew Phelps of Sitrick and Co., 310-788-2850; or shareholders, Laura Hobbs of Southwest Gas Corporation, 702-876-7237