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
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CONTACT: Media: Dante Pistone, 702-876-7253, or Shareholder: Laura Hobbs, 702-876-7237, both of Southwest Gas Corporation