DOVER, Del., Feb. 27, 2017 /PRNewswire/ -- Chesapeake
Utilities Corporation (NYSE: CPK) ("Chesapeake Utilities" or the
"Company") today announced financial results for the year and the
fourth quarter ended December 31, 2016. The Company's net
income for the year ended December 31, 2016 was $44.7 million, or $2.86 per share, an increase of $3.5 million, or $0.14 per share, compared to 2015. The growth in
net income and earnings per share in 2016 occurred despite the
negative impact of warmer temperatures in 2016, primarily during
the first quarter, and trading losses from Xeron. The higher
earnings resulted from growth in the Company's natural gas
transmission and distribution businesses, increased earnings from
Aspire Energy of Ohio, LLC
("Aspire Energy"), income generated from the Combined Heat &
Power ("CHP") plant and increased gross margin generated by
additional investments in the Florida Gas Reliability
Infrastructure Program ("GRIP").
For the fourth quarter of 2016, the Company reported net income
of $11.9 million, or $0.73 per share, an increase of $3.2 million, or $0.17 per share, compared to the same quarter in
2015. This increase was driven by the same factors that drove
higher earnings for the year as well as higher propane gas sales in
the Company's Delmarva Peninsula propane distribution business.
"Our performance during 2016 was exceptional as our earnings per
share set a record for the tenth consecutive year, surpassing 2015
by 5.1 percent, despite the warmer winter weather in the first
quarter," stated Michael P.
McMasters, President and Chief Executive Officer. "This
accomplishment flows from the strategic investments we have made to
propel diversified growth in our energy businesses. Our employees'
creative energy has produced this powerful growth; their hard work,
service ethic and financial discipline have driven our ten years of
success. We remain committed to the execution of our strategy
in 2017," added Mr. McMasters.
A more detailed discussion and analysis of the Company's results
for each segment is provided in the following pages.
Operating Results for the Years Ended December 31, 2016 and 2015
Operating income increased by $6.3
million to $84.1 million for
2016. This increase was driven by a $21.6
million, or 9.0 percent, increase in gross margin, which was
partially offset by a $15.3 million
increase in operating expenses. Excluding the net non-recurring
gain associated with a customer billing system settlement
recognized in 2015, operating income increased by $7.7 million, or 10.1 percent, in 2016.
Regulated Energy
Operating income for the
Regulated Energy segment increased by $8.9
million in 2016 compared to 2015. This increase was driven
by a higher gross margin of $17.0
million, which was partially offset by an increase of
$8.1 million in operating expenses.
The significant components of the gross margin increase
included:
- $7.2 million generated from
natural gas transmission expansions completed in 2014 and 2015, as
well as interim services provided pending completion of new
facilities, which are more fully discussed in the "Major Projects
and Initiatives" section later in this press release;
- $4.0 million generated by
additional GRIP investments in the Florida natural gas distribution
operations;
- $2.7 million from customer growth
in natural gas distribution and transmission services over and
above the growth attributable to recent service expansions;
- $1.5 million generated from the
partial year implementation of new rates for the Company's
Delaware natural gas distribution
division;
- $1.4 million from new natural gas
transmission and distribution services provided to Eight Flags
Energy, LLC's ("Eight Flags") CHP plant; and
- $736,000 from higher margins
generated by Sandpiper Energy, Inc. ("Sandpiper") associated with
the continued conversion of its distribution system from propane to
natural gas.
The significant drivers of the $8.1
million increase in operating expenses included:
- $3.6 million in higher staffing
and associated costs for additional personnel to support
growth;
- $2.6 million in higher
depreciation, asset removal and property tax costs associated with
recent capital investments to support growth and system integrity;
and
- $1.4 million due to the absence
of a $1.5 million gain from a
customer billing system settlement in 2015.
Unregulated Energy
Operating income for the
Unregulated Energy segment decreased by $2.5
million in 2016 compared to 2015. This decrease resulted
from lower gross margin due primarily to warmer than normal weather
during the first quarter of 2016, as well as lower propane retail
margins per gallon throughout 2016 as margins returned to more
normal levels. Despite these impacts, gross margin for the
Unregulated Energy segment increased $4.6
million in 2016, compared to 2015, driven by growth from
Aspire Energy, the Eight Flags' CHP plant, and the Company's
natural gas marketing subsidiary, Peninsula Energy Services
Company, Inc. ("PESCO"). The higher gross margin was more than
offset by increased operating expenses of $7.1 million, which reflects the significant
growth the Company experienced in 2016.
Gross margin increased $4.6
million, largely as a result of the following:
- $4.2 million from Aspire Energy,
due to the fact that 2015 reflected only nine months of margin for
Aspire Energy, which became a wholly-owned subsidiary of Chesapeake
Utilities on April 1, 2015;
- $1.7 million from Aspire Energy
as a result of pricing amendments to long-term gas sales
agreements, additional management fees and higher volumes of
natural gas delivered to or on behalf of certain of its
customers;
- $3.6 million from Eight Flags'
CHP plant, which commenced operations in June 2016; and
- $1.0 million from PESCO due to an
increase in the number of contracts and customers served.
The above increases were offset by the following:
- $2.8 million of lower gross
margin for the Company's propane distribution operations as propane
retail margins per gallon returned to more normal levels;
- $1.4 million of lower gross
margin due to lower customer consumption of propane mainly as a
result of warmer than normal temperatures on the Delmarva
Peninsula, primarily during the first quarter of 2016 compared to
colder than normal temperatures during the first quarter of 2015;
and
- $847,000 of lower gross margin
from Xeron.
The significant components of the $7.1
million increase in operating expenses included:
- $2.8 million incurred by Aspire
Energy, $1.6 million of which
occurred in the first quarter of 2016, compared to zero in the
first quarter of 2015 prior to the closing of the acquisition of
Aspire Energy's operations;
- $2.4 million in operating
expenses incurred by the Eight Flags' CHP plant, which commenced
operations in June 2016;
- $817,000 in higher staffing and
associated costs for additional personnel to support growth;
and
- $683,000 in higher outside
services costs primarily associated with growth and ongoing
compliance activities.
Operating Results for the Quarters Ended December 31,
2016 and 2015
The Company's operating income for the fourth quarter of 2016
was $21.8 million, an increase of
$5.6 million, compared to the same
quarter in 2015. The increased operating income was due to growth
in both the Regulated Energy and Unregulated Energy segments.
Regulated Energy Segment
Operating income for
the Regulated Energy segment increased by $3.8 million to $17.2
million in the fourth quarter of 2016, compared to the same
quarter in 2015. The increased operating income resulted from a
$5.6 million increase in gross
margin, partially offset by a $1.8
million increase in operating expenses. The significant
components of the gross margin increase included:
- $1.7 million generated from
natural gas transmission expansions completed in 2014 and 2015, as
well as interim services pending completion of new facilities,
which are discussed in the "Major Projects and Initiatives"
section later in this press release;
- $1.2 million as a result of
colder weather experienced during the fourth quarter of 2016;
- $975,000 generated by additional
GRIP investments in the Florida
natural gas distribution operations;
- $794,000 from customer growth in
natural gas distribution services, unrelated to a recent service
expansion offset by $304,000 in
decreased margin from interruptible service to customers; and
- $477,000 from new natural gas
transmission and distribution services provided to Eight Flags' CHP
plant.
The significant components of the $1.8
million increase in operating expenses included:
- $1.2 million in higher staffing
and associated costs for additional personnel to support growth;
and
- $1.1 million in higher
depreciation expense, amortization, asset removal and property tax
costs associated with capital investments to support growth and
maintain system integrity.
Unregulated Energy Segment
Operating income for
the Unregulated Energy segment for the fourth quarter of 2016 was
$4.6 million, an increase of
$1.9 million compared to operating
income for the same quarter in 2015. The increased operating income
resulted from a $5.2 million increase
in gross margin, offset by a $3.3
million increase in operating expenses. The significant
components of the gross margin increase included:
- $2.4 million from higher propane
gas sales by the Company's propane distribution operation primarily
on the Delmarva Peninsula in response to colder weather
quarter-over-quarter;
- $1.9 million from Eight Flags'
CHP plant; and
- $1.4 million from Aspire Energy
as a result of pricing amendments to long-term gas sales
agreements, additional management fees and higher volumes of
natural gas delivered to or on behalf of certain of its customers;
which increases were offset by
- $427,000 of lower gross margin
from Xeron.
The significant components of the $3.3
million increase in operating expenses included:
- $1.3 million in operating
expenses incurred by Eight Flags' CHP plant;
- $738,000 in higher staffing and
associated costs for additional personnel to support growth;
- $344,000 in operating expenses,
primarily higher staffing and associated costs as well as
depreciation expense, incurred by Aspire Energy; and
- $289,000 in higher outside
service expenses and facilities maintenance expenses.
Matters discussed in this release may include forward-looking
statements that involve risks and uncertainties. Actual results may
differ materially from those in the forward-looking statements.
Please refer to the Safe Harbor for Forward-Looking Statements in
the Company's 2016 Annual Report on Form 10-K for further
information on the risks and uncertainties related to the Company's
forward-looking statements.
The discussions of the results use the term "gross margin," a
non-Generally Accepted Accounting Principles ("GAAP") financial
measure, which management uses to evaluate the performance of the
Company's business segments. For an explanation of the calculation
of "gross margin," see the footnote to the Financial
Summary.
Unless otherwise noted, earnings per share information is
presented on a diluted basis.
Conference Call
Chesapeake Utilities Corporation will host a conference call on
March 1, 2017 at 10:30 a.m. Eastern Time to discuss the Company's
financial results for the year and quarter ended December 31,
2016. To participate in this call, dial 855.801.6270 and reference
Chesapeake Utilities' 2016 Financial Results Conference Call. To
access the replay recording of this call, please visit the
Company's website at http://investor.chpk.com/results.cfm or
download the replay on your mobile device by accessing the
Audiocast section of the Company's IR App.
About Chesapeake Utilities Corporation
Chesapeake Utilities is a diversified energy company engaged in
natural gas distribution, transmission, gathering and processing,
and marketing; electricity generation and distribution; propane gas
distribution; propane and crude oil wholesale marketing; and other
businesses. Information about Chesapeake Utilities and its family
of businesses is available at http://www.chpk.com or through
its IR App.
Please note that Chesapeake Utilities Corporation is not
affiliated with Chesapeake Energy, an oil and natural gas
exploration company headquartered in Oklahoma City, Oklahoma.
For more information, contact:
Beth W. Cooper
Senior Vice President & Chief Financial Officer
302.734.6799
Financial
Summary
(in thousands,
except per-share data)
|
|
|
|
|
|
Year
Ended
|
|
Fourth
Quarter
|
For the Periods
Ended December 31,
|
2016
|
|
2015
|
|
2016
|
|
2015
|
Gross Margin
(1)
|
|
|
|
|
|
|
|
Regulated
Energy
|
$
|
196,080
|
|
$
|
179,088
|
|
$
|
50,633
|
|
$
|
45,064
|
Unregulated
Energy
|
64,962
|
|
60,317
|
|
19,582
|
|
14,388
|
Other
businesses and eliminations
|
(225)
|
|
(203)
|
|
(58)
|
|
(46)
|
Total Gross
Margin
|
$
|
260,817
|
|
$
|
239,202
|
|
$
|
70,157
|
|
$
|
59,406
|
|
|
|
|
|
|
|
|
Operating
Income
|
|
|
|
|
|
|
|
Regulated
Energy
|
$
|
69,851
|
|
$
|
60,985
|
|
$
|
17,191
|
|
$
|
13,369
|
Unregulated
Energy
|
13,844
|
|
16,355
|
|
4,577
|
|
2,689
|
Other
businesses and eliminations
|
401
|
|
418
|
|
51
|
|
113
|
Total
Operating Income
|
$
|
84,096
|
|
$
|
77,758
|
|
$
|
21,819
|
|
$
|
16,171
|
|
|
|
|
|
|
|
|
Other (expense)
income
|
(441)
|
|
293
|
|
(372)
|
|
297
|
Interest
charges
|
10,639
|
|
10,006
|
|
2,643
|
|
2,582
|
Income
taxes
|
28,341
|
|
26,905
|
|
6,941
|
|
5,267
|
Net
Income
|
$
|
44,675
|
|
$
|
41,140
|
|
$
|
11,863
|
|
$
|
8,619
|
|
|
|
|
|
|
|
|
Earnings Per Share
of Common Stock
|
|
|
|
|
|
|
|
Basic
|
$
|
2.87
|
|
$
|
2.73
|
|
$
|
0.73
|
|
$
|
0.56
|
Diluted
|
$
|
2.86
|
|
$
|
2.72
|
|
$
|
0.73
|
|
$
|
0.56
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
"Gross margin" is determined by deducting the cost of sales from
operating revenue. Cost of sales includes the purchased fuel cost
for natural gas, electricity and propane and the cost of labor
spent on direct revenue-producing activities and excludes
depreciation, amortization and accretion. Gross margin should not
be considered an alternative to operating income or net income,
which are determined in accordance with GAAP. Chesapeake Utilities
believes that gross margin, although a non-GAAP measure, is useful
and meaningful to investors as a basis for making investment
decisions. It provides investors with information that demonstrates
the profitability achieved by the Company under its allowed rates
for regulated operations and under its competitive pricing
structure for non-regulated segments. Chesapeake Utilities'
management uses gross margin in measuring its business units'
performance. Other companies may calculate gross margin in a
different manner.
|
Financial Summary
Highlights
|
|
Key variances for the
year ended December 31, 2016 included:
|
|
|
|
|
|
|
(in thousands,
except per share)
|
Pre-tax
Income
|
|
Net
Income
|
|
Earnings
Per Share
|
Year ended December
31, 2015 Reported Results
|
$
|
68,045
|
|
$
|
41,140
|
|
$
|
2.72
|
|
|
|
|
|
|
Adjusting for unusual
items:
|
|
|
|
|
|
Weather impact,
primarily in the first quarter
|
(3,595)
|
|
(2,200)
|
|
(0.15)
|
Net gain from
settlement agreement associated with customer billing
system
|
(1,370)
|
|
(838)
|
|
(0.06)
|
|
(4,965)
|
|
(3,038)
|
|
(0.21)
|
Increased (Decreased)
Gross Margins:
|
|
|
|
|
|
Service
expansions*
|
7,192
|
|
4,400
|
|
0.30
|
Eight Flags'
CHP*
|
4,998
|
|
3,058
|
|
0.21
|
GRIP*
|
4,044
|
|
2,474
|
|
0.17
|
Natural Gas Growth
(excluding service expansions)
|
2,734
|
|
1,673
|
|
0.11
|
Lower retail propane
margins
|
(2,770)
|
|
(1,695)
|
|
(0.11)
|
Higher customer
consumption - other
|
1,899
|
|
1,162
|
|
0.08
|
Implementation of
Delaware Division new rates*
|
1,487
|
|
910
|
|
0.06
|
Natural gas
marketing
|
1,043
|
|
638
|
|
0.04
|
Xeron trading
losses
|
(847)
|
|
(518)
|
|
(0.04)
|
Sandpiper margins
associated with conversions
|
736
|
|
450
|
|
0.03
|
Sharp energy-related
services
|
(512)
|
|
(313)
|
|
(0.02)
|
|
20,004
|
|
12,239
|
|
0.83
|
Increased Other
Operating Expenses:
|
|
|
|
|
|
Higher staffing and
associated costs
|
(4,443)
|
|
(2,718)
|
|
(0.18)
|
Higher depreciation,
asset removal and property tax costs
|
(2,952)
|
|
(1,806)
|
|
(0.12)
|
Eight Flags'
operating expenses
|
(2,432)
|
|
(1,488)
|
|
(0.10)
|
Higher outside
service and facility maintenance costs
|
(974)
|
|
(596)
|
|
(0.04)
|
|
(10,801)
|
|
(6,608)
|
|
(0.44)
|
|
|
|
|
|
|
Net contribution from
Aspire Energy
|
3,130
|
|
1,915
|
|
0.09
|
Impact of common
stock issuance
|
—
|
|
—
|
|
(0.05)
|
Interest
charges
|
(633)
|
|
(387)
|
|
(0.03)
|
Change in other
income (expense)
|
(734)
|
|
(449)
|
|
(0.03)
|
Tax rate
changes
|
—
|
|
530
|
|
0.04
|
Net other
changes
|
(1,030)
|
|
(667)
|
|
(0.06)
|
Year ended December
31, 2016 Reported Results
|
$
|
73,016
|
|
$
|
44,675
|
|
$
|
2.86
|
|
|
|
|
|
|
|
|
|
* See the Major
Projects and Initiatives table later in this press
release.
|
Key variances for the
quarter ended December 31, 2016 included:
|
|
|
|
|
|
|
(in thousands,
except per share)
|
Pre-tax
Income
|
|
Net
Income
|
|
Earnings
Per Share
|
Fourth Quarter of
2015 Reported Results
|
$
|
13,886
|
|
$
|
8,619
|
|
$
|
0.56
|
|
|
|
|
|
|
Adjusting for unusual
items:
|
|
|
|
|
|
Weather
impact
|
3,408
|
|
2,150
|
|
0.14
|
|
3,408
|
|
2,150
|
|
0.14
|
Increased (Decreased)
Gross Margins:
|
|
|
|
|
|
Eight Flags'
CHP*
|
2,416
|
|
1,525
|
|
0.10
|
Service
expansions*
|
1,676
|
|
1,057
|
|
0.07
|
GRIP*
|
975
|
|
615
|
|
0.04
|
Higher customer
consumption - other
|
755
|
|
476
|
|
0.03
|
Natural gas growth
(excluding service expansions)
|
490
|
|
309
|
|
0.02
|
Xeron trading
losses
|
(427)
|
|
(269)
|
|
(0.02)
|
Lower retail propane
margins
|
(345)
|
|
(218)
|
|
(0.01)
|
Wholesale propane
margins
|
173
|
|
109
|
|
0.01
|
Implementation of
Delaware Division new rates*
|
140
|
|
88
|
|
0.01
|
|
5,853
|
|
3,692
|
|
0.25
|
(Increased) Decreased
Other Operating Expenses:
|
|
|
|
|
|
Higher staffing and
associated costs
|
(1,945)
|
|
(1,227)
|
|
(0.08)
|
Eight Flags'
operating expenses
|
(1,297)
|
|
(818)
|
|
(0.05)
|
Higher depreciation,
asset removal and property tax costs
|
(1,175)
|
|
(741)
|
|
(0.05)
|
Lower outside
services and facility maintenance costs
|
741
|
|
468
|
|
0.03
|
|
(3,676)
|
|
(2,318)
|
|
(0.15)
|
|
|
|
|
|
|
Net contribution from
Aspire Energy
|
1,060
|
|
669
|
|
0.04
|
Impact of
common stock issuance
|
—
|
|
—
|
|
(0.05)
|
Interest
charges
|
(61)
|
|
(39)
|
|
—
|
Change in income
(expense)
|
(669)
|
|
(422)
|
|
(0.03)
|
Net other
changes
|
(997)
|
|
(488)
|
|
(0.03)
|
Fourth Quarter of
2016 Reported Results
|
$
|
18,804
|
|
$
|
11,863
|
|
$
|
0.73
|
|
|
|
|
|
|
|
|
|
* See the Major
Projects and Initiatives table later in this press
release.
|
The following information highlights certain key factors
contributing to the Company's results for the year and quarter
ended December 31, 2016:
Major Projects
and Initiatives
|
|
The following table
summarizes gross margin for the Company's existing and future major
projects and initiatives. Gross margin reflects operating revenue
less cost of sales, excluding depreciation, amortization and
accretion (dollars in thousands):
|
|
|
|
Gross Margin for
the Period
|
|
Year
Ended
|
|
Three Months
Ended
|
|
|
|
December
31,
|
|
December
31,
|
|
Estimate
|
|
2016
|
|
2015
|
|
Variance
|
|
2016
|
|
2015
|
|
Variance
|
|
2017
|
|
2018
|
Existing Major
Projects and
Initiatives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital Investment
Projects
|
$
|
43,717
|
|
$
|
21,536
|
|
$
|
22,181
|
|
$
|
13,693
|
|
$
|
7,220
|
|
$
|
6,473
|
|
$
|
48,185
|
|
$
|
47,107
|
Regulatory
Proceedings
|
1,487
|
|
—
|
|
1,487
|
|
140
|
|
—
|
|
140
|
|
2,250
|
|
2,250
|
Total Existing Major
Projects and
Initiatives
|
$
|
45,204
|
|
$
|
21,536
|
|
$
|
23,668
|
|
$
|
13,833
|
|
$
|
7,220
|
|
$
|
6,613
|
|
$
|
50,435
|
|
$
|
49,357
|
Future Major
Projects and
Initiatives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Capital Investment
Projects (1)
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
2,250
|
|
$
|
20,238
|
Regulatory
Proceedings (2), (3)
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
Total Future Major
Projects and
Initiatives
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
—
|
|
$
|
2,250
|
|
$
|
20,238
|
Total
|
$
|
45,204
|
|
$
|
21,536
|
|
$
|
23,668
|
|
$
|
13,833
|
|
$
|
7,220
|
|
$
|
6,613
|
|
$
|
52,685
|
|
$
|
69,595
|
|
(1)
This represents gross margin for the System Reliability and
2017 Expansion projects.
|
(2) In
January 2017, Eastern Shore filed a rate case with the Federal
Energy Regulatory Commission ("FERC"). The outcome of the rate case
is not known at this time.
|
(3) In
February 2017, FPU's electric division filed a petition with the
Florida Public Service Commission ("PSC") requesting a temporary
surcharge mechanism to recover the costs, inclusive of an
appropriate return on investment, associated with essential
reliability and modernization projects on its electric distribution
system. The gross margin impact related with this action is
not known at this time.
|
Existing Major
Projects and Initiatives
|
|
The following
summarizes the Company's major projects and initiatives commenced
since 2014 and 2015. (dollars in thousands):
|
|
|
|
Gross Margin for
the Period
|
(in
thousands)
|
Year
Ended
|
|
Three Months
Ended
|
|
|
|
December
31,
|
|
December
31,
|
|
Estimate
for
|
|
2016
|
|
2015
|
|
Variance
|
|
2016
|
|
2015
|
|
Variance
|
|
2017
|
|
2018
|
Capital Investment
Projects:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Acquisition:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Aspire
Energy
|
$
|
12,271
|
|
$
|
6,324
|
|
$
|
5,947
|
|
$
|
4,068
|
|
$
|
2,663
|
|
$
|
1,405
|
|
$
|
13,376
|
|
$
|
14,302
|
Service
Expansions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Short-term
contracts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Delaware
|
$
|
11,454
|
|
$
|
4,952
|
|
$
|
6,502
|
|
$
|
3,184
|
|
$
|
1,501
|
|
$
|
1,683
|
|
$
|
4,339
|
|
$
|
714
|
Total short-term
contracts
|
$
|
11,454
|
|
$
|
4,952
|
|
$
|
6,502
|
|
$
|
3,184
|
|
$
|
1,501
|
|
$
|
1,683
|
|
$
|
4,339
|
|
$
|
714
|
Long-term
Contracts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Delaware
|
$
|
1,815
|
|
$
|
1,844
|
|
$
|
(29)
|
|
$
|
449
|
|
$
|
455
|
|
$
|
(6)
|
|
$
|
6,965
|
|
$
|
7,605
|
Florida
|
1,627
|
|
908
|
|
719
|
|
407
|
|
407
|
|
—
|
|
1,622
|
|
1,622
|
Total long-term
contracts
|
$
|
3,442
|
|
$
|
2,752
|
|
$
|
690
|
|
$
|
856
|
|
$
|
862
|
|
$
|
(6)
|
|
$
|
8,587
|
|
$
|
9,227
|
Total Service
Expansions
|
$
|
14,896
|
|
$
|
7,704
|
|
$
|
7,192
|
|
$
|
4,040
|
|
$
|
2,363
|
|
$
|
1,677
|
|
$
|
12,926
|
|
$
|
9,941
|
Florida
GRIP
|
$
|
11,552
|
|
$
|
7,508
|
|
$
|
4,044
|
|
$
|
3,169
|
|
$
|
2,194
|
|
$
|
975
|
|
$
|
13,727
|
|
$
|
14,407
|
Eight Flags' CHP
Plant
|
$
|
4,998
|
|
$
|
—
|
|
$
|
4,998
|
|
$
|
2,416
|
|
$
|
—
|
|
$
|
2,416
|
|
$
|
8,156
|
|
$
|
8,457
|
Total Capital
Investment Projects
|
$
|
43,717
|
|
$
|
21,536
|
|
$
|
22,181
|
|
$
|
13,693
|
|
$
|
7,220
|
|
$
|
6,473
|
|
$
|
48,185
|
|
$
|
47,107
|
Existing
Regulatory Proceedings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Delaware Division
Rate Case
|
$
|
1,487
|
|
$
|
—
|
|
$
|
1,487
|
|
$
|
140
|
|
$
|
—
|
|
$
|
140
|
|
$
|
2,250
|
|
$
|
2,250
|
Total Existing
Regulatory Proceedings
|
$
|
1,487
|
|
$
|
—
|
|
$
|
1,487
|
|
$
|
140
|
|
$
|
—
|
|
$
|
140
|
|
$
|
2,250
|
|
$
|
2,250
|
Total Existing
Major Projects and
Initiatives
|
$
|
45,204
|
|
$
|
21,536
|
|
$
|
23,668
|
|
$
|
13,833
|
|
$
|
7,220
|
|
$
|
6,613
|
|
$
|
50,435
|
|
$
|
49,357
|
Aspire Energy
Aspire Energy generated $5.9 million and $1.4
million in additional gross margin for the year and quarter
ended December 31, 2016, respectively, compared to the same
periods in 2015. Of the $5.9 million
of 2016 gross margin, $4.2 million of
gross margin was generated in the first quarter of 2016.
Aspire Energy's gross margin for the year ended December 31, 2015 was lower due in part to the
fact that the period included only nine months of results
commencing on April 1, 2015. Aspire
Energy also generated additional gross margin in 2016 from pricing
amendments to long-term gas sales agreements, additional management
fees and higher volumes of natural gas delivered to or on behalf of
certain of its customers.
Service Expansions
In January
2015, the Florida PSC approved a firm transportation
agreement between Peninsula Pipeline and our Florida natural gas distribution division.
Pursuant to this agreement, Peninsula Pipeline provides natural gas
transmission service to support our expansion of natural gas
distribution service in Polk County,
Florida. Peninsula Pipeline began the initial phase of its
service to Chesapeake Utilities' Florida natural gas distribution division in
March 2015. This new service
generated $719,000 of additional
gross margin for the year ended December 31, 2016 and produced
approximately the same gross margin in the fourth quarters of 2015
and 2016.
In April 2015, Eastern Shore
commenced interruptible service to an electric power generator in
Kent County, Delaware. The
interruptible service concluded in December
2015 and was replaced by a short-term OPT ≤ 90 service,
which generated additional gross margin of $5.4 million and $1.0
million for the year and quarter ended December 31, 2016, respectively, compared to the
same periods in 2015. The Company has executed a 20-year long-term
OPT 90 ≤ service agreement with this customer to be effective
March 1, 2017, and has filed an
agreement with FERC requesting: (i) the service to be effective
March 1, 2017; and (ii) a waiver of
the 30 day notice requirement in order to have it become effective
March 1, 2017.
In October 2015, Eastern Shore
submitted an application to the FERC to make certain measurement
and related improvements at its Texas Eastern Transmission, LP
("TETLP") interconnect facilities to enable Eastern Shore to
increase natural gas receipts from TETLP by 53,000 Dts/d for a
total capacity of 160,000 Dts/d. In December
2015, the FERC authorized Eastern Shore to proceed with this
project, which was completed and placed in service in March 2016. Approximately 60 percent of the
increased capacity has been subscribed on a short-term firm service
basis. This service generated an additional gross margin of
$1.4 million and $646,000 for the year and quarter ended
December 31, 2016, respectively,
compared to the same periods in 2015. The remaining capacity is
available for firm or interruptible service.
GRIP
GRIP is a natural gas pipe replacement program
approved by the Florida PSC. Since the inception of the
program in August 2012, the Company
has invested $102.8 million and
replaced 214 miles of qualifying distribution mains, $26.0 million of which was invested during 2016.
The increased investment in GRIP generated additional gross margin
of $4.0 million and $975,000 for the year and quarter ended
December 31, 2016, respectively,
compared to the same periods in 2015.
Eight Flags' CHP plant
In June
2016, Eight Flags, completed construction of a CHP plant on
Amelia Island, Florida, and began selling power generated
from the CHP plant to FPU, pursuant to a 20-year power purchase
agreement, for distribution to its retail electric customers. In
July 2016, it also started selling
steam to Rayonier pursuant to a separate 20-year contract.
The CHP plant is powered by natural gas transported by FPU
through its distribution system and Peninsula Pipeline, through its
intrastate pipeline. Eight Flags and other affiliates of Chesapeake
Utilities generated $5.0 million and
$2.4 million in additional gross
margin for the year and quarter ended December 31, 2016, respectively. These amounts
include gross margin of $1.4 million
and $477,000 for the year and quarter
ended December 31, 2016,
respectively, from natural gas distribution and transportation
services provided by the Company's affiliates.
Future Major Projects and Initiatives
White Oak Mainline Expansion Project: In August 2014, Eastern Shore entered into a
precedent agreement with an electric power generator in
Kent County, Delaware, to provide
a 20-year natural gas transmission service for 45,000 Dts/d for the
customer's facility, upon the satisfaction of certain conditions.
This new service will be provided as a long-term OPT ≤ 90 service
and is expected to generate at least $5.8
million in annual gross margin. In November 2014, Eastern Shore requested
authorization by the FERC to construct 5.4 miles of 16-inch
pipeline looping and 3,550 horsepower of new compression in
Delaware to provide this service.
As previously discussed, during the year ended December 31,
2016, compared to the year ended December
31, 2015, the Company generated $5.4
million, respectively, in additional gross margin by
providing short-term OPT ≤ 90 service to this customer. In
July 2016, the FERC authorized
Eastern Shore to construct and operate the proposed White Oak
Mainline Project. Construction of the project is underway.
Long-term service is expected to commence on March 1, 2017.
System Reliability Project: In July 2016, the FERC authorized Eastern Shore to
construct and operate approximately 10.1 miles of 16-inch pipeline
looping and auxiliary facilities in New
Castle and Kent Counties,
Delaware, and a new compressor at
its existing Bridgeville
compressor station in Sussex County,
Delaware. Construction of the project is underway and is
expected to be completed in April
2017. Since the project is intended to improve system
reliability, Eastern Shore requested a predetermination of
rolled-in rate treatment for the costs of the project and an order
granting the requested authorization. This project was included in
Eastern Shore's January 2017 rate
case filing. The estimated annual gross margin associated with this
project, assuming recovery in the 2017 rate case, is approximately
$4.5 million.
2017 Expansion Project: In May
2016, Eastern Shore submitted a request to the FERC to
initiate the FERC's pre-filing procedures for its proposed 2017
Expansion Project. The 2017 Expansion Project will provide 61,162
Dts/d of additional firm natural gas transportation service
pursuant to precedent agreements Eastern Shore entered into with
four existing customers as well as the Company's affiliates.
Facilities required to provide this new service will consist of:
(i) approximately 23 miles of pipeline looping in Pennsylvania, Maryland and Delaware; (ii) upgrades to existing metering
facilities in Lancaster County,
Pennsylvania; (iii) installation of an additional 3,550
horsepower compressor unit at Eastern Shore's existing Daleville compressor station in Chester County, Pennsylvania; and (iv)
approximately 17 miles of new mainline extension and two pressure
control stations in Sussex County,
Delaware.
In December 2016, Eastern Shore
filed its certificate of public convenience and necessity
application, requesting that the FERC approve the project in May,
2017. Assuming approval is obtained at that time, the Company
anticipates service commencing by the end of the year. The project
will generate approximately $15.7
million of gross margin in the first full year after the new
transportation services go into effect. The estimated cost of this
expansion project is $98.6
million.
Weather and Consumption
Warmer temperatures in
2016, particularly during the first quarter of the year when the
demand for natural gas and propane is normally higher, reduced
consumption and, therefore, reduced gross margin for the year ended
December 31, 2016, by $3.6 million, compared to 2015. The following
table summarizes the heating degree-days ('HDD") and cooling
degree-days ("CDD") information for the years and quarters ended
December 31, 2016 and 2015 and shows
variances between actual and "Normal" (10-year average) HDD and CDD
for those periods.
HDD and CDD
Information
|
|
|
|
|
|
|
|
|
|
|
|
|
For the Periods
Ended December 31,
|
2016
|
|
2015
|
|
Variance
|
|
Q4
2016
|
|
Q4
2015
|
|
Variance
|
Delmarva
|
|
|
|
|
|
|
|
|
|
|
|
Actual HDD
|
3,979
|
|
4,363
|
|
(384)
|
|
1,389
|
|
1,114
|
|
275
|
10-Year Average HDD
("Normal")
|
4,453
|
|
4,496
|
|
(43)
|
|
1,533
|
|
1,588
|
|
(55)
|
Variance from
Normal
|
(474)
|
|
(133)
|
|
|
|
(144)
|
|
(474)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Florida
|
|
|
|
|
|
|
|
|
|
|
|
Actual HDD
|
672
|
|
569
|
|
103
|
|
158
|
|
68
|
|
90
|
10-Year Average HDD
("Normal")
|
828
|
|
859
|
|
(31)
|
|
275
|
|
302
|
|
(27)
|
Variance from
Normal
|
(156)
|
|
(290)
|
|
|
|
(117)
|
|
(234)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ohio
|
|
|
|
|
|
|
|
|
|
|
|
Actual HDD
|
5,818
|
|
2,404
|
|
N/A(1)
|
|
2,071
|
|
1,693
|
|
378
|
10-Year Average HDD
("Normal")
|
6,078
|
|
2,903
|
|
N/A(1)
|
|
2,099
|
|
2,100
|
|
(1)
|
Variance from
Normal
|
(260)
|
|
(499)
|
|
|
|
(28)
|
|
(407)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Florida
|
|
|
|
|
|
|
|
|
|
|
|
Actual CDD
|
3,152
|
|
3,338
|
|
(186)
|
|
360
|
|
511
|
|
(151)
|
10-Year Average CDD
("Normal")
|
2,820
|
|
2,760
|
|
60
|
|
272
|
|
254
|
|
18
|
Variance from
Normal
|
332
|
|
578
|
|
|
|
88
|
|
257
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) HDD
for Ohio for 2015 is presented from April 1, 2015 through December
31, 2015, since Aspire Energy commenced operations on April 1,
2015.
|
Propane Margins
A return to more normal retail
propane margins per gallon for our Delmarva and Florida propane distribution operations
decreased gross margin by $2.8
million in 2016, of which $2.4
million is associated with the larger Delmarva Peninsula
propane distribution operation. As expected, the level of retail
margins per gallon generated during 2015 were not sustained. The
Company continues to assume more normal levels of margins in its
long-term financial plans and forecasts.
PESCO
PESCO provides natural gas supply and
services to residential, commercial, industrial and wholesale
customers. PESCO operates primarily in Florida, on the Delmarva Peninsula, and in
Ohio, competing with regulated utilities and other
unregulated third-party marketers to sell natural gas supplies
directly to commercial and industrial customers through
competitively-priced contracts. PESCO, which does not currently own
or operate any natural gas transmission or distribution assets,
sells gas that is delivered to retail or wholesale customers
through affiliated and non-affiliated local distribution company
systems and transmission pipelines.
In October 2016, the Delaware PSC
approved PESCO as Asset Manager for the Company's Delaware natural gas distribution division
under a three-year agreement, which goes into effect on
April 1, 2017, to provide gas supply
and capacity on regional pipelines and in storage facilities.
Operating revenues for PESCO were $95.4
million and $32.2 million for
the year and quarter ended December 31,
2016, respectively, compared to $56.2
million and $14.9 million for
the year and quarter ended December 31,
2015. The majority of this revenue growth was attributable
to growth in customers served and volumes sold in Florida, on the Delmarva Peninsula and in
Ohio.
Gross margin for PESCO was $4.6
million and $642,000 for the
year and quarter ended December 31,
2016, respectively, compared to $3.6
million and $660,000 for the
year and quarter ended December 31,
2015, respectively. Favorable results in 2016 from
increased customer contracts in Florida and on the Delmarva Peninsula were
offset by a $1.5 million loss
associated with a supplier agreement entered into by PESCO to
service approximately 40,000 end users on behalf of a customer,
where revenue from transported volumes was insufficient to cover
PESCO's fixed storage and pipeline fees, given the seasonality of
volumes as well as warmer temperatures. Under the contract, PESCO
pays fixed storage and pipeline fees over the entire twelve-month
period, although the projected volumes are expected to be highest
in the first quarter of 2017 followed by the fourth quarter of 2016
(contract period of April 1, 2016 -
March 31, 2017).
Operating income (loss) for PESCO was $1.9 million and $(341,000) for the year and quarter ended
December 31, 2016, respectively,
compared to $1.9 million and
$183,000 for the year and quarter
ended December 31, 2015,
respectively. PESCO experienced $1.0
million of increased operating expenses in 2016 due to
higher costs related to additional staffing.
Xeron
Xeron trades in short-term natural gas
liquids and crude oil forward and futures contracts on the
InterContinentalExchange, Inc. Xeron settles its purchases and
sales financially, without taking physical delivery of the propane
or crude oil. The level and profitability of the propane and crude
oil wholesale marketing trading activity is affected by both
propane and crude oil wholesale price volatility and liquidity in
the wholesale market.
Gross margin for Xeron was ($546,000) and ($590,000) for the year and quarter ended
December 31, 2016, respectively,
compared to gross margin of $301,000
and gross margin loss ($163,000) for
the year and quarter ended December 31,
2015, respectively. Xeron's operating loss was ($1.6 million) and ($855,000) for the year and quarter ended
December 31, 2016, respectively,
compared to an operating loss of ($765,000) and ($405,000) for the year and quarter ended
December 31, 2015,
respectively. Results in both years were impacted by
unfavorable crude oil and propane futures trading. At
December 31, 2016, Xeron did not have
any open futures or forward contracts.
Other Natural Gas Growth - Distribution
Operations
The natural gas distribution operations on
the Delmarva Peninsula generated $1.5
million and $376,000 in
additional gross margin for the year and quarter ended December 31, 2016, respectively, compared to the
same periods in 2015, due to an increase in residential, commercial
and industrial customers served over and above the growth from
service expansions. The average number of residential customers on
the Delmarva Peninsula increased by 3.6 percent in 2016 compared to
2015. The natural gas distribution operations in Florida generated $1.2
million and $418,000 in
additional gross margin for the year and quarter ended December 31, 2016, respectively, compared to the
same periods in 2015, due primarily to an increase in commercial
and industrial customers in Florida.
Regulatory Proceedings
Delaware division rate
case
In December 2016, the
Delaware PSC approved a settlement agreement related to the
Company's Delaware division rate
case filing, as recommended by the Hearing Examiner's report. The
settlement agreement, among other things, provided for an increase
in the Company's Delaware division
annual revenue requirement of $2.25
million and a rate of return on common equity of 9.75
percent. The new rates are effective for all services rendered on
or after January 1, 2017. Amounts
collected through interim rates in excess of the current portion of
the $2.25 million settlement were
accrued for refund as of December 31,
2016 and will be distributed to ratepayers beginning in the
first quarter of 2017. The accrued refund had no material effect on
results for the year ended December 31,
2016.
Eastern Shore Rate Case
In January 2017, Eastern Shore filed a base rate
proceeding with the FERC, as required by the terms of its 2012 rate
case settlement agreement. Eastern Shore's proposed rates are based
on the mainline cost of service of approximately $60 million, resulting in an overall revenue
increase of approximately $18.9
million and a rate of return on common equity of 13.75
percent. The FERC issued a notice of the filing in
January 2017, and the comment period
ended on February 8, 2017.
Fourteen parties intervened in the proceeding with six of those
parties filing protests. New rates are proposed to be effective on
March 1, 2017. However, the
FERC typically suspends the rates for a period of five
months. At the end of the suspension period, Eastern
Shore will file a motion to implement new rates effective
August 1, 2017. Eastern Shore will
respond to any comments filed.
Electric System Transformation and Reliability
program
In February, 2017, FPU's electric division filed a
petition with the Florida PSC, requesting a temporary surcharge
mechanism to recover costs, inclusive of an appropriate return on
investment, associated with an essential reliability and
modernization project on its electric distribution system. The
Company is seeking approval to invest approximately $59.8 million, over a five-year period associated
with this project. In February, 2017, the Office of Public Counsel
intervened in this petition. The outcome of the Company's petition
is not known at this time.
Chesapeake
Utilities Corporation and Subsidiaries
Condensed
Consolidated Statements of Income (Unaudited)
For the Periods
Ended December 31, 2016 and 2015
(in thousands,
except shares and per share data)
|
|
Year
Ended
|
Fourth
Quarter
|
|
2016
|
2015
|
2016
|
2015
|
Operating
Revenues
|
|
|
|
|
Regulated
Energy
|
$
|
305,689
|
$
|
301,902
|
$
|
79,059
|
$
|
66,464
|
Unregulated
Energy
|
203,778
|
162,108
|
67,417
|
38,944
|
Other businesses and
eliminations
|
(10,607)
|
(4,766)
|
(4,602)
|
(841)
|
Total Operating
Revenues
|
498,860
|
459,244
|
141,874
|
104,567
|
Operating
Expenses
|
|
|
|
Regulated energy cost
of sales
|
109,609
|
122,814
|
28,425
|
21,399
|
Unregulated energy
and other cost of sales
|
128,434
|
97,228
|
43,291
|
23,762
|
Operations
|
117,571
|
107,562
|
32,200
|
28,042
|
Maintenance
|
12,391
|
11,803
|
3,466
|
3,769
|
(Gain from a
settlement)
|
(130)
|
(1,500)
|
—
|
—
|
Depreciation
and amortization
|
32,159
|
29,972
|
8,667
|
7,817
|
Other
taxes
|
14,730
|
13,607
|
4,006
|
3,607
|
Total operating
expenses
|
414,764
|
381,486
|
120,055
|
88,396
|
Operating
Income
|
84,096
|
77,758
|
21,819
|
16,171
|
Other income
(expense)
|
(441)
|
293
|
(372)
|
297
|
Interest
charges
|
10,639
|
10,006
|
2,643
|
2,582
|
Income Before
Income Taxes
|
73,016
|
68,045
|
18,804
|
13,886
|
Income
taxes
|
28,341
|
26,905
|
6,941
|
5,267
|
Net
Income
|
$
|
44,675
|
$
|
41,140
|
$
|
11,863
|
$
|
8,619
|
|
|
|
|
|
Weighted Average
Common Shares Outstanding:
|
|
|
|
|
Basic
|
15,570,539
|
15,094,423
|
16,302,021
|
15,269,068
|
Diluted
|
15,613,091
|
15,143,373
|
16,349,110
|
15,320,587
|
|
|
|
|
|
Earnings Per Share
of Common Stock:
|
|
|
|
|
Basic
|
$
|
2.87
|
$
|
2.73
|
$
|
0.73
|
$
|
0.56
|
Diluted
|
$
|
2.86
|
$
|
2.72
|
$
|
0.73
|
$
|
0.56
|
Chesapeake
Utilities Corporation and Subsidiaries
Consolidated
Balance Sheets (Unaudited)
|
|
As of December
31,
|
Assets
|
2016
|
2015
|
(in thousands,
except shares and per share data)
|
|
|
Property,
Plant and Equipment
|
|
|
Regulated
energy
|
$
|
957,681
|
$
|
842,756
|
Unregulated
energy
|
196,800
|
145,734
|
Other
|
21,114
|
18,999
|
Total property, plant
and equipment
|
1,175,595
|
1,007,489
|
Less:
Accumulated depreciation and amortization
|
(245,207)
|
(215,313)
|
Plus:
Construction work in progress
|
56,276
|
62,774
|
Net property, plant
and equipment
|
986,664
|
854,950
|
Current
Assets
|
|
|
Cash and cash
equivalents
|
4,178
|
2,855
|
Accounts receivable
(less allowance for uncollectible accounts of $909 for 2016 and
2015)
|
62,803
|
41,007
|
Accrued
revenue
|
16,986
|
12,452
|
Propane
inventory, at average cost
|
6,457
|
6,619
|
Other
inventory, at average cost
|
4,576
|
3,803
|
Regulatory
assets
|
7,694
|
8,268
|
Storage gas
prepayments
|
5,484
|
3,410
|
Income taxes
receivable
|
22,888
|
24,950
|
Prepaid
expenses
|
6,792
|
7,146
|
Mark-to-market
energy assets
|
823
|
153
|
Other current
assets
|
2,470
|
1,044
|
Total current
assets
|
141,151
|
111,707
|
Deferred
Charges and Other Assets
|
|
|
Goodwill
|
15,070
|
14,548
|
Other
intangible assets, net
|
1,843
|
2,222
|
Investments, at
fair value
|
4,902
|
3,644
|
Regulatory
assets
|
76,803
|
77,519
|
Receivables and
other deferred charges
|
2,786
|
2,831
|
Total deferred
charges and other assets
|
101,404
|
100,764
|
Total
Assets
|
$
|
1,229,219
|
$
|
1,067,421
|
Chesapeake
Utilities Corporation and Subsidiaries
Consolidated
Balance Sheets (Unaudited)
|
|
As of December
31,
|
Capitalization and
Liabilities
|
2016
|
2015
|
(in thousands,
except shares and per share data)
|
|
|
Capitalization
|
|
|
|
|
|
Preferred stock, par
value $0.01 per share (authorized 2,000,000 shares), no shares
issued and outstanding
|
$
|
—
|
$
|
—
|
Common stock, par
value $0.4867 per share (authorized 25,000,000 shares)
|
7,935
|
7,432
|
Additional
paid-in capital
|
250,967
|
190,311
|
Retained
earnings
|
192,062
|
166,235
|
Accumulated
other comprehensive loss
|
(4,878)
|
(5,840)
|
Deferred
compensation obligation
|
2,416
|
1,883
|
Treasury
stock
|
(2,416)
|
(1,883)
|
Total
stockholders' equity
|
446,086
|
358,138
|
Long-term debt,
net of current maturities
|
136,954
|
149,006
|
Total
capitalization
|
583,040
|
507,144
|
Current
Liabilities
|
|
|
Current portion
of long-term debt
|
12,099
|
9,151
|
Short-term
borrowing
|
209,871
|
173,397
|
Accounts
payable
|
56,935
|
39,300
|
Customer
deposits and refunds
|
29,238
|
27,173
|
Accrued
interest
|
1,312
|
1,311
|
Dividends
payable
|
4,973
|
4,390
|
Accrued
compensation
|
10,496
|
10,014
|
Regulatory
liabilities
|
1,291
|
7,365
|
Mark-to-market
energy liabilities
|
773
|
433
|
Other accrued
liabilities
|
7,063
|
7,059
|
Total current
liabilities
|
334,051
|
279,593
|
Deferred
Credits and Other Liabilities
|
|
|
Deferred income
taxes
|
222,894
|
192,600
|
Regulatory
liabilities
|
43,064
|
43,064
|
Environmental
liabilities
|
8,592
|
8,942
|
Other pension and
benefit costs
|
32,828
|
33,481
|
Deferred investment
tax credits and Other liabilities
|
4,750
|
2,597
|
Total deferred
credits and other liabilities
|
312,128
|
280,684
|
Total
Capitalization and Liabilities
|
$
|
1,229,219
|
$
|
1,067,421
|
Chesapeake
Utilities Corporation and Subsidiaries
Distribution
Utility Statistical Data (Unaudited)
|
|
|
For the Three
Months Ended December 31, 2016
|
|
For the Three
Months Ended December 31, 2015
|
|
|
Delmarva
NG
Distribution
|
|
Chesapeake
Utilities'
Florida NG
Division
|
|
FPU NG
Distribution
|
|
FPU Electric
Distribution
|
|
Delmarva
NG
Distribution
|
|
Chesapeake
Utilities'
Florida NG
Division
|
|
FPU NG
Distribution
|
|
FPU Electric
Distribution
|
Operating
Revenues (in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential
|
|
$
|
12,767
|
|
$
|
1,312
|
|
$
|
7,442
|
|
$
|
9,548
|
|
$
|
10,406
|
|
$
|
1,212
|
|
$
|
5,299
|
|
$
|
9,192
|
Commercial
|
|
6,697
|
|
1,323
|
|
7,657
|
|
9,890
|
|
5,826
|
|
1,201
|
|
5,870
|
|
10,061
|
Industrial
|
|
2,146
|
|
1,666
|
|
5,185
|
|
1,343
|
|
1,835
|
|
1,444
|
|
4,051
|
|
749
|
Other
(1)
|
|
2,574
|
|
1,040
|
|
348
|
|
(2,095)
|
|
2,291
|
|
940
|
|
1,740
|
|
(3,975)
|
Total Operating
Revenues
|
|
$
|
24,184
|
|
$
|
5,341
|
|
$
|
20,632
|
|
$
|
18,686
|
|
$
|
20,358
|
|
$
|
4,797
|
|
$
|
16,960
|
|
$
|
16,027
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Volumes (in Dts
for natural gas and MWHs for electric)
|
|
|
|
|
|
|
|
|
|
|
Residential
|
|
732,491
|
|
82,560
|
|
314,989
|
|
61,963
|
|
606,758
|
|
71,945
|
|
277,250
|
|
59,298
|
Commercial
|
|
867,780
|
|
1,942,337
|
|
499,922
|
|
71,258
|
|
741,866
|
|
1,347,148
|
|
531,743
|
|
74,124
|
Industrial
|
|
1,352,489
|
|
2,600,411
|
|
1,106,017
|
|
12,230
|
|
1,244,862
|
|
2,815,222
|
|
952,282
|
|
4,660
|
Other
|
|
24,514
|
|
—
|
|
521
|
|
1,906
|
|
25,647
|
|
—
|
|
66,868
|
|
(5,815)
|
Total
|
|
2,977,274
|
|
4,625,308
|
|
1,921,449
|
|
147,357
|
|
2,619,133
|
|
4,234,315
|
|
1,828,143
|
|
132,267
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
Customers
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential
|
|
66,867
|
|
15,453
|
|
53,555
|
|
24,351
|
|
64,503
|
|
14,999
|
|
52,462
|
|
24,092
|
Commercial
|
|
6,746
|
|
1,399
|
|
4,200
|
|
7,420
|
|
6,636
|
|
1,388
|
|
4,220
|
|
7,385
|
Industrial
|
|
131
|
|
73
|
|
1,864
|
|
2
|
|
122
|
|
74
|
|
1,713
|
|
2
|
Other
|
|
6
|
|
—
|
|
—
|
|
—
|
|
4
|
|
—
|
|
—
|
|
—
|
Total
|
|
73,750
|
|
16,925
|
|
59,619
|
|
31,773
|
|
71,265
|
|
16,461
|
|
58,395
|
|
31,479
|
|
|
|
For the Year Ended
December 31, 2016
|
|
For the Year Ended
December 31, 2015
|
|
|
Delmarva
NG
Distribution
|
|
Chesapeake
Utilities'
Florida NG
Division
|
|
FPU NG
Distribution
|
|
FPU Electric
Distribution
|
|
Delmarva
NG
Distribution
|
|
Chesapeake
Utilities'
Florida NG
Division
|
|
FPU NG
Distribution
|
|
FPU Electric
Distribution
|
Operating
Revenues (in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential
|
|
$
|
49,841
|
|
|
$
|
5,289
|
|
|
$
|
28,040
|
|
|
$
|
46,459
|
|
|
$
|
63,745
|
|
|
$
|
5,000
|
|
|
$
|
22,945
|
|
|
$
|
46,686
|
|
Commercial
|
|
27,274
|
|
|
5,171
|
|
|
28,569
|
|
|
41,704
|
|
|
33,776
|
|
|
4,811
|
|
|
26,305
|
|
|
42,585
|
|
Industrial
|
|
7,420
|
|
|
6,474
|
|
|
20,583
|
|
|
3,497
|
|
|
7,214
|
|
|
5,981
|
|
|
16,007
|
|
|
3,111
|
|
Other
(1)
|
|
1,409
|
|
|
3,704
|
|
|
(2,266)
|
|
|
(7,505)
|
|
|
(1,175)
|
|
|
3,215
|
|
|
2,297
|
|
|
(12,954)
|
|
Total Operating
Revenues
|
|
$
|
85,944
|
|
|
$
|
20,638
|
|
|
$
|
74,926
|
|
|
$
|
84,155
|
|
|
$
|
103,560
|
|
|
$
|
19,007
|
|
|
$
|
67,554
|
|
|
$
|
79,428
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Volumes (in Dts
for natural gas and MWHs for electric)
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential
|
|
3,227,594
|
|
|
342,964
|
|
|
1,308,906
|
|
|
303,654
|
|
|
3,734,888
|
|
|
327,218
|
|
|
1,247,820
|
|
|
303,642
|
|
Commercial
|
|
3,407,184
|
|
|
6,060,468
|
|
|
2,133,842
|
|
|
304,458
|
|
|
3,696,839
|
|
|
5,416,714
|
|
|
2,417,819
|
|
|
313,757
|
|
Industrial
|
|
5,032,872
|
|
|
11,005,835
|
|
|
4,290,371
|
|
|
29,700
|
|
|
4,617,183
|
|
|
11,002,944
|
|
|
3,987,899
|
|
|
18,880
|
|
Other
|
|
92,807
|
|
|
—
|
|
|
—
|
|
|
8,484
|
|
|
82,655
|
|
|
—
|
|
|
(84,763)
|
|
|
(1,740)
|
|
Total
|
|
11,760,457
|
|
|
17,409,267
|
|
|
7,733,119
|
|
|
646,296
|
|
|
12,131,565
|
|
|
16,746,876
|
|
|
7,568,775
|
|
|
634,539
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average
Customers
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Residential
|
|
66,175
|
|
|
15,340
|
|
|
53,300
|
|
|
24,289
|
|
|
63,901
|
|
|
14,854
|
|
|
52,046
|
|
|
24,039
|
|
Commercial
|
|
6,746
|
|
|
1,393
|
|
|
4,236
|
|
|
7,404
|
|
|
6,637
|
|
|
1,360
|
|
|
4,249
|
|
|
7,389
|
|
Industrial
|
|
125
|
|
|
73
|
|
|
1,786
|
|
|
2
|
|
|
118
|
|
|
69
|
|
|
1,633
|
|
|
2
|
|
Other
|
|
5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
5
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Total
|
|
73,051
|
|
|
16,806
|
|
|
59,322
|
|
|
31,695
|
|
|
70,661
|
|
|
16,283
|
|
|
57,928
|
|
|
31,430
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1)
Operating Revenues from "Other" sources include unbilled revenue,
under (over) recoveries of fuel cost, conservation revenue, other
miscellaneous charges, fees for
billing services provided to third parties and adjustments for
pass-through taxes.
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/chesapeake-utilities-strong-2016-performance-marks-tenth-straight-year-of-record-earnings-300414519.html
SOURCE Chesapeake Utilities Corporation