Pennsylvania Enterprises Inc. Releases 1998 Financial Report; Weather Main Contributor to Lower Earnings

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Pennsylvania Enterprises Inc. Releases 1998 Financial Report; Weather Main Contributor to Lower Earnings
    WILKES-BARRE, Pa., Feb. 17 /PRNewswire/ -- Pennsylvania Enterprises, Inc.
(PEI) (NYSE: PNT) today reported basic and diluted earnings, before discount
(premium) on the repurchase or redemption of subsidiary's preferred stock, of
$.75 per share of common stock for 1998, a decrease from $1.22 per share in
1997.
    The Company cited one of the warmest years on record for pushing 1998 net
income down $4.3 million or 36.5 percent from the $11.8 million reported for
1997.
    For PEI's principal subsidiary, PG Energy, the abnormally warm weather
caused a $7.0 million operating margin decrease.
    PEI's non-regulated operations had a combined revenue increase of
$11.1 million (29.6 percent) over 1997 revenues.
    The effects of last year's warm weather are magnified due to the Company's
strong performance in 1997.  A year ago, PEI reported that basic and diluted
earnings per share had increased 155 percent over 1996.  Heating degree days
in 1997 totaled 6,498, or 1,202 (18.5 percent) more than 1998.
    "While PG Energy was able to mitigate the weather's impact somewhat
through reduced operating and maintenance expenses, we could not overcome the
full effect of one of the warmest winters in the last 100 years," said Thomas
F. Karam, President and CEO of PEI.
    "This past year underscores the need for PEI to continue our efforts to
become less weather sensitive in our core businesses," Mr. Karam said.  To
this end, Mr. Karam cited the revenues in three areas of PEI's non-regulated
operations:
   -- PG Energy Services Inc. saw its revenues climb 36.7 percent over 1997.
       In November it entered the state's deregulated electricity market with
       some of the lowest rates in Pennsylvania.  Through last week it had
       enrolled over 17,000 residential, commercial and industrial customers.
   -- Keystone Pipeline Services, Inc., a subsidiary of PG Energy Services,
       had 1998 revenues that increased 9.2 percent over 1997.
   -- PEI Power Corp., which began generating and selling electricity in
       July, had revenues of $1.5 million.
    PEI is a holding company with regulated subsidiaries that include PG
Energy and its subsidiary, Honesdale Gas Company.  They provide natural gas to
approximately 152,200 customers in 13 counties in northeastern and central
Pennsylvania.  The non-regulated group consists of PEI Power Corporation,
Theta Land Corporation, PG Energy Services which also trades as PG Energy
PowerPlus, and Keystone Pipeline Services, Inc.  PG Energy PowerPlus also
markets home and business security and safety systems and Custom Care, a
service contract for gas-fired heating equipment and appliances.
    PEI news releases are available 24 hours a day by fax or by visiting the
Company website at http://www.pnt.com.  To receive a faxed copy of this news release,
call 1-800-758-5804 on a touch-tone phone and use PEI's ID # 684209.  Company
news will be faxed to you immediately without charge.

                        PENNSYLVANIA ENTERPRISES, INC.
                       SUMMARY OF REVENUES AND EARNINGS

                                  Three Months Ended    Twelve Months Ended
                                       December 31            December 31
                                    1998        1997       1998       1997
                                   (In thousands, except per share amounts)
    OPERATING REVENUES:
    Energy products and services -
      Regulated                   $53,537     $61,108    $158,724   $190,533
      Nonregulated                 11,139       8,288      36,393     26,303
    Pipeline construction
     and services                   2,996       3,086      12,215     11,210
        Total operating
         revenues                 $67,672     $72,482    $207,332   $228,046

    NET INCOME                     $5,073      $5,994      $7,510    $11,830

    COMMON STOCK
      BASIC EARNINGS PER SHARE
       OF COMMON STOCK:
        Before discount/(premium)
         on repurchase/redemption
         of subsidiary's preferred
         stock.                     $0.49       $0.62       $0.75      $1.22
        Discount/(premium) on
         repurchase/redemption
         of subsidiary's preferred
         stock.                     (0.10)         --       (0.10)      0.08
           Net income               $0.39       $0.62       $0.65      $1.30

      DILUTED EARNINGS PER SHARE
       OF COMMON STOCK:
        Before discount/(premium)
         on repurchase/redemption
         of subsidiary's preferred
         stock.                     $0.49       $0.61       $0.75      $1.22
        Discount/(premium) on
         repurchase/redemption
         of subsidiary's preferred
         stock.                     (0.10)         --       (0.10)      0.08
           Net income               $0.39       $0.61       $0.65      $1.30

    WEIGHTED AVERAGE NUMBER OF
     SHARES OUTSTANDING
       Basic                   10,264,554   9,714,374   9,996,586  9,661,056

       Diluted                 10,334,017   9,808,990  10,076,273  9,735,809
SOURCE Pennsylvania Enterprises, Inc.
http://www.pnt.com
Company News On-Call:
http://www.prnewswire.com/comp/684209.html or fax,
800-758-5804, ext. 684209
CONTACT:
John J. Hambrose of Pennsylvania Enterprises,
570-829-8756