LAS VEGAS, Feb. 18 /PRNewswire-FirstCall/ --
Southwest Gas Corporation (NYSE: SWX) announced consolidated earnings of $1.33
per basic share for 2002, a $0.17 per share increase over the $1.16 per basic
share earned in 2001. Consolidated net income for 2002 was $44 million,
compared to $37.2 million during 2001.
(Photo: http://www.newscom.com/cgi-bin/prnh/20010823/SWXLOGO )
According to Michael O. Maffie, President and Chief Executive Officer,
"I'm pleased to report an improvement in operating results; however, I'm
disappointed in the magnitude of the increase. We did a good job of
controlling the cost side of the equation, but warm weather throughout our
service territories negatively impacted the revenue side. In Arizona, for
example, average temperatures during 2002 were some of the warmest in the last
100 years. We will continue to work with state regulators to mitigate the
impact of weather, good or bad, on our operating results."
Operating margin, defined as operating revenues less the cost of gas sold,
increased $37 million, or seven percent, in 2002 as compared to 2001. The
increase was a result of rate relief and customer growth, partially offset by
the impacts of warm weather between periods. General rate relief granted
during the fourth quarter of 2001, in both Arizona and Nevada, increased
operating margin by $33 million. The Company added 58,000 customers during
the last 12 months, an increase of four percent. New customers contributed
$20 million in incremental margin. Differences in heating demand caused by
weather variations between periods and conservation resulted in a $16 million
margin decrease. Warmer-than-normal temperatures were experienced during the
second and fourth quarters of 2002, whereas during 2001, temperatures were
relatively normal.
Operating expenses increased $23.6 million, or six percent, in 2002
reflecting general increases in labor and maintenance costs, and incremental
costs associated with servicing additional customers. During 2002, the
Company invested $264 million in its gas system. Capital expenditures are
projected to approximate $240 million during 2003.
Net financing costs declined $241,000 between periods. Strong cash flows
during the first half of 2002, from the recovery of previously deferred
purchased gas costs and general rate relief, mitigated the amount of
incremental borrowings needed to finance construction expenditures. Declining
interest rates on variable-rate debt instruments were also a contributing
favorable factor.
Other income declined $2.8 million, net of tax, principally because of
lower interest income earned on the balance of deferred purchased gas costs.
During the fourth quarter of 2002, consolidated net income was $37.8
million, or $1.14 per basic share, versus $31 million, or $0.96 per basic
share, for the fourth quarter of 2001. The current period reflected the
receipt of a $9 million, or $0.27 per basic share, after-tax settlement with
an insurance provider. The settlement reimbursed the Company for certain
costs incurred earlier during 2002 to defend and settle merger-related
litigation. Prior-period results included a $1.8 million, or $0.06 per share,
nonrecurring gain on sale of assets.
Operating margin increased $5.7 million over the fourth quarter of 2001 as
a result of customer growth and rate relief, partially offset by weather
variations between periods. Operating expenses increased $6.2 million, or six
percent, and net financing costs rose $465,000, or two percent.
Southwest Gas Corporation provides natural gas service to 1,455,000
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, customer growth rates,
natural gas prices, the effects of regulation/deregulation, the timing and
amount of rate relief, changes in gas procurement practices, changes in
capital requirements and funding, the impact of conditions in the capital
markets on financing costs, acquisitions, and competition.
SOUTHWEST GAS CONSOLIDATED EARNINGS DIGEST
(In thousands, except per share amounts)
YEAR ENDED DECEMBER 31, 2002 2001
Consolidated Operating Revenues $1,320,909 $1,396,688
Net Income $43,965 $37,156
Average Number of Common Shares Outstanding 32,953 32,122
Basic Earnings Per Share of Common Stock $1.33 $1.16
Diluted Earnings Per Share of Common Stock $1.32 $1.15
QUARTER ENDED DECEMBER 31,
Consolidated Operating Revenues $336,422 $384,136
Net Income $37,815 $30,975
Average Number of Common Shares Outstanding 33,223 32,427
Basic Earnings Per Share of Common Stock $1.14 $0.96
Diluted Earnings Per Share of Common Stock $1.13 $0.95
SOURCE Southwest Gas Corporation
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Related links:
http://www.swgas.com
Photo Notes:
NewsCom:
http://www.newscom.com/cgi-bin/prnh/20010823/SWXLOGO
AP Archive: http://photoarchive.ap.org
PRN Photo Desk, +1-888-776-6555 or +1-212-782-2840
CONTACT:
Media, Roger Buehrer, Las Vegas, NV,
+1-702-876-7132, or Shareholders, Ken Kenny, Las Vegas, NV,
+1-702-876-7237, both of Southwest Gas Corporation
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