LAS VEGAS, March 14 /PRNewswire-FirstCall/ -- Southwest Gas Corporation
(NYSE: SWX) announced consolidated earnings of $1.61 per basic share for 2004,
a $0.47 per share increase from the $1.14 per basic share earned in 2003.
Consolidated net income for 2004 was $56.8 million, compared to $38.5 million
during 2003.
According to Jeffrey W. Shaw, Chief Executive Officer, "2004 showed solid
improvement in the Company's earnings. Rate relief in California and Nevada,
a return to more normal weather patterns, record customer growth, and a
stellar contribution from our pipeline construction subsidiary combined to
favorably impact results. As we move forward in 2005, we will continue our
focus on seizing prudent customer growth opportunities, seeking rate relief
that provides an adequate revenue stream, and encouraging rate design that
mitigates the impact of usage variations on customers and shareholders."
Shaw noted that "NPL Construction Co., a wholly owned subsidiary, achieved
record net income of $8.4 million during 2004, compared to $4.3 million in
2003 due to profitable bid work, increased workload under existing contracts,
and a positive equipment resale market. However, given the cyclical nature of
the construction business, achieving similar results in 2005 will likely be
challenging."
During the fourth quarter of 2004, consolidated net income was
$40.4 million, or $1.12 per basic share, versus $34.5 million, or $1.01 per
basic share, for the fourth quarter of 2003.
Natural Gas Operations Segment Results
Full Year 2004
Operating margin, defined as operating revenues less the cost of gas sold,
increased $64 million in 2004 as compared to 2003. A return to more normal
temperatures in 2004 from the warm temperatures experienced in 2003 resulted
in a $25 million increase in margin between years. Rate relief in California
and Nevada provided $18 million. A record 82,000 customers were added during
2004, a growth rate of five percent. This marked the fifth time in ten years
the Company reported record growth. New customers contributed $21 million in
incremental margin.
Operating expenses increased $35 million, or eight percent, in 2004
reflecting general increases in labor and maintenance costs, and incremental
operating costs associated with serving additional customers. Additional
factors include increases in insurance premiums, employee-related costs, and
costs to develop energy efficient technology.
Net financing costs rose $2.8 million, or three percent, between periods
primarily due to an increase in average debt outstanding to help finance
growth, partially offset by a reduction in interest costs associated with the
purchased gas adjustment account balance.
Fourth Quarter
Operating margin increased approximately $22 million over the fourth
quarter of 2003 consisting of customer growth ($6 million), rate relief
($7 million), and improved weather conditions ($9 million). Operating
expenses increased $7.4 million, or seven percent, reflecting general cost
increases and incremental costs associated with continuing customer growth.
Net financing costs increased $2.8 million principally due to an increase in
outstanding debt.
Southwest Gas Corporation provides natural gas service to
1,613,000 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, changes in natural gas prices, the ability to recover
costs through the PGA mechanism, the effects of regulation/deregulation, the
timing and amount of rate relief, changes in rate design, changes in gas
procurement practices, changes in capital requirements and funding, the impact
of conditions in the capital markets on financing costs, changes in
construction expenditures and financing, changes in operations and maintenance
expenses, future liability claims, changes in pipeline capacity for the
transportation of gas and related costs, acquisitions and management's plans
related thereto, competition, and the ability to raise capital in external
financings. In addition, the Company can provide no assurance that its
discussions regarding certain trends relating to its financing, operations,
and maintenance expenses will continue in future periods.
SOUTHWEST GAS CONSOLIDATED EARNINGS DIGEST
(In thousands, except per share amounts)
YEAR ENDED DECEMBER 31, 2004 2003
Consolidated Operating Revenues $1,477,060 $1,231,004
Net Income $56,775 $38,502
Average Number of Common Shares Outstanding 35,204 33,760
Basic Earnings Per Share $1.61 $1.14
Diluted Earnings Per Share $1.60 $1.13
QUARTER ENDED DECEMBER 31,
Consolidated Operating Revenues $460,496 $351,705
Net Income $40,446 $34,474
Average Number of Common Shares Outstanding 36,239 34,077
Basic Earnings Per Share $1.12 $1.01
Diluted Earnings Per Share $1.11 $1.00
SOURCE Southwest Gas Corporation
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Related links:
http://www.swgas.com
CONTACT:
Media, Robyn Clayton, +1-702-364-3297, or
Shareholder Contact, Ken Kenny, +1-702-876-7237, both for
Southwest Gas Corporation
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