UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D. C. 20549
FORM 10-Q
(Mark One)
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x
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended September 30, 2011
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OR
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o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the transition period from _______________ to _______________
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Commission
File Number
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Registrant, State of Incorporation
Address and Telephone Number
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IRS Employer
Identification No.
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0-30512
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CH Energy Group, Inc.
(Incorporated in New York)
284 South Avenue
Poughkeepsie, New York 12601-4839
(845) 452-2000
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14-1804460
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1-3268
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Central Hudson Gas & Electric Corporation
(Incorporated in New York)
284 South Avenue
Poughkeepsie, New York 12601-4839
(845) 452-2000
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14-0555980
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Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrants were required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.
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CH Energy Group, Inc.
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Yes þ
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No o
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Central Hudson Gas & Electric Corporation
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Yes þ
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No o
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Indicate by check mark whether the Registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).
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CH Energy Group, Inc.
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Yes þ
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No o
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Central Hudson Gas & Electric Corporation
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Yes þ
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No o
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Indicate by check mark whether the Registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):
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CH Energy Group, Inc.
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Central Hudson Gas & Electric Corporation
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Large Accelerated Filer þ
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Large Accelerated Filer o
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Accelerated Filer o
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Accelerated Filer o
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Non-Accelerated Filer o
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Non-Accelerated Filer þ
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Smaller Reporting Company o
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Smaller Reporting Company o
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Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act):
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CH Energy Group, Inc.
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Yes o
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No þ
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Central Hudson Gas & Electric Corporation
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Yes o
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No þ
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As of the close of business on October 31, 2011 (i) CH Energy Group, Inc. had outstanding 14,888,149 shares of Common Stock ($0.10 per share par value) and (ii) all of the outstanding 16,862,087 shares of Common Stock ($5 per share par value) of Central Hudson Gas & Electric Corporation were held by CH Energy Group, Inc.
CENTRAL HUDSON GAS & ELECTRIC CORPORATION MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTIONS (H)(1)(a) AND (b) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH THE REDUCED DISCLOSURE FORMAT PURSUANT TO GENERAL INSTRUCTIONS (H)(2)(a), (b) AND (c).
FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 2011
TABLE OF CONTENTS
PART I – FINANCIAL INFORMATION
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CH Energy Group, Inc.
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PAGE
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Three and Nine Months Ended September 30, 2011 and 2010
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1
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Three and Nine Months Ended September 30, 2011 and 2010
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2
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Nine Months Ended September 30, 2011 and 2010
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3
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September 30, 2011, December 31, 2010 and September 30, 2010
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4
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Nine Months Ended September 30, 2011 and 2010
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6
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Central Hudson Gas & Electric Corporation
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Three and Nine Months Ended September 30, 2011 and 2010
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7
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Three and Nine Months Ended September 30, 2011 and 2010
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7
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Nine Months Ended September 30, 2011 and 2010
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8
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September 30, 2011, December 31, 2010 and September 30, 2010
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9
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Nine Months Ended September 30, 2011 and 2010
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11
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TABLE OF CONTENTS
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PAGE
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Management’s Discussion and Analysis of Financial Condition and Results of Operations
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57
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Quantitative and Qualitative Disclosure About Market Risk
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89
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Controls and Procedures
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89
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PART II – OTHER INFORMATION
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Legal Proceedings
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89
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Risk Factors
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89
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| ITEM 2 | Unregistered Sales of Equity Securities and Use of Proceeds | 90 |
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Exhibits
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90
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91
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92
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_______________________________________________
FILING FORMAT
This Quarterly Report on Form 10-Q is a combined quarterly report being filed by two different registrants: CH Energy Group, Inc. (“CH Energy Group”) and Central Hudson Gas & Electric Corporation (“Central Hudson”), a wholly owned subsidiary of CH Energy Group. Except where the content clearly indicates otherwise, any reference in this report to CH Energy Group includes all subsidiaries of CH Energy Group, including Central Hudson. Central Hudson makes no representation as to the information contained in this report in relation to CH Energy Group and its subsidiaries other than Central Hudson.
(In Thousands, except per share amounts)
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Three Months Ended
September 30,
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Nine Months Ended
September 30,
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||||||||||||||
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2011
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2010
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2011
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2010
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Operating Revenues
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Electric
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$ | 149,706 | $ | 165,304 | $ | 418,511 | $ | 436,362 | ||||||||
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Natural gas
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18,462 | 18,823 | 127,941 | 120,371 | ||||||||||||
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Competitive business subsidiaries:
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Petroleum products
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47,951 | 34,429 | 194,612 | 151,767 | ||||||||||||
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Other
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4,936 | 5,101 | 14,630 | 14,942 | ||||||||||||
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Total Operating Revenues
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221,055 | 223,657 | 755,694 | 723,442 | ||||||||||||
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Operating Expenses
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Operation:
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Purchased electricity and fuel used in electric generation
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60,734 | 76,890 | 168,797 | 196,413 | ||||||||||||
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Purchased natural gas
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6,337 | 7,217 | 63,425 | 59,619 | ||||||||||||
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Purchased petroleum
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43,564 | 30,268 | 167,558 | 125,352 | ||||||||||||
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Other expenses of operation - regulated activities
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55,480 | 58,495 | 181,460 | 166,389 | ||||||||||||
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Other expenses of operation - competitive business subsidiaries
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10,997 | 11,080 | 34,870 | 35,223 | ||||||||||||
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Depreciation and amortization
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10,180 | 9,766 | 30,599 | 29,049 | ||||||||||||
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Taxes, other than income tax
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11,760 | 11,243 | 36,687 | 32,626 | ||||||||||||
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Total Operating Expenses
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199,052 | 204,959 | 683,396 | 644,671 | ||||||||||||
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Operating Income
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22,003 | 18,698 | 72,298 | 78,771 | ||||||||||||
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Other Income and Deductions
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Income from unconsolidated affiliates
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25 | (95 | ) | 644 | (393 | ) | ||||||||||
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Interest on regulatory assets and other interest income
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1,226 | 853 | 4,673 | 3,487 | ||||||||||||
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Impairment of Investments
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(3,582 | ) | (11,408 | ) | (3,582 | ) | (11,408 | ) | ||||||||
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Regulatory adjustments for interest costs
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319 | (427 | ) | 1,032 | (675 | ) | ||||||||||
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Business development costs
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(529 | ) | (216 | ) | (1,027 | ) | (1,018 | ) | ||||||||
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Other - net
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154 | (86 | ) | (887 | ) | (119 | ) | |||||||||
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Total Other Income (Deductions)
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(2,387 | ) | (11,379 | ) | 853 | (10,126 | ) | |||||||||
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Interest Charges
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Interest on long-term debt
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6,620 | 5,591 | 20,090 | 16,848 | ||||||||||||
| Penalty for early retirement of debt | 2,982 | - | 2,982 | - | ||||||||||||
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Interest on regulatory liabilities and other interest
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1,553 | 1,288 | 4,568 | 4,439 | ||||||||||||
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Total Interest Charges
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11,155 | 6,879 | 27,640 | 21,287 | ||||||||||||
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Income before income taxes, non-controlling interest and preferred dividends of subsidiary
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8,461 | 440 | 45,511 | 47,358 | ||||||||||||
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Income Taxes (Benefit)
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3,550 | (1,360 | ) | 17,213 | 17,278 | |||||||||||
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Net Income from Continuing Operations
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4,911 | 1,800 | 28,298 | 30,080 | ||||||||||||
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Discontinued Operations
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Income (loss) from discontinued operations before tax
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(10 | ) | 393 | 1,149 | (1,167 | ) | ||||||||||
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Gain from sale of discontinued operations
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2,070 | - | 841 | - | ||||||||||||
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Income tax (benefit) expense from discontinued operations
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(1,599 | ) | 60 | (1,669 | ) | (524 | ) | |||||||||
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Net Income (loss) from Discontinued Operations
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3,659 | 333 | 3,659 | (643 | ) | |||||||||||
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Net Income
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8,570 | 2,133 | 31,957 | 29,437 | ||||||||||||
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Net Income (loss) attributable to non-controlling interest:
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Non-controlling interest in subsidiary
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- | 112 | - | (272 | ) | |||||||||||
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Dividends declared on Preferred Stock of subsidiary
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242 | 242 | 727 | 727 | ||||||||||||
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Net income attributable to CH Energy Group
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8,328 | 1,779 | 31,230 | 28,982 | ||||||||||||
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Dividends declared on Common Stock
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8,263 | 8,545 | 25,021 | 25,629 | ||||||||||||
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Change in Retained Earnings
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$ | 65 | $ | (6,766 | ) | $ | 6,209 | $ | 3,353 | |||||||
The Notes to Financial Statements are an integral part hereof.
- 1 -
CH ENERGY GROUP CONSOLIDATED STATEMENT OF INCOME (CONT'D) (UNAUDITED)
(In Thousands, except per share amounts)
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Three Months Ended
September 30,
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Nine Months Ended
September 30,
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2011
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2010
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2011
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2010
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Common Stock:
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Average shares outstanding - Basic
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15,126 | 15,790 | 15,416 | 15,783 | ||||||||||||
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Average shares outstanding - Diluted
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15,314 | 15,952 | 15,604 | 15,954 | ||||||||||||
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Income from continuing operations attributable to CH Energy Group common shareholders
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Earnings per share - Basic
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$ | 0.31 | $ | 0.09 | $ | 1.79 | $ | 1.88 | ||||||||
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Earnings per share - Diluted
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$ | 0.30 | $ | 0.09 | $ | 1.77 | $ | 1.86 | ||||||||
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Income (loss) from discontinued operations attributable to CH Energy Group common shareholders
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Earnings per share - Basic
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$ | 0.24 | $ | 0.02 | $ | 0.24 | $ | (0.04 | ) | |||||||
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Earnings per share - Diluted
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$ | 0.24 | $ | 0.02 | $ | 0.23 | $ | (0.04 | ) | |||||||
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Amounts attributable to CH Energy Group common shareholders
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Earnings per share - Basic
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$ | 0.55 | $ | 0.11 | $ | 2.03 | $ | 1.84 | ||||||||
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Earnings per share - Diluted
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$ | 0.54 | $ | 0.11 | $ | 2.00 | $ | 1.82 | ||||||||
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Dividends Declared Per Share
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$ | 0.56 | $ | 0.54 | $ | 1.64 | $ | 1.62 | ||||||||
(In Thousands)
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Three Months Ended
September 30,
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Nine Months Ended
September 30,
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2011
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2010
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2011
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2010
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Net Income
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$ | 8,570 | $ | 2,133 | $ | 31,957 | $ | 29,437 | ||||||||
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Other Comprehensive Income:
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Fair value of cash flow hedges:
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Unrealized (loss)/gains - net of tax of $0 and $0 in 2011 and $0 and ($13) in 2010, respectively
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- | - | - | 19 | ||||||||||||
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Reclassification for gains realized in net income - net of tax of $0 and $0 in 2011 and $0 and $35 in 2010, respectively
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- | - | - | (52 | ) | |||||||||||
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Net unrealized gains/(losses) recorded from investments held by equity method investees - net of tax of ($37) and ($10) in 2011 and ($7) and ($78) in 2010, respectively
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56 | 10 | 15 | 117 | ||||||||||||
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Other comprehensive income
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56 | 10 | 15 | 84 | ||||||||||||
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Comprehensive Income
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8,626 | 2,143 | 31,972 | 29,521 | ||||||||||||
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Comprehensive income attributable to non-controlling interest
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242 | 354 | 727 | 455 | ||||||||||||
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Comprehensive income attributable to CH Energy Group
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$ | 8,384 | $ | 1,789 | $ | 31,245 | $ | 29,066 | ||||||||
The Notes to Financial Statements are an integral part hereof.
(In Thousands)
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Nine Months Ended
September 30,
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2011
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2010
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Operating Activities:
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Net income
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$ | 31,957 | $ | 29,437 | ||||
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Adjustments to reconcile net income to net cash provided by operating activities:
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Depreciation
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28,614 | 27,055 | ||||||
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Amortization
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3,120 | 2,907 | ||||||
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Deferred income taxes - net
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15,061 | 25,618 | ||||||
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Bad debt expense
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6,049 | 2,410 | ||||||
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Impairment of investments
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3,582 | 11,408 | ||||||
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Distributed (undistributed) equity in earnings of unconsolidated affiliates
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(644 | ) | 756 | |||||
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Pension expense
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20,725 | 22,728 | ||||||
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Other post-employment benefits ("OPEB") expense
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5,203 | 4,883 | ||||||
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Regulatory liability - rate moderation
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(7,849 | ) | (14,019 | ) | ||||
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Revenue decoupling mechanism recorded
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4,956 | (1,568 | ) | |||||
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Regulatory asset amortization
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3,524 | 3,451 | ||||||
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(Gain) loss on sale of assets
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(897 | ) | 11 | |||||
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Changes in operating assets and liabilities - net of business acquisitions:
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Accounts receivable, unbilled revenues and other receivables
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2,380 | 6,546 | ||||||
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Fuel, materials and supplies
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(843 | ) | (2,298 | ) | ||||
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Special deposits and prepayments
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2,779 | 211 | ||||||
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Income and other taxes
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(1,773 | ) | (10,772 | ) | ||||
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Accounts payable
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(18,092 | ) | (4,279 | ) | ||||
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Accrued interest
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1,566 | 218 | ||||||
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Customer advances
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(508 | ) | (3,640 | ) | ||||
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Pension plan contribution
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(32,536 | ) | (31,854 | ) | ||||
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OPEB contribution
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(1,184 | ) | (4,275 | ) | ||||
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Revenue decoupling mechanism collected
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2,388 | 4,271 | ||||||
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Regulatory asset - storm deferral
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(3,441 | ) | (16,720 | ) | ||||
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Regulatory asset - manufactured gas plant ("MGP") site remediation
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3,761 | (10,802 | ) | |||||
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Regulatory asset - Temporary State Assessment
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(2,169 | ) | (3,112 | ) | ||||
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Deferred natural gas and electric costs
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22,164 | 5,052 | ||||||
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Other - net
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6,895 | 7,655 | ||||||
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Net cash provided by operating activities
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94,788 | 51,278 | ||||||
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Investing Activities:
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Proceeds from sale of assets
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42,234 | 40 | ||||||
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Additions to utility and other property and plant
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(61,755 | ) | (75,771 | ) | ||||
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Acquisitions made by competitive business subsidiaries
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(2,255 | ) | (749 | ) | ||||
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Proceeds from federal grants
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14,744 | - | ||||||
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Other - net
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(3,022 | ) | (3,910 | ) | ||||
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Net cash used in investing activities
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(10,054 | ) | (80,390 | ) | ||||
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Financing Activities:
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Redemption of long-term debt
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(20,464 | ) | (24,000 | ) | ||||
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Proceeds from issuance of long-term debt
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33,400 | 40,000 | ||||||
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Borrowings of short-term debt - net
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5,000 | - | ||||||
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Dividends paid on Common Stock
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(25,290 | ) | (25,619 | ) | ||||
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Dividends paid on Preferred Stock of subsidiary
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(727 | ) | (727 | ) | ||||
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Shares repurchased
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(48,612 | ) | - | |||||
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Other - net
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(647 | ) | (293 | ) | ||||
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Net cash used in financing activities
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(57,340 | ) | (10,639 | ) | ||||
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Net Change in Cash and Cash Equivalents
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27,394 | (39,751 | ) | |||||
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Cash and Cash Equivalents at Beginning of Period
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29,420 | 73,436 | ||||||
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Cash and Cash Equivalents at End of Period
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$ | 56,814 | $ | 33,685 | ||||
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Supplemental Disclosure of Cash Flow Information:
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Interest paid
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$ | 22,276 | $ | 17,189 | ||||
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Federal and state taxes paid
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$ | 17,150 | $ | 21,208 | ||||
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Additions to plant included in liabilities
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$ | 3,997 | $ | 2,685 | ||||
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Regulatory asset - storm deferral costs in liabilities
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$ | 9,396 | $ | 2,648 | ||||
The Notes to Financial Statements are an integral part hereof.
- 3 -
(In Thousands)
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September 30,
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December 31,
|
September 30,
|
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2011
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2010
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2010
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ASSETS
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Utility Plant
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Electric
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$ | 988,319 | $ | 963,261 | $ | 945,139 | ||||||
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Natural gas
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301,989 | 292,358 | 288,052 | |||||||||
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Common
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142,201 | 142,255 | 143,918 | |||||||||
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Gross Utility Plant
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1,432,509 | 1,397,874 | 1,377,109 | |||||||||
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Less: Accumulated depreciation
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385,198 | 395,776 | 393,514 | |||||||||
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Net
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1,047,311 | 1,002,098 | 983,595 | |||||||||
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Construction work in progress
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63,996 | 52,607 | 55,468 | |||||||||
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Net Utility Plant
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1,111,307 | 1,054,705 | 1,039,063 | |||||||||
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Non-Utility Property & Plant
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Griffith non-utility property & plant
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30,795 | 29,881 | 29,177 | |||||||||
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Other non-utility property & plant
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6,181 | 64,059 | 62,488 | |||||||||
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Gross Non-Utility Property & Plant
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36,976 | 93,940 | 91,665 | |||||||||
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Less: Accumulated depreciation - Griffith
|
21,656 | 20,519 | 20,071 | |||||||||
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Less: Accumulated depreciation - other
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1,121 | 5,108 | 4,576 | |||||||||
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Net Non-Utility Property & Plant
|
14,199 | 68,313 | 67,018 | |||||||||
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Current Assets
|
||||||||||||
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Cash and cash equivalents
|
56,814 | 29,420 | 33,685 | |||||||||
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Accounts receivable from customers - net of allowance for doubtful accounts of $6.5 million, $6.7 million and $7.0 million, respectively
|
90,155 | 99,402 | 84,091 | |||||||||
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Accrued unbilled utility revenues
|
11,320 | 16,233 | 10,862 | |||||||||
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Other receivables
|
8,618 | 8,006 | 7,686 | |||||||||
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Fuel, materials and supplies
|
25,530 | 25,447 | 27,182 | |||||||||
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Regulatory assets
|
43,407 | 89,905 | 106,607 | |||||||||
|
Income tax receivable
|
2,822 | 2,802 | 47,819 | |||||||||
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Fair value of derivative instruments
|
42 | 146 | 86 | |||||||||
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Special deposits and prepayments
|
19,836 | 22,869 | 21,149 | |||||||||
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Accumulated deferred income tax
|
12,956 | - | - | |||||||||
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Total Current Assets
|
271,500 | 294,230 | 339,167 | |||||||||
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|
||||||||||||
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Deferred Charges and Other Assets
|
||||||||||||
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Regulatory assets - pension plan
|
121,238 | 142,647 | 144,781 | |||||||||
|
Regulatory assets - other
|
105,899 | 90,264 | 79,571 | |||||||||
|
Goodwill
|
36,538 | 35,940 | 35,956 | |||||||||
|
Other intangible assets - net
|
12,682 | 12,867 | 13,431 | |||||||||
|
Unamortized debt expense
|
5,017 | 4,774 | 5,092 | |||||||||
|
Investments in unconsolidated affiliates
|
3,043 | 6,681 | 6,656 | |||||||||
|
Other investments
|
14,422 | 12,883 | 12,052 | |||||||||
|
Other
|
6,175 | 5,971 | 7,193 | |||||||||
|
Total Deferred Charges and Other Assets
|
305,014 | 312,027 | 304,732 | |||||||||
|
Total Assets
|
$ | 1,702,020 | $ | 1,729,275 | $ | 1,749,980 | ||||||
The Notes to Financial Statements are an integral part hereof.
- 4 -
CH ENERGY GROUP CONSOLIDATED BALANCE SHEET (CONT'D) (UNAUDITED)
(In Thousands)
|
|
September 30,
|
December 31,
|
September 30,
|
|||||||||
|
|
2011
|
2010
|
2010
|
|||||||||
|
CAPITALIZATION AND LIABILITIES
|
|
|
|
|||||||||
|
Capitalization
|
|
|
|
|||||||||
|
CH Energy Group Common Shareholders' Equity
|
|
|
|
|||||||||
|
Common Stock (30,000,000 shares authorized: $0.10 par value; 16,862,087 shares issued) 14,885,037 shares, 15,799,262 shares and 15,823,926 shares outstanding, respectively
|
$ | 1,686 | $ | 1,686 | $ | 1,686 | ||||||
|
Paid-in capital
|
350,693 | 350,360 | 350,444 | |||||||||
|
Retained earnings
|
236,551 | 230,342 | 229,352 | |||||||||
|
Treasury stock - 1,977,050 shares, 1,062,825 shares and 1,038,161 shares, respectively
|
(93,210 | ) | (44,887 | ) | (43,652 | ) | ||||||
|
Accumulated other comprehensive income
|
474 | 459 | 268 | |||||||||
|
Capital stock expense
|
(328 | ) | (328 | ) | (328 | ) | ||||||
|
Total CH Energy Group Common Shareholders' Equity
|
495,866 | 537,632 | 537,770 | |||||||||
|
Non-controlling interest in subsidiary
|
- | 172 | 1,113 | |||||||||
|
Total Equity
|
495,866 | 537,804 | 538,883 | |||||||||
|
Preferred Stock of subsidiary
|
21,027 | 21,027 | 21,027 | |||||||||
|
Long-term debt
|
446,466 | 502,959 | 503,900 | |||||||||
|
Total Capitalization
|
963,359 | 1,061,790 | 1,063,810 | |||||||||
|
Current Liabilities
|
||||||||||||
|
Current maturities of long-term debt
|
70,373 | 941 | - | |||||||||
|
Notes payable
|
5,000 | - | - | |||||||||
|
Accounts payable
|
47,915 | 57,059 | 42,252 | |||||||||
|
Accrued interest
|
7,964 | 6,398 | 6,285 | |||||||||
|
Dividends payable
|
8,505 | 8,774 | 8,787 | |||||||||
|
Accrued vacation and payroll
|
6,956 | 6,663 | 6,676 | |||||||||
|
Customer advances
|
18,801 | 19,309 | 18,810 | |||||||||
|
Customer deposits
|
6,651 | 7,727 | 7,982 | |||||||||
|
Regulatory liabilities
|
12,444 | 18,596 | 16,461 | |||||||||
|
Fair value of derivative instruments
|
12,778 | 13,183 | 35,184 | |||||||||
|
Accrued environmental remediation costs
|
5,227 | 2,233 | 5,593 | |||||||||
|
Deferred revenues
|
3,699 | 4,650 | 3,723 | |||||||||
|
Accumulated deferred income tax
|
- | 9,634 | 9,109 | |||||||||
|
Other
|
14,565 | 18,961 | 14,553 | |||||||||
|
Total Current Liabilities
|
220,878 | 174,128 | 175,415 | |||||||||
|
Deferred Credits and Other Liabilities
|
||||||||||||
|
Regulatory liabilities - OPEB
|
12,038 | 6,976 | 4,936 | |||||||||
|
Regulatory liabilities - other
|
110,280 | 99,793 | 99,395 | |||||||||
|
Operating reserves
|
3,414 | 3,187 | 3,938 | |||||||||
|
Fair value of derivative instruments
|
3,193 | 11,698 | - | |||||||||
|
Accrued environmental remediation costs
|
11,937 | 4,312 | 3,468 | |||||||||
|
Accrued OPEB costs
|
46,426 | 45,367 | 45,367 | |||||||||
|
Accrued pension costs
|
76,414 | 102,555 | 128,379 | |||||||||
|
Tax reserve
|
9,668 | 11,486 | 8,322 | |||||||||
|
Other
|
18,831 | 16,967 | 16,034 | |||||||||
|
Total Deferred Credits and Other Liabilities
|
292,201 | 302,341 | 309,839 | |||||||||
|
Accumulated Deferred Income Tax
|
225,582 | 191,016 | 200,916 | |||||||||
|
Commitments and Contingencies
|
||||||||||||
|
Total Capitalization and Liabilities
|
$ | 1,702,020 | $ | 1,729,275 | $ | 1,749,980 | ||||||
The Notes to Financial Statements are an integral part hereof.
- 5 -
(In Thousands, except share amounts)
|
|
CH Energy Group Common Shareholders
|
|
|
|||||||||||||||||||||||||||||||||||||
|
|
Common Stock
|
Treasury Stock
|
|
|
|
|
|
|
||||||||||||||||||||||||||||||||
|
|
Shares Issued
|
Amount
|
Shares Repurchased
|
Amount
|
Paid-In Capital
|
Capital Stock Expense
|
Retained Earnings
|
Accumulated Other Comprehensive Income / (Loss)
|
Non-controlling Interest
|
Total Equity
|
||||||||||||||||||||||||||||||
|
Balance at December 31, 2009
|
16,862,087 | $ | 1,686 | (1,057,525 | ) | $ | (44,406 | ) | $ | 350,367 | $ | (328 | ) | $ | 225,999 | $ | 184 | $ | 1,385 | $ | 534,887 | |||||||||||||||||||
|
Comprehensive income:
|
||||||||||||||||||||||||||||||||||||||||
|
Net income
|
29,709 | (272 | ) | 29,437 | ||||||||||||||||||||||||||||||||||||
|
Dividends declared on Preferred Stock of subsidiary
|
(727 | ) | (727 | ) | ||||||||||||||||||||||||||||||||||||
|
Change in fair value:
|
||||||||||||||||||||||||||||||||||||||||
|
Derivative instruments
|
19 | 19 | ||||||||||||||||||||||||||||||||||||||
|
Investments
|
117 | 117 | ||||||||||||||||||||||||||||||||||||||
|
Reclassification adjustments for gains recognized in net income
|
(52 | ) | (52 | ) | ||||||||||||||||||||||||||||||||||||
|
Dividends declared on common stock
|
(25,629 | ) | (25,629 | ) | ||||||||||||||||||||||||||||||||||||
|
Treasury shares activity - net
|
19,364 | 754 | 77 | 831 | ||||||||||||||||||||||||||||||||||||
|
Balance at September 30, 2010
|
16,862,087 | $ | 1,686 | (1,038,161 | ) | $ | (43,652 | ) | $ | 350,444 | $ | (328 | ) | $ | 229,352 | $ | 268 | $ | 1,113 | $ | 538,883 | |||||||||||||||||||
|
|
||||||||||||||||||||||||||||||||||||||||
|
Balance at December 31, 2010
|
16,862,087 | $ | 1,686 | (1,062,825 | ) | $ | (44,887 | ) | $ | 350,360 | $ | (328 | ) | $ | 230,342 | $ | 459 | $ | 172 | $ | 537,804 | |||||||||||||||||||
|
Comprehensive income:
|
||||||||||||||||||||||||||||||||||||||||
|
Net income
|
31,957 | 31,957 | ||||||||||||||||||||||||||||||||||||||
|
Dividends declared on Preferred Stock of subsidiary
|
(727 | ) | (727 | ) | ||||||||||||||||||||||||||||||||||||
|
Sale of majority owned subsidiary
|
(172 | ) | (172 | ) | ||||||||||||||||||||||||||||||||||||
|
Change in fair value:
|
||||||||||||||||||||||||||||||||||||||||
|
Investments
|
15 | 15 | ||||||||||||||||||||||||||||||||||||||
|
Dividends declared on common stock
|
(25,021 | ) | (25,021 | ) | ||||||||||||||||||||||||||||||||||||
|
Treasury shares activity - net
|
(914,225 | ) | (48,323 | ) | 333 | (47,990 | ) | |||||||||||||||||||||||||||||||||
|
Balance at September 30, 2011
|
16,862,087 | $ | 1,686 | (1,977,050 | ) | $ | (93,210 | ) | $ | 350,693 | $ | (328 | ) | $ | 236,551 | $ | 474 | $ | - | $ | 495,866 | |||||||||||||||||||
The Notes to Financial Statements are an integral part hereof.
- 6 -
(In Thousands)
|
|
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
||||||||||||||
|
|
2011
|
2010
|
2011
|
2010
|
||||||||||||
|
Operating Revenues
|
|
|
|
|
||||||||||||
|
Electric
|
$ | 149,706 | $ | 165,304 | $ | 418,511 | $ | 436,362 | ||||||||
|
Natural gas
|
18,462 | 18,823 | 127,941 | 120,371 | ||||||||||||
|
Total Operating Revenues
|
168,168 | 184,127 | 546,452 | 556,733 | ||||||||||||
|
|
||||||||||||||||
|
Operating Expenses
|
||||||||||||||||
|
Operation:
|
||||||||||||||||
|
Purchased electricity and fuel used in electric generation
|
60,734 | 76,890 | 168,796 | 196,413 | ||||||||||||
|
Purchased natural gas
|
6,337 | 7,217 | 63,425 | 59,619 | ||||||||||||
|
Other expenses of operation
|
55,480 | 58,495 | 181,460 | 166,389 | ||||||||||||
|
Depreciation and amortization
|
8,909 | 8,526 | 26,791 | 25,362 | ||||||||||||
|
Taxes, other than income tax
|
11,644 | 11,142 | 36,303 | 32,255 | ||||||||||||
|
Total Operating Expenses
|
143,104 | 162,270 | 476,775 | 480,038 | ||||||||||||
|
|
||||||||||||||||
|
Operating Income
|
25,064 | 21,857 | 69,677 | 76,695 | ||||||||||||
|
|
||||||||||||||||
|
Other Income and Deductions
|
||||||||||||||||
|
Interest on regulatory assets and other interest income
|
1,209 | 853 | 4,646 | 3,486 | ||||||||||||
|
Regulatory adjustments for interest costs
|
319 | (427 | ) | 1,032 | (675 | ) | ||||||||||
|
Other - net
|
327 | (168 | ) | (636 | ) | (206 | ) | |||||||||
|
Total Other Income
|
1,855 | 258 | 5,042 | 2,605 | ||||||||||||
|
|
||||||||||||||||
|
Interest Charges
|
||||||||||||||||
|
Interest on long-term debt
|
5,872 | 4,785 | 17,668 | 14,371 | ||||||||||||
|
Interest on regulatory liabilities and other interest
|
1,529 | 1,279 | 4,517 | 4,430 | ||||||||||||
|
Total Interest Charges
|
7,401 | 6,064 | 22,185 | 18,801 | ||||||||||||
|
|
||||||||||||||||
|
Income Before Income Taxes
|
19,518 | 16,051 | 52,534 | 60,499 | ||||||||||||
|
|
||||||||||||||||
|
Income Taxes
|
7,853 | 6,311 | 20,858 | 24,125 | ||||||||||||
|
|
||||||||||||||||
|
Net Income
|
11,665 | 9,740 | 31,676 | 36,374 | ||||||||||||
|
|
||||||||||||||||
|
Dividends Declared on Cumulative Preferred Stock
|
242 | 242 | 727 | 727 | ||||||||||||
|
|
||||||||||||||||
|
Income Available for Common Stock
|
$ | 11,423 | $ | 9,498 | $ | 30,949 | $ | 35,647 | ||||||||
|
|
Three Months Ended
September 30,
|
Nine Months Ended
September 30,
|
||||||||||||||
|
|
2011
|
2010
|
2011
|
2010
|
||||||||||||
|
Net Income
|
$ | 11,665 | $ | 9,740 | $ | 31,676 | $ | 36,374 | ||||||||
|
Other Comprehensive Income
|
- | - | - | - | ||||||||||||
|
Comprehensive Income
|
$ | 11,665 | $ | 9,740 | $ | 31,676 | $ | 36,374 | ||||||||
The Notes to Financial Statements are an integral part hereof.
- 7 -
(In Thousands)
|
|
Nine Months Ended
September 30,
|
|||||||
|
|
2011
|
2010
|
||||||
|
Operating Activities:
|
|
|
||||||
|
Net income
|
$ | 31,676 | $ | 36,374 | ||||
|
Adjustments to reconcile net income to net cash provided by operating activities:
|
||||||||
|
Depreciation
|
25,463 | 24,159 | ||||||
|
Amortization
|
1,328 | 1,203 | ||||||
|
Deferred income taxes - net
|
19,975 | 19,490 | ||||||
|
Bad debt expense
|
5,075 | 1,835 | ||||||
|
Pension expense
|
20,725 | 22,728 | ||||||
|
OPEB expense
|
5,203 | 5,344 | ||||||
|
Regulatory liability - rate moderation
|
(7,849 | ) | (14,019 | ) | ||||
|
Revenue decoupling mechanism recorded
|
4,956 | (1,568 | ) | |||||
|
Regulatory asset amortization
|
3,524 | 3,451 | ||||||
|
Changes in operating assets and liabilities - net:
|
||||||||
|
Accounts receivable, unbilled revenues and other receivables
|
1,690 | (1,646 | ) | |||||
|
Fuel, materials and supplies
|
(2,550 | ) | (3,100 | ) | ||||
|
Special deposits and prepayments
|
1,563 | 1,997 | ||||||
|
Income and other taxes
|
(682 | ) | 4,425 | |||||
|
Accounts payable
|
(10,420 | ) | 1,507 | |||||
|
Accrued interest
|
1,346 | (617 | ) | |||||
|
Customer advances
|
(3,597 | ) | (4,554 | ) | ||||
|
Pension plan contribution
|
(32,536 | ) | (31,854 | ) | ||||
|
OPEB contribution
|
(1,184 | ) | (4,275 | ) | ||||
|
Revenue decoupling mechanism collected
|
2,388 | 4,271 | ||||||
|
Regulatory asset - storm deferral
|
(3,441 | ) | (16,720 | ) | ||||
|
Regulatory asset - MGP site remediation
|
3,761 | (10,802 | ) | |||||
|
Regulatory asset - Temporary State Assessment
|
(2,169 | ) | (3,112 | ) | ||||
|
Deferred natural gas and electric costs
|
22,164 | 5,052 | ||||||
|
Other - net
|
10,658 | 11,971 | ||||||
|
Net cash provided by operating activities
|
97,067 | 51,540 | ||||||
|
|
||||||||
|
Investing Activities:
|
||||||||
|
Additions to utility plant
|
(57,434 | ) | (49,424 | ) | ||||
|
Other - net
|
(3,705 | ) | (3,964 | ) | ||||
|
Net cash used in investing activities
|
(61,139 | ) | (53,388 | ) | ||||
|
|
||||||||
|
Financing Activities:
|
||||||||
|
Redemption of long-term debt
|
- | (24,000 | ) | |||||
|
Proceeds from issuance of long-term debt
|
33,400 | 40,000 | ||||||
|
Dividends paid to parent - CH Energy Group
|
(33,000 | ) | - | |||||
|
Dividends paid on cumulative Preferred Stock
|
(727 | ) | (727 | ) | ||||
|
Other - net
|
(647 | ) | (294 | ) | ||||
|
Net cash (used in) provided by financing activities
|
(974 | ) | 14,979 | |||||
|
|
||||||||
|
Net Change in Cash and Cash Equivalents
|
34,954 | 13,131 | ||||||
|
Cash and Cash Equivalents - Beginning of Period
|
9,622 | 4,784 | ||||||
|
Cash and Cash Equivalents - End of Period
|
$ | 44,576 | $ | 17,915 | ||||
|
|
||||||||
|
Supplemental Disclosure of Cash Flow Information:
|
||||||||
|
Interest paid
|
$ | 17,036 | $ | 15,416 | ||||
|
Federal and state taxes paid
|
$ | 16,113 | $ | 15,656 | ||||
|
Additions to plant included in liabilities
|
$ | 3,997 | $ | 2,183 | ||||
|
Regulatory asset - storm deferral costs in liabilities
|
$ | 9,396 | $ | 2,648 | ||||
The Notes to Financial Statements are an integral part hereof.
- 8 -
(In Thousands)
|
|
September 30,
|
December 31,
|
September 30,
|
|||||||||
|
|
2011
|
2010
|
2010
|
|||||||||
|
ASSETS
|
|
|
|
|||||||||
|
Utility Plant
|
|
|
|
|||||||||
|
Electric
|
$ | 988,319 | $ | 963,261 | $ | 945,139 | ||||||
|
Natural gas
|
301,989 | 292,358 | 288,052 | |||||||||
|
Common
|
142,201 | 142,255 | 143,918 | |||||||||
|
Gross Utility Plant
|
1,432,509 | 1,397,874 | 1,377,109 | |||||||||
|
|
||||||||||||
|
Less: Accumulated depreciation
|
385,198 | 395,776 | 393,514 | |||||||||
|
Net
|
1,047,311 | 1,002,098 | 983,595 | |||||||||
|
|
||||||||||||
|
Construction work in progress
|
63,996 | 52,607 | 55,468 | |||||||||
|
Net Utility Plant
|
1,111,307 | 1,054,705 | 1,039,063 | |||||||||
|
|
||||||||||||
|
Non-Utility Property and Plant
|
681 | 681 | 681 | |||||||||
|
Less: Accumulated depreciation
|
36 | 35 | 34 | |||||||||
|
Net Non-Utility Property and Plant
|
645 | 646 | 647 | |||||||||
|
|
||||||||||||
|
Current Assets
|
< | |||||||||||