Cap Rock Energy Reports Third Quarter Earnings for 2004
November 23 2004 - 4:47PM
PR Newswire (US)
Cap Rock Energy Reports Third Quarter Earnings for 2004 MIDLAND,
Texas, Nov. 23 /PRNewswire-FirstCall/ -- Cap Rock Energy
Corporation (AMEX:RKE) reported net income for the third quarter of
2004 of $848,000, or $0.54 per common share, diluted, as compared
to $4,638,000, or $2.86 per common share, diluted, for the same
period in 2003. Detailed below are unaudited financial highlights
for Cap Rock Energy Corporation and subsidiaries for the three and
nine months ended September 30, 2004 and 2003: Cap Rock Energy
Corporation (unaudited) ($ in thousands except share and per share
amounts) Three Months Ended Nine Months Ended September 30,
September 30, 2004 2003 2004 2003 Operating revenues $22,352
$23,343 $65,507 $64,937 Operating income 1,338 6,747 10,810 16,555
Net Income 848 4,638 5,939 10,304 Earnings per share: Basic $0.56
$2.96 $3.82 $7.41 Diluted $0.54 $2.86 $3.69 $7.13 Weighted average
shares of Common stock outstanding: Basic 1,527,857 1,568,498
1,553,072 1,390,636 Diluted 1,584,172 1,623,796 1,609,387 1,445,934
The consumption and demand for electricity within the Company's
service areas can be greatly impacted by weather conditions and
temperatures. Weather conditions and the cost of fuel used to
generate electricity are the major factors affecting operating
expenses. Purchased power expense normally moves in relation to
electric demand and consumption. Power cost recovery revenues
increased by $827,000 and $4,091,000, respectively, for the
comparative three and nine month periods. This was offset by a
decrease in revenue accruals of $1,240,000 and $3,477,000, for the
same periods, especially as it related to the change in accounting
principle for the first quarter of 2003. The 2003 periods also
reflect recognition of a regulatory surcharge of $954,000 and
$1,428,000 respectively, which related to recovery of intervention
costs incurred in a prior CCN proceeding. There was also an
increase in kWh sales for the 2004 periods of $133,000 and
$1,119,000. The conclusion of the rate making treatment of the
capital lease payments associated with the transmission system in
2003 caused a decrease of $451,000 and $3,556,000 in purchased
power expense for the comparative three and nine month periods in
2004. Power costs and consumer consumption caused an increase of
$281,000 and $2,349,000 in purchased power expense. Fuel cost
related to the regulatory liability because of an overcollection of
power cost recovery caused an increase in expenses of $3,074,000
for the 2004 periods. The expensing of noncash stock awards to
officers and directors caused a decrease of $547,000 for the
comparative three month periods, but an increase of $1,100,000 for
the nine month comparative periods. Increased costs for the 2004
periods of $534,000 and $1,201,000 related to IT support and
outsourced IT functions associated with the new fully integrated
utility software application. The net increase in interest expense
is due to the interest on the new short-term note payable in the
2004 periods, and extinguishment of a note payable to a bank in
September 2003 thus causing a decrease for the 2004 periods.
Depreciation and amortization also increased for the 2004 periods
because: (1) amortization of the fees and costs related to the
short-term note payable; (2) amortization of the costs associated
with implementation of the new fully integrated software
application; (3) conclusion of the rate making treatment in
September 2003 of the amortization of property and equipment
associated with the transmission system capital lease causing more
of an increase for 2004 because those costs were shown in purchased
power expense in the 2003 periods; and (4) amortization of the fees
and costs associated with the original transmission system capital
lease in 2003 causing more of an increase for 2004. Cap Rock Energy
provides electric distribution services to over 35,000 meters in 28
counties in Texas. Its corporate office is located in Midland,
Texas, with service divisions in Stanton, Colorado City, Brady and
Celeste, Texas. The Company also provides management services to
the Farmersville Municipal Electric System. The Company's
predecessor, Cap Rock Electric Cooperative, Inc., was incorporated
as an electric cooperative in the State of Texas in 1939. All
statements, other than statements of historical fact included in
this news release are forward looking statements as that term is
defined in the Private Securities Litigation Reform Act of 1995.
Any such forward looking statements involve risks and uncertainties
and actual results, performance or achievements of Cap Rock Energy
may be different from those expressed or implied in the forward
looking statements. DATASOURCE: Cap Rock Energy Corporation
CONTACT: Valerie Newsom of Cap Rock Energy Corporation,
+1-432-684-0301, or
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