Unitil Corporation (NYSE: UTL) (unitil.com) today announced Net
Income of $24.1 million, or $1.51 in Earnings Per Share (EPS), for
the quarter ended March 31, 2023, an increase of $2.6 million in
Net Income, or $0.16 in EPS, compared to the same period in 2022.
The Company’s Electric and Gas GAAP Gross Margins were $20.3
million and $44.8 million, respectively, for the first quarter of
2023.
“We continue to deliver on our commitments to stakeholders with
strong operational and financial performance in the first quarter,”
said Thomas P. Meissner, Jr., Unitil’s Chairman and Chief Executive
Officer. “Our accelerated dividend growth, successful response to
multiple winter storms, and investments in sustainable technologies
reflect the Company’s focus on our strategic priorities and
creating exceptional value for all stakeholders.”
Electric GAAP Gross Margin was $20.3 million in the three months
ended March 31, 2023, an increase of $2.4 million compared to the
same period in 2022. The increase was driven by higher rates of
$2.1 million and lower depreciation and amortization expense of
$0.3 million.
Electric Adjusted Gross Margin (a non-GAAP financial measure1)
was $26.7 million in the first quarter of 2023, an increase of $2.1
million compared to the same period in 2022. This increase reflects
higher rates.
Electric kilowatt-hour (kWh) sales decreased 4.7% in the three
month period ended March 31, 2023, compared to the same period in
2022. Sales to Residential and Commercial and Industrial (C&I)
customers decreased 6.0% and 3.7%, respectively, in the three month
period ended March 31, 2023, compared to the same period in 2022,
reflecting warmer winter weather in 2023 compared to 2022 and lower
average usage, partially offset by customer growth. As of March 31,
2023, the number of electric customers increased by approximately
250 over the previous year.
______________________1 The accompanying Supplemental
Information more fully describes the non-GAAP financial measures
used in this press release and includes a reconciliation of the
non-GAAP financial measures to the financial measures that the
Company’s management believes are the most comparable GAAP
financial measures. The Supplemental Information also includes a
discussion of the changes in the most comparable GAAP financial
measures for the periods presented.______________________
Gas GAAP Gross Margin was $44.8 million in the first quarter of
2023, an increase of $1.3 million compared to the same period in
2022. The increase was driven by higher rates and customer growth
of $4.0 million, partially offset by the unfavorable effects of
warmer winter weather in 2023 of $1.1 million and higher
depreciation and amortization of $1.6 million.
Gas Adjusted Gross Margin (a non-GAAP financial measure1) was
$54.9 million in the first quarter of 2023, an increase of $2.9
million compared to the same period in 2022, driven by higher rates
and customer growth of $4.0 million, partially offset by the
unfavorable effects of warmer winter weather in 2023 of $1.1
million.
Gas therm sales decreased 7.6% in the three month period ended
March 31, 2023, compared to the same period in 2022. In the first
quarter of 2023, sales to Residential and C&I customers
decreased 9.9% and 6.8%, respectively, compared to the same period
in 2022, reflecting warmer winter weather in 2023 compared to 2022,
partially offset by customer growth. Based on weather data
collected in the Company’s gas service areas, on average there were
10.6% fewer Effective Degree Days (EDD) in the first quarter of
2023 compared to the same period in 2022. The Company estimates
weather-normalized gas therm sales, excluding decoupled sales,
increased 0.6% in the first three months of 2023 compared to the
same period in 2022. As of March 31, 2023, the number of gas
customers increased by approximately 800 over the previous
year.
Operation and Maintenance (O&M) expenses decreased $0.4
million in the three months ended March 31, 2023, compared to the
same period in 2022. The decrease reflects lower labor costs and
professional fees of $0.6 million, partially offset by higher
utility operating costs of $0.2 million. The lower labor costs
primarily reflect lower restricted stock compensation.
Depreciation and Amortization expense increased $1.2 million in
the three months ended March 31, 2023, respectively, compared to
the same period in 2022, reflecting additional depreciation
associated with higher levels of utility plant in service and
higher amortization of rate case and other deferred costs.
Taxes Other Than Income Taxes increased $0.5 million in the
three months ended March 31, 2023, compared to the same period in
2022, reflecting higher local property taxes on higher utility
plant in service and higher payroll taxes.
Other Expense (Income), Net decreased $0.7 million in the three
months ended March 31, 2023 compared to the same period in 2022,
reflecting lower retirement benefit costs.
Interest Expense, Net increased $0.9 million in the three months
ended March 31, 2023, compared to the same period in 2022,
primarily reflecting higher interest expense on short-term
borrowings, partially offset by lower interest expense on long-term
debt and higher interest income on regulatory assets.
Federal and State Income Taxes increased $0.9 million for the
three months ended March 31, 2023 compared to the same period in
2022, reflecting higher pre-tax earnings in 2023.
At its January 2023 and April 2023 meetings, the Unitil
Corporation Board of Directors declared quarterly dividends on the
Company’s common stock of $0.405 per share. These quarterly
dividends result in a current effective annualized dividend rate of
$1.62 per share, representing an unbroken record of quarterly
dividend payments since trading began in Unitil’s common stock.
The Company’s earnings are seasonal and are typically higher in
the first and fourth quarters when customers use natural gas for
heating purposes.
The Company will hold a quarterly conference call to discuss
first quarter 2023 results on Tuesday, May 2, 2023, at 10:00 a.m.
Eastern Time. This call is being webcast. This call, financial and
other statistical information contained in the Company’s
presentation on this call, and information required by Regulation G
regarding non-GAAP financial measures can be accessed in the
Investor Relations section of Unitil’s website, unitil.com.
About Unitil Corporation
Unitil Corporation provides energy for life by safely and
reliably delivering electricity and natural gas in New England. We
are committed to the communities we serve and to developing people,
business practices, and technologies that lead to the delivery of
dependable, more efficient energy. Unitil Corporation is a public
utility holding company with operations in Maine, New Hampshire and
Massachusetts. Together, Unitil’s operating utilities serve
approximately 108,100 electric customers and 87,500 natural gas
customers. For more information about our people, technologies, and
community involvement please visit unitil.com.
Forward-Looking Statements
This press release may contain forward-looking statements. All
statements, other than statements of historical fact, included in
this press release are forward-looking statements. Forward-looking
statements include declarations regarding Unitil’s beliefs and
current expectations. These forward-looking statements are subject
to the inherent risks and uncertainties in predicting future
results and conditions that could cause the actual results to
differ materially from those projected in these forward-looking
statements. Some, but not all, of the risks and uncertainties
include the following: Unitil’s regulatory environment (including
regulations relating to climate change, greenhouse gas emissions
and other environmental matters); fluctuations in the supply of,
the demand for, and the prices of, energy commodities and
transmission and transportation capacity and Unitil’s ability to
recover energy commodity costs in its rates; customers’ preferred
energy sources; severe storms and Unitil’s ability to recover storm
costs in its rates; general economic conditions; variations in
weather; long-term global climate change; unforeseen or changing
circumstances, which could adversely affect the reduction of
company-wide direct greenhouse gas emissions; Unitil’s ability to
retain its existing customers and attract new customers; increased
competition; and other risks detailed in Unitil's filings with the
Securities and Exchange Commission. These forward
looking statements speak only as of the date they are made. Unitil
undertakes no obligation, and does not intend, to update these
forward-looking statements except as required by law.
For more information please contact:
Todd Diggins – Investor RelationsPhone: 603-773-6504Email:
diggins@unitil.com |
|
Alec O’Meara – External AffairsPhone: 603-773-6404Email:
omeara@unitil.com |
|
|
|
Supplemental Information; Non-GAAP Financial Measures
The Company analyzes operating results using Electric and Gas
Adjusted Gross Margins, which are non-GAAP financial measures.
Electric Adjusted Gross Margin is calculated as Total Electric
Operating Revenue less Cost of Electric Sales. Gas Adjusted Gross
Margin is calculated as Total Gas Operating Revenues less Cost of
Gas Sales. The Company’s management believes Electric and Gas
Adjusted Gross Margins provide useful information to investors
regarding profitability. Also, the Company’s management believes
Electric and Gas Adjusted Gross Margins are important measures to
analyze revenue from the Company’s ongoing operations because the
approved cost of electric and gas sales are tracked, reconciled and
passed through directly to customers in electric and gas tariff
rates, resulting in an equal and offsetting amount reflected in
Total Electric and Gas Operating Revenue.
In the following tables the Company has reconciled Electric and
Gas Adjusted Gross Margin to GAAP Gross Margin, which we believe to
be the most comparable GAAP financial measure. GAAP Gross Margin is
calculated as Revenue less Cost of Sales, and Depreciation and
Amortization. The Company calculates Electric and Gas Adjusted
Gross Margin as Revenue less Cost of Sales. The Company believes
excluding Depreciation and Amortization, which are period costs and
not related to volumetric sales, is a meaningful measure to inform
investors of the Company’s profitability from electric and gas
sales in the period.
Three Months Ended March 31, 2023 ($
millions) |
|
|
|
|
|
|
Electric |
Gas |
Other |
Total |
Total Operating Revenue |
$ |
108.2 |
|
$ |
112.0 |
|
$ |
--- |
|
$ |
220.2 |
|
Less:
Cost of Sales |
|
(81.5 |
) |
|
(57.1 |
) |
|
--- |
|
|
(138.6 |
) |
Less:
Depreciation and Amortization |
|
(6.4 |
) |
|
(10.1 |
) |
|
(0.2 |
) |
|
(16.7 |
) |
GAAP Gross Margin |
|
20.3 |
|
|
44.8 |
|
|
(0.2 |
) |
|
64.9 |
|
Depreciation and Amortization |
|
6.4 |
|
|
10.1 |
|
|
0.2 |
|
|
16.7 |
|
Adjusted Gross Margin |
$ |
26.7 |
|
$ |
54.9 |
|
$ |
--- |
|
$ |
81.6 |
|
Three Months Ended March 31, 2022 ($
millions) |
|
|
|
|
|
|
Electric |
Gas |
Other |
Total |
Total Operating Revenue |
$ |
89.2 |
|
$ |
103.4 |
|
$ |
--- |
|
$ |
192.6 |
|
Less:
Cost of Sales |
|
(64.6 |
) |
|
(51.4 |
) |
|
--- |
|
|
(116.0 |
) |
Less:
Depreciation and Amortization |
|
(6.7 |
) |
|
(8.5 |
) |
|
(0.3 |
) |
|
(15.5 |
) |
GAAP Gross Margin |
|
17.9 |
|
|
43.5 |
|
|
(0.3 |
) |
|
61.1 |
|
Depreciation and Amortization |
|
6.7 |
|
|
8.5 |
|
|
0.3 |
|
|
15.5 |
|
Adjusted Gross Margin |
$ |
24.6 |
|
$ |
52.0 |
|
$ |
--- |
|
$ |
76.6 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Selected financial data for 2023 and 2022 is presented in the
following table:
Unitil Corporation - Condensed Consolidated Financial
Data |
(Millions, except Per Share data) (Unaudited) |
|
|
Three Months Ended March 31, |
|
|
2023 |
2022 |
Change |
|
|
|
|
|
|
|
|
Electric kWh Sales: |
|
|
|
|
|
|
|
Residential |
|
|
|
181.3 |
|
|
|
192.8 |
|
|
|
(6.0 |
%) |
Commercial/Industrial |
|
|
|
228.5 |
|
|
|
237.2 |
|
|
|
(3.7 |
%) |
Total Electric kWh Sales |
|
|
|
409.8 |
|
|
|
430.0 |
|
|
|
(4.7 |
%) |
|
|
|
|
|
|
|
|
Gas Therm Sales: |
|
|
|
|
|
|
|
Residential |
|
|
|
21.9 |
|
|
|
24.3 |
|
|
|
(9.9 |
%) |
Commercial/Industrial |
|
|
|
69.4 |
|
|
|
74.5 |
|
|
|
(6.8 |
%) |
Total Gas Therm Sales |
|
|
|
91.3 |
|
|
|
98.8 |
|
|
|
(7.6 |
%) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Electric Revenues |
|
|
$ |
108.2 |
|
|
$ |
89.2 |
|
|
$ |
19.0 |
|
Cost of Electric Sales |
|
|
|
81.5 |
|
|
|
64.6 |
|
|
|
16.9 |
|
Electric Adjusted Gross Margin (a
non-GAAP financial
measure1): |
|
|
|
26.7 |
|
|
|
24.6 |
|
|
|
2.1 |
|
|
|
|
|
|
|
|
|
Gas Revenues |
|
|
|
112.0 |
|
|
|
103.4 |
|
|
|
8.6 |
|
Cost of Gas Sales |
|
|
|
57.1 |
|
|
|
51.4 |
|
|
|
5.7 |
|
Gas Adjusted Gross Margin (a non-GAAP
financial
measure1): |
|
|
|
54.9 |
|
|
|
52.0 |
|
|
|
2.9 |
|
|
|
|
|
|
|
|
|
Total Adjusted Gross Margin: (a
non-GAAP financial
measure1): |
|
|
|
81.6 |
|
|
|
76.6 |
|
|
|
5.0 |
|
|
|
|
|
|
|
|
|
Operation & Maintenance Expenses |
|
|
|
18.1 |
|
|
|
18.5 |
|
|
|
(0.4 |
) |
Depreciation & Amortization |
|
|
|
16.7 |
|
|
|
15.5 |
|
|
|
1.2 |
|
Taxes Other Than Income Taxes |
|
|
|
7.3 |
|
|
|
6.8 |
|
|
|
0.5 |
|
Other Expense (Income), Net |
|
|
|
--- |
|
|
|
0.7 |
|
|
|
(0.7 |
) |
Interest Expense, Net |
|
|
|
7.1 |
|
|
|
6.2 |
|
|
|
0.9 |
|
Income Before Income Taxes |
|
|
|
32.4 |
|
|
|
28.9 |
|
|
|
3.5 |
|
Provision for Income Taxes |
|
|
|
8.3 |
|
|
|
7.4 |
|
|
|
0.9 |
|
Net Income |
|
|
$ |
24.1 |
|
|
$ |
21.5 |
|
|
$ |
2.6 |
|
|
|
|
|
|
|
|
|
Earnings Per Share |
|
|
$ |
1.51 |
|
|
$ |
1.35 |
|
|
$ |
0.16 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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