Empire District reports profit on electric service growth

Empire District Electric Co. had a 58 percent increase in profit in the second quarter, largely fueled by higher electric rates.

Consolidated net income for the second quarter was $7.6 million, or 22 cents per share, up from $4.8 million, or 14 cents per share, in the same period a year ago, the publicly traded Joplin-based utility (NYSE: EDE) reported July 23.

Electric revenues were up 2.1 percent, or $2.1 million, over second-quarter 2008. Electric rate increases, primarily from the company's Missouri jurisdiction, were responsible for a $6.4 million increase in electric revenues, and weather and customer growth accounted for another $600,000 in gains; the increases were partly offset by a $4.7 million decline in off-system sales.

Gas revenues fell by $1.2 million, resulting in a second-quarter loss of $750,000, compared to a $648,000 loss a year ago.

Total interest charges for the quarter grew by $600,000, primarily reflecting interest on $75 million of first mortgage bonds issued in March. The issuance, combined with the $90 million in first mortgage bonds in May 2008, increased the company's long-term debt interest by $2.1 million for the quarter.

In June, Empire District Electric filed a request with the Missouri Public Service Commission to increase gas segment annual revenues by 4.9 percent, or $2.9 million, as well as add three energy-efficiency programs. The increase would result in an approximately $4.83 hike in a residential customer's monthly bill.

Also during the second quarter, a severe storm classified as an inland hurricane occurred in Empire's service area in May. Incremental expenditures from the storm totaled about $6.4 million. Of those costs, $5.7 million was capitalized because of the nature of the restoration efforts; the remaining $700,000 has been recorded as a regulatory asset that the company expects to recover in future rate cases.

Empire District on July 23 declared a quarterly dividend of 32 cents per share, payable Sept. 15 to shareholders of record as of Sept. 1.

Company shares closed Friday at $18.35, compared to a 52-week range of $11.92 to $23.48.[[In-content Ad]]