BROOKLYN UNION GAS REPORTS 1992 EARNINGS
BROOKLYN UNION GAS REPORTS 1992 EARNINGS BROOKLYN, N.Y., Oct. 28 /PRNewswire/ -- Brooklyn Union Gas
(NYSE: BU) today announced financial results for its fiscal year ended Sept. 30, 1992. Consolidated earnings in fiscal 1992 were $2.02 per share, reflecting a write-down by a subsidiary, compared to $2.18 per share in fiscal 1991. Without the write-down of 46 cents per share, consolidated earnings would have been $2.48 per share in fiscal 1992.
Utility operations performed well in fiscal 1992, contributing $2.39 per share, compared to $2.12 per share in fiscal 1991. The company exceeded its allowed rate of return on utility common equity, set at 11.7 percent by the New York State Public Service Commission (PSC). By arrangement with the PSC, the company is permitted to retain 35 percent of the earnings above the allowed rate of return of 11.7 percent. The remaining 65 percent is refunded to customers. As a result, the rate of return on utility common equity was 12.2 percent, adjusted for sharing and other incentives. Robert B. Catell, president and chief executive officer, said, "Despite warm weather and the continual effects of an economic recession, 1992 was a year in which we were successful in meeting most of our financial and growth objectives. In
addition, the three-year agreement reached with the PSC in October 1991 provides for the allowed rate of return to increase to 11.9 percent in fiscal 1993 and to 12.1 percent in fiscal 1994. The sharing and incentive features continue to apply, providing an opportunity for continued improvement."
Despite the continuing recession, Brooklyn Union achieved a sales- growth rate, normalized for weather, of 3 percent in fiscal 1992, reflecting our strong commitment to growth through customer satisfaction. Weather in fiscal 1992, though warmer than normal, was not as warm as last year, and the weather-normalization adjustment in the company's tariff was fully effective this year in mitigating the impact on sales. Subsidiaries As previously reported, consolidated results were affected by a non- cash depletion charge of 46 cents per share recorded in March by Fuel Resources Inc. (FRI), the company's exploration-and-production subsidiary, to reflect the effect of unusually low gas prices in that quarter on the valuation of its proved gas reserves. Without the depletion charge, FRI contributed 16 cents per share in fiscal 1992. Moreover, income from cogeneration businesses and the Iroquois pipeline project reduced the loss incurred by Star Gas Corporation, the propane- distribution company in which a Brooklyn Union subsidiary holds a 45 percent interest. On the whole, subsidiaries contributed 9 cents per share to consolidated earnings, excluding the depletion charge recorded last March, compared with 6 cents in 1991. In 1992, FRI increased its proved gas-reserve base in North America, largely as a result of the acquisition of Solex Energy Corporation, an oil-and-gas company headquartered in Alberta, Canada. FRI is now geographically diversified and is well-positioned to be more profitable as gas prices move higher and production increases. Brooklyn Union Gas distributes natural gas in the New York City boroughs of Brooklyn and Staten Island and in two-thirds of the borough of Queens, a territory of 187 square miles with a population of 4,000,000. Through subsidiary and affiliated companies, Brooklyn Union is involved in oil-and-gas exploration and marketing, cogeneration projects, pipeline projects and propane distribution in the United States and Canada. BROOKLYN UNION GAS COMPANY Consolidated Summary of Earnings (in thousands of dollars) Periods ended Three Months Fiscal Year Sept. 30 1992 1991 1992 1991 Operating revenues $147,804 $126,773 $1,074,860 $990,509 Cost of gas 53,276 42,509 402,137 373,048 Net revenues 94,528 84,264 672,723 617,461 Operating and maintenance 90,460 80,026 333,984 316,141 Depreciation and depletion 13,956 10,719 73,930 42,715 General taxes 22,719 25,665 135,549 136,419 Federal income tax (credit) (13,956) (14,388) 30,812 26,690 Operating income (loss) (a) (18,651) (17,758) 98,448 95,496 Other income (666) 407 3,487 6,775 Income (loss) before interest charges (19,317) (17,351) 101,935 102,271 Interest charges 11,077 8,837 42,062 40,462 Net income (loss) (30,394) (26,188) 59,873 61,809 Dividends on preferred stock 93 956 2,078 3,847 Income (loss) applicable to common stock (30,487) (27,144) 57,795 57,962 Per share of common stock (1.06) (.97) 2.02 2.18 Other information Capital Expenditures 47,567 44,829 173,467 147,745 Firm gas sales(10,000 therms or MDTH) 13,035 11,691 122,476 108,694 Degree days 57 60 4,659 3,971 Warmer than normal(pct) -- -- 4.0 19.0 Average common shares (000) 28,889 28,104 28,588 26,596 (a) The fourth quarter is unprofitable due to the seasonal nature of gas heating sales. -0- 10/28/92 /CONTACT: Jan C. Childress, manager-investor relations of Brooklyn Union Gas, 718-403-3382, or fax, 718-852-8221/ (BU) CO: Brooklyn Union Gas ST: New York IN: UTI SU: ERN
LR-AH -- NY040 -- 6131 10/28/92 15:00 EST
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|Date:||Oct 28, 1992|
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