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Southwest Gas earnings $3.14 per basic share

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Staff writer ▼ | February 28, 2014
Southwest Gas Corporation reported consolidated earnings of $3.14 per basic share for 2013, a $0.25 per share increase from the $2.89 per basic share in 2012.
Southwest Gas
Southwest GasSouthwest Gas Corporation reported consolidated earnings of $3.14 per basic share for 2013, a $0.25 per share increase from the $2.89 per basic share in 2012.


For the full year operating margin, defined as operating revenues less the net cost of gas sold, increased $22 million. Rate relief provided $8 million of the increase in operating margin (including general rate relief in Nevada and net attrition amounts in California).

New customers contributed $7 million of the increase during 2013 as approximately 28,000 net new customers were added during the last twelve months. Incremental margin from customers outside the decoupling mechanisms and other miscellaneous revenues (including amounts associated with recoveries of Arizona regulatory assets) contributed the remainder of the increase.

Operating expenses increased $26.6 million, or 4%, between years primarily due to higher general costs, employee-related costs (including pension costs), uncollectible expense, and pipeline integrity management programs.

Other contributing factors included amortization associated with the recovery of regulatory assets (including new or expanded conservation and energy efficiency programs in Nevada and Arizona), and incremental depreciation expense associated with plant additions (partially offset by lower depreciation rates in Nevada). Higher property and general taxes were also components of the increase.

Other income increased $8.1 million between 2013 and 2012 primarily due to the $5.8 million change in COLI-related income between years. In addition, Arizona non-recoverable pipe replacement costs were $2.5 million lower in 2013 as compared to 2012 because this pipe replacement activity was substantially completed in 2012.

Net interest deductions decreased $4.4 million between 2013 and 2012 primarily due to cost savings from debt refinancing, redemptions, and lower interest expense associated with deferred purchased gas adjustment (PGA) balances payable.


 

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