SOURCE: Pennichuck Corporation

Pennichuck Corporation

March 03, 2010 17:29 ET

Pennichuck Corporation Announces Fourth Quarter and Full Year 2009 Earnings

MERRIMACK, NH--(Marketwire - March 3, 2010) - Pennichuck Corporation (NASDAQ: PNNW) today announced that net income for 2009 was $2.4 million, or $.55 per share (diluted), on revenues of $32.8 million. Adjusted for non-operating eminent domain-related costs which totaled $499,000, 2009 earnings would have been $.63 per share (diluted). Net income for 2008 was $4.7 million, or $1.11 per share (diluted), on revenues of $31 million. 2008 net income benefitted from a non-operating after-tax gain of $2.3 million from the sale of the Company's interests in three commercial office properties, and from lower eminent domain-related costs. Excluding the real estate gain and the eminent domain-related costs which totaled $217,000, 2008 earnings would have been $.60 per share (diluted).

The increase from $.60 per share to $.63 per share was due principally to increased water utility revenues of $1.7 million, offset in part by higher utility operating expenses of $1.0 million, lower Allowance for Funds Used During Construction ("AFUDC") of $0.3 million and lower interest income of $0.2 million. The increase in utility revenues resulted from the net effect of higher water rates granted by the New Hampshire Public Utilities Commission ("NHPUC") to the Company's Pennichuck Water and Pittsfield Aqueduct utility subsidiaries and lower water usage volumes due to the combined effects of the severe economic recession, cool and wet weather affecting peak summer usage and continued customer conservation efforts related to water saving appliances and the like. Water rates for Pennichuck Water are currently set based on 2007 usage volumes, which were substantially greater than actual usage volumes in 2008 and 2009. The increase in utility operating expenses was due principally to higher real property taxes including state utility taxes and, to a lesser extent, additional costs resulting from the change to monthly from quarterly billing.

Commenting on the results for 2009, Duane C. Montopoli, Pennichuck's President and Chief Executive Officer, said, "Considering the state of the economy, we are pleased with these results. We always work hard to minimize expenses and that was particularly important in 2009. In response to the decline in water usage volumes and the increased real property taxes, we will continue to look for opportunities to reduce expenses and will seek rate relief for Pennichuck Water in 2010 based on a 2009 test year. The rate filing will also reflect the costs associated with the additional capital improvements Pennichuck Water has made, including the last $4 million to complete the upgrade of our water treatment plant in Nashua, New Hampshire. We will also evaluate whether new rate cases should be filed for either of our other two utilities. Of course, rate relief for any of our utilities is subject to the approval of the NHPUC."

Commenting on the Company's eminent domain dispute with the city of Nashua, Mr. Montopoli added, "Regarding the pending New Hampshire Supreme Court decision, we believe we have the law on our side and we are optimistic that the outcome will be favorable. In any event, however, I am encouraged by the fact that Mayor Lozeau has not closed the door on further discussions and that she continues to believe a negotiated solution is the best way to go. Our board of directors shares that view and, regardless of the outcome of the Supreme Court appeals, we will continue to consider any and all credible acquisition proposals the city may wish to make."

Fourth quarter 2009 net income was $0.3 million, or $.07 per share (diluted), on revenues of $7.8 million. Adjusted for non-operating eminent domain-related costs which totaled $108,000, fourth quarter 2009 earnings would have been $.09 per share (diluted). Fourth quarter 2008 net income was $0.5 million, or $.12 per share (diluted), on revenues of $7.9 million. Adjusted for eminent domain costs which totaled $76,000 and for a final adjustment to the real estate gain calculation, fourth quarter 2008 earnings would have been $.14 per share (diluted). The decline from $.14 per share to $.09 per share was essentially entirely due to increased real property taxes, including state utility taxes.

The Company will host a conference call on Wednesday, March 10, 2010 at 10:00 am Eastern Time. The dial-in number is (888) 689-6812 or (970) 315-0492, Confirmation Code 56547787. Interested parties can also listen to the call over the Internet by logging on to www.pennichuck.com/investor/webcasts.php.

The Company's annual meeting of shareholders will be held at 9:00 am on Wednesday, May 5, 2010 at the Nashua Courtyard by Marriott Hotel. The Board of Directors has fixed the close of business on Friday, March 5, 2010 as the record date for the determination of shareholders entitled to notice of, and to vote at, the annual meeting.

Pennichuck Corporation is a holding company involved principally in the supply and distribution of potable water in New Hampshire through its three regulated water utilities. Its non-regulated, water-related activities include operations and maintenance contracts with municipalities and private entities in New Hampshire and Massachusetts. The Company's real estate operations are involved in the ownership, management and commercialization of real estate in southern New Hampshire.

Pennichuck Corporation's common stock trades on the Nasdaq Global Market under the symbol "PNNW." The Company's website is at www.pennichuck.com.

This news release may contain certain forward-looking statements with respect to the financial condition, results of operations and business of Pennichuck Corporation. Forward-looking statements are based on current information and expectations available to management at the time the statements are made, and are subject to various factors, risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. These factors include, but are not limited to, the results of the appeal to the New Hampshire Supreme Court of the reaffirmed eminent domain order of the New Hampshire Public Utilities Commission in favor of the City of Nashua, New Hampshire; the impact of an eminent domain taking by Nashua on business operations and net assets; legislation and/or regulation and accounting factors affecting Pennichuck Corporation's financial condition and results of operations; the availability and cost of capital, including the impact on our borrowing costs of changes in interest rates; and, the impact of weather. Investors are encouraged to access Pennichuck Corporation's annual and quarterly periodic reports filed with the Securities and Exchange Commission for financial and business information regarding Pennichuck Corporation, including a more detailed discussion of these and other risks and uncertainties that could affect Pennichuck Corporation's forward-looking statements. We undertake no obligation to update or revise publicly any forward-looking statement.

            Pennichuck Corporation and Subsidiaries
                Comparative Financial Results


Quarter Ended December 31:                            2009         2008
                                                  ------------ ------------
Operating Revenues                                $  7,824,000 $  7,857,000
Operating Income                                  $  1,407,000 $  1,903,000
Net Income                                        $    313,000 $    526,000
Earnings Per Common Share:
    Basic                                         $       0.07 $       0.12
    Diluted                                       $       0.07 $       0.12
Weighted Average Common Shares Outstanding:
    Basic                                            4,330,807    4,250,921
    Diluted                                          4,360,522    4,260,028


Full Year Ended December 31:                          2009         2008
                                                  ------------ ------------
Operating Revenues                                $ 32,772,000 $ 30,979,000
Operating Income                                  $  7,992,000 $  7,410,000
Net Income                                        $  2,382,000 $  4,721,000
Earnings Per Common Share:
    Basic                                         $       0.56 $       1.11
    Diluted                                       $       0.55 $       1.11
Weighted Average Common Shares Outstanding:
    Basic                                            4,274,174    4,240,410
    Diluted                                          4,294,013    4,266,129

Contact Information

  • For More Information, Contact:
    Thomas C. Leonard
    Senior Vice President and Chief Financial Officer
    Phone: 603-913-2300
    Fax: 603-913-2305