RGC Resources(US:RGCO)2026-02-09 21:47Revenue and Growth - Total operating revenues for the three months ended December 31, 2025, increased by approximately 11% to $30,260,468 compared to $27,289,486 in the same period last year, primarily due to higher gas costs and increased residential and commercial delivered volumes [127]. - Gas utility operating revenues for the three months ended December 31, 2025, were $30,235,141, an increase from $27,263,204 in the same period of 2024, representing an increase of approximately 7.2% [132]. - Total operating revenues for the three months ended December 31, 2025, were $30,260,468, compared to $27,289,486 for the same period in 2024, reflecting a growth of about 11.5% [132]. - Delivered volumes of regulated natural gas for residential and commercial customers increased by 6% to 2,306,247 DTH, while transportation and interruptible volumes decreased by 10% to 1,187,981 DTH [127]. - The Company recognized approximately $271,000 in additional SAVE Plan revenues for the three months ended December 31, 2025, compared to the same period last year, contributing to the overall revenue increase [117]. - RNG revenue for the three months ended December 31, 2025, was approximately $484,000, up from $388,000 in the prior year, indicating growth in renewable natural gas operations [120]. Expenses and Costs - Operations and maintenance expenses increased by $533,810, or 11%, due to inflationary pressures and increased staffing costs [132]. - The Company experienced a net income decrease of $386,824 for the three months ended December 31, 2025, primarily due to inflationary pressures on operating costs [126]. - The effective tax rate for the three-month periods ended December 31, 2025, was 21.4%, down from 23.4% in 2024, primarily due to a decrease in pre-tax income [136]. Rate Applications and Regulatory Matters - The Company filed for an expedited rate application with the SCC to increase non-gas base rates by $4.3 million annually, with new rates effective from January 1, 2026, subject to review [114]. - The Company anticipates final resolution of the SCC's review of the rate application in the first quarter of fiscal 2027 [114]. Financial Position and Cash Flow - Cash and cash equivalents increased by $335,665 for the three months ended December 31, 2025, compared to an increase of $1,204,178 for the same period in 2024 [145]. - Cash flows from operating activities increased by $252,670 compared to the same period last year, driven by colder weather and increased gas costs [147]. - Roanoke Gas has a term note of $15 million due in August 2026 and believes it has sufficient financing resources for the next year [151]. Capital Expenditures and Investments - Total capital expenditures for the three-month period ended December 31, 2025, were approximately $5.6 million, slightly down from $5.7 million in the same period last year [148]. - The company anticipates total fiscal 2026 capital expenditures to be approximately $22 million, focusing on infrastructure replacement and system improvements [148]. Debt and Financing - Interest expense decreased by $108,780, or 6%, as the weighted-average interest rate on total debt fell from 4.45% to 4.14% [135]. - Midstream established new amortizing term notes totaling $53.6 million, maturing on September 5, 2032, which refinanced all outstanding debt [152]. - Midstream's total debt principal payments over the next 12 months amount to $2,846,018 [152]. - Midstream received a quarterly cash distribution of approximately $753,000 from MVP in fiscal 2026, with expectations for similar distributions going forward [152]. Weather Impact - The WNA mechanism resulted in a revenue reduction of approximately $319,000 for the three months ended December 31, 2025, due to weather being 4% colder than normal, compared to an increase of approximately $500,000 for the same period last year when it was 6% warmer [118]. - The average price of gas in storage during the first quarter of fiscal 2026 increased by 3% compared to the same period in fiscal 2025, which may lead to higher ICC revenues if natural gas prices remain stable [119]. Utility Margin - Gross utility margin for the same period increased slightly to $15,653,526, reflecting a 1% increase from $15,560,495, driven by higher SAVE and RNG revenues [130]. - Gross utility margin (Non-GAAP) for the three months ended December 31, 2025, was $15,653,526, up from $15,560,495 in 2024, indicating a slight increase of 0.6% [132].