RGC Resources(US:RGCO)2019-08-09 20:10Financial Data and Key Metrics Changes - Third quarter 2019 earnings per share were $0.14, matching the results from the third quarter of 2018 [3] - Operating income for the third quarter was approximately $1.6 million, with a 5% increase in year-to-date operating income to approximately $11.1 million [8][10] - Net income increased over $1.6 million or 25% compared to the first nine months of the prior year [11] Business Line Data and Key Metrics Changes - Capital expenditures in the third quarter were $5.6 million, a 20% decrease from the same period last year, with $2.8 million on infrastructure replacement, $1.3 million on customer growth, and $1.5 million on capital needs [4] - Year-to-date customer additions reached 516, representing a 5.5% increase over 2018 [5] - Equity earnings in the Mountain Valley pipeline investment increased over $770,000, a rise of $532,000 compared to the same quarter last year [9] Market Data and Key Metrics Changes - Total volumes for the third quarter decreased due to 42% warmer weather compared to the same period in 2018, with commercial volumes slightly down and industrial volumes remaining flat [6] - Year-to-date volumes remained flat compared to the prior year, with only a 1% decrease [6] Company Strategy and Development Direction - The company plans to invest approximately $46 million in fiscal 2019, with $22 million focused on regulated utility infrastructure replacement and customer growth, and $24 million in the Mountain Valley pipeline [13] - The Mountain Valley pipeline is approximately 89% complete, with expectations to go into service in the summer of 2020 [15] Management's Comments on Operating Environment and Future Outlook - The regulatory environment for the Mountain Valley pipeline remains stable, with ongoing issues related to the Appalachian Trail crossing and Nationwide 12 permit [28] - The company anticipates a final order for the Roanoke Gas general rate case around the end of calendar year 2019 [14] - Fiscal 2019 earnings guidance is projected between $1.02 to $1.07 per share [16] Other Important Information - Operating expenses remained flat during the third quarter [8] - Other income increased by approximately $150,000, primarily due to revenue-sharing [11] Q&A Session Summary Question: Was the decrease in CapEx year-over-year anticipated? - Management indicated that the decrease was due to timing in 2019 projects, with some expenditures moving to the fiscal fourth quarter [24] Question: Update on the Mountain Valley pipeline's regulatory environment? - Management noted that weather conditions have been favorable for construction, and regulatory issues are proceeding as planned without significant changes [27][28] Question: Will gas access require the pipeline to be fully in service? - Management stated that the Appalachian Trail crossing would need to be completed for gas to flow, but there could be potential for backhauling gas if necessary [30] Question: Will the pipeline be brought online in stages? - Management confirmed that they are at the tail end of the pipeline and expect the full pipeline to be completed before gas flows [31]