Chesapeake Utilities Corp., Dover reported lower earnings in the third quarter as seasonal factors and one-time gains at a gas gathering unit in 2015 affected results.
The company’s net income for the quarter ended September 30. was $4.4 million, compared to $5.1 million in the same quarter of 2015.
The decrease was principally due to fixed pipeline and storage costs associated with natural gas supply contracts where a significant portion of the sales volume will occur during the winter months; increased deliveries and imbalance positions that favorably impacted gas gatherer Aspire Energy in 2015 and lower retail propane margins per gallon on the Delmarva Peninsula.
For the nine months ended September 30, the company reported net income of $32.8 million, an increase of $291,000 over the first nine months of 2015.
Year-to-date, higher earnings from growth in Chesapeake’s natural gas transmission and distribution businesses, Aspire Energy of Ohio, LLC and the Combined Heat & Power plant constructed by the company’s Florida subsidiary, Eight Flags Energy, LLC offset the negative effect of warmer weather largely during the first quarter of 2016. The warmer weather reduced year-to-date earnings per share by $0.31 compared to the same period in 2015.
“Third quarter results of operations met our expectations and demonstrated the success of our employees in cultivating growth in the areas we serve. The Eight Flags Energy project is now fully operational and contributed more than $2.0 million in new margin during the quarter,” stated Michael P. McMasters, CEO of Chesapeake Utilities Corporation.
“We also completed an equity offering which provides us with the capital we need while maintaining our strong financial position. Looking forward we are positioned to continue executing on our projects and delivering value to our customers and shareholders,” McMasters added.
