Chesapeake Utilities Corporation, Dover, reported lower earnings in the third quarter as seasonal factors and reduced margins on propane affected the bottom line.
Earnings for the first nine months of the year were well above 2017 figures.
The company’s net income for the quarter ended September 30, 2018 was $5.5 million, compared to $6.8 million for the same quarter of 2017.
During the third quarter, continued growth in the natural gas transmission operations was offset by seasonality, lower propane margins and lower operating income for PESCO.
For the nine months ended September 30, 2018, the Company reported net income of $38.8 million This represents an increase of $6.8 million compared to the same period in 2017.
Higher year-to-date earnings reflect continued growth and expansion in the Company’s natural gas operations, as well as growth in electric and propane operations and the benefit of the lower effective federal income tax rate from the TCJA on unregulated energy earnings.
“Our strong, disciplined capital investment strategy continues to expand the safe, clean, reliable energy services we provide to our customers and produce quarterly and year-to-date earnings growth in our Regulated Energy segment and year-to-date earnings growth in our Unregulated Energy segment’s propane operations and natural gas supply services,” stated Michael P. McMasters, CEO. “Our outlook for the year remains in line with our beginning of the year guidance.” McMasters added. “Our significant growth in 2018 and industry-leading growth over the past ten years result directly from our employees’ persistent efforts to find and develop new regulated and unregulated energy opportunities for growth.”
Other highlights from the earnings report.
- Eastern Shore Natural Gas Company (“Eastern Shore”) and Peninsula Pipeline Company (“Peninsula Pipeline”) expansions added $3.6 million in gross margin* for the quarter
- Continued growth in the natural gas transmission operations during the third quarter was offset by seasonality, slightly lower propane margins and lower results for Peninsula Energy Services Company, Inc. (“PESCO”) as it continues to build its platform for future growth. PESCO is a natural gas services company.
- As a result of the Tax Cuts and Jobs Act (“TCJA”), the Company year-to-date has passed through approximately $7.5 million in lower federal income taxes to regulated energy customers
