Chesapeake Utilities Corporation reported higher earnings in the second quarter and the first half of this year.
The Dover-based company’s net income for the quarter ended June 30, was $8.3 million, compared to $6.4 million for the same quarter of 2018.
Higher earnings for the second quarter primarily reflect contributions from pipeline expansion projects, organic growth in the natural gas distribution operations and lower operating expenses.
The increases were partially offset by lower results from Peninsula Energy Services Company, Inc. (“PESCO”) and higher interest expense.
(PESCO), provides natural gas supply, asset management and risk management services to retail and wholesale customers in the Mid-Atlantic, Southeast and Appalachian Basin regions. PESCO handles transactions on more than 10 transmission pipelines and more than 16 local distribution companies in seven states.
The absence of a one- time non-recurring severance charge recorded in the second quarter of 2018, was offset by the impact of warmer weather in the second quarter of 2019.
For the six months ended June 30, 2019, the Company reported net income of $37 millionThis represents an increase of $3.7 million compared to the same period in 2018.
Earningswere affected by the factors noted above, along with incremental margin from the acquisition of certain assets of Marlin Gas Transport, Inc. (“Marlin Gas Transport”) and R. F. Ohl Fuel Oil, Inc. (“Ohl”), a Florida Public Service Commission (“PSC”) regulatory order that enabled the company to retain tax savings associated with lower federal tax rates resulting from the federal tax cut in several natural gas distribution operations and continued growth in gross margin from Aspire Energy of Ohio.
These increases were partially offset by lower results for PESCO, lower energy consumption due to warmer weather in the Company’s service territories, and higher interest expense.
“In the first half of 2019, we have delivered strong financial results to our shareholders driven by our organic growth initiatives and increased margin from the Marlin Gas Transport and Ohl assets we acquired at the end of 2018. The unwavering commitment of our employees to provide safe, clean, reliable energy services while growing the footprint of our businesses and continually generating increased financial results is truly impressive,” stated Jeffry M. Householder, CEO. “As we move into the second half of 2019, I’m excited to continue working with such a determined group of employees in further expanding the footprint of our existing businesses and realizing new investment opportunities like 2018 portion of the retained tax savings for certain Florida natural gas distribution operations associated with the tax cut legislation.
Chesapeake’s Florida Public Utilities operation was hit last year by a hurricane which resulted in a rebuilding of its electric lines.