UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM 8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the
Securities
Exchange Act of 1934
Date
of Report: April 30, 2015
(Date
of earliest event reported)
THE
EMPIRE DISTRICT ELECTRIC COMPANY
(Exact
name of registrant as specified in charter)
KS
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1-3368
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44-0236370
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(State or other jurisdiction
of incorporation)
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(Commission File Number)
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(IRS Employer
Identification Number)
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602 S. Joplin Avenue, Joplin, Missouri
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64801
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(Address of Principal Executive Offices)
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(Zip Code)
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(417) 625-5100
(Registrant's telephone number, including area
code)
Not applicable
(Former name or former address, if
changed since last report)
Check the
appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any
of the following provisions:
⃞
Written
communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
⃞
Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
⃞
Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR
240.14d-2(b))
⃞
Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR
240.13e-4(c))
Item 2.02 Results of Operations and Financial Condition
On April 30, 2015, The Empire District Electric Company (the “Company”)
issued a press release announcing the Company’s earnings for the first
quarter of 2015 and for the twelve month period ended March 31, 2015.
Furnished herewith as Exhibit 99.1 is a copy of the press release, which
is incorporated by reference herein.
The information in this Item
2.02, including Exhibit 99.1 hereto, shall not be deemed “filed” for
purposes of Section 18 of the Securities Exchange Act of 1934 (the
“Exchange Act”) or otherwise subject to the liabilities of that section
or Sections 11 and 12(a)(2) of the Securities Act of 1933, nor shall it
be deemed incorporated by reference in any filing under the Securities
Act of 1933 or the Exchange Act, except as expressly set forth by
specific reference in such a filing.
Item 9.01. Financial Statements and Exhibits.
(a) Financial
Statements of businesses acquired:
None
(b) Pro forma financial information:
None
(c) Shell company transactions:
None
(d) Exhibits:
99.1 Press Release of THE EMPIRE DISTRICT
ELECTRIC COMPANY dated April 30, 2015
SIGNATURE
Pursuant to
the requirements of the Securities Exchange Act of 1934, the registrant
has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
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THE EMPIRE DISTRICT ELECTRIC COMPANY
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By
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/s/
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Laurie A. Delano
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Name:
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Laurie A. Delano
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Title:
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Vice President - Finance and Chief
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Financial Officer
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Dated:
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April 30, 2015
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Exhibit Index
Exhibit No.
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Description
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99.1
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Press Release of THE EMPIRE DISTRICT ELECTRIC COMPANY dated April
30, 2015
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4
Exhibit 99.1
The
Empire District Electric Company Reports First Quarter 2015 Earnings;
Declares Quarterly Dividend
JOPLIN, Mo.--(BUSINESS WIRE)--April 30, 2015--(NYSE:EDE) At
the Board of Directors meeting of The Empire District Electric Company
held today, the Directors declared a quarterly dividend of $0.26 per
share. The dividend is payable June 15, 2015, to holders of record as of
June 1, 2015. The Company, an operator of regulated electric, gas
and water utilities, announced today the results for the quarter and
twelve months ended March 31, 2015.
The Company reported consolidated earnings for the first quarter of 2015
of $14.6 million, or $0.34 per share, compared to same quarter 2014
earnings of $20.9 million, or $0.48 per share. Earnings for the twelve
months ended March 31, 2015 were $60.8 million, or $1.40 per share,
compared to earnings of $71.7 million, or $1.67 per share, for the 2014
twelve month period.
Earnings were lower this quarter over the same quarter last year,
primarily due to decreased electric and gas sales and higher
depreciation expense. Temperatures in the first quarter of 2015
moderated from the extremely cold temperatures in the first quarter of
2014, lowering sales and driving a cumulative pre-tax decrease in gross
electric and gas margins of approximately $5.0 million. Electric
depreciation expense, reflecting the completion of the Asbury Air
Quality Control System (AQCS) environmental upgrade, increased by $2.0
million, also negatively impacting first quarter 2015 results when
compared to the 2014 first quarter.
The decrease in earnings for the twelve month ending period was
primarily driven by increased operating, maintenance and depreciation
expenses.
The Company’s full-year weather normal earnings guidance range of $1.30
to $1.45 per share, provided in February 2015, remains unchanged.
First Quarter 2015 Results
Electric segment gross margin (electric revenue less cost of fuel and
purchased power) decreased approximately $3.8 million during the first
quarter 2015 compared to the first quarter 2014 on decreased revenues of
approximately $10.5 million. Electric segment gross margin was
negatively impacted by:
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Milder weather and other volumetric factors combined to decrease
sales, driving an estimated decrease in revenues of $6.2 million,
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A $1.4 million January 2015 refund to FERC wholesale customers
reflecting the acceleration of a pass through of lower fuel costs from
the SPP integrated market, and
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Miscellaneous revenues which decreased $0.2 million.
Positive impacts to electric segment gross margin included:
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Increased customer counts, which added an estimated $0.5 million to
revenues, and
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Increased customer rates, which added an estimated $0.5 million to
revenues.
Changes in off-system revenues related to the Southwest Power Pool (SPP)
Integrated Marketplace and fuel recovery revenues combined to reduce
revenues by $3.6 million during the first quarter 2015 compared to the
first quarter 2014, however this decrease is offset by a similar
decrease in fuel expense, resulting in only a negligible impact on gross
margin.
Gas segment gross margin (gas revenues less cost of gas sold and
transported) decreased approximately $1.2 million quarter over quarter.
Gas segment retail sales decreased approximately 18.4% compared to the
2014 quarter due to the milder weather described above.
Consolidated quarterly earnings were negatively impacted by:
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Depreciation and Amortization expense increases of $2.1 million,
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Operating and maintenance expense increases of $0.7 million,
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Interest expense increases of $0.7 million, and
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Changes in Allowance For Funds Used During Construction (AFUDC), which
decreased earnings by $0.5 million.
Consolidated net income decreased approximately $6.3 million in the
first quarter of 2015 compared to the 2014 quarter.
Twelve Months Ended March 2015 Results
Electric segment gross margin decreased approximately $1.4 million
during the twelve month period ended March 31, 2015 despite increased
revenues of approximately $21.4 million. This revenue increase was
primarily driven by an increase in off-system revenues of approximately
$26.4 million related to combined SPP Integrated Marketplace and fuel
recovery revenues. As described above, this change is offset by a
similar change in fuel expense, resulting in no material change to gross
margin.
Electric segment gross margin was negatively impacted by:
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Weather and other volumetric factors, which decreased revenues an
estimated $10.4 million, and
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The $1.4 million January 2015 refund to the Company’s FERC wholesale
customers mentioned above.
Positive impacts to electric segment gross margin included:
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Increased customer counts, which added an estimated $1.6 million to
revenues,
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Increased customer rates, which added an estimated $5.1 million to
revenues, and
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Miscellaneous revenue changes which added $0.1 million to revenues.
Gas segment gross margin decreased approximately $1.6 million on
decreased revenues of $7.1 million. Gas segment results were unfavorably
impacted by the milder heating season during the twelve month period
ended March 15, 2015.
Consolidated twelve month ended earnings were negatively impacted by:
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Operating and maintenance expense increases of $10.0 million,
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Depreciation and amortization expense increases of $4.1 million,
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Property and other tax increases of $1.1 million, and
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Interest expense increases of $0.9 million.
Twelve month ended consolidated earnings were positively impacted by
$2.4 million from AFUDC changes.
Consolidated net income decreased approximately $10.9 million in the
2015 twelve month ended period compared to 2014.
Selected unaudited consolidated financial data for the quarters and
twelve months ended March 31, 2015 and March 31, 2014 is presented in
the following table.
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(dollars in millions, except Per Share data)
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Three Months Ended March 31,
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Twelve Months Ended March 31,
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2015
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2014
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Change*
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2015
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2014
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Change*
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Electric Revenues
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$
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142.6
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$
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153.1
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$
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(10.5
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)
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$
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582.1
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$
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560.7
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$
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21.4
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Electric Fuel and Purchased Power
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48.9
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55.6
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(6.7
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208.5
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185.7
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22.8
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Electric Margin
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93.7
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97.5
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(3.8
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373.6
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375.0
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(1.4
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)
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Gas Revenues
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19.8
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24.6
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(4.8
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47.0
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54.1
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(7.1
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Cost of Gas Sold and Transported
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11.4
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15.0
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(3.6
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23.4
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28.9
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(5.5
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Gas Margin
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8.4
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9.6
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(1.2
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23.6
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25.2
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(1.6
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Other Revenues
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2.0
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2.0
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0.0
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8.1
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8.0
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0.1
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Gross Margin
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104.1
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109.1
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(5.0
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405.3
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408.2
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(2.9
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Less:
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Operating and Maintenance Expenses
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39.6
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38.9
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0.7
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161.2
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151.2
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10.0
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Depreciation and Amortization
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20.0
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18.0
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2.0
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75.3
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71.1
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4.2
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Taxes
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19.8
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22.7
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(2.9
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73.6
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78.6
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(5.0
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Operating Income
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24.7
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29.5
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(4.8
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95.2
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107.3
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(12.1
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Interest Expense and Other, net
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10.1
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8.6
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1.5
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34.4
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35.6
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(1.2
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Net Income
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$
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14.6
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$
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20.9
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$
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(6.3
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$
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60.8
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$
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71.7
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$
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(10.9
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Earnings Per Share
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$
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0.34
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$
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0.48
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$
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(0.14
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$
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1.40
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$
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1.67
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$
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(0.27
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Three Months Ended March 31,
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Twelve Months Ended March 31,
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2015
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2014
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% Change*
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2015
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2014
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% Change*
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Electric On-System kWh Sales (in millions):
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Residential
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590
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642
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(8.1
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)%
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1,899
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2,007
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(5.4
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)%
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Commercial
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377
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389
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(2.9
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)%
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1,573
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1,571
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0.1
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%
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Industrial
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246
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237
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3.6
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%
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1,040
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1,012
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2.8
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%
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Other
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116
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119
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(2.7
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)%
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461
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474
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(2.8
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%)
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Total On-System Electric Sales
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1,329
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1,387
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(4.2
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)%
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4,973
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5,064
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(1.8
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)%
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Retail Gas Sales (billion cubic feet):
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Residential
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1.27
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1.54
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(17.3
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)%
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2.49
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2.95
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(15.5
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)%
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Commercial/Industrial
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0.56
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0.71
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(20.6
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)%
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1.20
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1.48
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(19.8
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)%
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Other
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0.02
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0.02
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(19.1
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)%
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0.03
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0.04
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(15.7
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)%
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Total Retail Gas Sales
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1.85
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2.27
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(18.4
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)%
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3.72
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4.47
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(17.0
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)%
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* Slight differences from actual results may occur due to rounding.
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Reconciliation of Earnings Per Share
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Quarter Ended
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Twelve Months Ended
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Basic Earnings Per Share – March 31, 2014
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$
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0.48
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$
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1.67
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Gross Margins
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Electric segment
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(0.05
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)
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(0.02
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Gas segment
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(0.02
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(0.02
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Other segment
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0.00
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0.00
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Total Gross Margins
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(0.07
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)
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(0.04
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Expenses
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Operating
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(0.01
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(0.08
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Maintenance and repairs
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0.00
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(0.07
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Depreciation and amortization
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(0.03
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(0.06
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Other taxes
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(0.01
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)
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(0.02
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Other income and deductions
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0.00
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(0.01
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Interest charges
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(0.01
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(0.01
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AFUDC
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(0.01
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)
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0.04
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Dilutive effect of additional shares
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0.00
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(0.02
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)
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Basic Earnings Per Share – March 31, 2015
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$
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0.34
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$
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1.40
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The reconciliation of basic earnings per share (EPS) presented above
compares the quarter and year ended March 31, 2015 versus March 31, 2014
and is a non-GAAP presentation. The economic substance behind this
non-GAAP EPS measure is to present the after tax impact of significant
items and components of the statement of income on a per share basis
before the impact of additional stock issuances. The Company believes
this presentation is useful to investors because the statement of income
does not readily show the EPS impact of the various components,
including the effect of new stock issuances. This could limit the
readers’ understanding of the reasons for the EPS change from previous
years. This information is useful to management, and the Company
believes useful to investors, to better understand the reasons for the
fluctuation in EPS between the prior and current years on a per share
basis.
In addition, although a non-GAAP presentation, the Company believes
the presentation of gross margin (reflected in the table above and
elsewhere in this press release) is useful to investors and others in
understanding and analyzing changes in operating performance from one
period to the next, and have included the analysis as a complement to
the financial information provided in accordance with GAAP. This
reconciliation and margin information may not be comparable to other
companies or more useful than the GAAP presentation included in the
statements of income. The presentation does not purport to be an
alternative to EPS determined in accordance with GAAP as a measure of
operating performance or any other measure of financial performance
presented in accordance with GAAP. Management compensates for the
limitations of using non-GAAP financial measures by using them to
supplement GAAP results to provide a more complete understanding of the
factors and trends affecting the business than GAAP results alone. The
dilutive effect of additional shares issued in this table reflects the
impact of all shares issued in the respective periods presented.
Earnings Guidance
The guidance range assumed 30-year average weather, overall system
energy growth of less than 1%, an August 1, 2015 effective date for our
pending Missouri rate case at the filed amount, and increased operating
costs, driven by a full year of service from our Asbury AQCS upgrade. A
stipulation currently on file for our pending Missouri rate case, if
approved by the Missouri Public Service Commission, will not impact our
guidance range of $1.30 to $1.45. Other factors that may impact earnings
include variations in customer growth and usage projections and
unanticipated or unplanned events that may impact operating and
maintenance costs. The effects of assumptions and other factors
evaluated for the purpose of providing guidance are not necessarily
independent of one another, and the combination of effects can cause
individual impacts smaller or larger than the indicated guidance range.
Earnings Conference Call
Brad Beecher, President and CEO, will host a conference call Friday, May
1, 2015, at 1:00 p.m. Eastern Time to discuss earnings for the first
quarter and twelve months ended March 31, 2015. To phone in to the
conference call, parties in the United States should dial
1-888-243-4451, any time after 12:45 p.m. Eastern Time. The webcast
presentation and accompanying presentation slides can also be accessed
from Empire’s website at www.empiredistrict.com. The
webcast presentation will be available for replay for one year from
today’s date. Forward-looking and other material information may be
discussed during the conference call.
Based in Joplin, Missouri, The Empire District Electric Company
(NYSE:EDE) is an investor-owned, regulated utility providing electric,
natural gas (through its wholly owned subsidiary, The Empire District
Gas Company) and water service, with approximately 218,000 customers in
Missouri, Kansas, Oklahoma, and Arkansas. A subsidiary of the Company
also provides fiber optic services.
Certain matters discussed in this press release are “forward-looking
statements” intended to qualify for the safe harbor from liability
established by the Private Securities Litigation Reform Act of 1995. Such
statements address future plans, objectives, expectations, earnings, and
events or conditions concerning various matters. Actual results
in each case could differ materially from those currently anticipated in
such statements, by reason of the factors noted in the Company’s filings
with the SEC, including the most recent Form 10-K.
CONTACT:
The Empire District Electric Company
INVESTOR
RELATIONS
Dale Harrington, 417-625-4222
Director of Investor
Relations
dharrington@empiredistrict.com
or
MEDIA
COMMUNICATIONS
Amy Bass, 417-625-5114
Director of Corporate
Communications
abass@empiredistrict.com
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