Good weather and population growth boost Southwest Gas Corp. earnings
Local natural-gas utility Southwest Gas Corp. improved its financial results in the quarter that ended March 31.
The company on Monday reported net income of $75.4 million, or $1.59 per share, in the first quarter. That was up from $72 million, or $1.54 per share, in the same period of 2015.
Quarterly revenue dipped to $731.2 million, down 0.4 percent from $734.2 million a year earlier.
Executives traced the improved earnings to better weather, which slightly suppressed results from the natural-gas segment, but aided the company’s construction-services business.
On the natural-gas side, the utility’s operating margin, or its operating revenue minus the cost of gas sold, increased as it added 26,000 net new customers year over year in the quarter in its service areas in Nevada, Arizona and California. Rate relief in California and through the Paiute Pipeline Co. also boosted the margin, as did a new conservation and energy efficiency surcharge that took effect in January in Nevada.
The company said it expects its operating margin to continue to benefit from sustained customer growth and expansion projects through 2016.
Operating costs could tick up as well, because of rising general costs, damage-prevention programs and costs associated with customer growth. But those increases should be offset by falling pension costs.
Contact Jennifer Robison at jrobison@reviewjournal.com. Follow @_JRobison on Twitter.
