NICOR Inc. (GAS, Financial) filed Quarterly Report for the period ended 2009-06-30.
Nicor Inc. is a holding company and is a member of the Standard & Poor\'s 500 Index. Its primary business is Nicor Gas one of the nation\'s largest natural gas distribution companies. Nicor owns Tropical Shipping a containerized shipping business serving the Caribbean region and the Bahamas. In addition the company owns and has an equity interest in several energy-related businesses. NICOR Inc. has a market cap of $1.68 billion; its shares were traded at around $37.2 with a P/E ratio of 13.8 and P/S ratio of 0.4. The dividend yield of NICOR Inc. stocks is 4.9%.
Gas distribution revenues are impacted by changes in natural gas costs, which are passed directly through to customers without markup, subject to ICC review. Gas distribution revenues decreased $233.8 million for the three months ended June 30, 2009 compared to the prior year due primarily to lower natural gas costs (approximately $215 million decrease) and lower demand unrelated to weather (approximately $15 million decrease), partially offset by the impact of the recent base rate increase (approximately $20 million increase). Gas distribution revenues decreased $714.0 million for the six months ended June 30, 2009 compared to the prior year due primarily to lower natural gas costs (approximately $585 million decrease), lower demand unrelated to weather (approximately $75 million decrease) and warmer weather (approximately $65 million decrease), partially offset by the impact of the recent base rate increase (approximately $20 million increase).
Gas distribution margin increased $15.6 million for the three months ended June 30, 2009 compared to the prior year due to the impact of the recent base rate increase (approximately $20 million increase), partially offset by lower demand unrelated to weather (approximately $2 million decrease). Gas distribution margin increased $11.0 million for the six months ended June 30, 2009 compared to the prior year due to the impact of the recent base rate increase (approximately $20 million increase), partially offset by lower demand unrelated to weather (approximately $6 million decrease) and warmer weather (approximately $2 million decrease).
Gas distribution operating and maintenance expense. Gas distribution operating and maintenance expense increased $9.4 million for the three months ended June 30, 2009 compared to the prior year due to higher payroll and benefit-related costs ($7.1 million increase, of which $5.5 million relates to higher pension expense, net of capitalization) and the absence of prior year recoveries of previously incurred costs ($3.9 million, of which $2.0 million relates to a recovery of costs associated with the PCB matter and $1.9 million relates to legal cost recoveries from a counterparty with whom Nicor previously did business during the PBR timeframe). Operating and maintenance expense increased $11.4 million for the six months ended June 30, 2009 compared to the prior year due primarily to higher payroll and benefit-related costs ($14.3 million increase, of which $10.9 million relates to higher pension expense, net of capitalization), the absence of the previously mentioned cost recoveries ($3.9 million) and higher company use and storage-related gas costs ($2.4 million increase), partially offset by lower franchise gas costs ($6.7 million decrease) and lower bad debt expense ($6.0 million decrease due to lower revenues attributable principally to lower natural gas costs). As a result of the recent rate order, which became effective on March 25, 2009, the expense for franchise gas costs will be deferred until the related revenue, recovered through a cost recovery rider, is recognized.
Shipping operating expenses. Shipping segment operating expenses decreased $15.6 million and $26.6 million for the three and six months ended June 30, 2009, respectively, compared to the prior year due primarily to lower transportation-related costs ($11.9 million and $20.3 million decreases, respectively, largely attributable to lower fuel prices and lower volumes shipped) and charter costs ($2.8 million and $3.8 million decreases, respectively).
Other energy ventures operating expenses. Other energy ventures operating expenses decreased $3.2 million for the three months ended June 30, 2009 compared to the prior year due primarily to a decrease in operating expenses at Nicor s energy-related products and services businesses ($1.6 million decrease) and at Nicor Enerchange ($1.4 million decrease). The decrease in operating expenses at Nicor s energy-related products and services businesses was due primarily to lower average cost per utility-bill management contract, partially offset by higher average contract volumes. The decrease in operating expenses at Nicor Enerchange was due to lower transportation and storage charges. Operating expenses increased $2.1 million for the six months ended June 30, 2009 compared to the prior year due primarily to an increase in operating expenses at Nicor s energy-related products and services businesses ($3.2 million increase), partially offset by a decrease in operating expense at Nicor Enerchange ($1.4 million decrease). The increase in operat
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Nicor Inc. is a holding company and is a member of the Standard & Poor\'s 500 Index. Its primary business is Nicor Gas one of the nation\'s largest natural gas distribution companies. Nicor owns Tropical Shipping a containerized shipping business serving the Caribbean region and the Bahamas. In addition the company owns and has an equity interest in several energy-related businesses. NICOR Inc. has a market cap of $1.68 billion; its shares were traded at around $37.2 with a P/E ratio of 13.8 and P/S ratio of 0.4. The dividend yield of NICOR Inc. stocks is 4.9%.
Highlight of Business Operations:
Corporate and eliminations operating results decreased $3.1 million for the six months ended June 30, 2009 compared to the prior year due to the previously mentioned prior year recoveries of legal costs ($3.1 million decrease) and the absence of prior year benefits realized on life insurance contracts ($1.3 million decrease), partially offset by lower costs of a natural weather hedge associated with the utility-bill management products offered by Nicor s energy-related products and services businesses ($1.1 million decrease). The company recorded $2.9 million of costs associated with the natural weather hedge in the current year compared to $4.0 million of costs recorded in the prior year. Benefits or costs resulting from variances from normal weather related to these products are recorded primarily at the corporate level as a result of an agreement between the parent company and certain of its subsidiaries. The weather impact of these contracts generally serves to partially offset the gas distribution segment s weather risk. The amount of the offset attributable to the utility-bill management products marketed by Nicor s other energy ventures will vary depending upon a number of factors including the time of year, weather patterns, the number of customers for these products and the market price for natural gas.Gas distribution revenues are impacted by changes in natural gas costs, which are passed directly through to customers without markup, subject to ICC review. Gas distribution revenues decreased $233.8 million for the three months ended June 30, 2009 compared to the prior year due primarily to lower natural gas costs (approximately $215 million decrease) and lower demand unrelated to weather (approximately $15 million decrease), partially offset by the impact of the recent base rate increase (approximately $20 million increase). Gas distribution revenues decreased $714.0 million for the six months ended June 30, 2009 compared to the prior year due primarily to lower natural gas costs (approximately $585 million decrease), lower demand unrelated to weather (approximately $75 million decrease) and warmer weather (approximately $65 million decrease), partially offset by the impact of the recent base rate increase (approximately $20 million increase).
Gas distribution margin increased $15.6 million for the three months ended June 30, 2009 compared to the prior year due to the impact of the recent base rate increase (approximately $20 million increase), partially offset by lower demand unrelated to weather (approximately $2 million decrease). Gas distribution margin increased $11.0 million for the six months ended June 30, 2009 compared to the prior year due to the impact of the recent base rate increase (approximately $20 million increase), partially offset by lower demand unrelated to weather (approximately $6 million decrease) and warmer weather (approximately $2 million decrease).
Gas distribution operating and maintenance expense. Gas distribution operating and maintenance expense increased $9.4 million for the three months ended June 30, 2009 compared to the prior year due to higher payroll and benefit-related costs ($7.1 million increase, of which $5.5 million relates to higher pension expense, net of capitalization) and the absence of prior year recoveries of previously incurred costs ($3.9 million, of which $2.0 million relates to a recovery of costs associated with the PCB matter and $1.9 million relates to legal cost recoveries from a counterparty with whom Nicor previously did business during the PBR timeframe). Operating and maintenance expense increased $11.4 million for the six months ended June 30, 2009 compared to the prior year due primarily to higher payroll and benefit-related costs ($14.3 million increase, of which $10.9 million relates to higher pension expense, net of capitalization), the absence of the previously mentioned cost recoveries ($3.9 million) and higher company use and storage-related gas costs ($2.4 million increase), partially offset by lower franchise gas costs ($6.7 million decrease) and lower bad debt expense ($6.0 million decrease due to lower revenues attributable principally to lower natural gas costs). As a result of the recent rate order, which became effective on March 25, 2009, the expense for franchise gas costs will be deferred until the related revenue, recovered through a cost recovery rider, is recognized.
Shipping operating expenses. Shipping segment operating expenses decreased $15.6 million and $26.6 million for the three and six months ended June 30, 2009, respectively, compared to the prior year due primarily to lower transportation-related costs ($11.9 million and $20.3 million decreases, respectively, largely attributable to lower fuel prices and lower volumes shipped) and charter costs ($2.8 million and $3.8 million decreases, respectively).
Other energy ventures operating expenses. Other energy ventures operating expenses decreased $3.2 million for the three months ended June 30, 2009 compared to the prior year due primarily to a decrease in operating expenses at Nicor s energy-related products and services businesses ($1.6 million decrease) and at Nicor Enerchange ($1.4 million decrease). The decrease in operating expenses at Nicor s energy-related products and services businesses was due primarily to lower average cost per utility-bill management contract, partially offset by higher average contract volumes. The decrease in operating expenses at Nicor Enerchange was due to lower transportation and storage charges. Operating expenses increased $2.1 million for the six months ended June 30, 2009 compared to the prior year due primarily to an increase in operating expenses at Nicor s energy-related products and services businesses ($3.2 million increase), partially offset by a decrease in operating expense at Nicor Enerchange ($1.4 million decrease). The increase in operat
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