Cap Rock Energy (AMEX:RKE)
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Cap Rock Energy Reports Earnings for 2003
MIDLAND, Texas, March 30 /PRNewswire-FirstCall/ -- Cap Rock Energy Corporation
today reported net income of $11.198 million for the year ended December 31,
2003, or $7.41 earnings per common share, diluted,compared to $8.776 million,
or $6.74 per common share, diluted, for the year ended December 31, 2002.
"Our financial and other achievements in 2003 were commendable and exceeded our
expectations," stated David W. Pruitt, President and CEO of Cap Rock Energy.
"We received approval for the transfer of the CCN to Cap Rock Energy from its
predecessor, thus completing the conversion process. As we are now subject to
the oversight authority of the Public Utility Commission of Texas, we believe we
have made significant steps in positioning ourselves for entrance in the
regulatory arena. We have nearly achieved our goal of selling all assets that
are not directly related to our core business. As we continue to build on our
achievements, we will maintain our unsurpassed high level of quality electric
service. Our attitude of excellence will enable us to continue to meet
challenges in an increasingly competitive marketplace."
Detailed below are financial highlights for Cap Rock Energy for the years ended
2003 and 2002:
(in thousands, except share and Year ended December 31,
per share data) 2003 2002
Operating revenues $82,852 $74,637
Operating income $19,869 $14,673
Net income $11,198 $ 8,776
Earnings per share:
Basic $ 7.69 $ 6.74
Diluted $ 7.41 $ 6.74
Weighted average number of common
shares outstanding:
Basic 1,455,443 1,302,355
Diluted 1,510,741 1,302,355
Total assets $202,989 $211,294
Total debt $162,195 $181,976
Equity $ 26,973 $ 14,738
The major component of the increase in operating revenues is the result of the
change in the method of revenue recognition in accordance with the Company's
change in rate-making policy. The other two major components were adjustments
for recovery of increased power costs from prior periods, and a regulatory
surcharge billed to customers, which related to intervention costs. Operations
and maintenance expense increased because personnel devoted more time to
maintaining the distribution and transmission systems, which resulted in current
expense as opposed to engaging in construction activities that would have
resulted in capitalized costs. Decreased costs in 2003 for legal fees and
outside services, which related to the PUCT proceedings concerning the
application to transfer certified territory to the Company, were partially
offset by noncash stock awards to employees, officers and directors. These
awards are being expensed over periods of 2 to 5 years. In an effort to focus
all of the Company's resources on its core business by divesting itself of
activities which are unrelated to providing quality electric service, the
Company sold its interest in an oil and gas company, as well as extinguished a
note payable and cross-collateralized note receivable. The effective tax rate
for both 2003 and 2002 is less than the statutory rate because of the
availability and expected utilization of net operating loss carryforwards, as
well as significant book/tax timing differences.
Cap Rock Energy provides electric distribution services to approximately 35,000
meters in 28 counties in Texas. Its corporate officeis located in Midland,
Texas, with service divisions in Stanton, Colorado City, Brady and Celeste,
Texas. The Company also provides management services to the Farmersville
Municipal Electric System. The Company's predecessor, Cap Rock Electric
Cooperative, Inc., was incorporated as an electric cooperative in the State of
Texas in 1939.
All statements, other than statements of historical fact included in this news
release, are forward looking statements as that term is defined in the Private
Securities Litigation Reform Act of 1995. This statement should be read in
conjunction with all other filings made with the Securities and Exchange
Commission. Any such forward looking statements involve risks and uncertainties
and actual results, performance or achievements of Cap Rock Energy may be
different from those expressed or implied in the forward looking statements.
DATASOURCE: Cap Rock Energy Corporation
CONTACT: Valerie Newsom of Cap Rock Energy Corporation, +1-432-684-0301,
or