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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Chesapeake Utilities Corporation | NYSE:CPK | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 107.14 | 0 | 12:00:12 |
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FORM 10-K
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C
HESAPEAKE
U
TILITIES
C
ORPORATION
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(Exact name of registrant as specified in its charter)
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State of Delaware
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51-0064146
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(State or other jurisdiction of
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(I.R.S. Employer
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incorporation or organization)
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Identification No.)
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Title of each class
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Name of each exchange on which registered
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Common Stock—par value per share $0.4867
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New York Stock Exchange, Inc.
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Large accelerated filer
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ý
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Accelerated filer
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¨
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Non-accelerated filer
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¨
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Smaller Reporting Company
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¨
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Page
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•
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state and federal legislative and regulatory initiatives (including deregulation) that affect cost and investment recovery, have an impact on rate structures, and affect the speed and the degree to which competition enters the electric and natural gas industries;
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•
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the outcomes of regulatory, tax, environmental and legal matters, including whether pending matters are resolved within current estimates and whether the costs associated with such matters are adequately covered by insurance or recoverable in rates;
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•
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the timing of certification authorizations associated with new capital projects;
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•
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changes in environmental and other laws and regulations to which we are subject and environmental conditions of property that we now, or may in the future, own or operate;
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•
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possible increased federal, state and local regulation of the safety of our operations;
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•
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general economic conditions, including any potential effects arising from terrorist attacks and any hostilities or other external factors over which we have no control;
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•
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industrial, commercial and residential growth or contraction in our markets or service territories;
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•
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the weather and other natural phenomena, including the economic, operational and other effects of hurricanes, ice storms and other damaging weather events;
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•
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the timing and extent of changes in commodity prices and interest rates;
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•
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the ability to establish and maintain new key supply sources;
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•
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the effect of spot, forward and future market prices on our various energy businesses;
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•
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the effect of competition on our businesses;
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•
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the capital-intensive nature of our regulated energy businesses;
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•
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the extent of our success in connecting natural gas and electric supplies to transmission systems and in expanding natural gas and electric markets;
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•
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the ability to construct facilities at or below estimated costs;
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•
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the creditworthiness of counterparties with which we are engaged in transactions;
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•
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the results of financing efforts, including our ability to obtain financing on favorable terms, which can be affected by various factors, including credit ratings and general economic conditions;
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•
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the ability to successfully execute, manage and integrate merger, acquisition or divestiture plans; regulatory or other limitations imposed as a result of a merger; acquisition or divestiture, and the success of the business following a merger, acquisition or divestiture;
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•
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the impact on our costs and funding obligations, under our pension and other post retirement benefit plans, of potential downturns in the financial markets, lower discount rates, and costs associated with the Patient Protection and Affordable Care Act;
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•
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the ability to continue to hire, train and retain appropriately qualified personnel;
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•
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the effect of accounting pronouncements issued periodically by accounting standard-setting bodies;
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•
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the timing and success of technological improvements;
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•
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risks related to cyber-attacks or cyber-terrorism that could disrupt our business operations or result in failure of information technology systems; and
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•
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the impact of significant changes to current tax regulations and rates.
|
(dollars in thousands)
|
Operating Income
|
|
Total Assets
|
||||
Regulated Energy
|
$
|
69,851
|
|
|
$
|
986,752
|
|
Unregulated Energy
|
13,844
|
|
|
226,368
|
|
||
Other businesses and eliminations
|
401
|
|
|
16,099
|
|
||
Total
|
$
|
84,096
|
|
|
$
|
1,229,219
|
|
|
|
|
|
|||||||||||||||
|
|
Delmarva
Natural Gas Distribution
(2)
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|
Florida
Natural Gas Distribution
(3)
|
|
FPU
Electric
Distribution
|
||||||||||||
Operating Revenues
(in thousands)
|
|
|
|
|
|
|
|
|
|
|||||||||
Residential
|
|
$
|
49,841
|
|
57
|
%
|
|
$
|
33,329
|
|
35
|
%
|
|
$
|
46,459
|
|
55
|
%
|
Commercial
|
|
27,274
|
|
32
|
%
|
|
33,740
|
|
35
|
%
|
|
41,704
|
|
50
|
%
|
|||
Industrial
|
|
7,420
|
|
9
|
%
|
|
27,057
|
|
28
|
%
|
|
3,497
|
|
4
|
%
|
|||
Other
(1)
|
|
1,409
|
|
2
|
%
|
|
1,438
|
|
2
|
%
|
|
(7,505
|
)
|
(9
|
)%
|
|||
Total Operating revenues
|
|
$
|
85,944
|
|
100
|
%
|
|
$
|
95,564
|
|
100
|
%
|
|
$
|
84,155
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Volumes
(in Dts for natural gas/MWHs for electric)
|
|
|
|
|
|
|
|
|
|
|||||||||
Residential
|
|
3,227,594
|
|
27
|
%
|
|
1,651,870
|
|
7
|
%
|
|
303,654
|
|
47
|
%
|
|||
Commercial
|
|
3,407,184
|
|
29
|
%
|
|
8,194,310
|
|
33
|
%
|
|
304,458
|
|
47
|
%
|
|||
Industrial
|
|
5,032,872
|
|
43
|
%
|
|
15,296,206
|
|
60
|
%
|
|
29,700
|
|
5
|
%
|
|||
Other
|
|
92,807
|
|
1
|
%
|
|
—
|
|
—
|
%
|
|
8,484
|
|
1
|
%
|
|||
Total Volumes
|
|
11,760,457
|
|
100
|
%
|
|
25,142,386
|
|
100
|
%
|
|
646,296
|
|
100
|
%
|
|||
|
|
|
|
|
|
|
|
|
|
|||||||||
Average Number of Customers
(4)
|
|
|
|
|
|
|
|
|
|
|||||||||
Residential
|
|
66,175
|
|
91
|
%
|
|
68,640
|
|
91
|
%
|
|
24,289
|
|
77
|
%
|
|||
Commercial
|
|
6,746
|
|
9
|
%
|
|
5,629
|
|
7
|
%
|
|
7,404
|
|
23
|
%
|
|||
Industrial
|
|
125
|
|
—
|
%
|
|
1,859
|
|
2
|
%
|
|
2
|
|
—
|
%
|
|||
Other
|
|
5
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|
—
|
|
—
|
%
|
|||
Total Average Customers
|
|
73,051
|
|
100
|
%
|
|
76,128
|
|
100
|
%
|
|
31,695
|
|
100
|
%
|
|
Eastern Shore
|
||||
Operating Revenues
(in thousands)
|
|
|
|||
Local distribution companies - affiliated
(1)
|
$
|
15,476
|
|
29
|
%
|
Local distribution companies - non-affiliated
|
20,826
|
|
39
|
%
|
|
Commercial and industrial
|
16,521
|
|
31
|
%
|
|
Other
(2)
|
83
|
|
1
|
%
|
|
Total Operating Revenues
|
$
|
52,906
|
|
100
|
%
|
|
|
|
|||
Contracted firm transportation capacity
(in Dts/d)
|
|
|
|||
Local distribution companies - affiliated
|
102,902
|
|
43
|
%
|
|
Local distribution companies - non-affiliated
|
66,182
|
|
28
|
%
|
|
Commercial and industrial
|
67,923
|
|
29
|
%
|
|
Total
|
237,007
|
|
100
|
%
|
|
|
|
|
|||
Design day capacity
(in Dts/d)
|
237,007
|
|
100
|
%
|
|
|
|
|
Maximum Daily Firm Transportation Capacity (Dts)
|
|
Contract Expiration Date
|
Division
|
|
Counterparty
|
|
|
||
Delaware
|
|
Eastern Shore
|
|
73,779
|
|
2017 - 2028
|
|
|
Columbia Gas
|
|
10,960
|
|
2017 - 2020
|
|
|
Transco
|
|
21,423
|
|
2017 - 2028
|
|
|
TETLP
|
|
34,100
|
|
2027
|
|
|
|
|
|
|
|
Maryland
|
|
Eastern Shore
|
|
26,673
|
|
2017 - 2027
|
|
|
Columbia Gas
|
|
4,200
|
|
2017 - 2019
|
|
|
Transco
|
|
6,188
|
|
2017 - 2019
|
|
|
TETLP
|
|
15,900
|
|
2027
|
|
|
Delmarva Peninsula and Pennsylvania
|
|
Florida
|
||||||||||
Operating Revenues
(in thousands)
|
|
|
|
|
||||||||||
Residential bulk
|
|
$
|
19,309
|
|
|
34
|
%
|
|
$
|
5,427
|
|
|
31
|
%
|
Residential metered
|
|
6,347
|
|
|
11
|
%
|
|
4,602
|
|
|
27
|
%
|
||
Commercial bulk
|
|
11,679
|
|
|
20
|
%
|
|
4,354
|
|
|
25
|
%
|
||
Commercial metered
|
|
—
|
|
|
—
|
%
|
|
1,913
|
|
|
11
|
%
|
||
Wholesale
|
|
15,914
|
|
|
28
|
%
|
|
736
|
|
|
4
|
%
|
||
Other
(1)
|
|
4,186
|
|
|
7
|
%
|
|
361
|
|
|
2
|
%
|
||
Total Operating Revenues
|
|
$
|
57,435
|
|
|
100
|
%
|
|
$
|
17,393
|
|
|
100
|
%
|
|
|
|
|
|
|
|
|
|
||||||
Volumes
(in thousands of gallons)
|
|
|
|
|
|
|
|
|
||||||
Residential bulk
|
|
8,940
|
|
|
20
|
%
|
|
1,331
|
|
|
22
|
%
|
||
Residential metered
|
|
3,222
|
|
|
6
|
%
|
|
927
|
|
|
15
|
%
|
||
Commercial bulk
|
|
9,432
|
|
|
21
|
%
|
|
2,311
|
|
|
37
|
%
|
||
Commercial metered
|
|
—
|
|
|
—
|
%
|
|
824
|
|
|
13
|
%
|
||
Wholesale
|
|
20,834
|
|
|
46
|
%
|
|
818
|
|
|
13
|
%
|
||
Other
|
|
3,351
|
|
|
7
|
%
|
|
—
|
|
|
—
|
%
|
||
Total Volumes
|
|
45,779
|
|
|
100
|
%
|
|
6,211
|
|
|
100
|
%
|
||
|
|
|
|
|
|
|
|
|
||||||
Average Number of Customers
(2)
|
|
|
|
|
|
|
|
|
||||||
Residential bulk
|
|
26,007
|
|
|
67
|
%
|
|
8,918
|
|
|
55
|
%
|
||
Residential metered
|
|
8,421
|
|
|
22
|
%
|
|
6,175
|
|
|
38
|
%
|
||
Commercial bulk
|
|
4,153
|
|
|
11
|
%
|
|
920
|
|
|
6
|
%
|
||
Commercial metered
|
|
38
|
|
|
—
|
%
|
|
274
|
|
|
1
|
%
|
||
Wholesale
|
|
35
|
|
|
—
|
%
|
|
6
|
|
|
—
|
%
|
||
Total Average Customers
|
|
38,654
|
|
|
100
|
%
|
|
16,293
|
|
|
100
|
%
|
|
Operating revenues
|
|
Deliveries
|
|||
|
(in thousands)
|
|
(in Dts)
|
|||
Supply to Columbia Gas of Ohio
|
$
|
9,429
|
|
|
2,197
|
|
Supply to CGC
|
8,037
|
|
|
1,238
|
|
|
Supply to Marketers - affiliated
|
3,544
|
|
|
1,604
|
|
|
Supply to Marketers - unaffiliated
|
3,230
|
|
|
1,266
|
|
|
Other (including natural gas gathering and processing)
|
2,313
|
|
|
1,797
|
|
|
Total
|
$
|
26,553
|
|
|
8,102
|
|
Name
|
|
Age
|
|
Position
|
Michael P. McMasters
|
|
58
|
|
President (March 2010 - present)
Chief Executive Officer (January 2011 - present)
Director (March 2010 - present)
Executive Vice President (September 2008 - February 2010)
Chief Operating Officer (September 2008 - December 2010)
Chief Financial Officer (January 1997 - September 2008)
Mr. McMasters also previously served as Senior Vice President, Vice President, Treasurer, Director of Accounting and Rates and Controller.
|
Beth W. Cooper
|
|
50
|
|
Senior Vice President (September 2008 - present)
Chief Financial Officer (September 2008 - present)
Assistant Secretary (March 2015-present) Corporate Secretary (June 2005 - March 2015)
Vice President (June 2005 - September 2008)
Treasurer (March 2003 - May 2012)
Ms. Cooper also previously served as Assistant Vice President, Assistant Treasurer, Director of Internal Audit and Director of Strategic Planning.
|
Elaine B. Bittner
|
|
47
|
|
Senior Vice President of Strategic Development (May 2013 - present)
Chief Operating Officer - Sharp, Aspire Energy, PESCO and Xeron (May 2014 - Present)
Vice President of Strategic Development (June 2010 - May 2013)
Vice President, Eastern Shore (May 2005 - June 2010) Ms. Bittner also previously served as Director of Eastern Shore, Director of Customer Services and Regulatory Affairs for Eastern Shore and Director of Environmental Affairs and Environmental Engineer. |
Stephen C. Thompson
|
|
56
|
|
Senior Vice President (September 2004 - present)
President, Eastern Shore (January 1997 - present)
Vice President (May 1997 - September 2004)
Mr. Thompson also previously served as Director of Gas Supply and Marketing for Eastern Shore, Superintendent of Eastern Shore and Regional Manager for Florida distribution operations.
|
Jeffry M. Householder
|
|
59
|
|
President of Florida Public Utilities Company (June 2010 - present)
Prior to joining Chesapeake Utilities, Mr. Householder operated a consulting practice that provided business development and regulatory services to utilities, propane retailers and industrial clients.
|
James F. Moriarty
|
|
59
|
|
Senior Vice President (Effective February 2017) General Counsel & Corporate Secretary (March 2015 - present)
Vice President (March 2015 - February 2017)
Prior to joining Chesapeake Utilities, Mr. Moriarty was a Partner at Locke Lord LLP and Fulbright & Jaworski, LLP, both international law firms with offices in Washington, D.C.
|
•
|
Charters for the Audit Committee, Compensation Committee and Corporate Governance Committee of the Board of Directors; and
|
|
Quarter Ended
|
|
High
|
|
Low
|
|
Close
|
|
Dividends
Declared
Per Share
|
||||||||
2016
|
|
|
|
|
|
|
|
|
|
||||||||
|
March 31
|
|
$
|
67.36
|
|
|
$
|
52.25
|
|
|
$
|
62.97
|
|
|
$
|
0.2875
|
|
|
June 30
|
|
$
|
66.19
|
|
|
$
|
56.56
|
|
|
$
|
66.18
|
|
|
$
|
0.3050
|
|
|
September 30
|
|
$
|
67.88
|
|
|
$
|
59.12
|
|
|
$
|
61.06
|
|
|
$
|
0.3050
|
|
|
December 31
|
|
$
|
70.00
|
|
|
$
|
57.63
|
|
|
$
|
66.95
|
|
|
$
|
0.3050
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
2015
|
|
|
|
|
|
|
|
|
|
||||||||
|
March 31
|
|
$
|
52.22
|
|
|
$
|
44.83
|
|
|
$
|
50.61
|
|
|
$
|
0.2700
|
|
|
June 30
|
|
$
|
55.72
|
|
|
$
|
44.37
|
|
|
$
|
53.85
|
|
|
$
|
0.2875
|
|
|
September 30
|
|
$
|
56.15
|
|
|
$
|
45.25
|
|
|
$
|
53.08
|
|
|
$
|
0.2875
|
|
|
December 31
|
|
$
|
61.13
|
|
|
$
|
49.50
|
|
|
$
|
56.75
|
|
|
$
|
0.2875
|
|
|
|
|
|
|
|
|
|
|
|
|
Total
Number
of Shares
Purchased
|
|
Average
Price Paid
per Share
|
|
Total Number of Shares
Purchased as Part of
Publicly Announced Plans
or Programs
(2)
|
|
Maximum Number of
Shares That May Yet Be
Purchased Under the Plans
or Programs
(2)
|
|||||
Period
|
|
|
|
|
|
|
|
|||||
October 1, 2016 through October 31, 2016
(1)
|
418
|
|
|
$
|
58.33
|
|
|
—
|
|
|
—
|
|
November 1, 2016 through November 30, 2016
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
December 1, 2016 through December 31, 2016
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
Total
|
418
|
|
|
$
|
58.33
|
|
|
—
|
|
|
—
|
|
(1)
|
In October 2016, we purchased shares of common stock on the open market for the purpose of reinvesting the dividend on shares held in the Rabbi Trust accounts for certain Directors and Senior Executives under the Non-Qualified Deferred Compensation Plan. The Non-Qualified Deferred Compensation Plan is discussed in detail in
Item 8, Financial Statements and Supplementary Data
(see Note 16
, Employee Benefit Plans
, in the consolidated financial statements). During the quarter, 418 shares were purchased through the reinvestment of dividends.
|
(2)
|
Except for the purpose described in footnote
(1)
, we have no publicly announced plans or programs to repurchase our shares.
|
|
2011
|
|
2012
|
|
2013
|
|
2014
|
|
2015
|
|
2016
|
||||||||||||
Chesapeake Utilities
|
$
|
100
|
|
|
$
|
108
|
|
|
$
|
146
|
|
|
$
|
186
|
|
|
$
|
216
|
|
|
$
|
260
|
|
Industry Index
|
$
|
100
|
|
|
$
|
102
|
|
|
$
|
123
|
|
|
$
|
158
|
|
|
$
|
180
|
|
|
$
|
216
|
|
S&P 500 Index
|
$
|
100
|
|
|
$
|
116
|
|
|
$
|
153
|
|
|
$
|
174
|
|
|
$
|
176
|
|
|
$
|
197
|
|
|
For the Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Operating
(1)
|
|
|
|
|
|
||||||
(in thousands)
|
|
|
|
|
|
||||||
Revenues
|
|
|
|
|
|
||||||
Regulated Energy
|
$
|
305,689
|
|
|
$
|
301,902
|
|
|
$
|
300,442
|
|
Unregulated Energy
|
203,778
|
|
|
162,108
|
|
|
184,961
|
|
|||
Other businesses and eliminations
|
(10,607
|
)
|
|
(4,766
|
)
|
|
13,431
|
|
|||
Total revenues
|
$
|
498,860
|
|
|
$
|
459,244
|
|
|
$
|
498,834
|
|
Operating income
|
|
|
|
|
|
||||||
Regulated Energy
|
$
|
69,851
|
|
|
$
|
60,985
|
|
|
$
|
50,451
|
|
Unregulated Energy
|
13,844
|
|
|
16,355
|
|
|
11,723
|
|
|||
Other businesses and eliminations
|
401
|
|
|
418
|
|
|
105
|
|
|||
Total operating income
|
$
|
84,096
|
|
|
$
|
77,758
|
|
|
$
|
62,279
|
|
Net income from continuing operations
|
$
|
44,675
|
|
|
$
|
41,140
|
|
|
$
|
36,092
|
|
Assets
|
|
|
|
|
|
||||||
(in thousands)
|
|
|
|
|
|
||||||
Gross property, plant and equipment
|
$
|
1,175,595
|
|
|
1,007,489
|
|
|
$
|
870,125
|
|
|
Net property, plant and equipment
|
$
|
986,664
|
|
|
$
|
854,950
|
|
|
$
|
689,762
|
|
Total assets
|
$
|
1,229,219
|
|
|
$
|
1,067,421
|
|
|
$
|
904,469
|
|
Capital expenditures
(1)
|
$
|
169,376
|
|
|
$
|
142,713
|
|
|
$
|
98,057
|
|
Capitalization
|
|
|
|
|
|
||||||
(in thousands)
|
|
|
|
|
|
||||||
Stockholders’ equity
|
$
|
446,086
|
|
|
$
|
358,138
|
|
|
$
|
300,322
|
|
Long-term debt, net of current maturities
|
136,954
|
|
|
149,006
|
|
|
158,486
|
|
|||
Total capitalization
|
$
|
583,040
|
|
|
$
|
507,144
|
|
|
$
|
458,808
|
|
Current portion of long-term debt
|
12,099
|
|
|
9,151
|
|
|
9,109
|
|
|||
Short-term debt
|
209,871
|
|
|
173,397
|
|
|
88,231
|
|
|||
Total capitalization and short-term financing
|
$
|
805,010
|
|
|
$
|
689,692
|
|
|
$
|
556,148
|
|
(1)
|
These amounts exclude the results of distributed energy due to their reclassification to discontinued operations. We closed our distributed energy operation in 2007. These amounts also include accruals for capital expenditures that we have incurred for each reporting period.
|
(2)
|
These amounts include the financial position and results of operation of FPU for the period from the merger (October 28, 2009) to December 31, 2009. These amounts also include the effects of acquisition accounting and issuance of our common shares as a result of the merger.
|
For the Year Ended December 31,
|
|
|
|
|
|
|
|
|
||||||||||||||||||
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
(2)
|
|
2008
|
|
2007
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
$
|
264,637
|
|
|
$
|
246,208
|
|
|
$
|
256,226
|
|
|
$
|
269,438
|
|
|
$
|
138,671
|
|
|
$
|
116,123
|
|
|
$
|
128,566
|
|
166,723
|
|
|
133,049
|
|
|
149,586
|
|
|
146,793
|
|
|
119,973
|
|
|
161,290
|
|
|
115,190
|
|
|||||||
12,946
|
|
|
13,245
|
|
|
12,215
|
|
|
11,315
|
|
|
10,141
|
|
|
14,030
|
|
|
14,530
|
|
|||||||
$
|
444,306
|
|
|
$
|
392,502
|
|
|
$
|
418,027
|
|
|
$
|
427,546
|
|
|
$
|
268,785
|
|
|
$
|
291,443
|
|
|
$
|
258,286
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
$
|
50,084
|
|
|
$
|
46,999
|
|
|
$
|
43,911
|
|
|
$
|
43,267
|
|
|
$
|
26,668
|
|
|
$
|
23,833
|
|
|
$
|
21,739
|
|
12,353
|
|
|
8,355
|
|
|
9,619
|
|
|
8,150
|
|
|
8,390
|
|
|
3,600
|
|
|
5,244
|
|
|||||||
297
|
|
|
1,281
|
|
|
175
|
|
|
513
|
|
|
(1,322
|
)
|
|
1,046
|
|
|
1,131
|
|
|||||||
$
|
62,734
|
|
|
$
|
56,635
|
|
|
$
|
53,705
|
|
|
$
|
51,930
|
|
|
$
|
33,736
|
|
|
$
|
28,479
|
|
|
$
|
28,114
|
|
$
|
32,787
|
|
|
$
|
28,863
|
|
|
$
|
27,622
|
|
|
$
|
26,056
|
|
|
$
|
15,897
|
|
|
$
|
13,607
|
|
|
$
|
13,218
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
$
|
805,394
|
|
|
$
|
697,159
|
|
|
$
|
625,488
|
|
|
$
|
584,385
|
|
|
$
|
543,905
|
|
|
$
|
381,689
|
|
|
$
|
352,838
|
|
$
|
631,246
|
|
|
$
|
541,781
|
|
|
$
|
487,704
|
|
|
$
|
462,757
|
|
|
$
|
436,587
|
|
|
$
|
280,671
|
|
|
$
|
260,423
|
|
$
|
837,522
|
|
|
$
|
733,746
|
|
|
$
|
709,066
|
|
|
$
|
670,993
|
|
|
$
|
615,811
|
|
|
$
|
385,795
|
|
|
$
|
381,557
|
|
$
|
108,039
|
|
|
$
|
78,210
|
|
|
$
|
44,431
|
|
|
$
|
46,955
|
|
|
$
|
26,294
|
|
|
$
|
30,844
|
|
|
$
|
30,142
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
$
|
278,773
|
|
|
$
|
256,598
|
|
|
$
|
240,780
|
|
|
$
|
226,239
|
|
|
$
|
209,781
|
|
|
$
|
123,073
|
|
|
$
|
119,576
|
|
117,592
|
|
|
101,907
|
|
|
110,285
|
|
|
89,642
|
|
|
98,814
|
|
|
86,422
|
|
|
63,256
|
|
|||||||
$
|
396,365
|
|
|
$
|
358,505
|
|
|
$
|
351,065
|
|
|
$
|
315,881
|
|
|
$
|
308,595
|
|
|
$
|
209,495
|
|
|
$
|
182,832
|
|
11,353
|
|
|
8,196
|
|
|
8,196
|
|
|
9,216
|
|
|
35,299
|
|
|
6,656
|
|
|
7,656
|
|
|||||||
105,666
|
|
|
61,199
|
|
|
34,707
|
|
|
63,958
|
|
|
30,023
|
|
|
33,000
|
|
|
45,664
|
|
|||||||
$
|
513,384
|
|
|
$
|
427,900
|
|
|
$
|
393,968
|
|
|
$
|
389,055
|
|
|
$
|
373,917
|
|
|
$
|
249,151
|
|
|
$
|
236,152
|
|
|
For the Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
Common Stock Data and Ratios
|
|
|
|
|
|
||||||
Basic earnings per share from continuing operations
(1) (3)
|
$
|
2.87
|
|
|
$
|
2.73
|
|
|
$
|
2.48
|
|
Diluted earnings per share from continuing operations
(1) (3)
|
$
|
2.86
|
|
|
$
|
2.72
|
|
|
$
|
2.47
|
|
Diluted earnings per share growth - 1 year
|
5.1
|
%
|
|
10.1
|
%
|
|
9.3
|
%
|
|||
Diluted earnings per share growth - 5 year
|
8.4
|
%
|
|
8.4
|
%
|
|
11.6
|
%
|
|||
Diluted earnings per share growth - 10 year
|
9.3
|
%
|
|
8.4
|
%
|
|
8.5
|
%
|
|||
Return on average equity from continuing operations
(1)
|
11.3
|
%
|
|
12.1
|
%
|
|
12.2
|
%
|
|||
Common equity / total capitalization
|
76.5
|
%
|
|
70.6
|
%
|
|
65.5
|
%
|
|||
Common equity / total capitalization and short-term financing
|
55.4
|
%
|
|
51.9
|
%
|
|
54.0
|
%
|
|||
Capital expenditures / average total capitalization
|
31.1
|
%
|
|
29.5
|
%
|
|
22.9
|
%
|
|||
Book value per share
(3)
|
$
|
27.36
|
|
|
$
|
23.45
|
|
|
$
|
20.59
|
|
Market price:
|
|
|
|
|
|
||||||
High
|
$
|
70.000
|
|
|
$
|
61.130
|
|
|
$
|
52.660
|
|
Low
|
$
|
52.250
|
|
|
$
|
44.370
|
|
|
$
|
37.493
|
|
Close
|
$
|
66.950
|
|
|
$
|
56.750
|
|
|
$
|
49.660
|
|
Weighted average number of shares outstanding
(3)
|
15,570,539
|
|
|
15,094,423
|
|
|
14,551,308
|
|
|||
Shares outstanding at year-end
(3)
|
16,303,499
|
|
|
15,270,659
|
|
|
14,588,711
|
|
|||
Registered common shareholders
|
2,373
|
|
|
2,396
|
|
|
2,329
|
|
|||
Cash dividends declared per share
(3)
|
$
|
1.20
|
|
|
$
|
1.13
|
|
|
$
|
1.07
|
|
Dividend yield (annualized)
(4)
|
1.8
|
%
|
|
2.0
|
%
|
|
2.2
|
%
|
|||
Book yield
|
4.7
|
%
|
|
5.1
|
%
|
|
5.4
|
%
|
|||
Payout ratio from continuing operations
(1) (5)
|
41.8
|
%
|
|
41.5
|
%
|
|
43.0
|
%
|
|||
Additional Data
|
|
|
|
|
|
||||||
Customers
|
|
|
|
|
|
||||||
Natural gas distribution
|
149,179
|
|
|
144,872
|
|
|
141,227
|
|
|||
Electric distribution
|
31,695
|
|
|
31,430
|
|
|
31,272
|
|
|||
Propane distribution
|
54,947
|
|
|
53,682
|
|
|
53,272
|
|
|||
Total employees
|
903
|
|
|
832
|
|
|
753
|
|
(1)
|
These amounts exclude the results of a former distributed energy subsidiary due to its reclassification to discontinued operations in 2007.
|
(2)
|
These amounts include the financial position and results of operation of FPU for the period from the merger closing (October 28, 2009) to December 31, 2009.
|
(3)
|
Shares and per share amounts for all periods presented reflect the three-for-two stock split declared on July 2, 2014, effected in the form of a stock dividend, and distributed on September 8, 2014.
|
(4)
|
Dividend yield (annualized) is calculated by multiplying the fourth quarter dividend by four (4), then dividing that amount by the closing common stock price at December 31.
|
(5)
|
The payout ratio from continuing operations is calculated by dividing cash dividends declared per share (for the year) by basic earnings per share from continuing operations.
|
For the Year Ended December 31,
|
|
|
|
|
|
|
|
|
||||||||||||||||||
2013
|
|
2012
|
|
2011
|
|
2010
|
|
2009
(2)
|
|
2008
|
|
2007
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
$
|
2.27
|
|
|
$
|
2.01
|
|
|
$
|
1.93
|
|
|
$
|
1.83
|
|
|
$
|
1.45
|
|
|
$
|
1.33
|
|
|
$
|
1.31
|
|
$
|
2.26
|
|
|
$
|
1.99
|
|
|
$
|
1.91
|
|
|
$
|
1.82
|
|
|
$
|
1.43
|
|
|
$
|
1.32
|
|
|
$
|
1.29
|
|
13.6
|
%
|
|
4.2
|
%
|
|
4.9
|
%
|
|
27.3
|
%
|
|
8.3
|
%
|
|
2.3
|
%
|
|
10.3
|
%
|
|||||||
11.4
|
%
|
|
9.1
|
%
|
|
10.3
|
%
|
|
8.5
|
%
|
|
5.6
|
%
|
|
2.4
|
%
|
|
7.2
|
%
|
|||||||
6.8
|
%
|
|
8.1
|
%
|
|
7.8
|
%
|
|
6.7
|
%
|
|
3.0
|
%
|
|
6.7
|
%
|
|
5.3
|
%
|
|||||||
12.2
|
%
|
|
11.6
|
%
|
|
11.6
|
%
|
|
11.6
|
%
|
|
11.2
|
%
|
|
11.2
|
%
|
|
11.5
|
%
|
|||||||
70.3
|
%
|
|
71.6
|
%
|
|
68.6
|
%
|
|
71.6
|
%
|
|
68.0
|
%
|
|
58.7
|
%
|
|
65.4
|
%
|
|||||||
54.3
|
%
|
|
60.0
|
%
|
|
61.1
|
%
|
|
58.2
|
%
|
|
56.1
|
%
|
|
49.4
|
%
|
|
50.6
|
%
|
|||||||
28.6
|
%
|
|
22.0
|
%
|
|
13.3
|
%
|
|
15.0
|
%
|
|
10.2
|
%
|
|
15.7
|
%
|
|
16.5
|
%
|
|||||||
$
|
19.28
|
|
|
$
|
17.82
|
|
|
$
|
16.78
|
|
|
$
|
15.84
|
|
|
$
|
14.89
|
|
|
$
|
12.02
|
|
|
$
|
11.76
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
$
|
40.780
|
|
|
$
|
32.613
|
|
|
$
|
29.687
|
|
|
$
|
28.133
|
|
|
$
|
23.333
|
|
|
$
|
23.227
|
|
|
$
|
24.833
|
|
$
|
30.560
|
|
|
$
|
26.593
|
|
|
$
|
24.000
|
|
|
$
|
18.673
|
|
|
$
|
14.680
|
|
|
$
|
14.620
|
|
|
$
|
18.667
|
|
$
|
40.013
|
|
|
$
|
30.267
|
|
|
$
|
28.900
|
|
|
$
|
27.680
|
|
|
$
|
21.367
|
|
|
$
|
20.987
|
|
|
$
|
21.233
|
|
14,430,962
|
|
|
14,379,216
|
|
|
14,333,699
|
|
|
14,211,831
|
|
|
10,969,980
|
|
|
10,217,772
|
|
|
10,114,562
|
|
|||||||
14,457,345
|
|
|
14,396,248
|
|
|
14,350,959
|
|
|
14,286,293
|
|
|
14,091,471
|
|
|
10,240,682
|
|
|
10,166,115
|
|
|||||||
2,345
|
|
|
2,396
|
|
|
2,481
|
|
|
2,482
|
|
|
2,670
|
|
|
1,914
|
|
|
1,920
|
|
|||||||
$
|
1.01
|
|
|
$
|
0.96
|
|
|
$
|
0.91
|
|
|
$
|
0.87
|
|
|
$
|
0.83
|
|
|
$
|
0.81
|
|
|
$
|
0.78
|
|
2.6
|
%
|
|
3.2
|
%
|
|
3.2
|
%
|
|
3.2
|
%
|
|
3.9
|
%
|
|
3.9
|
%
|
|
3.7
|
%
|
|||||||
5.4
|
%
|
|
5.5
|
%
|
|
5.6
|
%
|
|
5.7
|
%
|
|
6.2
|
%
|
|
6.8
|
%
|
|
6.8
|
%
|
|||||||
44.6
|
%
|
|
47.8
|
%
|
|
47.4
|
%
|
|
47.6
|
%
|
|
57.6
|
%
|
|
60.5
|
%
|
|
60.2
|
%
|
|||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
138,210
|
|
|
124,015
|
|
|
121,934
|
|
|
120,230
|
|
|
117,887
|
|
|
65,201
|
|
|
62,884
|
|
|||||||
31,151
|
|
|
31,066
|
|
|
30,986
|
|
|
30,966
|
|
|
31,030
|
|
|
—
|
|
|
—
|
|
|||||||
51,988
|
|
|
49,312
|
|
|
48,824
|
|
|
48,100
|
|
|
48,680
|
|
|
34,981
|
|
|
34,143
|
|
|||||||
842
|
|
|
738
|
|
|
711
|
|
|
734
|
|
|
757
|
|
|
448
|
|
|
445
|
|
•
|
executing a capital investment program in pursuit of growth opportunities that generate returns equal to or greater than our cost of capital;
|
•
|
expanding our energy distribution and transmission businesses organically as well as into new geographic areas;
|
•
|
providing new services in our current service territories;
|
•
|
expanding our footprint in potential growth markets through strategic acquisitions;
|
•
|
entering new unregulated energy markets and business lines that will complement our existing operating units and growth strategy while capitalizing on opportunities across the energy value chain; and
|
•
|
differentiating the Company as a full-service energy supplier/partner/provider through a customer-centric model.
|
(in thousands except per share data)
|
|
|
|
|
Increase
|
|
|
|
|
|
Increase
|
||||||||||||
For the Year Ended December 31,
|
2016
|
|
2015
|
|
(decrease)
|
|
2015
|
|
2014
|
|
(decrease)
|
||||||||||||
Operating Income:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Regulated Energy
|
$
|
69,851
|
|
|
$
|
60,985
|
|
|
$
|
8,866
|
|
|
$
|
60,985
|
|
|
$
|
50,451
|
|
|
$
|
10,534
|
|
Unregulated Energy
|
13,844
|
|
|
16,355
|
|
|
(2,511
|
)
|
|
16,355
|
|
|
11,723
|
|
|
4,632
|
|
||||||
Other businesses and eliminations
|
401
|
|
|
418
|
|
|
(17
|
)
|
|
418
|
|
|
105
|
|
|
313
|
|
||||||
Total Operating Income
|
84,096
|
|
|
77,758
|
|
|
6,338
|
|
|
77,758
|
|
|
62,279
|
|
|
15,479
|
|
||||||
Gains from sales of businesses
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,139
|
|
|
(7,139
|
)
|
||||||
Other income (expense)
|
(441
|
)
|
|
293
|
|
|
(734
|
)
|
|
293
|
|
|
101
|
|
|
192
|
|
||||||
Interest charges
|
10,639
|
|
|
10,006
|
|
|
633
|
|
|
10,006
|
|
|
9,482
|
|
|
524
|
|
||||||
Income Before Income Taxes
|
73,016
|
|
|
68,045
|
|
|
4,971
|
|
|
68,045
|
|
|
60,037
|
|
|
8,008
|
|
||||||
Income taxes
|
28,341
|
|
|
26,905
|
|
|
1,436
|
|
|
26,905
|
|
|
23,945
|
|
|
2,960
|
|
||||||
Net Income
|
$
|
44,675
|
|
|
$
|
41,140
|
|
|
$
|
3,535
|
|
|
$
|
41,140
|
|
|
$
|
36,092
|
|
|
$
|
5,048
|
|
Earnings Per Share of Common Stock:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Basic
|
$
|
2.87
|
|
|
$
|
2.73
|
|
|
$
|
0.14
|
|
|
$
|
2.73
|
|
|
2.48
|
|
|
$
|
0.25
|
|
|
Diluted
|
$
|
2.86
|
|
|
$
|
2.72
|
|
|
$
|
0.14
|
|
|
$
|
2.72
|
|
|
2.47
|
|
|
$
|
0.25
|
|
(in thousands, except per share data)
|
|
Pre-tax
Income |
|
Net
Income |
|
Earnings
Per Share |
||||||
Year ended December 31, 2015 Reported Results
|
|
$
|
68,045
|
|
|
$
|
41,140
|
|
|
$
|
2.72
|
|
|
|
|
|
|
|
|
||||||
Adjusting for unusual items:
|
|
|
|
|
|
|
||||||
Weather impact, primarily in the first quarter
|
|
(3,595
|
)
|
|
(2,200
|
)
|
|
(0.15
|
)
|
|||
Net gain from settlement agreement associated with customer billing system
|
|
(1,370
|
)
|
|
(838
|
)
|
|
(0.06
|
)
|
|||
|
|
(4,965
|
)
|
|
(3,038
|
)
|
|
(0.21
|
)
|
|||
Increased (Decreased) Gross Margins:
|
|
|
|
|
|
|
||||||
Service expansions*
|
|
7,192
|
|
|
4,400
|
|
|
0.30
|
|
|||
Eight Flags' CHP*
|
|
4,998
|
|
|
3,058
|
|
|
0.21
|
|
|||
GRIP*
|
|
4,044
|
|
|
2,474
|
|
|
0.17
|
|
|||
Natural Gas Growth (excluding service expansions)
|
|
2,734
|
|
|
1,673
|
|
|
0.11
|
|
|||
Lower retail propane margins
|
|
(2,770
|
)
|
|
(1,695
|
)
|
|
(0.11
|
)
|
|||
Higher customer consumption - other
|
|
1,899
|
|
|
1,162
|
|
|
0.08
|
|
|||
Implementation of Delaware Division new rates*
|
|
1,487
|
|
|
910
|
|
|
0.06
|
|
|||
Natural gas marketing
|
|
1,043
|
|
|
638
|
|
|
0.04
|
|
|||
Xeron trading losses
|
|
(847
|
)
|
|
(518
|
)
|
|
(0.04
|
)
|
|||
Sandpiper margins associated with conversions
|
|
736
|
|
|
450
|
|
|
0.03
|
|
|||
Sharp energy-related services
|
|
(512
|
)
|
|
(313
|
)
|
|
(0.02
|
)
|
|||
|
|
20,004
|
|
|
12,239
|
|
|
0.83
|
|
|||
Increased Other Operating Expenses:
|
|
|
|
|
|
|
||||||
Higher staffing and associated costs
|
|
(4,443
|
)
|
|
(2,718
|
)
|
|
(0.18
|
)
|
|||
Higher depreciation, asset removal and property tax costs due to new capital investments
|
|
(2,952
|
)
|
|
(1,806
|
)
|
|
(0.12
|
)
|
|||
Eight Flags' operating expenses
|
|
(2,432
|
)
|
|
(1,488
|
)
|
|
(0.10
|
)
|
|||
Higher outside service and facility maintenance costs
|
|
(974
|
)
|
|
(596
|
)
|
|
(0.04
|
)
|
|||
|
|
(10,801
|
)
|
|
(6,608
|
)
|
|
(0.44
|
)
|
|||
|
|
|
|
|
|
|
||||||
Net contribution from Aspire Energy
|
|
3,130
|
|
|
1,915
|
|
|
0.09
|
|
|||
Impact of common stock issuance
|
|
—
|
|
|
—
|
|
|
(0.05
|
)
|
|||
Interest charges
|
|
(633
|
)
|
|
(387
|
)
|
|
(0.03
|
)
|
|||
Change in other income (expense)
|
|
(734
|
)
|
|
(449
|
)
|
|
(0.03
|
)
|
|||
Tax rate changes
|
|
—
|
|
|
530
|
|
|
0.04
|
|
|||
Net other changes
|
|
(1,030
|
)
|
|
(667
|
)
|
|
(0.06
|
)
|
|||
Year ended December 31, 2016 Reported Results
|
|
$
|
73,016
|
|
|
$
|
44,675
|
|
|
$
|
2.86
|
|
(in thousands, except per share amounts)
|
|
Pre-tax
Income
|
|
Net
Income
|
|
Earnings
Per Share
|
||||||
Year ended December 31, 2014 Reported Results
|
|
$
|
60,037
|
|
|
$
|
36,092
|
|
|
$
|
2.47
|
|
Adjusting for unusual items:
|
|
|
|
|
|
|
||||||
Gains on sales of businesses, recorded in 2014
|
|
(7,139
|
)
|
|
(4,292
|
)
|
|
(0.29
|
)
|
|||
Asset impairment charges, recorded in 2014
|
|
6,880
|
|
|
4,136
|
|
|
0.28
|
|
|||
Weather impact
|
|
(4,408
|
)
|
|
(2,650
|
)
|
|
(0.18
|
)
|
|||
Gain from settlement agreement associated with customer billing system
|
|
1,500
|
|
|
902
|
|
|
0.06
|
|
|||
|
|
(3,167
|
)
|
|
(1,904
|
)
|
|
(0.13
|
)
|
|||
Increased (Decreased) Gross Margins:
|
|
|
|
|
|
|
||||||
Higher retail propane margins
|
|
8,930
|
|
|
5,369
|
|
|
0.37
|
|
|||
Service expansions*
|
|
5,215
|
|
|
3,135
|
|
|
0.21
|
|
|||
Other natural gas growth
|
|
4,260
|
|
|
2,561
|
|
|
0.17
|
|
|||
GRIP*
|
|
4,151
|
|
|
2,496
|
|
|
0.17
|
|
|||
FPU electric base rate increase
|
|
2,465
|
|
|
1,482
|
|
|
0.10
|
|
|||
Xeron trading losses
|
|
(1,179
|
)
|
|
(709
|
)
|
|
(0.05
|
)
|
|||
Decreased wholesale propane sales
|
|
(446
|
)
|
|
(268
|
)
|
|
(0.02
|
)
|
|||
|
|
23,396
|
|
|
14,066
|
|
|
0.95
|
|
|||
Increased Other Operating Expenses:
|
|
|
|
|
|
|
||||||
Higher staffing and associated costs
|
|
(4,071
|
)
|
|
(2,447
|
)
|
|
(0.17
|
)
|
|||
Higher depreciation, asset removal and property tax costs due to new capital investments
|
|
(3,265
|
)
|
|
(1,963
|
)
|
|
(0.13
|
)
|
|||
Higher facility maintenance and service contractor costs
|
|
(2,499
|
)
|
|
(1,502
|
)
|
|
(0.10
|
)
|
|||
Costs associated with a customer billing system settlement and other transactions
|
|
(1,081
|
)
|
|
(650
|
)
|
|
(0.04
|
)
|
|||
Increased incentive compensation
|
|
(910
|
)
|
|
(547
|
)
|
|
(0.04
|
)
|
|||
|
|
(11,826
|
)
|
|
(7,109
|
)
|
|
(0.48
|
)
|
|||
Net contribution from Aspire Energy, including impact of shares issued
|
|
567
|
|
|
341
|
|
|
(0.06
|
)
|
|||
Adjustment for other shares issued in 2015
|
|
—
|
|
|
—
|
|
|
(0.01
|
)
|
|||
Interest charges
|
|
(525
|
)
|
|
(316
|
)
|
|
(0.02
|
)
|
|||
Net other changes
|
|
(437
|
)
|
|
(259
|
)
|
|
(0.02
|
)
|
|||
Tax rate change
|
|
—
|
|
|
229
|
|
|
0.02
|
|
|||
Year ended December 31, 2015 Reported Results
|
|
$
|
68,045
|
|
|
$
|
41,140
|
|
|
$
|
2.72
|
|
|
Gross Margin for the Period
|
|
||||||||||||||||||||||||||||||
|
Year Ended
|
|
Year Ended
|
|
|
|||||||||||||||||||||||||||
|
December 31,
|
|
December 31,
|
|
Estimate for
|
|
||||||||||||||||||||||||||
|
2016
|
|
2015
|
|
Variance
|
|
2015
|
|
2014
|
|
Variance
|
|
2017
|
|
2018
|
|
||||||||||||||||
Existing Major Projects and Initiatives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Capital Investment Projects
|
$
|
43,717
|
|
|
$
|
21,536
|
|
|
$
|
22,181
|
|
|
$
|
21,536
|
|
|
$
|
5,846
|
|
|
$
|
15,690
|
|
|
$
|
48,185
|
|
|
$
|
47,107
|
|
|
Regulatory Proceedings
|
1,487
|
|
|
—
|
|
|
1,487
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,250
|
|
|
2,250
|
|
|
||||||||
Total Existing Major Projects and Initiatives
|
$
|
45,204
|
|
|
$
|
21,536
|
|
|
$
|
23,668
|
|
|
$
|
21,536
|
|
|
$
|
5,846
|
|
|
$
|
15,690
|
|
|
$
|
50,435
|
|
|
$
|
49,357
|
|
|
Future Major Projects and Initiatives
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Capital Investment Projects
(1)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,250
|
|
|
$
|
20,238
|
|
|
Regulatory Proceedings
(2), (3)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
||||||||
Total Future Major Projects and Initiatives
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,250
|
|
|
$
|
20,238
|
|
|
Total
|
$
|
45,204
|
|
|
$
|
21,536
|
|
|
$
|
23,668
|
|
|
$
|
21,536
|
|
|
$
|
5,846
|
|
|
$
|
15,690
|
|
|
$
|
52,685
|
|
|
$
|
69,595
|
|
|
|
|
|
|
|
Gross Margin for the Period
|
|
|
|
|
|
||||||||||||||||||||||
|
Year Ended
|
|
Year Ended
|
|
|
|
||||||||||||||||||||||||||
|
December 31,
|
|
December 31,
|
|
Estimate for
|
|
||||||||||||||||||||||||||
|
2016
|
|
2015
|
|
Variance
|
|
2015
|
|
2014
|
|
Variance
|
|
2017
|
|
2018
|
|
||||||||||||||||
Capital Investment Projects:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Acquisition:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Aspire Energy
|
$
|
12,271
|
|
|
$
|
6,324
|
|
|
$
|
5,947
|
|
|
$
|
6,324
|
|
|
$
|
—
|
|
|
$
|
6,324
|
|
|
$
|
13,376
|
|
|
$
|
14,302
|
|
|
Service Expansions:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Short-term contracts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Delaware
|
$
|
11,454
|
|
|
$
|
4,952
|
|
|
$
|
6,502
|
|
|
$
|
4,952
|
|
|
$
|
2,026
|
|
|
$
|
2,926
|
|
|
$
|
4,339
|
|
|
$
|
714
|
|
|
Total short-term contracts
|
$
|
11,454
|
|
|
$
|
4,952
|
|
|
$
|
6,502
|
|
|
$
|
4,952
|
|
|
$
|
2,026
|
|
|
$
|
2,926
|
|
|
$
|
4,339
|
|
|
$
|
714
|
|
|
Long-term Contracts
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Delaware
|
$
|
1,815
|
|
|
$
|
1,844
|
|
|
$
|
(29
|
)
|
|
$
|
1,844
|
|
|
$
|
463
|
|
|
$
|
1,381
|
|
|
$
|
6,965
|
|
|
$
|
7,605
|
|
|
Florida
|
1,627
|
|
|
908
|
|
|
719
|
|
|
908
|
|
|
—
|
|
|
908
|
|
|
1,622
|
|
|
1,622
|
|
|
||||||||
Total long-term contracts
|
$
|
3,442
|
|
|
$
|
2,752
|
|
|
$
|
690
|
|
|
$
|
2,752
|
|
|
$
|
463
|
|
|
$
|
2,289
|
|
|
$
|
8,587
|
|
|
$
|
9,227
|
|
|
Total Service Expansions
|
$
|
14,896
|
|
|
$
|
7,704
|
|
|
$
|
7,192
|
|
|
$
|
7,704
|
|
|
$
|
2,489
|
|
|
$
|
5,215
|
|
|
$
|
12,926
|
|
|
$
|
9,941
|
|
|
Florida GRIP
|
$
|
11,552
|
|
|
$
|
7,508
|
|
|
$
|
4,044
|
|
|
$
|
7,508
|
|
|
$
|
3,357
|
|
|
$
|
4,151
|
|
|
$
|
13,727
|
|
|
$
|
14,407
|
|
|
Eight Flags' CHP Plant
|
$
|
4,998
|
|
|
$
|
—
|
|
|
$
|
4,998
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8,156
|
|
|
$
|
8,457
|
|
|
Total Capital Investment Projects
|
$
|
43,717
|
|
|
$
|
21,536
|
|
|
$
|
22,181
|
|
|
$
|
21,536
|
|
|
$
|
5,846
|
|
|
$
|
15,690
|
|
|
$
|
48,185
|
|
|
$
|
47,107
|
|
|
Existing Regulatory Proceedings:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Delaware Division Rate Case
|
$
|
1,487
|
|
|
$
|
—
|
|
|
$
|
1,487
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,250
|
|
|
$
|
2,250
|
|
|
Total Existing Regulatory Proceedings
|
$
|
1,487
|
|
|
$
|
—
|
|
|
$
|
1,487
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
2,250
|
|
|
$
|
2,250
|
|
|
Total Existing Major Projects and Initiatives
|
$
|
45,204
|
|
|
$
|
21,536
|
|
|
$
|
23,668
|
|
|
$
|
21,536
|
|
|
$
|
5,846
|
|
|
$
|
15,690
|
|
|
$
|
50,435
|
|
|
$
|
49,357
|
|
|
For the Years Ended December 31,
|
2016
|
|
2015
|
|
Variance
|
|
2015
|
|
2014
|
|
Variance
|
||||||
Delmarva
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Actual HDD
|
3,979
|
|
|
4,363
|
|
|
(384
|
)
|
|
4,363
|
|
|
4,826
|
|
|
(463
|
)
|
10-Year Average HDD ("Normal")
|
4,453
|
|
|
4,496
|
|
|
(43
|
)
|
|
4,496
|
|
|
4,483
|
|
|
13
|
|
Variance from Normal
|
(474
|
)
|
|
(133
|
)
|
|
|
|
(133
|
)
|
|
343
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Florida
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Actual HDD
|
672
|
|
|
569
|
|
|
103
|
|
|
569
|
|
|
888
|
|
|
(319
|
)
|
10-Year Average HDD ("Normal")
|
828
|
|
|
859
|
|
|
(31
|
)
|
|
859
|
|
|
856
|
|
|
3
|
|
Variance from Normal
|
(156
|
)
|
|
(290
|
)
|
|
|
|
(290
|
)
|
|
32
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Ohio
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Actual HDD
|
5,818
|
|
|
2,404
|
|
|
N/A
(1)
|
|
|
2,404
|
|
|
—
|
|
|
N/A
(1)
|
|
10-Year Average HDD ("Normal")
|
6,078
|
|
|
2,903
|
|
|
N/A
(1)
|
|
|
2,903
|
|
|
—
|
|
|
N/A
(1)
|
|
Variance from Normal
|
(260
|
)
|
|
(499
|
)
|
|
|
|
(499
|
)
|
|
—
|
|
|
|
||
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Florida
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Actual CDD
|
3,152
|
|
|
3,338
|
|
|
(186
|
)
|
|
3,338
|
|
|
2,705
|
|
|
633
|
|
10-Year Average CDD ("Normal")
|
2,820
|
|
|
2,760
|
|
|
60
|
|
|
2,760
|
|
|
2,768
|
|
|
(8
|
)
|
Variance from Normal
|
332
|
|
|
578
|
|
|
|
|
578
|
|
|
(63
|
)
|
|
|
|
|
|
|
|
Increase
|
|
|
|
|
|
Increase
|
||||||||||||
For the Year Ended December 31,
|
2016
|
|
2015
|
|
(decrease)
|
|
2015
|
|
2014
|
|
(decrease)
|
||||||||||||
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Revenue
|
$
|
305,689
|
|
|
$
|
301,902
|
|
|
$
|
3,787
|
|
|
$
|
301,902
|
|
|
$
|
300,442
|
|
|
$
|
1,460
|
|
Cost of sales
|
109,609
|
|
|
122,814
|
|
|
(13,205
|
)
|
|
122,814
|
|
|
134,560
|
|
|
(11,746
|
)
|
||||||
Gross margin
|
196,080
|
|
|
179,088
|
|
|
16,992
|
|
|
179,088
|
|
|
165,882
|
|
|
13,206
|
|
||||||
Operations & maintenance
|
88,098
|
|
|
83,616
|
|
|
4,482
|
|
|
83,616
|
|
|
76,046
|
|
|
7,570
|
|
||||||
(Gain from a settlement)/asset impairment charge
|
(130
|
)
|
|
(1,497
|
)
|
|
1,367
|
|
|
(1,497
|
)
|
|
6,449
|
|
|
(7,946
|
)
|
||||||
Depreciation & amortization
|
25,677
|
|
|
24,195
|
|
|
1,482
|
|
|
24,195
|
|
|
21,915
|
|
|
2,280
|
|
||||||
Other taxes
|
12,584
|
|
|
11,789
|
|
|
795
|
|
|
11,789
|
|
|
11,021
|
|
|
768
|
|
||||||
Operating expenses
|
126,229
|
|
|
118,103
|
|
|
8,126
|
|
|
118,103
|
|
|
115,431
|
|
|
2,672
|
|
||||||
Operating Income
|
$
|
69,851
|
|
|
$
|
60,985
|
|
|
$
|
8,866
|
|
|
$
|
60,985
|
|
|
$
|
50,451
|
|
|
$
|
10,534
|
|
(in thousands)
|
|
||
Gross margin for the year ended December 31, 2015
|
$
|
179,088
|
|
Factors contributing to the gross margin increase (decrease) for the year ended December 31, 2016:
|
|
||
Service Expansions
|
7,192
|
|
|
Additional Revenue from GRIP in Florida
|
4,044
|
|
|
Natural Gas Growth (Excluding Service Expansions)
|
2,734
|
|
|
Delaware Division Base Rate Increase
|
1,487
|
|
|
Margin from Service to Eight Flags
|
1,369
|
|
|
Sandpiper SIR
|
736
|
|
|
Decreased Customer Consumption - Weather
|
(282
|
)
|
|
Other
|
(288
|
)
|
|
Gross margin for the year ended December 31, 2016
|
$
|
196,080
|
|
•
|
$5.4 million
associated with service to an electric power generator in Kent County, Delaware, representing
$6.8 million
from the short-term OPT
≤
90 Service that commenced in December 2015, which was offset by a
$1.4 million
decrease in gross margin from the conclusion of the interruptible service Eastern Shore provided to this customer in 2015;
|
•
|
$1.4 million
from short-term firm service that commenced in March 2016, following certain measurement and related improvements to Eastern Shore's interconnect with TETLP that increased Eastern Shore's natural gas receipt capacity from TETLP by 53,000 Dts/d, for a total capacity of 160,000 Dts/d. The remaining capacity is available for firm or interruptible service; and
|
•
|
$719,000
from natural gas transmission service, which was part of the major expansion initiative in Polk County, Florida.
|
•
|
The foregoing gross margin increases were offset by a gross margin decrease of
$243,000
resulting from a reduction in rates for a long-term firm service to an industrial customer in New Castle County, Delaware.
|
•
|
$1.5 million
from a
3.6 percent
increase in the average number of residential customers in the Delmarva natural gas distribution operations, as well as growth in the number of commercial and industrial customers; and
|
•
|
$1.2 million
from Florida natural gas customer growth due primarily to new services to commercial and industrial customers.
|
•
|
$3.6 million
in higher staffing and associated costs for additional personnel to support growth;
|
•
|
$2.6 million
in higher depreciation, asset removal and property tax costs associated with recent capital investments to support growth and system integrity; and
|
•
|
$1.4 million
due to the absence of a
$1.5 million
gain from a customer billing system settlement in 2015.
|
(in thousands)
|
|
||
Gross margin for the year ended December 31, 2014
|
$
|
165,882
|
|
Factors contributing to the gross margin increase (decrease) for the year ended December 31, 2015:
|
|
||
Service Expansions
|
5,215
|
|
|
Additional Revenue from GRIP in Florida
|
4,151
|
|
|
Natural Gas Distribution Customer Growth
|
3,322
|
|
|
Weather and Other
|
(3,096
|
)
|
|
FPU Electric Base Rate Increase
|
2,465
|
|
|
Growth in Natural Gas Transmission Services (Excluding Service Expansions)
|
938
|
|
|
Other
|
211
|
|
|
Gross margin for the year ended December 31, 2015
|
$
|
179,088
|
|
•
|
$1.6 million from interruptible service that commenced in April 2015 to an industrial customer facility in Kent County, Delaware; the interruptible service was replaced by short-term OPT ≤ 90 Service in December 2015, which generated an additional $646,000 of gross margin;
|
•
|
$1.4 million from a new service to the same industrial customer in Kent County, Delaware, that commenced in October 2014 upon completion of new facilities, which included approximately 5.5 miles of pipeline lateral and metering facilities extending from Eastern Shore's mainline to the new industrial customer facility;
|
•
|
$334,000 in additional gross margin from a short-term contract with an existing industrial customer in New Castle County, Delaware to provide 50,000 Dts/d of service from April 2014 to April 2015, which was subsequently increased to 55,580 Dts/d of service at a lower reservation rate through August 2020; and
|
•
|
$908,000 from natural gas transmission service, which was part of the major expansion initiative in Polk County, Florida.
|
•
|
$1.9 million from Florida natural gas customer growth due primarily to new services to commercial and industrial customers; and
|
•
|
$1.4 million from a 2.7 percent increase in residential customers in the Delmarva natural gas distribution operations, as well as growth in commercial and industrial customers in Worcester County, Maryland.
|
•
|
$678,000 from natural gas transmission service to commercial customers in Florida, and
|
•
|
$137,000 from interruptible service to an industrial customer in New Castle County, Delaware.
|
•
|
$2.9 million in higher depreciation, asset removal and property tax costs associated with recent capital investments;
|
•
|
$2.8 million in higher staffing and associated costs as a result of additional personnel to support growth and increased overtime on the Delmarva Peninsula in early 2015 due to colder weather;
|
•
|
$1.4 million in higher service contractor and other consulting costs;
|
•
|
$987,000 in legal and consulting costs associated with the billing system settlement and other initiatives; and
|
•
|
$480,000 in higher accruals for incentive compensation as a result of improved year-to-date financial performance; the foregoing increases were partially offset by:
|
•
|
$1.5 million gain from a customer billing system settlement in 2015.
|
|
|
|
|
|
Increase
|
|
|
|
|
|
Increase
|
||||||||||||
For the Year Ended December 31,
|
2016
|
|
2015
|
|
(decrease)
|
|
2015
|
|
2014
|
|
(decrease)
|
||||||||||||
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Revenue
|
$
|
203,778
|
|
|
$
|
162,108
|
|
|
$
|
41,670
|
|
|
$
|
162,108
|
|
|
$
|
184,961
|
|
|
$
|
(22,853
|
)
|
Cost of sales
|
138,816
|
|
|
101,791
|
|
|
37,025
|
|
|
101,791
|
|
|
137,081
|
|
|
(35,290
|
)
|
||||||
Gross margin
|
64,962
|
|
|
60,317
|
|
|
4,645
|
|
|
60,317
|
|
|
47,880
|
|
|
12,437
|
|
||||||
Operations & maintenance
|
42,659
|
|
|
36,536
|
|
|
6,123
|
|
|
36,536
|
|
|
30,197
|
|
|
6,339
|
|
||||||
Asset impairment charges
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
432
|
|
|
(432
|
)
|
||||||
Depreciation & amortization
|
6,386
|
|
|
5,679
|
|
|
707
|
|
|
5,679
|
|
|
3,994
|
|
|
1,685
|
|
||||||
Other taxes
|
2,073
|
|
|
1,747
|
|
|
326
|
|
|
1,747
|
|
|
1,534
|
|
|
213
|
|
||||||
Operating expenses
|
51,118
|
|
|
43,962
|
|
|
7,156
|
|
|
43,962
|
|
|
36,157
|
|
|
7,805
|
|
||||||
Operating Income
|
$
|
13,844
|
|
|
$
|
16,355
|
|
|
$
|
(2,511
|
)
|
|
$
|
16,355
|
|
|
$
|
11,723
|
|
|
$
|
4,632
|
|
•
|
$2.8 million
in operating expenses incurred by Aspire Energy, with
$1.6 million
representing expenses incurred in the first quarter of 2016, compared to zero in the first quarter of 2015 when Aspire Energy’s operations had not yet commenced;
|
•
|
$2.4 million
incurred by Eight Flags' CHP plant, which commenced operations in June 2016;
|
•
|
$817,000
in higher staffing and additional costs for additional personnel to support growth; and
|
•
|
$683,000
in higher outside services costs associated primarily with growth and ongoing compliance activities.
|
•
|
$1.4 million in higher staffing and associated costs due to increased seasonal overtime and additional resources hired to support growth;
|
•
|
$553,000 in additional costs for facility maintenance; and
|
•
|
$411,000 in increased accruals for incentive compensation as a result of improved year-to-date financial results in 2015, as well as a larger workforce.
|
|
December 31, 2016
|
|
December 31, 2015
|
||||||||||
(in thousands)
|
|
|
|
|
|
|
|
||||||
Long-term debt, net of current maturities
|
$
|
136,954
|
|
|
23
|
%
|
|
$
|
149,006
|
|
|
29
|
%
|
Stockholders’ equity
|
446,086
|
|
|
77
|
%
|
|
358,138
|
|
|
71
|
%
|
||
Total capitalization, excluding short-term borrowings
|
$
|
583,040
|
|
|
100
|
%
|
|
$
|
507,144
|
|
|
100
|
%
|
|
December 31, 2016
|
|
December 31, 2015
|
||||||||||
(in thousands)
|
|
|
|
|
|
|
|
||||||
Short-term debt
|
$
|
209,871
|
|
|
26
|
%
|
|
$
|
173,397
|
|
|
25
|
%
|
Long-term debt, including current maturities
|
149,053
|
|
|
19
|
%
|
|
158,157
|
|
|
23
|
%
|
||
Stockholders’ equity
|
446,086
|
|
|
55
|
%
|
|
358,138
|
|
|
52
|
%
|
||
Total capitalization, including short-term borrowings
|
$
|
805,010
|
|
|
100
|
%
|
|
$
|
689,692
|
|
|
100
|
%
|
(in thousands)
|
2016
|
|
2015
|
|
2014
|
||||||
Average borrowings
|
$
|
129,721
|
|
|
$
|
102,062
|
|
|
$
|
68,928
|
|
Weighted average interest rate
|
1.41
|
%
|
|
1.22
|
%
|
|
1.28
|
%
|
|||
Maximum month-end borrowings
|
$
|
201,311
|
|
|
$
|
168,757
|
|
|
$
|
86,040
|
|
|
For the Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
(in thousands)
|
|
|
|
|
|
||||||
Net cash provided by (used in):
|
|
|
|
|
|
||||||
Operating activities
|
$
|
103,371
|
|
|
$
|
104,123
|
|
|
$
|
73,708
|
|
Investing activities
|
(170,037
|
)
|
|
(164,539
|
)
|
|
(81,010
|
)
|
|||
Financing activities
|
67,989
|
|
|
58,697
|
|
|
8,520
|
|
|||
Net increase (decrease) in cash and cash equivalents
|
1,323
|
|
|
(1,719
|
)
|
|
1,218
|
|
|||
Cash and cash equivalents—beginning of period
|
2,855
|
|
|
4,574
|
|
|
3,356
|
|
|||
Cash and cash equivalents—end of period
|
$
|
4,178
|
|
|
$
|
2,855
|
|
|
$
|
4,574
|
|
•
|
Changes in net accounts receivable and accrued revenue and accounts payable and accrued liabilities decreased cash flows by
$13.4 million
, due primarily to higher revenues and the timing of the receipt of customer payments as well as increased expenses and the timing of payments to vendors.
|
•
|
Net income, adjusted for non-cash adjustments and reconciling activities, increased cash flows by
$18.3 million
, due primarily to an increase in deferred income taxes as a result of the availability and utilization of bonus depreciation in 2016, which resulted in a higher book-to-tax timing difference and higher non-cash adjustments for depreciation and amortization.
|
•
|
Changes in net regulatory assets and liabilities decreased cash flows by
$11.4 million
, due primarily to the change in fuel costs collected through the various fuel cost recovery mechanisms.
|
•
|
The changes in income taxes increased cash flows by
$7.4 million
due primarily to higher pre-tax income as a result of continued investment in the infrastructure, treatment, storage and distribution of natural gas, propane and electricity.
|
•
|
Net cash flows from changes in propane, natural gas and materials inventories decreased net cash flows by approximately
$4.1 million
.
|
•
|
The changes in net regulatory assets and liabilities increased cash flows by $14.9 million, due primarily to the change in fuel costs collected through the various fuel cost recovery mechanisms.
|
•
|
The change in income taxes receivable increased cash flows by $11.0 million, due primarily to the receipt of a tax refund related to our 2014 federal income tax obligation. Our tax deductions, which were higher than projected, due to bonus depreciation, reduced our 2014 federal income tax obligation.
|
•
|
Net income, adjusted for non-cash adjustments and reconciling activities, increased cash flows by $7.6 million, due primarily to higher earnings and higher non-cash adjustments for depreciation and amortization.
|
•
|
Changes in customer deposits and refunds increased cash flows by $2.9 million.
|
•
|
Changes in net accounts receivable and payable decreased cash flows by
$1.9 million
, due primarily to the timing of the collections and payments associated with trading contracts entered into by our propane wholesale and marketing subsidiary and net cash flows from accounts receivable and payable attributed to Aspire Energy. This decrease was partially offset by an increase in net cash flow from receivables and payables in various other operations.
|
•
|
Net cash flows from changes in propane, natural gas and materials inventories decreased by approximately $2.7 million.
|
•
|
An increase in cash paid for capital expenditures year-over-year, due primarily to our GRIP investment in our Florida natural gas distribution operations, Eight Flags' construction of the CHP plant and Eastern Shore expansion projects, which decreased cash flows by
$26.3 million
.
|
•
|
In 2015, we paid
$20.7 million
in cash (
$27.5 million
paid, less
$6.8 million
of cash acquired) through our short-term borrowings in conjunction with the acquisition of Gatherco. In addition to the net cash consideration, we also issued
592,970
shares of our common stock, which had no cash flow impact.
|
•
|
An increase in cash paid for capital expenditures year-over-year, due primarily to our GRIP investment in our Florida natural gas distribution operations and Eight Flags' construction of the CHP plant, which decreased cash flows by
$52.0 million
.
|
•
|
The
$20.7 million
in cash, noted above, related to the acquisition of Gatherco.
|
•
|
Net proceeds of
$57.4 million
, after deducting underwriting commissions and expenses from the issuance of common stock during the third quarter of 2016, were used to pay down short-term debt under unsecured lines of credit.
|
•
|
Net borrowings/repayments under the line of credit agreements decreased cash flows by
$48.0 million
, largely due to the common stock issuance mentioned above.
|
•
|
Net borrowings/repayments under the line of credit agreements increased cash flows by $98.7 million due to an increase in short-term borrowing, which includes the $35.0 million we borrowed under the Revolver. In 2014, we used the proceeds from the issuance of $50.0 million of the 3.88 percent Senior Notes to repay borrowings under our lines of credit arrangements.
|
•
|
Book overdrafts decreased cash flows by $3.4 million.
|
•
|
Net proceeds from and repayments of long-term debt decreased cash flows by $50.8 million due primarily to the $50.0 million issuance of the 3.88 percent Senior Notes in May 2014.
|
|
Payments Due by Period
|
||||||||||||||||||
Contractual Obligations
|
Less than 1
year
|
|
1 — 3 years
|
|
3 — 5 years
|
|
More than 5
years
|
|
Total
|
||||||||||
(in thousands)
|
|
|
|
|
|
|
|
|
|
||||||||||
Long-term debt
(1)
|
$
|
10,698
|
|
|
$
|
18,597
|
|
|
$
|
29,200
|
|
|
$
|
87,400
|
|
|
$
|
145,895
|
|
Operating leases
(2)
|
1,389
|
|
|
1,904
|
|
|
1,150
|
|
|
2,318
|
|
|
6,761
|
|
|||||
Capital leases
(2)
|
1,401
|
|
|
2,070
|
|
|
—
|
|
|
—
|
|
|
3,471
|
|
|||||
Purchase obligations
(3)
|
|
|
|
|
|
|
|
|
|
||||||||||
Transmission capacity
|
30,042
|
|
|
55,740
|
|
|
38,708
|
|
|
81,833
|
|
|
206,323
|
|
|||||
Storage capacity
|
1,741
|
|
|
2,262
|
|
|
755
|
|
|
354
|
|
|
5,112
|
|
|||||
Commodities
|
41,760
|
|
|
2,967
|
|
|
—
|
|
|
—
|
|
|
44,727
|
|
|||||
Electric supply
|
16,477
|
|
|
33,608
|
|
|
—
|
|
|
—
|
|
|
50,085
|
|
|||||
Unfunded benefits
(4)
|
388
|
|
|
704
|
|
|
894
|
|
|
1,456
|
|
|
3,442
|
|
|||||
Funded benefits
(5)
|
2,880
|
|
|
—
|
|
|
—
|
|
|
4,881
|
|
|
7,761
|
|
|||||
Total Contractual Obligations
|
$
|
106,776
|
|
|
$
|
117,852
|
|
|
$
|
70,707
|
|
|
$
|
178,242
|
|
|
$
|
473,577
|
|
(1)
|
This represents principal payments on long-term debt. See
Item 8, Financial Statements and Supplementary Data,
Note 12
, Long-Term Debt
, for additional information. The expected interest payments on long-term debt are
$7.2 million
,
$12.6 million
,
$10.0 million
and
$11.9 million
, respectively, for the periods indicated above. Expected interest payments for all periods total
$41.7 million
.
|
(2)
|
See
Item 8, Financial Statements and Supplementary Data,
Note 14
, Lease Obligations
, for further information.
|
(3)
|
See
Item 8, Financial Statements and Supplementary Data,
Note 20
, Other Commitments and Contingencies
, for further information.
|
(4)
|
We have recorded long-term liabilities of
$3.4 million
at
December 31, 2016
for unfunded post-employment and post-retirement benefit plans. The amounts specified in the table are based on expected payments to current retirees and assume a retirement age of 62 for currently active employees. There are many factors that would cause actual payments to differ from these amounts, including early retirement, future health care costs that differ from past experience and discount rates implicit in calculations. See
Item 8, Financial Statements and Supplementary Data,
Note 16
, Employee Benefit Plan
s, for further information on the plans.
|
(5)
|
We have recorded long-term liabilities of
$23.2 million
at
December 31, 2016
for two qualified, defined benefit pension plans. The assets funding these plans are in a separate trust and are not considered assets of ours or included in our balance sheets. The Contractual Obligations table above includes
$2.9 million
reflecting the payments we expect to make to the trust funds in 2017. Additional contributions may be required in future years based on the actual return earned by the plan assets and other actuarial assumptions, such as the discount rate and long-term expected rate of return on plan assets. See
Item 8, Financial Statements and Supplementary Data,
Note 16
, Employee Benefit Plan
s, for further information on the plans. Additionally, the Contractual Obligations table above includes deferred compensation obligations totaling
$4.9 million
, funded with Rabbi Trust assets in the same amount. The Rabbi Trust assets are recorded under Investments on the consolidated balance sheets. We assume a retirement age of 65 for purposes of distribution from this account.
|
Chesapeake Utilities Corporation and Subsidiaries
Consolidated Statements of Income
|
|||||||||||
|
For the Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
(in thousands, except shares and per share data)
|
|
|
|
|
|
||||||
Operating Revenues
|
|
|
|
|
|
||||||
Regulated Energy
|
$
|
305,689
|
|
|
$
|
301,902
|
|
|
$
|
300,442
|
|
Unregulated Energy
|
203,778
|
|
|
162,108
|
|
|
184,961
|
|
|||
Other businesses and eliminations
|
(10,607
|
)
|
|
(4,766
|
)
|
|
13,431
|
|
|||
Total operating revenues
|
498,860
|
|
|
459,244
|
|
|
498,834
|
|
|||
Operating Expenses
|
|
|
|
|
|
||||||
Regulated energy cost of sales
|
109,609
|
|
|
122,814
|
|
|
134,560
|
|
|||
Unregulated energy and other cost of sales
|
128,434
|
|
|
97,228
|
|
|
143,556
|
|
|||
Operations
|
117,571
|
|
|
107,562
|
|
|
102,197
|
|
|||
Maintenance
|
12,391
|
|
|
11,803
|
|
|
9,706
|
|
|||
(Gain from a settlement)/asset impairment charges
|
(130
|
)
|
|
(1,500
|
)
|
|
6,881
|
|
|||
Depreciation and amortization
|
32,159
|
|
|
29,972
|
|
|
26,316
|
|
|||
Other taxes
|
14,730
|
|
|
13,607
|
|
|
13,339
|
|
|||
Total operating expenses
|
414,764
|
|
|
381,486
|
|
|
436,555
|
|
|||
Operating Income
|
84,096
|
|
|
77,758
|
|
|
62,279
|
|
|||
Gains from sales of businesses
|
—
|
|
|
—
|
|
|
7,139
|
|
|||
Other (expense) income
|
(441
|
)
|
|
293
|
|
|
101
|
|
|||
Interest charges
|
10,639
|
|
|
10,006
|
|
|
9,482
|
|
|||
Income Before Income Taxes
|
73,016
|
|
|
68,045
|
|
|
60,037
|
|
|||
Income taxes
|
28,341
|
|
|
26,905
|
|
|
23,945
|
|
|||
Net Income
|
$
|
44,675
|
|
|
$
|
41,140
|
|
|
$
|
36,092
|
|
|
|
|
|
|
|
||||||
Weighted Average Common Shares Outstanding:
|
|
|
|
|
|
||||||
Basic
|
15,570,539
|
|
|
15,094,423
|
|
|
14,551,308
|
|
|||
Diluted
|
15,613,091
|
|
|
15,143,373
|
|
|
14,604,944
|
|
|||
Earnings Per Share of Common Stock:
|
|
|
|
|
|
||||||
Basic
|
$
|
2.87
|
|
|
$
|
2.73
|
|
|
$
|
2.48
|
|
Diluted
|
$
|
2.86
|
|
|
$
|
2.72
|
|
|
$
|
2.47
|
|
Cash Dividends Declared Per Share of Common Stock
|
$
|
1.2025
|
|
|
$
|
1.1325
|
|
|
$
|
1.0667
|
|
|
|
|
|
|
|
Chesapeake Utilities Corporation and Subsidiaries
Consolidated Statements of Comprehensive Income
|
|||||||||||
|
For the Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
(in thousands)
|
|
|
|
|
|
||||||
Net Income
|
$
|
44,675
|
|
|
$
|
41,140
|
|
|
$
|
36,092
|
|
Other Comprehensive Income (Loss), net of tax:
|
|
|
|
|
|
||||||
Employee Benefits, net of tax:
|
|
|
|
|
|
||||||
Amortization of prior service cost, net of tax of ($29), $(27) and $(24), respectively
|
(48
|
)
|
|
(40
|
)
|
|
(34
|
)
|
|||
Net gain (loss), net of tax of $178, $73, and $(1,997), respectively
|
268
|
|
|
103
|
|
|
(3,076
|
)
|
|||
Cash Flow Hedges, net of tax:
|
|
|
|
|
|
||||||
Unrealized gain (loss) on commodity contract cash flow hedges, net of tax of $496, $(150) and $(22), respectively
|
742
|
|
|
(227
|
)
|
|
(33
|
)
|
|||
Total Other Comprehensive Income (Loss)
|
962
|
|
|
(164
|
)
|
|
(3,143
|
)
|
|||
Comprehensive Income
|
$
|
45,637
|
|
|
$
|
40,976
|
|
|
$
|
32,949
|
|
Chesapeake Utilities Corporation and Subsidiaries
Consolidated Balance Sheets
|
|||||||
|
As of December 31,
|
||||||
Assets
|
2016
|
|
2015
|
||||
(in thousands, except shares and per share data)
|
|
|
|
||||
Property, Plant and Equipment
|
|
|
|
||||
Regulated energy
|
$
|
957,681
|
|
|
$
|
842,756
|
|
Unregulated energy
|
196,800
|
|
|
145,734
|
|
||
Other businesses and eliminations
|
21,114
|
|
|
18,999
|
|
||
Total property, plant and equipment
|
1,175,595
|
|
|
1,007,489
|
|
||
Less: Accumulated depreciation and amortization
|
(245,207
|
)
|
|
(215,313
|
)
|
||
Plus: Construction work in progress
|
56,276
|
|
|
62,774
|
|
||
Net property, plant and equipment
|
986,664
|
|
|
854,950
|
|
||
Current Assets
|
|
|
|
||||
Cash and cash equivalents
|
4,178
|
|
|
2,855
|
|
||
Accounts receivable (less allowance for uncollectible accounts of $909 for 2016 and 2015)
|
62,803
|
|
|
41,007
|
|
||
Accrued revenue
|
16,986
|
|
|
12,452
|
|
||
Propane inventory, at average cost
|
6,457
|
|
|
6,619
|
|
||
Other inventory, at average cost
|
4,576
|
|
|
3,803
|
|
||
Regulatory assets
|
7,694
|
|
|
8,268
|
|
||
Storage gas prepayments
|
5,484
|
|
|
3,410
|
|
||
Income taxes receivable
|
22,888
|
|
|
24,950
|
|
||
Prepaid expenses
|
6,792
|
|
|
7,146
|
|
||
Mark-to-market energy assets
|
823
|
|
|
153
|
|
||
Other current assets
|
2,470
|
|
|
1,044
|
|
||
Total current assets
|
141,151
|
|
|
111,707
|
|
||
Deferred Charges and Other Non-Current Assets
|
|
|
|
||||
Goodwill
|
15,070
|
|
|
14,548
|
|
||
Other intangible assets, net
|
1,843
|
|
|
2,222
|
|
||
Investments, at fair value
|
4,902
|
|
|
3,644
|
|
||
Regulatory assets
|
76,803
|
|
|
77,519
|
|
||
Receivables and other deferred charges
|
2,786
|
|
|
2,831
|
|
||
Total deferred charges and other non-current assets
|
101,404
|
|
|
100,764
|
|
||
Total Assets
|
$
|
1,229,219
|
|
|
$
|
1,067,421
|
|
Chesapeake Utilities Corporation and Subsidiaries
Consolidated Balance Sheets
|
|||||||
|
As of December 31,
|
||||||
Capitalization and Liabilities
|
2016
|
|
2015
|
||||
(in thousands, except shares and per share data)
|
|
|
|
||||
Capitalization
|
|
|
|
||||
Stockholders’ equity
|
|
|
|
||||
Preferred stock, par value $0.01 per share (authorized 2,000,000 shares), no shares issued and outstanding
|
$
|
—
|
|
|
$
|
—
|
|
Common stock, par value $0.4867 per share (authorized 25,000,000 shares)
|
7,935
|
|
|
7,432
|
|
||
Additional paid-in capital
|
250,967
|
|
|
190,311
|
|
||
Retained earnings
|
192,062
|
|
|
166,235
|
|
||
Accumulated other comprehensive loss
|
(4,878
|
)
|
|
(5,840
|
)
|
||
Deferred compensation obligation
|
2,416
|
|
|
1,883
|
|
||
Treasury stock
|
(2,416
|
)
|
|
(1,883
|
)
|
||
Total stockholders’ equity
|
446,086
|
|
|
358,138
|
|
||
Long-term debt, net of current maturities
|
136,954
|
|
|
149,006
|
|
||
Total capitalization
|
583,040
|
|
|
507,144
|
|
||
Current Liabilities
|
|
|
|
||||
Current portion of long-term debt
|
12,099
|
|
|
9,151
|
|
||
Short-term borrowing
|
209,871
|
|
|
173,397
|
|
||
Accounts payable
|
56,935
|
|
|
39,300
|
|
||
Customer deposits and refunds
|
29,238
|
|
|
27,173
|
|
||
Accrued interest
|
1,312
|
|
|
1,311
|
|
||
Dividends payable
|
4,973
|
|
|
4,390
|
|
||
Accrued compensation
|
10,496
|
|
|
10,014
|
|
||
Regulatory liabilities
|
1,291
|
|
|
7,365
|
|
||
Mark-to-market energy liabilities
|
773
|
|
|
433
|
|
||
Other accrued liabilities
|
7,063
|
|
|
7,059
|
|
||
Total current liabilities
|
334,051
|
|
|
279,593
|
|
||
Deferred Credits and Other Liabilities
|
|
|
|
||||
Deferred income taxes
|
222,894
|
|
|
192,600
|
|
||
Regulatory liabilities
|
43,064
|
|
|
43,064
|
|
||
Environmental liabilities
|
8,592
|
|
|
8,942
|
|
||
Other pension and benefit costs
|
32,828
|
|
|
33,481
|
|
||
Deferred investment tax credits and other liabilities
|
4,750
|
|
|
2,597
|
|
||
Total deferred credits and other liabilities
|
312,128
|
|
|
280,684
|
|
||
Other commitments and contingencies (Note 19 and 20)
|
|
|
|
|
|
||
Total Capitalization and Liabilities
|
$
|
1,229,219
|
|
|
$
|
1,067,421
|
|
Chesapeake Utilities Corporation and Subsidiaries
Consolidated Statements of Cash Flows
|
|||||||||||
|
For the Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
(in thousands)
|
|
|
|
|
|
||||||
Operating Activities
|
|
|
|
|
|
||||||
Net Income
|
$
|
44,675
|
|
|
$
|
41,140
|
|
|
$
|
36,092
|
|
Adjustments to reconcile net income to net operating cash:
|
|
|
|
|
|
||||||
Goodwill & long-lived asset impairment
|
—
|
|
|
—
|
|
|
6,881
|
|
|||
Depreciation and amortization
|
32,159
|
|
|
29,972
|
|
|
26,316
|
|
|||
Depreciation and accretion included in other costs
|
7,334
|
|
|
6,978
|
|
|
6,577
|
|
|||
Deferred income taxes, net
|
31,257
|
|
|
20,520
|
|
|
22,235
|
|
|||
Realized loss (gain) on sale of assets/investments
|
695
|
|
|
(340
|
)
|
|
(7,293
|
)
|
|||
Unrealized (gain) loss on investments/commodity contracts
|
(385
|
)
|
|
96
|
|
|
501
|
|
|||
Employee benefits and compensation
|
1,887
|
|
|
1,235
|
|
|
684
|
|
|||
Share-based compensation
|
2,367
|
|
|
1,937
|
|
|
1,958
|
|
|||
Other, net
|
(79
|
)
|
|
47
|
|
|
3
|
|
|||
Changes in assets and liabilities:
|
|
|
|
|
|
||||||
Accounts receivable and accrued revenue
|
(27,013
|
)
|
|
17,097
|
|
|
20,683
|
|
|||
Propane inventory, storage gas and other inventory
|
(2,531
|
)
|
|
1,527
|
|
|
4,177
|
|
|||
Regulatory assets/liabilities, net
|
(7,523
|
)
|
|
3,883
|
|
|
(11,014
|
)
|
|||
Prepaid expenses and other current assets
|
(1,387
|
)
|
|
(759
|
)
|
|
(699
|
)
|
|||
Accounts payable and other accrued liabilities
|
18,829
|
|
|
(11,916
|
)
|
|
(13,623
|
)
|
|||
Income taxes receivable
|
2,466
|
|
|
(4,967
|
)
|
|
(15,936
|
)
|
|||
Customer deposits and refunds
|
2,065
|
|
|
1,976
|
|
|
(927
|
)
|
|||
Accrued compensation
|
358
|
|
|
(331
|
)
|
|
37
|
|
|||
Other assets and liabilities, net
|
(1,803
|
)
|
|
(3,972
|
)
|
|
(2,944
|
)
|
|||
Net cash provided by operating activities
|
103,371
|
|
|
104,123
|
|
|
73,708
|
|
|||
Investing Activities
|
|
|
|
|
|
||||||
Property, plant and equipment expenditures
|
(169,861
|
)
|
|
(143,599
|
)
|
|
(91,588
|
)
|
|||
Change in intangibles
|
—
|
|
|
—
|
|
|
14
|
|
|||
Proceeds from sale of assets
|
174
|
|
|
164
|
|
|
10,797
|
|
|||
Acquisitions, net of cash acquired
|
—
|
|
|
(20,930
|
)
|
|
—
|
|
|||
Environmental expenditures
|
(350
|
)
|
|
(174
|
)
|
|
(233
|
)
|
|||
Net cash used by investing activities
|
(170,037
|
)
|
|
(164,539
|
)
|
|
(81,010
|
)
|
|||
Financing Activities
|
|
|
|
|
|
||||||
Common stock dividends
|
(17,482
|
)
|
|
(15,924
|
)
|
|
(13,887
|
)
|
|||
Issuance (Purchase) of stock for Dividend Reinvestment Plan
|
811
|
|
|
813
|
|
|
(165
|
)
|
|||
Proceeds from issuance of common stock, net of expenses
|
57,360
|
|
|
—
|
|
|
—
|
|
|||
Change in cash overdrafts due to outstanding checks
|
3,920
|
|
|
2,450
|
|
|
(921
|
)
|
|||
Net borrowing (repayment) under line of credit agreements
|
32,526
|
|
|
82,178
|
|
|
(16,513
|
)
|
|||
Proceeds from issuance of long-term debt
|
—
|
|
|
—
|
|
|
49,975
|
|
|||
Repayment of long-term debt and capital lease obligation
|
(9,146
|
)
|
|
(10,820
|
)
|
|
(9,969
|
)
|
|||
Net cash provided by financing activities
|
67,989
|
|
|
58,697
|
|
|
8,520
|
|
|||
Net Increase (Decrease) in Cash and Cash Equivalents
|
1,323
|
|
|
(1,719
|
)
|
|
1,218
|
|
|||
Cash and Cash Equivalents — Beginning of Period
|
2,855
|
|
|
4,574
|
|
|
3,356
|
|
|||
Cash and Cash Equivalents — End of Period
|
$
|
4,178
|
|
|
$
|
2,855
|
|
|
$
|
4,574
|
|
Chesapeake Utilities Corporation and Subsidiaries
Consolidated Statements of Stockholders' Equity
|
||||||||||||||||||||||||||||||
|
Common Stock
(1)
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||||
(in thousands, except shares and per share data)
|
Number
of
Shares
(2)
|
|
Par
Value
|
|
Additional
Paid-In
Capital
|
|
Retained
Earnings
|
|
Accumulated
Other
Comprehensive
Loss
|
|
Deferred
Compensation
|
|
Treasury
Stock
|
|
Total
|
|||||||||||||||
Balance at December 31, 2013
|
14,457,345
|
|
|
$
|
4,691
|
|
|
$
|
152,341
|
|
|
$
|
124,274
|
|
|
$
|
(2,533
|
)
|
|
$
|
1,124
|
|
|
$
|
(1,124
|
)
|
|
$
|
278,773
|
|
Net Income
|
—
|
|
|
—
|
|
|
—
|
|
|
36,092
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
36,092
|
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(3,143
|
)
|
|
—
|
|
|
—
|
|
|
(3,143
|
)
|
|||||||
Dividends declared ($1.0667 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
(15,675
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(15,675
|
)
|
|||||||
Retirement savings plan and dividend reinvestment plan
|
43,367
|
|
|
16
|
|
|
1,844
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,860
|
|
|||||||
Conversion of Debentures
|
47,313
|
|
|
15
|
|
|
520
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
535
|
|
|||||||
Share-based compensation and tax benefit
(4) (5)
|
40,686
|
|
|
13
|
|
|
1,876
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,889
|
|
|||||||
Stock split in the form of stock dividend
|
—
|
|
|
2,365
|
|
|
—
|
|
|
(2,374
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(9
|
)
|
|||||||
Treasury stock activities
(2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
134
|
|
|
(134
|
)
|
|
—
|
|
|||||||
Balance at December 31, 2014
|
14,588,711
|
|
|
7,100
|
|
|
156,581
|
|
|
142,317
|
|
|
(5,676
|
)
|
|
1,258
|
|
|
(1,258
|
)
|
|
300,322
|
|
|||||||
Net Income
|
—
|
|
|
—
|
|
|
—
|
|
|
41,140
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
41,140
|
|
|||||||
Other comprehensive loss
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(164
|
)
|
|
—
|
|
|
—
|
|
|
(164
|
)
|
|||||||
Dividends declared ($1.1325 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
(17,222
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(17,222
|
)
|
|||||||
Retirement savings plan and dividend reinvestment plan
|
43,275
|
|
|
21
|
|
|
2,214
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,235
|
|
|||||||
Common stock issued in acquisition
|
592,970
|
|
|
289
|
|
|
29,876
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
30,165
|
|
|||||||
Share-based compensation and tax benefit
(4) (5)
|
45,703
|
|
|
22
|
|
|
1,640
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,662
|
|
|||||||
Treasury stock activities
(2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
625
|
|
|
(625
|
)
|
|
—
|
|
|||||||
Balance at December 31, 2015
|
15,270,659
|
|
|
7,432
|
|
|
190,311
|
|
|
166,235
|
|
|
(5,840
|
)
|
|
1,883
|
|
|
(1,883
|
)
|
|
358,138
|
|
|||||||
Net Income
|
—
|
|
|
—
|
|
|
—
|
|
|
44,675
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
44,675
|
|
|||||||
Other comprehensive income
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
962
|
|
|
—
|
|
|
—
|
|
|
962
|
|
|||||||
Dividends declared ($1.2025 per share)
|
—
|
|
|
—
|
|
|
—
|
|
|
(18,848
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(18,848
|
)
|
|||||||
Retirement savings plan and dividend reinvestment plan
|
36,253
|
|
|
17
|
|
|
2,225
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
2,242
|
|
|||||||
Stock issuance
(3)
|
960,488
|
|
|
467
|
|
|
56,893
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
57,360
|
|
|||||||
Share-based compensation and tax benefit
(4) (5)
|
36,099
|
|
|
19
|
|
|
1,538
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,557
|
|
|||||||
Treasury stock activities
(2)
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
533
|
|
|
(533
|
)
|
|
—
|
|
|||||||
Balance at December 31, 2016
|
16,303,499
|
|
|
$
|
7,935
|
|
|
$
|
250,967
|
|
|
$
|
192,062
|
|
|
$
|
(4,878
|
)
|
|
$
|
2,416
|
|
|
$
|
(2,416
|
)
|
|
$
|
446,086
|
|
(1)
|
2,000,000
shares of preferred stock at
$0.01
par value per share have been authorized. No shares have been issued or are outstanding; accordingly, no information has been included in the Statements of Stockholders’ Equity.
|
(2)
|
Includes
76,745
,
70,631
and
57,382
shares at December 31, 2016, 2015 and 2014, respectively, held in a Rabbi Trust related to our Non-Qualified Deferred Compensation Plan.
|
(3)
|
On September 22, 2016, we completed a public offering of
960,488
shares of our common stock at a price per share of
$62.26
. The net proceeds from the sale of common stock, after deducting underwriting commissions and expenses, were approximately
$57.4 million
.
|
(4)
|
Includes amounts for shares issued for directors’ compensation.
|
(5)
|
The shares issued under the SICP are net of shares withheld for employee taxes. For 2016, 2015 and 2014, we withheld
12,031
,
12,620
and
12,687
shares, respectively, for taxes.
|
|
As of December 31,
|
||||||
(in thousands)
|
2016
|
|
2015
|
||||
Property, plant and equipment
|
|
|
|
||||
Regulated Energy
|
|
|
|
||||
Natural gas distribution – Delmarva
|
$
|
220,083
|
|
|
$
|
207,127
|
|
Natural gas distribution – Florida
|
331,281
|
|
|
286,538
|
|
||
Natural gas transmission – Delmarva
|
285,746
|
|
|
249,274
|
|
||
Natural gas transmission – Florida
|
27,018
|
|
|
20,291
|
|
||
Electric distribution – Florida
|
93,553
|
|
|
79,526
|
|
||
Unregulated Energy
|
|
|
|
||||
Propane distribution – Delmarva
|
73,686
|
|
|
66,403
|
|
||
Propane distribution – Florida
|
26,359
|
|
|
24,589
|
|
||
Other Unregulated natural gas services – Ohio
|
61,383
|
|
|
54,607
|
|
||
CHP - Florida
|
35,237
|
|
|
—
|
|
||
Other unregulated energy
|
135
|
|
|
135
|
|
||
Other
|
21,114
|
|
|
18,999
|
|
||
Total property, plant and equipment
|
1,175,595
|
|
|
1,007,489
|
|
||
Less: Accumulated depreciation and amortization
|
(245,207
|
)
|
|
(215,313
|
)
|
||
Plus: Construction work in progress
|
56,276
|
|
|
62,774
|
|
||
Net property, plant and equipment
|
$
|
986,664
|
|
|
$
|
854,950
|
|
|
2016
|
|
2015
|
|
2014
|
Natural gas distribution – Delmarva
|
2.5%
|
|
2.4%
|
|
2.5%
|
Natural gas distribution – Florida
|
2.9%
|
|
2.9%
|
|
2.9%
|
Natural gas transmission – Delmarva
|
2.7%
|
|
2.7%
|
|
2.7%
|
Natural gas transmission – Florida
|
3.9%
|
|
4.0%
|
|
4.0%
|
Electric distribution – Florida
|
3.5%
|
|
3.5%
|
|
3.8%
|
Asset Description
|
Useful Life
|
Propane distribution mains
|
10-37 years
|
Propane bulk plants and tanks
|
10-40 years
|
Propane equipment
|
5-33 years
|
Meters and meter installations
|
5-33 years
|
Measuring and regulating station equipment
|
5-37 years
|
Natural gas pipelines
|
45 years
|
Natural gas right of ways
|
Perpetual
|
CHP plant
|
30 years
|
Natural gas processing equipment
|
20-25 years
|
Office furniture and equipment
|
3-10 years
|
Transportation equipment
|
4-20 years
|
Structures and improvements
|
5-45 years
|
Other
|
Various
|
|
For the Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
(in thousands, except shares and per share data)
|
|
|
|
|
|
||||||
Calculation of Basic Earnings Per Share:
|
|
|
|
|
|
||||||
Net Income
|
$
|
44,675
|
|
|
$
|
41,140
|
|
|
$
|
36,092
|
|
Weighted average shares outstanding
|
15,570,539
|
|
|
15,094,423
|
|
|
14,551,308
|
|
|||
Basic Earnings Per Share
|
$
|
2.87
|
|
|
$
|
2.73
|
|
|
$
|
2.48
|
|
|
|
|
|
|
|
||||||
Calculation of Diluted Earnings Per Share:
|
|
|
|
|
|
||||||
Net Income
|
$
|
44,675
|
|
|
$
|
41,140
|
|
|
$
|
36,092
|
|
Reconciliation of Denominator:
|
|
|
|
|
|
||||||
Weighted average shares outstanding — Basic
|
15,570,539
|
|
|
15,094,423
|
|
|
14,551,308
|
|
|||
Effect of dilutive securities — Share-based compensation
|
42,552
|
|
|
48,950
|
|
|
53,636
|
|
|||
Adjusted denominator — Diluted
|
15,613,091
|
|
|
15,143,373
|
|
|
14,604,944
|
|
|||
Diluted Earnings Per Share
|
$
|
2.86
|
|
|
$
|
2.72
|
|
|
$
|
2.47
|
|
(in thousands)
|
Net Purchase Price
|
|
|
Chesapeake Utilities common stock issued
|
$
|
30,164
|
|
Cash
|
27,494
|
|
|
Acquired debt
|
1,696
|
|
|
Aggregate amount paid in the acquisition
|
59,354
|
|
|
Less: cash acquired
|
(6,806
|
)
|
|
Net amount paid in the acquisition
|
$
|
52,548
|
|
(in thousands)
|
Purchase Price Allocation
|
||
Purchase price
|
$
|
57,658
|
|
|
|
||
Property plant and equipment
|
53,203
|
|
|
Cash
|
6,806
|
|
|
Accounts receivable
|
3,629
|
|
|
Income taxes receivable
|
3,163
|
|
|
Other assets
|
425
|
|
|
Total assets acquired
|
67,226
|
|
|
|
|
||
Long-term debt
|
1,696
|
|
|
Deferred income taxes
|
13,409
|
|
|
Accounts payable
|
3,837
|
|
|
Other current liabilities
|
745
|
|
|
Total liabilities assumed
|
19,687
|
|
|
Net identifiable assets acquired
|
47,539
|
|
|
Goodwill
|
$
|
10,119
|
|
•
|
Regulated Energy
. Includes natural gas distribution, natural gas transmission and electric distribution operations. All operations in this segment are regulated, as to their rates and services, by the PSC having jurisdiction in each operating territory or by the FERC in the case of Eastern Shore.
|
•
|
Unregulated Energy.
Includes propane distribution, propane and crude oil wholesale marketing and natural gas marketing operations, which are unregulated as to their rates and services. Effective April 2015, this segment includes Aspire Energy, whose services include natural gas gathering, processing, transportation and supply (See Note 4,
Acquisitions and Dispositions
, regarding the merger with Gatherco). Effective June 2016, this segment also includes electricity and steam generation through Eight Flags' CHP plant. Also included in this segment are other unregulated energy services, such as energy-related merchandise sales and heating, ventilation and air conditioning, plumbing and electrical services.
|
|
For the Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
(in thousands)
|
|
|
|
|
|
||||||
Operating Revenues, Unaffiliated Customers
|
|
|
|
|
|
||||||
Regulated Energy
|
$
|
302,402
|
|
|
$
|
300,674
|
|
|
$
|
299,345
|
|
Unregulated Energy
|
196,458
|
|
|
158,570
|
|
|
184,557
|
|
|||
Other businesses and eliminations
|
—
|
|
|
—
|
|
|
14,932
|
|
|||
Total operating revenues, unaffiliated customers
|
$
|
498,860
|
|
|
$
|
459,244
|
|
|
$
|
498,834
|
|
Intersegment Revenues
(1)
|
|
|
|
|
|
||||||
Regulated Energy
|
$
|
3,287
|
|
|
$
|
1,228
|
|
|
$
|
1,097
|
|
Unregulated Energy
|
7,321
|
|
|
3,537
|
|
|
404
|
|
|||
Other businesses
|
880
|
|
|
880
|
|
|
979
|
|
|||
Total intersegment revenues
|
$
|
11,488
|
|
|
$
|
5,645
|
|
|
$
|
2,480
|
|
Operating Income
|
|
|
|
|
|
||||||
Regulated Energy
|
$
|
69,851
|
|
|
$
|
60,985
|
|
|
$
|
50,451
|
|
Unregulated Energy
|
13,844
|
|
|
16,355
|
|
|
11,723
|
|
|||
Other businesses and eliminations
|
401
|
|
|
418
|
|
|
105
|
|
|||
Operating Income
|
84,096
|
|
|
77,758
|
|
|
62,279
|
|
|||
Gains from sales of businesses
|
—
|
|
|
—
|
|
|
7,139
|
|
|||
Other (expense) income
|
(441
|
)
|
|
293
|
|
|
101
|
|
|||
Interest charges
|
10,639
|
|
|
10,006
|
|
|
9,482
|
|
|||
Income Before Income taxes
|
73,016
|
|
|
68,045
|
|
|
60,037
|
|
|||
Income taxes
|
28,341
|
|
|
26,905
|
|
|
23,945
|
|
|||
Net Income
|
$
|
44,675
|
|
|
$
|
41,140
|
|
|
$
|
36,092
|
|
Depreciation and Amortization
|
|
|
|
|
|
||||||
Regulated Energy
|
$
|
25,677
|
|
|
$
|
24,195
|
|
|
$
|
21,915
|
|
Unregulated Energy
|
6,386
|
|
|
5,679
|
|
|
3,994
|
|
|||
Other businesses and eliminations
|
96
|
|
|
98
|
|
|
407
|
|
|||
Total depreciation and amortization
|
$
|
32,159
|
|
|
$
|
29,972
|
|
|
$
|
26,316
|
|
Capital Expenditures
|
|
|
|
|
|
||||||
Regulated Energy
|
$
|
139,994
|
|
|
$
|
98,372
|
|
|
$
|
84,959
|
|
Unregulated Energy
|
23,984
|
|
|
38,347
|
|
|
9,648
|
|
|||
Other businesses
|
5,398
|
|
|
5,994
|
|
|
3,450
|
|
|||
Total capital expenditures
|
$
|
169,376
|
|
|
$
|
142,713
|
|
|
$
|
98,057
|
|
(1)
|
All significant intersegment revenues are billed at market rates and have been eliminated from consolidated revenues.
|
|
As of December 31,
|
||||||
|
2016
|
|
2015
|
||||
Identifiable Assets
|
|
|
|
||||
Regulated Energy
|
$
|
986,752
|
|
|
$
|
872,065
|
|
Unregulated Energy
|
226,368
|
|
|
171,840
|
|
||
Other businesses
|
16,099
|
|
|
23,516
|
|
||
Total identifiable assets
|
$
|
1,229,219
|
|
|
$
|
1,067,421
|
|
|
For the Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
(in thousands)
|
|
|
|
|
|
||||||
Cash paid for interest
|
$
|
10,315
|
|
|
$
|
9,497
|
|
|
$
|
8,870
|
|
Cash paid for income taxes, net of refunds
|
$
|
(5,308
|
)
|
|
$
|
11,076
|
|
|
$
|
17,588
|
|
|
For the Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
(in thousands)
|
|
|
|
|
|
||||||
Capital property and equipment acquired on account, but not paid for as of December 31
|
$
|
9,791
|
|
|
$
|
10,268
|
|
|
$
|
7,040
|
|
Common stock issued for the Retirement Savings Plan
|
$
|
777
|
|
|
$
|
690
|
|
|
$
|
602
|
|
Common stock issued for the conversion of debentures
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
535
|
|
Common stock issued under the SICP
|
$
|
1,027
|
|
|
$
|
1,594
|
|
|
$
|
1,533
|
|
Capital lease obligation
|
$
|
3,471
|
|
|
$
|
4,824
|
|
|
$
|
6,130
|
|
Common stock issued in acquisition
|
$
|
—
|
|
|
$
|
30,164
|
|
|
$
|
—
|
|
|
|
|
Year Ended
|
|
||
(in thousands)
|
|
|
December 31, 2016
(1)
|
|
||
Commodity contracts
|
|
$
|
(233
|
)
|
|
|
Fair value adjustment for natural gas inventory designated as the hedged item
|
|
681
|
|
|
||
Total increase in purchased gas cost
|
|
$
|
448
|
|
|
|
|
|
|
|
|
||
The increase in purchased gas cost is comprised of the following:
|
|
|
|
|||
Basis ineffectiveness
|
|
$
|
(83
|
)
|
|
|
Timing ineffectiveness
|
|
531
|
|
|
||
Total ineffectiveness
|
|
$
|
448
|
|
|
(1)
|
There were no natural gas futures commodity contracts designated as fair value hedges in 2015 or 2014.
|
|
Asset Derivatives
|
||||||||
|
|
|
Fair Value As Of
|
||||||
(in thousands)
|
Balance Sheet Location
|
|
December 31, 2016
|
|
December 31, 2015
|
||||
Derivatives not designated as hedging instruments
|
|
|
|
|
|
||||
Forward contracts
|
Mark-to-market energy assets
|
|
$
|
—
|
|
|
$
|
1
|
|
Propane swap agreements
|
Mark-to-market energy assets
|
|
8
|
|
|
—
|
|
||
Derivatives designated as fair value hedges
|
|
|
|
|
|
||||
Put options
|
Mark-to-market energy assets
|
|
9
|
|
|
152
|
|
||
Derivatives designated as cash flow hedges
|
|
|
|
|
|
||||
Natural gas futures contracts
|
Mark-to-market energy assets
|
|
113
|
|
|
—
|
|
||
Propane swap agreements
|
Mark-to-market energy assets
|
|
693
|
|
|
—
|
|
||
Total asset derivatives
|
|
|
$
|
823
|
|
|
$
|
153
|
|
|
Liability Derivatives
|
||||||||
|
|
|
Fair Value As Of
|
||||||
(in thousands)
|
Balance Sheet Location
|
|
December 31, 2016
|
|
December 31, 2015
|
||||
Derivatives not designated as hedging instruments
|
|
|
|
|
|
||||
Forward contracts
|
Mark-to-market energy liabilities
|
|
$
|
—
|
|
|
$
|
1
|
|
Natural gas futures contracts
|
Mark-to-market energy liabilities
|
|
773
|
|
|
—
|
|
||
Derivatives designated as cash flow hedges
|
|
|
|
|
|
||||
Propane swap agreements
|
Mark-to-market energy liabilities
|
|
—
|
|
|
323
|
|
||
Natural gas futures contracts
|
Mark-to-market energy liabilities
|
|
—
|
|
|
109
|
|
||
Total liability derivatives
|
|
|
$
|
773
|
|
|
$
|
433
|
|
|
Amount of Gain (Loss) on Derivatives:
|
||||||||||||
|
Location of Gain
(Loss) on Derivatives
|
|
For the Year Ended December 31,
|
||||||||||
(in thousands)
|
2016
|
|
2015
|
|
2014
|
||||||||
Derivatives not designated as hedging instruments:
|
|
|
|
|
|
|
|
||||||
Realized (loss) gain on forward contracts and options
(1)
|
Revenue
|
|
$
|
(546
|
)
|
|
$
|
426
|
|
|
$
|
1,423
|
|
Unrealized (loss) gain on forward contracts
(1)
|
Revenue
|
|
—
|
|
|
(126
|
)
|
|
57
|
|
|||
Natural gas futures contracts
|
Cost of sales
|
|
(541
|
)
|
|
—
|
|
|
—
|
|
|||
Propane swap agreements
|
Cost of sales
|
|
7
|
|
|
18
|
|
|
(735
|
)
|
|||
Derivatives designated as fair value hedges:
|
|
|
|
|
|
|
|
||||||
Put/Call option
|
Cost of Sales
|
|
49
|
|
|
528
|
|
|
235
|
|
|||
Put/Call option
(2)
|
Propane Inventory
|
|
—
|
|
|
43
|
|
|
517
|
|
|||
Natural gas futures contracts
|
Natural Gas Inventory
|
|
(233
|
)
|
|
—
|
|
|
—
|
|
|||
Derivatives designated as cash flow hedges
|
|
|
|
|
|
|
|
||||||
Propane swap agreements
|
Cost of Sales
|
|
(364
|
)
|
|
(120
|
)
|
|
(341
|
)
|
|||
Propane swap agreements
|
Other Comprehensive Income
|
|
1,016
|
|
|
(323
|
)
|
|
—
|
|
|||
Call options
|
Cost of Sales
|
|
—
|
|
|
(81
|
)
|
|
(17
|
)
|
|||
Call options
|
Other Comprehensive Income
|
|
—
|
|
|
—
|
|
|
(55
|
)
|
|||
Natural gas futures contracts
|
Cost of sales
|
|
345
|
|
|
—
|
|
|
—
|
|
|||
Natural gas futures contracts
|
Other Comprehensive Income
|
|
222
|
|
|
109
|
|
|
—
|
|
|||
Total
|
|
|
$
|
(45
|
)
|
|
$
|
474
|
|
|
$
|
1,084
|
|
(1)
|
All of the realized and unrealized gain (loss) on forward contracts represents the effect of trading activities on our consolidated statements of income.
|
(2)
|
As a fair value hedge with no ineffective portion, the unrealized gains and losses associated with this call option are recorded in cost of sales, offset by the corresponding change in the value of propane inventory (hedged item), which is also recorded in cost of sales. The amounts in cost of sales offset to zero and the unrealized gains and losses of this call option effectively changed the value of propane inventory.
|
|
|
|
Fair Value Measurements Using:
|
||||||||||||
As of December 31, 2016
|
Fair Value
|
|
Quoted Prices in
Active Markets
(Level 1)
|
|
Significant Other
Observable
Inputs
(Level 2)
|
|
Significant
Unobservable
Inputs
(Level 3)
|
||||||||
(in thousands)
|
|
|
|
|
|
|
|
||||||||
Assets:
|
|
|
|
|
|
|
|
||||||||
Investments—equity securities
|
$
|
21
|
|
|
$
|
21
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Investments—guaranteed income fund
|
$
|
561
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
561
|
|
Investments—mutual funds and other
|
$
|
4,320
|
|
|
$
|
4,320
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Mark-to-market energy assets, including put options
|
$
|
823
|
|
|
$
|
—
|
|
|
$
|
823
|
|
|
$
|
—
|
|
Liabilities:
|
|
|
|
|
|
|
|
||||||||
Mark-to-market energy liabilities, including swap agreements and natural gas futures contracts
|
$
|
773
|
|
|
$
|
—
|
|
|
$
|
773
|
|
|
$
|
—
|
|
|
For the Year Ended December 31,
|
||||||
|
2016
|
|
2015
|
||||
(in thousands)
|
|
|
|
||||
Beginning Balance
|
$
|
279
|
|
|
$
|
287
|
|
Purchases and adjustments
|
123
|
|
|
69
|
|
||
Transfers/disbursements
|
151
|
|
|
(82
|
)
|
||
Investment income
|
8
|
|
|
5
|
|
||
Ending Balance
|
$
|
561
|
|
|
$
|
279
|
|
|
|
||||||
(in thousands)
|
December 31,
2016 |
|
December 31,
2015 |
||||
Rabbi trust (associated with the Non-qualified Deferred Compensation Plan)
|
$
|
4,881
|
|
|
$
|
3,626
|
|
Investments in equity securities
|
21
|
|
|
18
|
|
||
Total
|
$
|
4,902
|
|
|
$
|
3,644
|
|
|
As of December 31,
|
||||||||||||||
|
2016
|
|
2015
|
||||||||||||
(in thousands)
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
|
Gross
Carrying
Amount
|
|
Accumulated
Amortization
|
||||||||
Customer lists
|
$
|
4,012
|
|
|
$
|
2,379
|
|
|
$
|
4,012
|
|
|
$
|
2,048
|
|
Non-Compete agreements
|
270
|
|
|
146
|
|
|
270
|
|
|
103
|
|
||||
Other
|
270
|
|
|
184
|
|
|
270
|
|
|
179
|
|
||||
Total
|
$
|
4,552
|
|
|
$
|
2,709
|
|
|
$
|
4,552
|
|
|
$
|
2,330
|
|
|
For the Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
(in thousands)
|
|
|
|
|
|
||||||
Current Income Tax Expense
|
|
|
|
|
|
||||||
Federal
|
$
|
(4,898
|
)
|
|
$
|
4,875
|
|
|
$
|
434
|
|
State
|
2,053
|
|
|
1,533
|
|
|
1,311
|
|
|||
Other
|
(71
|
)
|
|
(23
|
)
|
|
(35
|
)
|
|||
Total current income tax expense
|
(2,916
|
)
|
|
6,385
|
|
|
1,710
|
|
|||
Deferred Income Tax Expense
(1)
|
|
|
|
|
|
||||||
Property, plant and equipment
|
31,062
|
|
|
21,205
|
|
|
20,382
|
|
|||
Deferred gas costs
|
1,163
|
|
|
(1,539
|
)
|
|
1,614
|
|
|||
Pensions and other employee benefits
|
237
|
|
|
(84
|
)
|
|
537
|
|
|||
FPU merger related premium cost and deferred gain
|
(572
|
)
|
|
(556
|
)
|
|
(802
|
)
|
|||
Net operating loss carryforwards
|
(9
|
)
|
|
2,078
|
|
|
(112
|
)
|
|||
Other
|
(624
|
)
|
|
(584
|
)
|
|
616
|
|
|||
Total deferred income tax expense
|
31,257
|
|
|
20,520
|
|
|
22,235
|
|
|||
Total Income Tax Expense
|
$
|
28,341
|
|
|
$
|
26,905
|
|
|
$
|
23,945
|
|
|
For the Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
(in thousands)
|
|
|
|
|
|
||||||
Reconciliation of Effective Income Tax Rates
|
|
|
|
|
|
||||||
Continuing Operations
|
|
|
|
|
|
||||||
Federal income tax expense
(1)
|
$
|
22,759
|
|
|
$
|
23,865
|
|
|
$
|
21,121
|
|
State income taxes, net of federal benefit
|
3,422
|
|
|
3,062
|
|
|
2,946
|
|
|||
ESOP dividend deduction
|
(264
|
)
|
|
(263
|
)
|
|
(267
|
)
|
|||
Other
|
2,424
|
|
|
241
|
|
|
145
|
|
|||
Total Income Tax Expense
|
$
|
28,341
|
|
|
$
|
26,905
|
|
|
$
|
23,945
|
|
Effective Income Tax Rate
|
38.81
|
%
|
|
39.54
|
%
|
|
39.88
|
%
|
(1)
|
Federal income taxes were calculated at
35%
for each year represented.
|
|
As of December 31,
|
||||||
|
2016
|
|
2015
|
||||
(in thousands)
|
|
|
|
||||
Deferred Income Taxes
|
|
|
|
||||
Deferred income tax liabilities:
|
|
|
|
||||
Property, plant and equipment
|
$
|
218,074
|
|
|
$
|
185,448
|
|
Acquisition adjustment
|
14,840
|
|
|
15,490
|
|
||
Loss on reacquired debt
|
442
|
|
|
485
|
|
||
Deferred gas costs
|
1,846
|
|
|
683
|
|
||
Other
|
6,375
|
|
|
5,961
|
|
||
Total deferred income tax liabilities
|
241,577
|
|
|
208,067
|
|
||
Deferred income tax assets:
|
|
|
|
||||
Pension and other employee benefits
|
6,230
|
|
|
6,570
|
|
||
Environmental costs
|
2,592
|
|
|
2,445
|
|
||
Net operating loss carryforwards
|
952
|
|
|
943
|
|
||
Investment tax credit carryforwards
|
2,643
|
|
|
—
|
|
||
Self insurance
|
189
|
|
|
278
|
|
||
Storm reserve liability
|
1,131
|
|
|
1,153
|
|
||
Other
|
4,946
|
|
|
4,078
|
|
||
Total deferred income tax assets
|
18,683
|
|
|
15,467
|
|
||
Deferred Income Taxes Per Consolidated Balance Sheets
|
$
|
222,894
|
|
|
$
|
192,600
|
|
|
As of December 31,
|
||||||
(in thousands)
|
2016
|
|
2015
|
||||
FPU secured first mortgage bonds:
|
|
|
|
||||
9.08% bond, due June 1, 2022
|
$
|
7,978
|
|
|
$
|
7,973
|
|
Uncollateralized Senior Notes:
|
|
|
|
||||
6.64% note, due October 31, 2017
|
2,727
|
|
|
5,455
|
|
||
5.50% note, due October 12, 2020
|
8,000
|
|
|
10,000
|
|
||
5.93% note, due October 31, 2023
|
21,000
|
|
|
24,000
|
|
||
5.68% note, due June 30, 2026
|
29,000
|
|
|
29,000
|
|
||
6.43% note, due May 2, 2028
|
7,000
|
|
|
7,000
|
|
||
3.73% note, due December 16, 2028
|
20,000
|
|
|
20,000
|
|
||
3.88% note, due May 15, 2029
|
50,000
|
|
|
50,000
|
|
||
Promissory notes
|
168
|
|
|
238
|
|
||
Capital lease obligation
|
3,471
|
|
|
4,824
|
|
||
Less: debt issuance costs
|
(291
|
)
|
|
(333
|
)
|
||
Total long-term debt
|
149,053
|
|
|
158,157
|
|
||
Less: current maturities
|
(12,099
|
)
|
|
(9,151
|
)
|
||
Total long-term debt, net of current maturities
|
$
|
136,954
|
|
|
$
|
149,006
|
|
|
|
|
|
Outstanding borrowings at
|
|
|||||||||
(in thousands)
|
Total Facility
|
Interest Rate
|
Expiration Date
|
December 31, 2016
|
December 31, 2015
|
Available at December 31, 2016
|
||||||||
Bank Credit Facility
|
|
|
|
|
|
|
||||||||
Committed revolving credit facility A
|
$
|
55,000
|
|
LIBOR plus 1.00 percent
(1)
|
October 29, 2017
|
$
|
45,000
|
|
$
|
30,000
|
|
$
|
10,000
|
|
Committed revolving credit facility B
|
30,000
|
|
LIBOR plus 1.00 percent
(1)
|
October 31, 2017
|
21,311
|
|
23,757
|
|
8,689
|
|
||||
Short-term revolving credit Note C
|
50,000
|
|
LIBOR plus 0.80 percent
(2)
|
October 31, 2017
|
50,000
|
|
50,000
|
|
—
|
|
||||
Committed revolving credit facility D
|
35,000
|
|
LIBOR plus 0.85 percent
(3)
|
December 19, 2017
|
35,000
|
|
30,000
|
|
—
|
|
||||
Committed revolving credit facility E
|
150,000
|
|
LIBOR plus 1.00 percent
(1)
|
October 8, 2020
|
50,000
|
|
35,000
|
|
100,000
|
|
||||
Total short term credit facilities
|
$
|
320,000
|
|
|
|
$
|
201,311
|
|
$
|
168,757
|
|
$
|
118,689
|
|
Book overdrafts
(4)
|
|
|
|
8,560
|
|
4,640
|
|
|
||||||
Total short-term borrowing
|
|
|
|
$
|
209,871
|
|
$
|
173,397
|
|
|
|
|
Defined Benefit Pension and Postretirement Plan Items
|
|
Commodity Contract Cash Flow Hedges
|
|
Total
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
As of December 31, 2015
|
|
$
|
(5,580
|
)
|
|
$
|
(260
|
)
|
|
$
|
(5,840
|
)
|
Other comprehensive (loss)/income before reclassifications
|
|
(254
|
)
|
|
762
|
|
|
508
|
|
|||
Amounts reclassified from accumulated other comprehensive loss
|
|
474
|
|
|
(20
|
)
|
|
454
|
|
|||
Net current-period other comprehensive income
|
|
220
|
|
|
742
|
|
|
962
|
|
|||
As of December 31, 2016
|
|
$
|
(5,360
|
)
|
|
$
|
482
|
|
|
$
|
(4,878
|
)
|
|
|
Defined Benefit Pension and Postretirement Plan Items
|
|
Commodity Contracts Cash Flow Hedges
|
|
Total
|
||||||
(in thousands)
|
|
|
|
|
|
|
||||||
As of December 31, 2014
|
|
$
|
(5,643
|
)
|
|
$
|
(33
|
)
|
|
$
|
(5,676
|
)
|
Other comprehensive loss before reclassifications
|
|
(286
|
)
|
|
(350
|
)
|
|
(636
|
)
|
|||
Amounts reclassified from accumulated other comprehensive loss
|
|
349
|
|
|
123
|
|
|
472
|
|
|||
Net current-period other comprehensive income/(loss)
|
|
63
|
|
|
(227
|
)
|
|
(164
|
)
|
|||
As of December 31, 2015
|
|
$
|
(5,580
|
)
|
|
$
|
(260
|
)
|
|
$
|
(5,840
|
)
|
|
|
For the Year Ended December 31,
|
||||||
(in thousands)
|
|
2016
|
|
2015
|
||||
Amortization of defined benefit pension and postretirement plan items:
|
|
|
|
|
||||
Prior service cost
(1)
|
|
$
|
77
|
|
|
$
|
68
|
|
Net gain
(1)
|
|
(871
|
)
|
|
(650
|
)
|
||
Total before income taxes
|
|
(794
|
)
|
|
(582
|
)
|
||
Income tax benefit
|
|
320
|
|
|
233
|
|
||
Net of tax
|
|
$
|
(474
|
)
|
|
$
|
(349
|
)
|
|
|
|
|
|
||||
Gains and losses on commodity contracts cash flow hedges
|
|
|
|
|
||||
Propane swap agreements
(2)
|
|
$
|
(322
|
)
|
|
$
|
(120
|
)
|
Call options
(2)
|
|
—
|
|
|
(55
|
)
|
||
Natural gas futures
(2)
|
|
345
|
|
|
(31
|
)
|
||
Total before income taxes
|
|
23
|
|
|
(206
|
)
|
||
Income tax impact
|
|
(3
|
)
|
|
83
|
|
||
Net of tax
|
|
$
|
20
|
|
|
$
|
(123
|
)
|
|
|
|
|
|
||||
Total reclassifications for the period
|
|
$
|
(454
|
)
|
|
$
|
(472
|
)
|
(1)
|
These amounts are included in the computation of net periodic benefits. See Note 16
, Employee Benefit Plans
, for additional details.
|
(2)
|
These amounts are included in the effects of gains and losses from derivative instruments. See Note 7,
Derivative Instruments
, for additional details.
|
|
Chesapeake
Pension Plan
|
|
FPU
Pension Plan
|
||||||||||||
At December 31,
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
(in thousands)
|
|
|
|
|
|
|
|
||||||||
Change in benefit obligation:
|
|
|
|
|
|
|
|
||||||||
Benefit obligation — beginning of year
|
$
|
11,501
|
|
|
$
|
11,981
|
|
|
$
|
64,435
|
|
|
$
|
68,173
|
|
Interest cost
|
421
|
|
|
407
|
|
|
2,525
|
|
|
2,504
|
|
||||
Actuarial loss (gain)
|
330
|
|
|
(401
|
)
|
|
(216
|
)
|
|
(3,374
|
)
|
||||
Effect of settlement
|
(433
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Benefits paid
|
(464
|
)
|
|
(486
|
)
|
|
(2,912
|
)
|
|
(2,868
|
)
|
||||
Benefit obligation — end of year
|
11,355
|
|
|
11,501
|
|
|
63,832
|
|
|
64,435
|
|
||||
Change in plan assets:
|
|
|
|
|
|
|
|
||||||||
Fair value of plan assets — beginning of year
|
8,752
|
|
|
9,078
|
|
|
42,207
|
|
|
45,077
|
|
||||
Actual return on plan assets
|
424
|
|
|
(289
|
)
|
|
2,343
|
|
|
(1,464
|
)
|
||||
Employer contributions
|
389
|
|
|
449
|
|
|
1,634
|
|
|
1,462
|
|
||||
Benefits paid
|
(464
|
)
|
|
(486
|
)
|
|
(2,912
|
)
|
|
(2,868
|
)
|
||||
Effect of settlement
|
(433
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Fair value of plan assets — end of year
|
8,668
|
|
|
8,752
|
|
|
43,272
|
|
|
42,207
|
|
||||
Reconciliation:
|
|
|
|
|
|
|
|
||||||||
Funded status
|
(2,687
|
)
|
|
(2,749
|
)
|
|
(20,560
|
)
|
|
(22,228
|
)
|
||||
Accrued pension cost
|
$
|
(2,687
|
)
|
|
$
|
(2,749
|
)
|
|
$
|
(20,560
|
)
|
|
$
|
(22,228
|
)
|
Assumptions:
|
|
|
|
|
|
|
|
||||||||
Discount rate
|
3.75
|
%
|
|
3.75
|
%
|
|
4.00
|
%
|
|
4.00
|
%
|
||||
Expected return on plan assets
|
6.00
|
%
|
|
6.00
|
%
|
|
6.50
|
%
|
|
7.00
|
%
|
|
Chesapeake
Pension Plan |
|
FPU
Pension Plan |
||||||||||||||||||||
For the Years Ended December 31,
|
2016
|
|
2015
|
|
2014
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Components of net periodic pension cost:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest cost
|
$
|
421
|
|
|
$
|
407
|
|
|
$
|
425
|
|
|
$
|
2,525
|
|
|
$
|
2,504
|
|
|
$
|
2,613
|
|
Expected return on assets
|
(501
|
)
|
|
(530
|
)
|
|
(516
|
)
|
|
(2,702
|
)
|
|
(3,107
|
)
|
|
(3,089
|
)
|
||||||
Amortization of actuarial loss
|
459
|
|
|
392
|
|
|
176
|
|
|
519
|
|
|
456
|
|
|
8
|
|
||||||
Settlement expense
|
161
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net periodic pension cost
|
540
|
|
|
269
|
|
|
85
|
|
|
342
|
|
|
(147
|
)
|
|
(468
|
)
|
||||||
Amortization of pre-merger regulatory asset
|
—
|
|
|
—
|
|
|
—
|
|
|
761
|
|
|
761
|
|
|
761
|
|
||||||
Total periodic cost
|
$
|
540
|
|
|
$
|
269
|
|
|
$
|
85
|
|
|
$
|
1,103
|
|
|
$
|
614
|
|
|
$
|
293
|
|
Assumptions:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Discount rate
|
3.75
|
%
|
|
3.50
|
%
|
|
4.25
|
%
|
|
4.00
|
%
|
|
3.75
|
%
|
|
4.75
|
%
|
||||||
Expected return on plan assets
|
6.00
|
%
|
|
6.00
|
%
|
|
6.00
|
%
|
|
6.50
|
%
|
|
7.00
|
%
|
|
7.00
|
%
|
At December 31,
|
2016
|
|
2015
|
||||
(in thousands)
|
|
|
|
||||
Change in benefit obligation:
|
|
|
|
||||
Benefit obligation — beginning of year
|
$
|
2,510
|
|
|
$
|
2,650
|
|
Interest cost
|
91
|
|
|
91
|
|
||
Actuarial gain
|
(21
|
)
|
|
(85
|
)
|
||
Benefits paid
|
(152
|
)
|
|
(146
|
)
|
||
Benefit obligation — end of year
|
2,428
|
|
|
2,510
|
|
||
Change in plan assets:
|
|
|
|
||||
Fair value of plan assets — beginning of year
|
—
|
|
|
—
|
|
||
Employer contributions
|
152
|
|
|
146
|
|
||
Benefits paid
|
(152
|
)
|
|
(146
|
)
|
||
Fair value of plan assets — end of year
|
—
|
|
|
—
|
|
||
Reconciliation:
|
|
|
|
||||
Funded status
|
(2,428
|
)
|
|
(2,510
|
)
|
||
Accrued pension cost
|
$
|
(2,428
|
)
|
|
$
|
(2,510
|
)
|
Assumptions:
|
|
|
|
||||
Discount rate
|
3.75
|
%
|
|
3.75
|
%
|
For the Years Ended December 31,
|
2016
|
|
2015
|
|
2014
|
||||||
(in thousands)
|
|
|
|
|
|
||||||
Components of net periodic pension cost:
|
|
|
|
|
|
||||||
Interest cost
|
$
|
91
|
|
|
$
|
91
|
|
|
$
|
92
|
|
Amortization of prior service cost
|
—
|
|
|
9
|
|
|
19
|
|
|||
Amortization of actuarial loss
|
87
|
|
|
99
|
|
|
47
|
|
|||
Net periodic pension cost
|
$
|
178
|
|
|
$
|
199
|
|
|
$
|
158
|
|
Assumptions:
|
|
|
|
|
|
||||||
Discount rate
|
3.75
|
%
|
|
3.50
|
%
|
|
4.25
|
%
|
|
Chesapeake
Pension Plan |
|
FPU
Pension Plan |
||||||||||||||
At December 31,
|
2016
|
|
2015
|
|
2014
|
|
2016
|
|
2015
|
|
2014
|
||||||
Asset Category
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Equity securities
|
52.93
|
%
|
|
48.01
|
%
|
|
51.42
|
%
|
|
53.18
|
%
|
|
48.56
|
%
|
|
52.62
|
%
|
Debt securities
|
37.64
|
%
|
|
39.62
|
%
|
|
37.31
|
%
|
|
37.74
|
%
|
|
41.74
|
%
|
|
37.69
|
%
|
Other
|
9.43
|
%
|
|
12.37
|
%
|
|
11.27
|
%
|
|
9.08
|
%
|
|
9.70
|
%
|
|
9.69
|
%
|
Total
|
100.00
|
%
|
|
100.00
|
%
|
|
100.00
|
%
|
|
100.00
|
%
|
|
100.00
|
%
|
|
100.00
|
%
|
Asset Allocation Strategy
|
|||||
Asset Class
|
Minimum
Allocation Percentage |
|
Maximum
Allocation Percentage |
||
Domestic Equities (Large Cap, Mid Cap and Small Cap)
|
14
|
%
|
|
32
|
%
|
Foreign Equities (Developed and Emerging Markets)
|
13
|
%
|
|
25
|
%
|
Fixed Income (Inflation Bond and Taxable Fixed)
|
26
|
%
|
|
40
|
%
|
Alternative Strategies (Long/Short Equity and Hedge Fund of Funds)
|
6
|
%
|
|
14
|
%
|
Diversifying Assets (High Yield Fixed Income, Commodities, and Real Estate)
|
7
|
%
|
|
19
|
%
|
Cash
|
0
|
%
|
|
5
|
%
|
|
Fair Value Measurement Hierarchy
|
||||||||||||||||||||||||||||||
|
|
|
|
||||||||||||||||||||||||||||
|
December 31, 2016
|
|
December 31, 2015
|
||||||||||||||||||||||||||||
Asset Category
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||||||||||
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Mutual Funds - Equity securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
U.S. Large Cap
(1)
|
$
|
4,031
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
4,031
|
|
|
$
|
3,641
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
3,641
|
|
U.S. Mid Cap
(1)
|
1,677
|
|
|
—
|
|
|
—
|
|
|
1,677
|
|
|
1,577
|
|
|
—
|
|
|
—
|
|
|
1,577
|
|
||||||||
U.S. Small Cap
(1)
|
845
|
|
|
—
|
|
|
—
|
|
|
845
|
|
|
865
|
|
|
—
|
|
|
—
|
|
|
865
|
|
||||||||
International
(2)
|
9,574
|
|
|
—
|
|
|
—
|
|
|
9,574
|
|
|
9,416
|
|
|
—
|
|
|
—
|
|
|
9,416
|
|
||||||||
Alternative Strategies
(3)
|
5,238
|
|
|
—
|
|
|
—
|
|
|
5,238
|
|
|
2,737
|
|
|
—
|
|
|
—
|
|
|
2,737
|
|
||||||||
|
21,365
|
|
|
—
|
|
|
—
|
|
|
21,365
|
|
|
18,236
|
|
|
—
|
|
|
—
|
|
|
18,236
|
|
||||||||
Mutual Funds - Debt securities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||||||||
Fixed income
(4)
|
16,958
|
|
|
—
|
|
|
—
|
|
|
16,958
|
|
|
18,565
|
|
|
—
|
|
|
—
|
|
|
18,565
|
|
||||||||
High Yield
(4)
|
2,636
|
|
|
—
|
|
|
—
|
|
|
2,636
|
|
|
2,521
|
|
|
—
|
|
|
—
|
|
|
2,521
|
|
||||||||
|
19,594
|
|
|
—
|
|
|
—
|
|
|
19,594
|
|
|
21,086
|
|
|
—
|
|
|
—
|
|
|
21,086
|
|
||||||||
Mutual Funds - Other
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||||
Commodities
(5)
|
2,134
|
|
|
—
|
|
|
—
|
|
|
2,134
|
|
|
1,365
|
|
|
—
|
|
|
—
|
|
|
1,365
|
|
||||||||
Real Estate
(6)
|
2,116
|
|
|
—
|
|
|
—
|
|
|
2,116
|
|
|
2,529
|
|
|
—
|
|
|
—
|
|
|
2,529
|
|
||||||||
Guaranteed deposit
(7)
|
—
|
|
|
—
|
|
|
498
|
|
|
498
|
|
|
—
|
|
|
—
|
|
|
1,286
|
|
|
1,286
|
|
||||||||
|
4,250
|
|
|
—
|
|
|
498
|
|
|
4,748
|
|
|
3,894
|
|
|
—
|
|
|
1,286
|
|
|
5,180
|
|
||||||||
Total Pension Plan Assets in fair value hierarchy
|
$
|
45,209
|
|
|
$
|
—
|
|
|
$
|
498
|
|
|
45,707
|
|
|
$
|
43,216
|
|
|
$
|
—
|
|
|
$
|
1,286
|
|
|
44,502
|
|
||
Investments measured at net asset value
(8)
|
|
|
|
|
|
|
6,233
|
|
|
|
|
|
|
|
|
6,457
|
|
||||||||||||||
Total Pension Plan Assets
|
|
|
|
|
|
|
$
|
51,940
|
|
|
|
|
|
|
|
|
$
|
50,959
|
|
(1)
|
Includes funds that invest primarily in United States common stocks.
|
(2)
|
Includes funds that invest primarily in foreign equities and emerging markets equities.
|
(3)
|
Includes funds that actively invest in both equity and debt securities, funds that sell short securities and funds that provide long-term capital appreciation. The funds may invest in debt securities below investment grade.
|
(4)
|
Includes funds that invest in investment grade and fixed income securities.
|
(5)
|
Includes funds that invest primarily in commodity-linked derivative instruments and fixed income securities.
|
(6)
|
Includes funds that invest primarily in real estate.
|
(7)
|
Includes investment in a group annuity product issued by an insurance company.
|
(8)
|
Certain investments that were measured at net asset value per share have not been classified in the fair value hierarchy. These amounts are presented to reconcile to total pension plan assets.
|
|
For the Year Ended December 31,
|
||||||
|
2016
|
|
2015
|
||||
(in thousands)
|
|
|
|
||||
Balance, beginning of year
|
$
|
1,286
|
|
|
$
|
1,144
|
|
Purchases
|
2,023
|
|
|
1,926
|
|
||
Transfers in
|
1,435
|
|
|
1,900
|
|
||
Disbursements
|
(4,268
|
)
|
|
(3,688
|
)
|
||
Investment income
|
22
|
|
|
4
|
|
||
Balance, end of year
|
$
|
498
|
|
|
$
|
1,286
|
|
|
Chesapeake
Postretirement Plan |
|
FPU
Medical Plan |
||||||||||||
At December 31,
|
2016
|
|
2015
|
|
2016
|
|
2015
|
||||||||
(in thousands)
|
|
|
|
|
|
|
|
||||||||
Change in benefit obligation:
|
|
|
|
|
|
|
|
||||||||
Benefit obligation — beginning of year
|
$
|
1,153
|
|
|
$
|
1,238
|
|
|
$
|
1,444
|
|
|
$
|
1,712
|
|
Interest cost
|
43
|
|
|
42
|
|
|
55
|
|
|
57
|
|
||||
Plan participants contributions
|
90
|
|
|
108
|
|
|
64
|
|
|
75
|
|
||||
Actuarial loss (gain)
|
20
|
|
|
(58
|
)
|
|
(41
|
)
|
|
(132
|
)
|
||||
Benefits paid
|
(174
|
)
|
|
(177
|
)
|
|
(173
|
)
|
|
(268
|
)
|
||||
Benefit obligation — end of year
|
1,132
|
|
|
1,153
|
|
|
1,349
|
|
|
1,444
|
|
||||
Change in plan assets:
|
|
|
|
|
|
|
|
||||||||
Fair value of plan assets — beginning of year
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Employer contributions
(1)
|
84
|
|
|
69
|
|
|
109
|
|
|
193
|
|
||||
Plan participants contributions
|
90
|
|
|
108
|
|
|
64
|
|
|
75
|
|
||||
Benefits paid
|
(174
|
)
|
|
(177
|
)
|
|
(173
|
)
|
|
(268
|
)
|
||||
Fair value of plan assets — end of year
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Reconciliation:
|
|
|
|
|
|
|
|
||||||||
Funded status
|
(1,132
|
)
|
|
(1,153
|
)
|
|
(1,349
|
)
|
|
(1,444
|
)
|
||||
Accrued postretirement cost
|
$
|
(1,132
|
)
|
|
$
|
(1,153
|
)
|
|
$
|
(1,349
|
)
|
|
$
|
(1,444
|
)
|
Assumptions:
|
|
|
|
|
|
|
|
||||||||
Discount rate
|
3.75
|
%
|
|
3.75
|
%
|
|
4.00
|
%
|
|
4.00
|
%
|
(1)
|
The Chesapeake Postretirement Plan does not receive a Medicare Part-D subsidy. The FPU Medical Plan did not receive a significant subsidy for the post-merger period.
|
|
Chesapeake
Postretirement Plan |
|
FPU
Medical Plan |
||||||||||||||||||||
For the Years Ended December 31,
|
2016
|
|
2015
|
|
2014
|
|
2016
|
|
2015
|
|
2014
|
||||||||||||
(in thousands)
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Components of net periodic postretirement cost:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Interest cost
|
$
|
43
|
|
|
$
|
42
|
|
|
$
|
39
|
|
|
$
|
55
|
|
|
$
|
57
|
|
|
$
|
69
|
|
Amortization of:
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Actuarial loss
|
64
|
|
|
72
|
|
|
55
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Prior service cost
|
(77
|
)
|
|
(77
|
)
|
|
(77
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Net periodic cost
|
30
|
|
|
37
|
|
|
17
|
|
|
55
|
|
|
57
|
|
|
69
|
|
||||||
Amortization of pre-merger regulatory asset
|
—
|
|
|
—
|
|
|
—
|
|
|
8
|
|
|
8
|
|
|
8
|
|
||||||
Net periodic cost
|
$
|
30
|
|
|
$
|
37
|
|
|
$
|
17
|
|
|
$
|
63
|
|
|
$
|
65
|
|
|
$
|
77
|
|
Assumptions
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Discount rate
|
3.75
|
%
|
|
3.50
|
%
|
|
4.25
|
%
|
|
4.00
|
%
|
|
3.75
|
%
|
|
4.75
|
%
|
(in thousands)
|
Chesapeake
Pension
Plan
|
|
FPU
Pension
Plan
|
|
Chesapeake
SERP
|
|
Chesapeake
Postretirement
Plan
|
|
FPU
Medical
Plan
|
|
Total
|
||||||||||||
Prior service cost (credit)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(678
|
)
|
|
$
|
—
|
|
|
$
|
(678
|
)
|
Net loss
|
4,223
|
|
|
20,043
|
|
|
757
|
|
|
748
|
|
|
58
|
|
|
25,829
|
|
||||||
Total
|
$
|
4,223
|
|
|
$
|
20,043
|
|
|
$
|
757
|
|
|
$
|
70
|
|
|
$
|
58
|
|
|
$
|
25,151
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Accumulated other comprehensive loss pre-tax
(1)
|
$
|
4,223
|
|
|
$
|
3,808
|
|
|
$
|
757
|
|
|
$
|
70
|
|
|
$
|
11
|
|
|
$
|
8,869
|
|
Post-merger regulatory asset
|
—
|
|
|
16,235
|
|
|
—
|
|
|
—
|
|
|
47
|
|
|
16,282
|
|
||||||
Subtotal
|
4,223
|
|
|
20,043
|
|
|
757
|
|
|
70
|
|
|
58
|
|
|
25,151
|
|
||||||
Pre-merger regulatory asset
|
—
|
|
|
2,065
|
|
|
—
|
|
|
—
|
|
|
30
|
|
|
2,095
|
|
||||||
Total unrecognized cost
|
$
|
4,223
|
|
|
$
|
22,108
|
|
|
$
|
757
|
|
|
$
|
70
|
|
|
$
|
88
|
|
|
$
|
27,246
|
|
(1)
|
The total amount of accumulated other comprehensive loss recorded on our consolidated balance sheet as of
December 31, 2016
is net of income tax benefits of
$3.5 million
.
|
(in thousands)
|
Chesapeake
Pension
Plan
|
|
FPU
Pension
Plan
|
|
Chesapeake
SERP
|
|
Chesapeake
Postretirement
Plan
|
|
FPU
Medical
Plan
|
|
Total
|
||||||||||||
Prior service cost (credit)
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
(77
|
)
|
|
$
|
—
|
|
|
$
|
(77
|
)
|
Net loss
|
$
|
426
|
|
|
$
|
523
|
|
|
$
|
87
|
|
|
$
|
65
|
|
|
$
|
—
|
|
|
$
|
1,101
|
|
Amortization of pre-merger regulatory asset
|
$
|
—
|
|
|
$
|
761
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
8
|
|
|
$
|
769
|
|
|
Chesapeake Pension
Plan
(1)
|
|
FPU Pension
Plan
(1)
|
|
Chesapeake
SERP
(2)
|
|
Chesapeake
Postretirement
Plan
(2)
|
|
FPU
Medical
Plan
(2)
|
||||||||||
(in thousands)
|
|
|
|
|
|
|
|
|
|
||||||||||
2017
|
$
|
746
|
|
|
$
|
3,041
|
|
|
$
|
151
|
|
|
$
|
83
|
|
|
$
|
129
|
|
2018
|
$
|
664
|
|
|
$
|
3,128
|
|
|
$
|
150
|
|
|
$
|
82
|
|
|
$
|
93
|
|
2019
|
$
|
713
|
|
|
$
|
3,235
|
|
|
$
|
149
|
|
|
$
|
82
|
|
|
$
|
99
|
|
2020
|
$
|
649
|
|
|
$
|
3,319
|
|
|
$
|
148
|
|
|
$
|
76
|
|
|
$
|
93
|
|
2021
|
$
|
902
|
|
|
$
|
3,370
|
|
|
$
|
376
|
|
|
$
|
72
|
|
|
$
|
95
|
|
Years 2022 through 2026
|
$
|
5,020
|
|
|
$
|
18,447
|
|
|
$
|
732
|
|
|
$
|
319
|
|
|
$
|
405
|
|
(1)
|
The pension plan is funded; therefore, benefit payments are expected to be paid out of the plan assets.
|
(2)
|
Benefit payments are expected to be paid out of our general funds.
|
|
For the Year Ended December 31,
|
||||||||||
|
2016
|
|
2015
|
|
2014
|
||||||
(in thousands)
|
|
|
|
|
|
||||||
Awards to non-employee directors
|
$
|
580
|
|
|
$
|
640
|
|
|
$
|
540
|
|
Awards to key employees
|
1,787
|
|
|
1,297
|
|
|
1,418
|
|
|||
Total compensation expense
|
2,367
|
|
|
1,937
|
|
|
1,958
|
|
|||
Less: tax benefit
|
(952
|
)
|
|
(780
|
)
|
|
(790
|
)
|
|||
Share-based compensation amounts included in net income
|
$
|
1,415
|
|
|
$
|
1,157
|
|
|
$
|
1,168
|
|
|
Number of
Shares
|
|
Weighted Average
Grant Date Fair Value
|
|||
Outstanding — December 31, 2014
|
—
|
|
|
$
|
—
|
|
Granted
|
14,484
|
|
|
$
|
45.54
|
|
Vested
|
(14,484
|
)
|
|
$
|
45.54
|
|
Outstanding — December 31, 2015
|
—
|
|
|
$
|
—
|
|
Granted
|
8,577
|
|
|
$
|
62.90
|
|
Vested
|
(8,577
|
)
|
|
$
|
62.90
|
|
Outstanding — December 31, 2016
|
—
|
|
|
$
|
—
|
|
|
Number of
Shares
|
|
Weighted Average
Fair Value
|
|||
Outstanding — December 31, 2014
|
123,038
|
|
|
$
|
32.60
|
|
Granted
|
33,719
|
|
|
$
|
47.65
|
|
Vested
|
(43,839
|
)
|
|
$
|
28.01
|
|
Expired
|
(2,520
|
)
|
|
$
|
28.83
|
|
Outstanding — December 31, 2015
|
110,398
|
|
|
$
|
38.34
|
|
Granted
|
46,571
|
|
|
$
|
67.90
|
|
Vested
|
(39,553
|
)
|
|
$
|
31.79
|
|
Expired
|
(2,325
|
)
|
|
$
|
42.25
|
|
Outstanding — December 31, 2016
|
115,091
|
|
|
$
|
51.85
|
|
|
As of December 31,
|
||||||
|
2016
|
|
2015
|
||||
(in thousands)
|
|
|
|
||||
Regulatory Assets
|
|
|
|
||||
Under-recovered purchased fuel and conservation cost recovery
(1)
|
$
|
5,703
|
|
|
$
|
4,598
|
|
Under-recovered GRIP revenue
(2)
|
1,469
|
|
|
3,091
|
|
||
Deferred postretirement benefits
(3)
|
18,379
|
|
|
19,479
|
|
||
Deferred conversion and development costs
(1)
|
8,051
|
|
|
5,729
|
|
||
Environmental regulatory assets and expenditures
(4)
|
3,694
|
|
|
4,158
|
|
||
Acquisition adjustment
(5)
|
41,864
|
|
|
43,735
|
|
||
Loss on reacquired debt
(6)
|
1,145
|
|
|
1,259
|
|
||
Other
|
4,192
|
|
|
3,738
|
|
||
Total Regulatory Assets
|
$
|
84,497
|
|
|
$
|
85,787
|
|
|
|
|
|
||||
|
|
|
|
||||
Regulatory Liabilities
|
|
|
|
||||
Self-insurance
(7)
|
$
|
987
|
|
|
$
|
1,031
|
|
Over-recovered purchased fuel and conservation cost recovery
(1)
|
808
|
|
|
6,994
|
|
||
Storm reserve
(7)
|
2,310
|
|
|
2,973
|
|
||
Accrued asset removal cost
(8)
|
39,826
|
|
|
39,206
|
|
||
Other
|
424
|
|
|
225
|
|
||
Total Regulatory Liabilities
|
$
|
44,355
|
|
|
$
|
50,429
|
|
|
|
|
|
(1)
|
We are allowed to recover the asset or are required to pay the liability in rates. We do not earn an overall rate of return on these assets.
|
(2)
|
The Florida PSC allowed us to recover through a surcharge, capital and other program-related-costs, inclusive of an appropriate return on investment, associated with accelerating the replacement of qualifying distribution mains and services (defined as any material other than coated steel or plastic) in FPU’s natural gas distribution, Fort Meade and Chesapeake’s Florida division. We are allowed to recover the asset or are required to pay the liability in rates related to GRIP.
|
(3)
|
The Florida PSC allowed FPU to treat as a regulatory asset the portion of the unrecognized costs pursuant to ASC Topic 715
, Compensation - Retirement Benefits
, related to its regulated operations. See Note 16
, Employee Benefit Plans,
for additional information.
|
(4)
|
All of our environmental expenditures incurred to date and our current estimate of future environmental expenditures have been approved by various PSCs for recovery. See Note 19
, Environmental Commitments and Contingencies
, for additional information on our environmental contingencies.
|
(5)
|
We are allowed to include the premiums paid in various natural gas utility acquisitions in Florida in our rate bases and recover them over a specific time period pursuant to the Florida PSC approvals. Included in these amounts are
$1.3 million
of the premium paid by FPU,
$34.2 million
of the premium paid by us in 2009, including the gross up of the amount for income tax, because it is not tax deductible, and
$746,000
of the premium paid by FPU in 2010.
|
(6)
|
Gains and losses resulting from the reacquisition of long-term debt are amortized over future periods as adjustments to interest expense in accordance with established regulatory practice.
|
(7)
|
We have self-insurance and storm reserves in our Florida regulated energy operations that allow us to collect through rates amounts to be used against general claims, storm restoration costs and other losses as they are incurred.
|
(8)
|
See Note 1
, Summary of Significant Accounting Policies,
for additional information on our asset removal cost policies.
|
|
For the Quarters Ended
|
||||||||||||||
|
March 31
|
|
June 30
|
|
September 30
|
|
December 31
|
||||||||
(in thousands except per share amounts)
|
|
|
|
|
|
|
|
||||||||
2016
(1)
|
|
|
|
|
|
|
|
||||||||
Operating Revenues
|
$
|
146,296
|
|
|
$
|
102,342
|
|
|
$
|
108,348
|
|
|
141,874
|
|
|
Operating Income
|
$
|
36,380
|
|
|
$
|
15,742
|
|
|
$
|
10,156
|
|
|
$
|
21,819
|
|
Net Income
|
$
|
20,367
|
|
|
$
|
8,029
|
|
|
$
|
4,416
|
|
|
$
|
11,863
|
|
Earnings per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
1.33
|
|
|
$
|
0.52
|
|
|
$
|
0.29
|
|
|
$
|
0.73
|
|
Diluted
|
$
|
1.33
|
|
|
$
|
0.52
|
|
|
$
|
0.29
|
|
|
$
|
0.73
|
|
|
|
|
|
|
|
|
|
||||||||
2015
(1)
|
|
|
|
|
|
|
|
||||||||
Operating Revenues
|
$
|
170,081
|
|
|
$
|
92,682
|
|
|
$
|
91,913
|
|
|
104,567
|
|
|
Operating Income
|
$
|
37,508
|
|
|
$
|
13,170
|
|
|
$
|
10,909
|
|
|
$
|
16,171
|
|
Net Income
|
$
|
21,109
|
|
|
$
|
6,294
|
|
|
$
|
5,119
|
|
|
$
|
8,619
|
|
Earnings per share:
|
|
|
|
|
|
|
|
||||||||
Basic
|
$
|
1.45
|
|
|
$
|
0.41
|
|
|
$
|
0.34
|
|
|
$
|
0.56
|
|
Diluted
|
$
|
1.44
|
|
|
$
|
0.41
|
|
|
$
|
0.33
|
|
|
$
|
0.56
|
|
(1)
|
The sum of the four quarters does not equal the total year due to rounding.
|
|
|
|
• Exhibit 1.1
|
|
Underwriting Agreement entered into by Chesapeake Utilities Corporation and Wells Fargo Securities, LLC, RBC Capital Markets, LLC, Janney Montgomery Scott LLC., Robert W. Baird & Co., Incorporated, J.J.B. Hilliard, W.L. Lyons, LLC, Ladenburg Thalmann & Co. Inc., U.S. Capital Advisors LLC and BB&T Securities, LLC on September 22, 2016, relating to the sale and issuance of 835,207 shares of the Company’s common stock, is incorporated herein by reference to Exhibit 1.1 of the Company’s current report on Form 8-K, filed on September 28, 2016, File No. 001-11590.
|
|
|
|
• Exhibit 3.1
|
|
Amended and Restated Certificate of Incorporation of Chesapeake Utilities Corporation is incorporated herein by reference to Exhibit 3.1 of our Quarterly Report on Form 10-Q for the period ended June 30, 2010, File No. 001-11590.
|
|
|
|
• Exhibit 3.2
|
|
Amended and Restated Bylaws of Chesapeake Utilities Corporation, effective December 4, 2012, are incorporated herein by reference to Exhibit 3 of our Current Report on Form 8-K, filed December 7, 2012, File No. 001-11590.
|
|
|
|
• Exhibit 3.3
|
|
First Amendment to the Amended and Restated Bylaws of Chesapeake Utilities Corporation, effective December 3, 2014, is incorporated herein by reference to Exhibit 3.3 of our Annual Report on Form 10-K for the year ended December 31, 2014.
|
|
|
|
• Exhibit 3.4
|
|
Second Amendment to the Amended and Restated Bylaws of Chesapeake Utilities Corporation, effective November 2, 2016, is incorporated herein by reference to Exhibit 3.3 of our Quarterly Report on Form 10-Q for the quarter ended September 30, 2016.
|
|
|
|
• Exhibit 4.1
|
|
Form of Indenture between Chesapeake Utilities Corporation and Boatmen’s Trust Company, as Trustee, relating to its 8 1/4% Convertible Debentures, is incorporated herein by reference to Exhibit 4.2 of our Registration Statement on Form S-2, Reg. No. 33-26582, filed on January 13, 1989.
|
|
|
|
• Exhibit 4.2
|
|
Note Purchase Agreement dated December 27, 2000, between Chesapeake Utilities Corporation, as issuer, and Pacific Life Insurance Company, relating to the private placement of Chesapeake Utilities Corporation’s 7.83% Senior Notes. †
|
|
|
|
• Exhibit 4.3
|
|
Note Agreement dated October 31, 2002, between Chesapeake Utilities Corporation, as issuer, and Massachusetts Mutual Life Insurance Company, C.M. Life Insurance Company, American United Life Insurance Company, Pioneer Mutual Life Insurance Company and The State Life Insurance Company, relating to the private placement of Chesapeake Utilities Corporation’s 6.64% Senior Notes due 2017, is incorporated herein by reference to Exhibit 2 of our Current Report on Form 8-K, filed November 6, 2002, File No. 001-11590.
|
|
|
|
• Exhibit 4.4
|
|
Note Agreement dated October 18, 2005, between Chesapeake Utilities Corporation, as issuer, and Prudential Investment Management, Inc., relating to the private placement of Chesapeake Utilities Corporation’s 5.5% Senior Notes due 2020, is incorporated herein by reference to Exhibit 4.1 of our Annual Report on Form 10-K for the year ended December 31, 2005, File No. 001-11590.
|
|
|
|
• Exhibit 4.5
|
|
Note Agreement dated October 31, 2008, among Chesapeake Utilities Corporation, as issuer, General American Life Insurance Company and New England Life Insurance Company, relating to the private placement of Chesapeake Utilities Corporation's 5.93% Senior Notes due 2023.†
|
|
|
|
• Exhibit 4.6
|
|
Note Agreement dated June 29, 2010, among Chesapeake Utilities Corporation, as issuer, Metropolitan Life Insurance Company and New England Life Insurance Company, relating to the private placement of Chesapeake Utilities Corporation’s 5.68% Senior Notes due 2026 and Chesapeake Utilities Corporation’s 6.43% Senior Notes due 2028.†
|
|
|
|
• Exhibit 4.7
|
|
Note Agreement dated September 5, 2013, among Chesapeake Utilities Corporation, as issuer, and certain note holders, relating to the private placement of Chesapeake Utilities Corporation’s 3.73% Senior Notes due 2028 and Chesapeake Utilities Corporation’s 3.88% Senior Notes due 2029.†
|
|
|
|
• Exhibit 4.8
|
|
Form of Indenture of Mortgage and Deed of Trust dated September 1, 1942, between Florida Public Utilities Company and the trustee, for the First Mortgage Bonds, is incorporated herein by reference to Exhibit 7-A of Florida Public Utilities Company’s Registration No. 2-6087.
|
|
|
|
• Exhibit 4.9
|
|
Seventeenth Supplemental Indenture dated April 12, 2011, between Chesapeake Utilities Corporation and Florida Public Utilities Company, pursuant to which Chesapeake Utilities Corporation guarantees the payment and performance obligations of Florida Public Utilities Company under the Indenture, is incorporated herein by reference to Exhibit 4.1 of our Quarterly Report on Form 10-Q for the period ended March 31, 2011, File No. 001-11590.
|
|
|
|
• Exhibit 4.10
|
|
Sixteenth Supplemental Indenture dated December 1, 2009, between Chesapeake Utilities Corporation and Florida Public Utilities Company, pursuant to which Chesapeake Utilities Corporation guaranteed the secured First Mortgage Bonds of Florida Public Utilities Company under the Merger Agreement, is incorporated herein by reference to Exhibit 4.9 of our Annual Report on Form 10-K for the year ended December 31, 2010, File No. 001-11590.
|
|
|
|
• Exhibit 4.11
|
|
Thirteenth Supplemental Indenture dated June 1, 1992, pursuant to which Florida Public Utilities, on May 1, 1992, privately placed $8,000,000 of its 9.08% First Mortgage Bonds, is incorporated herein by reference to Exhibit 4 to Florida Public Utilities Company’s Quarterly Report on Form 10-Q for the period ended June 30, 1992.
|
|
|
|
• Exhibit 4.12
|
|
Private Shelf Agreement dated October 8, 2015, between Chesapeake Utilities Corporation, as issuer, and Prudential Investment Management Inc., relating to the purchase of Chesapeake Utilities Corporation unsecured Senior Notes, is incorporated herein by reference to Exhibit 4.1 of our Quarterly Report on Form 10-Q for the period ended September 30, 2015, File No. 001-11590.
|
|
|
|
• Exhibit 10.1*
|
|
Chesapeake Utilities Corporation Cash Bonus Incentive Plan, effective January 1, 2015, is incorporated herein by reference to our Proxy Statement dated March 31, 2015, in connection with our Annual Meeting held on May 6, 2015, File No. 001-11590.
|
|
|
|
• Exhibit 10.2*
|
|
Chesapeake Utilities Corporation 2013 Stock and Incentive Compensation Plan, effective May 2, 2013 is incorporated herein by reference to our Proxy Statement dated March 29, 2013 in connection with our Annual Meeting held on May 2, 2013, File No. 001-11590.
|
|
|
|
• Exhibit 10.3*
|
|
Non-Qualified Deferred Compensation Plan, effective January 1, 2014, is incorporated herein by reference to Exhibit 10.8 of our Annual Report on Form 10-K for the year ended December 31, 2013, File No. 001-11590.
|
|
|
|
• Exhibit 10.4*
|
|
Consulting Agreement dated January 2, 2013, between Chesapeake Utilities Corporation and John R. Schimkaitis, is incorporated herein by reference to Exhibit 10.7 of our Annual Report on Form 10-K for the year ended December 31, 2012, File No. 001-11590.
|
|
|
|
• Exhibit 10.5*
|
|
Executive Employment Agreement dated January 14, 2011, between Chesapeake Utilities Corporation and Michael P. McMasters, is incorporated herein by reference to Exhibit 10.1 of our Current Report on Form 8-K, filed January 21, 2011, File No. 001-11590.
|
|
|
|
• Exhibit 10.6*
|
|
Amendment to Executive Employment Agreement effective January 1, 2014, between Chesapeake Utilities Corporation and Michael P. McMasters, is incorporated herein by reference to Exhibit 10.1 of our Current Report on Form 8-K filed January 14, 2014, File No. 001-11590.
|
|
|
|
• Exhibit 10.7*
|
|
Executive Employment Agreement dated January 9, 2013, between Chesapeake Utilities Corporation and Stephen C. Thompson, is incorporated herein by reference to Exhibit 10.9 of our Annual Report on Form 10-K for the year ended December 31, 2012, File No. 001-11590.
|
|
|
|
• Exhibit 10.8*
|
|
Executive Employment Agreement dated January 9, 2013, between Chesapeake Utilities Corporation and Beth W. Cooper, is incorporated herein by reference to Exhibit 10.10 of our Annual Report on Form 10-K for the year ended December 31, 2012, File No. 001-11590.
|
|
|
|
• Exhibit 10.9*
|
|
Executive Employment Agreement dated January 9, 2013, between Chesapeake Utilities Corporation and Elaine B. Bittner, incorporated herein by reference to Exhibit 10.11 of our Annual Report on Form 10-K for the year ended December 31, 2012, File No. 001-11590.
|
|
|
|
• Exhibit 10.10*
|
|
Executive Employment Agreement dated January 1, 2015, between Chesapeake Utilities Corporation and Jeffry M. Householder, is incorporated herein by reference to Exhibit 10.15 of our Annual Report on Form 10-K for the year ended December 31, 2014, File No. 001-11590.
|
|
|
|
• Exhibit 10.11*
|
|
Form of Performance Share Agreement, effective January 7, 2014 for the period 2014 to 2016, pursuant to Chesapeake Utilities Corporation 2013 Stock and Incentive Compensation Plan by and between Chesapeake Utilities Corporation and each of Michael P. McMasters, Beth W. Cooper, Stephen C. Thompson, Elaine B. Bittner, and Jeffry M. Householder is incorporated herein by reference to Exhibit 10.18 of our Annual Report on Form 10-K for the year ended December 31, 2013, File No. 001-11590.
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• Exhibit 10.12*
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Form of Performance Share Agreement, effective January 13, 2015 for the period 2015 to 2017, pursuant to Chesapeake Utilities Corporation 2013 Stock and Incentive Compensation Plan by and between Chesapeake Utilities Corporation and each of Michael P. McMasters, Beth W. Cooper, Stephen C. Thompson, Elaine B. Bittner and Jeffry M. Householder, is incorporated herein by reference to Exhibit 10.19 of our Annual Report on Form 10-K for the year ended December 31, 2014, File No. 001-11590.
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• Exhibit 10.13*
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Form of Performance Share Agreement, dated March 6, 2015 for the period 2015 to 2017, pursuant to Chesapeake Utilities Corporation 2013 Stock and Incentive Compensation Plan by and between Chesapeake Utilities Corporation and James F. Moriarty is incorporated herein by reference to Exhibit 10.2 to our Quarterly Report on Form 10-Q for the period ended September 30, 2015, File No. 001-11590.
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• Exhibit 10.14*
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Form of Performance Share Agreement, dated January 12, 2016 for the period 2016 to 2018, pursuant to Chesapeake Utilities Corporation 2013 Stock and Incentive Compensation Plan by and between Chesapeake Utilities Corporation and each of Michael P. McMasters, Beth W. Cooper, Stephen C. Thompson, Elaine B. Bittner, Jeffry M. Householder and James F. Moriarty, is filed herewith.
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• Exhibit 10.15*
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Chesapeake Utilities Corporation Supplemental Executive Retirement Plan, as amended and restated effective January 1, 2009, is incorporated herein by reference to Exhibit 10.27 of our Annual Report on Form 10-K for the year ended December 31, 2008, File No. 001-11590.
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• Exhibit 10.16*
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First Amendment to the Chesapeake Utilities Corporation Supplemental Executive Retirement Plan as amended and restated effective January 1, 2009, is incorporated herein by reference to Exhibit 10.30 of our Annual Report on Form 10-K for the year ended December 31, 2010, File No. 001-11590.
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• Exhibit 10.17
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Revolving Credit Agreement dated December 29, 2014, between Chesapeake Utilities Corporation and Citizens Bank, National Association, as lender, is incorporated herein by reference to Exhibit 10.25 of our Annual Report on Form 10-K for the year ended December 31, 2014, File No. 001-11590.
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• Exhibit 10.18
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Revolving Credit Agreement dated October 8, 2015, between Chesapeake Utilities Corporation and PNC Bank, National Association, Bank of America, N.A., Citizens Bank N.A., Royal Bank of Canada and Wells Fargo Bank, National Association as lenders, is incorporated herein by reference to Exhibit 10.1 of our Quarterly Report on Form 10-Q for the period ended September 30, 2015, File No. 001-11590.
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• Exhibit 10.19
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First Amendment dated February 25, 2016 to the Revolving Credit Agreement dated October 8, 2015, between Chesapeake Utilities Corporation and PNC Bank, National Association, Bank of America, N.A., Citizens Bank N.A., Royal Bank of Canada and Wells Fargo Bank, National Association as lenders, is filed herewith.
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• Exhibit 10.20
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Promissory Note, contained as an exhibit to the Revolving Credit Agreement dated December 29, 2014, between Chesapeake Utilities Corporation and Citizens Bank, National Association, as lender, is incorporated herein by reference to Exhibit 10.26 of our Annual Report on Form 10-K for the year ended December 31, 2014, File No. 001-11590.
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• Exhibit 10.21*
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Executive Employment Agreement dated May 10, 2016, between Chesapeake Utilities Corporation and James F. Moriarty, is incorporated herein by reference to Exhibit 10.1 of our Quarterly Report on Form 10-Q for the year ended June 30, 2016, File No. 001-11590.
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• Exhibit 12
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Computation of Ratio of Earning to Fixed Charges is filed herewith.
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• Exhibit 14.1
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Code of Ethics for Financial Officers is filed is incorporated herein by reference to Exhibit 14.1 of our Annual Report on Form 10-K for the period ended December 31, 2014, File No. 001-11590.
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• Exhibit 14.2
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Business Code of Ethics and Conduct is is incorporated herein by reference to Exhibit 14.2 of our Annual Report on Form 10-K for the period ended December 31, 2014, File No. 001-11590.
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• Exhibit 21
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Subsidiaries of the Registrant is filed herewith.
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• Exhibit 23.1
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Consent of Independent Registered Public Accounting Firm is filed herewith.
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• Exhibit 31.1
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Certificate of Chief Executive Officer of Chesapeake Utilities Corporation pursuant to Exchange Act Rule 13a-14(a) and 15d – 14(a), is filed herewith.
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• Exhibit 31.2
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Certificate of Chief Financial Officer of Chesapeake Utilities Corporation pursuant to Exchange Act Rule 13a-14(a) and 15d – 14(a), is filed herewith.
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• Exhibit 32.1
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Certificate of Chief Executive Officer of Chesapeake Utilities Corporation pursuant to 18 U.S.C. Section 1350, is filed herewith.
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• Exhibit 32.2
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Certificate of Chief Financial Officer of Chesapeake Utilities Corporation pursuant to 18 U.S.C. Section 1350, is filed herewith.
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• Exhibit 101.INS XBRL Instance Document is filed herewith.
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• Exhibit 101.SCH XBRL Taxonomy Extension Schema Document is filed herewith.
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• Exhibit 101.CAL XBRL Taxonomy Extension Calculation Linkbase Document is filed herewith.
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• Exhibit 101.DEF XBRL Taxonomy Extension Definition Linkbase Document is filed herewith.
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• Exhibit 101.LAB XBRL Taxonomy Extension Label Linkbase Document is filed herewith.
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• Exhibit 101.PRE XBRL Taxonomy Extension Presentation Linkbase Document is filed herewith.
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*
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Management contract or compensatory plan or agreement.
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†
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These agreements have not been filed herewith pursuant to Item 601(b)(4)(v) of Regulation S-K under the Securities Act of 1933, as amended. We hereby agree to furnish copies to the SEC upon request.
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C
HESAPEAKE
U
TILITIES
C
ORPORATION
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||
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By:
|
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/s/ M
ICHAEL
P. M
C
M
ASTERS
|
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Michael P. McMasters,
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|
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President and Chief Executive Officer
|
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|
February 27, 2017
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/
S
/ M
ICHAEL
P. M
C
M
ASTERS
|
|
|
/
S
/ B
ETH
W. C
OOPER
|
Michael P. McMasters,
|
|
|
Beth W. Cooper, Senior Vice President
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President, Chief Executive Officer and Director
|
|
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and Chief Financial Officer
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February 27, 2017
|
|
|
(Principal Financial and Accounting Officer)
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February 27, 2017
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|
|
/
S
/ J
OHN
R. S
CHIMKAITIS
|
|
|
/
S
/ R
ONALD
G. F
ORSYTHE
, J
R
.
|
John R. Schimkaitis
|
|
|
Dr. Ronald G. Forsythe, Jr., Director
|
Chair of the Board and Director
|
|
|
February 27, 2017
|
February 27, 2017
|
|
|
|
|
|
|
|
/
S
/ E
UGENE
H. B
AYARD
, E
SQ
|
|
|
/
S
/ D
ENNIS
S. H
UDSON
, III
|
Eugene H. Bayard, Esq., Director
|
|
|
Dennis S. Hudson, III, Director
|
February 27, 2017
|
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|
February 27, 2017
|
|
|
|
|
/
S
/ T
HOMAS
J. B
RESNAN
|
|
|
/
S
/ D
IANNA
F. M
ORGAN
|
Thomas J. Bresnan, Director
|
|
|
Dianna F. Morgan, Director
|
February 27, 2017
|
|
|
February 27, 2017
|
|
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/
S
/ T
HOMAS
P. H
ILL
, J
R
.
|
|
|
/
S
/ C
ALVERT
A. M
ORGAN
, JR.
|
Thomas P. Hill, Jr., Director
|
|
|
Calvert A. Morgan, Jr., Director
|
February 27, 2017
|
|
|
February 27, 2017
|
|
|
|
|
/
S
/ P
AUL
L. M
ADDOCK
, J
R
.
|
|
|
|
Paul L. Maddock, Jr., Director
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|
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|
February 27, 2017
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R
EPORT
OF
I
NDEPENDENT
R
EGISTERED
P
UBLIC
A
CCOUNTING
F
IRM
|
|
|
|
|
Additions
|
|
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||||||||||||
For the Year Ended December 31,
|
Balance at
Beginning of
Year
|
|
Charged to
Income
|
|
Other
Accounts
(1)
|
|
Deductions
(2)
|
|
Balance at End
of Year
|
||||||||||
(In thousands)
|
|
|
|
|
|
|
|
|
|
||||||||||
Reserve Deducted From Related Assets
|
|
|
|
|
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|
||||||||||
Reserve for Uncollectible Accounts
|
|
|
|
|
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|
|
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|
||||||||||
2016
|
$
|
909
|
|
|
$
|
985
|
|
|
$
|
340
|
|
|
$
|
(1,325
|
)
|
|
$
|
909
|
|
2015
|
$
|
1,120
|
|
|
$
|
979
|
|
|
$
|
246
|
|
|
(1,436
|
)
|
|
$
|
909
|
|
|
2014
|
$
|
1,635
|
|
|
$
|
1,073
|
|
|
$
|
85
|
|
|
(1,673
|
)
|
|
$
|
1,120
|
|
(1)
|
Recoveries.
|
(2)
|
Uncollectible accounts charged off.
|
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1 Month Chesapeake Utilities Chart |
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