Piedmont Natural Gas Co Inc PNY
Q2 2013 Earnings Call Transcript

Transcript Call Date 06/11/2013

Operator: Good day. Welcome to the Piedmont Natural Gas Company Incorporated Second Quarter 2013 Earnings Conference Call. Today's conference is being recorded.

At this time, I would like to turn the conference over to Mr. Nick Giaimo. Please go ahead, sir.

Nicholas Giaimo - IR: Thank you, Merida. Good morning, everyone, and thank you for joining the Piedmont Natural Gas second quarter 2013 earnings conference call. This call is open to the general public and is being webcast live over the Internet. If you would like to access the webcast of this call or view the slides of the accompanying presentation, please visit our website at and choose the For Investors link. On the right-hand side of that page, you'll find the appropriate links.

On the call today presenting prepared remarks, we have Tom Skains, President, Chairman and Chief Executive Officer; and Karl Newlin, Senior Vice President and Chief Financial Officer. Other officers of the Company are also in attendance to take your questions.

Finally, this call may include forward-looking statements, and our actual results may materially differ from those statements. More information about the risks and uncertainties related to these forward-looking statements may be found at Piedmont's first quarter Form 10-Q, filed Friday, June 7th, with the SEC.

With that, I will turn the call over to Tom.

Thomas E. Skains - Chairman, President and CEO: Thank you, Nick, and good morning, everybody, and thank you for joining us for our second quarter 2013 earnings conference call. We saw many of you at the AGA Financial Forum last month and I appreciate you taking the time to join us again today. As you know, we filed our second quarter 10-Q and issued our earnings release Friday afternoon. This morning, I'm going to talk about our recent accomplishments and provide you with the general update on the Company. Then, I'll turn it over to Karl to give you a more detailed discussion of our second quarter financial results.

I continue to be very proud of our performance in 2013. As you see on Slide 2, we reported net income of $55.8 million and diluted earnings per share of $0.74 in the second quarter, up 11% and 6% respectively from the second quarter of last year. We were also pleased to see continued customer growth during the quarter with the addition of more than 3,000 new customers, a 16% improvement from last year.

Year-to-date, we've added nearly 6,800 customers, which is a 12% improvement from 2012. We continue to work diligently in our large capital expansion program for fiscal year 2013. Our $550 million to $600 million program includes expenditures for the completion of our Sutton project, which we put into service on June 1st.

At the end of last month, we filed a general rate case in North Carolina for the first time since 2008. Over that time period, we've invested more than $1.2 billion in the state and we are seeking to refresh our rates to account for this investment. Finally, we reaffirmed our 2013 earnings per share guidance range of $1.67 to $1.77 per share.

Slide 3, shows our second quarter earnings of $56 million, which were nearly $6 million higher than the second quarter of last year. Our growth in net income was driven by higher margin, lower general taxes and increased contribution from our joint ventures at lower interest expense partially offset by increased O&M and depreciation expense.

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