Non-Utility Operations Boost SJI's 1Q Earnings

Apr 17, 2001, 01:00 ET from South Jersey Industries

    FOLSOM, N.J., April 17 /PRNewswire/ -- South Jersey Industries (NYSE:   SJI)
 reported record net income from continuing operations of $20 million or $1.73
 per share for the first quarter of 2001, compared with $19.1 million or $1.69
 per share for first quarter 2000.  Earnings per share including discontinued
 operations for the recent quarter totaled $1.72, compared with $1.68 in the
 first quarter of 2000.
     SJI's non-utility operations contributed $4.7 million in pretax earnings
 in the first quarter of 2001, compared with $2.5 million during the first
 quarter of 2000.  The increase is primarily due to effective management of
 natural gas portfolios, storages, and pipeline assets within the company's
 wholesale and retail natural gas marketing operations during a period of high
 volatility in natural gas commodity prices.
     Based upon first quarter results, Charles Biscieglia, SJI's chairman,
 president and CEO expects non-utility operations to provide up to 15 percent
 of the company's net income in 2001.
     "SJI's true growth engine going forward is in our non-utility operations.
 Our goal is for these businesses to provide 20 percent of net income beyond
 2003," said Biscieglia.  "The utility will always be the backbone of SJI's
 earnings but the growth opportunities in our non-utility businesses for
 energy, energy-related services and air monitoring are value creators for the
 short and the long term."
     SJI's natural gas utility subsidiary, South Jersey Gas, saw customer
 growth rise sharply in the first quarter.  South Jersey Gas reported having
 283,944 customers as of March 31, 2001, compared with 276,088 at the same time
 last year.  The company attributes the rise to new home construction boosted
 by favorable interest rates, a healthy local economy, and increased heating
 system conversions from oil and electricity to natural gas.
     The positive benefits of customer growth and increased seasonal natural
 gas use were offset by two factors during the quarter.  Off-system natural gas
 sales generated record margins in the first quarter of $9.1 million, a
 19 percent increase over the same period last year.  However, due to timing
 issues related to the utility's sharing formula, contributions to net income
 from off-system sales were lower in the first quarter of 2001 than in the
 first quarter of 2000.  Under an approved regulatory formula, margins from
 off-system sales are apportioned between South Jersey Gas and its customers.
 South Jersey Gas' customers benefited by $6.0 million under this formula in
 the first quarter of 2001.
     Also impacting utility performance were interest expenses associated with
 financing high levels of natural gas costs.  This issue was recently resolved
 as South Jersey Gas received regulatory approval to collect under-recovered
 gas costs, plus carrying costs, over a three-year period.  This method of
 recovery shields customers from sudden price spikes by spreading out the costs
 over time.  The utility does not profit on this recovery since natural gas
 purchased for customers is a pass-through charge.
 
     Webcast & Conference Call
     SJI will hold an open conference call and webcast to discuss its first
 quarter 2001 results today at 11 a.m. Eastern.  To participate in the call,
 dial 1-800-360-9865 approximately 10 minutes ahead of the scheduled time.  To
 listen to the live webcast, simply visit the South Jersey Industries website
 at http://www.sjindustries.com and click the webcast icon.  A recorded version
 of the webcast will be available at SJI's website following the call.  A
 rebroadcast will also be available by phoning 1-800-428-6051 and entering the
 code: 180330.
     South Jersey Industries (NYSE:   SJI) is an energy services holding company
 for South Jersey Gas and South Jersey Energy.  To learn more about SJI and its
 subsidiaries please visit http://www.sjindustries.com on the Internet.
     This release contains forward-looking statements about SJI's financial
 performance.  The statements are made in good faith and deemed reasonable at
 the date of this release.  Actual results may vary and SJI encourages you to
 conduct your own research before making any investment decisions including a
 review of SJI's Annual Report to Shareholders and Form 10K for a complete
 discussion of risks and/or uncertainties that may cause actual results to
 vary.
 
 
                 SOUTH JERSEY INDUSTRIES, INC. AND SUBSIDIARIES
                        COMPARATIVE EARNINGS STATEMENTS
                    (In Thousands Except for Per Share Data)
                                   UNAUDITED
 
                                              Three Months Ended March 31,
                                                  2001         2000
     Operating Revenues:
       Utility                                $  202,441   $  146,118
       Nonutility                                140,184       21,404
 
         Total Operating Revenues                342,625      167,522
 
     Operating Expenses:
       Operation and Maintenance                 297,395      124,612
 
       Income Taxes                               14,290       13,626
 
       Energy and Other Taxes                      4,476        4,383
 
     Operating Income                             26,464       24,901
 
     Interest Charges  *                           5,679        5,059
 
     Preferred Dividend Requirements
      of Subsidiary                                  766          771
 
     Income from Continuing Operations            20,019       19,071
 
     Discontinued Operations  -  Net                (149)         (90)
 
     Net Income Applicable to Common Stock    $   19,870   $   18,981
 
     Average Shares Outstanding                   11,588       11,284
 
     Earnings Per Common Share (Based on
       Average Shares Outstanding):
       Continuing Operations                  $     1.73   $     1.69
       Discontinued Operations  - Net              (0.01)       (0.01)
 
     Earnings Per Common Share                $     1.72   $     1.68
 
 
                                             Twelve Months Ended March 31,
                                                  2001         2000
     Operating Revenues:
       Utility                                $  488,609   $  357,134
       Nonutility                                202,172       56,868
 
         Total Operating Revenues                690,781      414,002
 
     Operating Expenses:
       Operation and Maintenance                 609,159      338,568
 
       Income Taxes                               19,322       17,353
 
       Energy and Other Taxes                     11,706       11,023
 
     Operating Income                             50,594       47,058
 
     Interest Charges  *                          21,912       20,830
 
     Preferred Dividend Requirements
      of Subsidiary                                3,069        3,083
 
     Income from Continuing Operations            25,613       23,145
 
     Discontinued Operations  -  Net                (540)        (315)
 
     Net Income Applicable to Common Stock    $   25,073   $   22,830
 
     Average Shares Outstanding                   11,477       11,048
 
     Earnings Per Common Share (Based on
       Average Shares Outstanding):
       Continuing Operations                  $     2.23   $     2.10
       Discontinued Operations  - Net              (0.05)       (0.03)
 
     Earnings Per Common Share                $     2.18   $     2.07
 
     * Net of rate recovery of carrying costs on certain
       unrecovered fuel and environmental
       remediation expenses.
 
 

SOURCE South Jersey Industries
    FOLSOM, N.J., April 17 /PRNewswire/ -- South Jersey Industries (NYSE:   SJI)
 reported record net income from continuing operations of $20 million or $1.73
 per share for the first quarter of 2001, compared with $19.1 million or $1.69
 per share for first quarter 2000.  Earnings per share including discontinued
 operations for the recent quarter totaled $1.72, compared with $1.68 in the
 first quarter of 2000.
     SJI's non-utility operations contributed $4.7 million in pretax earnings
 in the first quarter of 2001, compared with $2.5 million during the first
 quarter of 2000.  The increase is primarily due to effective management of
 natural gas portfolios, storages, and pipeline assets within the company's
 wholesale and retail natural gas marketing operations during a period of high
 volatility in natural gas commodity prices.
     Based upon first quarter results, Charles Biscieglia, SJI's chairman,
 president and CEO expects non-utility operations to provide up to 15 percent
 of the company's net income in 2001.
     "SJI's true growth engine going forward is in our non-utility operations.
 Our goal is for these businesses to provide 20 percent of net income beyond
 2003," said Biscieglia.  "The utility will always be the backbone of SJI's
 earnings but the growth opportunities in our non-utility businesses for
 energy, energy-related services and air monitoring are value creators for the
 short and the long term."
     SJI's natural gas utility subsidiary, South Jersey Gas, saw customer
 growth rise sharply in the first quarter.  South Jersey Gas reported having
 283,944 customers as of March 31, 2001, compared with 276,088 at the same time
 last year.  The company attributes the rise to new home construction boosted
 by favorable interest rates, a healthy local economy, and increased heating
 system conversions from oil and electricity to natural gas.
     The positive benefits of customer growth and increased seasonal natural
 gas use were offset by two factors during the quarter.  Off-system natural gas
 sales generated record margins in the first quarter of $9.1 million, a
 19 percent increase over the same period last year.  However, due to timing
 issues related to the utility's sharing formula, contributions to net income
 from off-system sales were lower in the first quarter of 2001 than in the
 first quarter of 2000.  Under an approved regulatory formula, margins from
 off-system sales are apportioned between South Jersey Gas and its customers.
 South Jersey Gas' customers benefited by $6.0 million under this formula in
 the first quarter of 2001.
     Also impacting utility performance were interest expenses associated with
 financing high levels of natural gas costs.  This issue was recently resolved
 as South Jersey Gas received regulatory approval to collect under-recovered
 gas costs, plus carrying costs, over a three-year period.  This method of
 recovery shields customers from sudden price spikes by spreading out the costs
 over time.  The utility does not profit on this recovery since natural gas
 purchased for customers is a pass-through charge.
 
     Webcast & Conference Call
     SJI will hold an open conference call and webcast to discuss its first
 quarter 2001 results today at 11 a.m. Eastern.  To participate in the call,
 dial 1-800-360-9865 approximately 10 minutes ahead of the scheduled time.  To
 listen to the live webcast, simply visit the South Jersey Industries website
 at http://www.sjindustries.com and click the webcast icon.  A recorded version
 of the webcast will be available at SJI's website following the call.  A
 rebroadcast will also be available by phoning 1-800-428-6051 and entering the
 code: 180330.
     South Jersey Industries (NYSE:   SJI) is an energy services holding company
 for South Jersey Gas and South Jersey Energy.  To learn more about SJI and its
 subsidiaries please visit http://www.sjindustries.com on the Internet.
     This release contains forward-looking statements about SJI's financial
 performance.  The statements are made in good faith and deemed reasonable at
 the date of this release.  Actual results may vary and SJI encourages you to
 conduct your own research before making any investment decisions including a
 review of SJI's Annual Report to Shareholders and Form 10K for a complete
 discussion of risks and/or uncertainties that may cause actual results to
 vary.
 
 
                 SOUTH JERSEY INDUSTRIES, INC. AND SUBSIDIARIES
                        COMPARATIVE EARNINGS STATEMENTS
                    (In Thousands Except for Per Share Data)
                                   UNAUDITED
 
                                              Three Months Ended March 31,
                                                  2001         2000
     Operating Revenues:
       Utility                                $  202,441   $  146,118
       Nonutility                                140,184       21,404
 
         Total Operating Revenues                342,625      167,522
 
     Operating Expenses:
       Operation and Maintenance                 297,395      124,612
 
       Income Taxes                               14,290       13,626
 
       Energy and Other Taxes                      4,476        4,383
 
     Operating Income                             26,464       24,901
 
     Interest Charges  *                           5,679        5,059
 
     Preferred Dividend Requirements
      of Subsidiary                                  766          771
 
     Income from Continuing Operations            20,019       19,071
 
     Discontinued Operations  -  Net                (149)         (90)
 
     Net Income Applicable to Common Stock    $   19,870   $   18,981
 
     Average Shares Outstanding                   11,588       11,284
 
     Earnings Per Common Share (Based on
       Average Shares Outstanding):
       Continuing Operations                  $     1.73   $     1.69
       Discontinued Operations  - Net              (0.01)       (0.01)
 
     Earnings Per Common Share                $     1.72   $     1.68
 
 
                                             Twelve Months Ended March 31,
                                                  2001         2000
     Operating Revenues:
       Utility                                $  488,609   $  357,134
       Nonutility                                202,172       56,868
 
         Total Operating Revenues                690,781      414,002
 
     Operating Expenses:
       Operation and Maintenance                 609,159      338,568
 
       Income Taxes                               19,322       17,353
 
       Energy and Other Taxes                     11,706       11,023
 
     Operating Income                             50,594       47,058
 
     Interest Charges  *                          21,912       20,830
 
     Preferred Dividend Requirements
      of Subsidiary                                3,069        3,083
 
     Income from Continuing Operations            25,613       23,145
 
     Discontinued Operations  -  Net                (540)        (315)
 
     Net Income Applicable to Common Stock    $   25,073   $   22,830
 
     Average Shares Outstanding                   11,477       11,048
 
     Earnings Per Common Share (Based on
       Average Shares Outstanding):
       Continuing Operations                  $     2.23   $     2.10
       Discontinued Operations  - Net              (0.05)       (0.03)
 
     Earnings Per Common Share                $     2.18   $     2.07
 
     * Net of rate recovery of carrying costs on certain
       unrecovered fuel and environmental
       remediation expenses.
 
 SOURCE  South Jersey Industries