El Paso Electric Company (EE) has reported a 772.84 percent jump in profit for the quarter ended Dec. 31, 2016. The company has earned $5.66 million, or $0.14 a share in the quarter, compared with $0.65 million, or $0.02 a share for the same period last year.
Revenue during the quarter grew 6.66 percent to $134.10 million from $125.73 million in the previous year period. Total expenses were 84.74 percent of quarterly revenues, down from 93.39 percent for the same period last year. This has led to an improvement of 865 basis points in operating margin to 15.26 percent.
Operating income for the quarter was $20.47 million, compared with $8.31 million in the previous year period.
"We have made significant investments to meet growth in our region and to replace aging infrastructure, some of which is almost 60 years old. This modern infrastructure will benefit our customers well into the future" said Mary Kipp, chief executive officer. "We are pleased that we have started to recover and earn a return on some of those investments. Our improved overall financial results are largely due to the rate relief we received in 2016, which helped to partially mitigate regulatory lag. Including Montana Power Station Units 3 and 4 and other plant additions, we have now completed $444 million of capital projects since the end of the test year in our 2015 rate cases. As a result, we filed a new rate case in Texas on February 13, 2017 to allow us to begin to recover and earn a return on these most recent investments."
Operating cash flow declines
El Paso Electric Company has generated cash of $231.15 million from operating activities during the year, down 6.29 percent or $15.52 million, when compared with the last year.
The company has spent $275.73 million cash to meet investing activities during the year as against cash outgo of $342.73 million in the last year.
Cash flow from financing activities was $44.85 million for the year, down 29.60 percent or $18.85 million, when compared with the last year.
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