The report follows the earlier release of year-end data that showed Cobb EMC had a total net income of $21.8 million for fiscal 2011 — about half of the utility’s fiscal 2010 net income of $43.14 million.
Cobb EMC’s fiscal year runs from May 1 through April 30.
For the first quarter of FY12, Cobb EMC had total revenue of $131 million, with the bulk of that — $128.2 million — coming from operations.
The utility’s expenses totaled $133 million for the quarter. Of that, $120 million were operating expenses. The company also had interest costs of nearly $7 million, and lost $6.1 million in Gas South.
Cobb Electric and Gas South are the two major components of Cobb EMC.
Chief Financial Officer Robert Steele noted in a statement to the Journal that both Cobb Electric and Gas South are seasonal businesses by nature and are greatly affected by weather.
Gas South’s quarterly loss “was not unexpected, as their budget projected negative numbers for this period,” Steele said in the statement. “Gas South has been profitable since its inception in 2006.”
Also, Cobb Electric and Gas South “peak at opposite times of the year,” he said. “Cobb Electric is generally most profitable from July through September, whereas Gas South is generally most profitable from December through March. … Extreme temperatures can have a significant impact on their bottom lines.”
The company did not provide comparative data for the first quarter of 2011.
“As these are the first quarterly statements prepared, there are no 2011 comparative numbers,” Steele said in the statement. “It was felt that the work required to produce first quarter 2011 numbers would be greater than the benefit derived.”
As for the year-end 2011 numbers, Steele said many factors accounted for the reduced net income from fiscal 2010 to 2011.
“The single largest difference for 2011 is we reduced the revenue by $14.5 million and rebated it to the members,” he said. “Also, Gas South’s income was down, and various other expenses were greater.”
Cobb EMC is a nonprofit, member-owned electric cooperative that serves about 190,000 customers in five counties. It is governed by a 10-member board of directors.
Chief executive Chip Nelson announced last week that the company would begin releasing its quarterly reports as part of a host of changes intended to make the utility’s operations more transparent to its member-owners.
A group of members sued the utility in 2007, accusing the 10 directors and then-CEO Dwight Brown of unjust enrichment and breach of fiduciary duties, among other things.
After four years of legal back-and-forths, the plaintiffs scored a major victory in September when members overwhelmingly voted to reject mail-in ballots for future director elections. The EMC had urged members to approve the mail-in ballots, but the plaintiffs argued the ballots would be used to further entrench the 10 incumbent directors. And in fact, the two longest-serving directors have since announced that they will not seek reelection early next year.
The first round of elections is set for Nov. 12, and four seats are up. All members may cast votes in all 10 director elections.