ERMUSR FINANCIAL 04-12-2011 - Laserfiche WebLink

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PROFIT AND LOSS NARRATIVE February 2011 Electric P&L February Operating Revenue is better than budgeted numbers and up from the prior year. Within the revenue categories, Residential usage is up 9% from last year, Small Commercial usage is up 21 %, Large Industrial usage is up 4%, and the Data Center usage is up 17% from the prior year. Other Operating Revenue is better than budgeted numbers, and consistent with the prior year. The Landfill continues to perform better than budget and the prior year, although marginal. Connection revenue is down, both from budget and the prior year, and is a very inconsistent item from year to year. Purchased Power is in line with the budget and last year numbers (consistent with revenues, this year it is up slightly). For other expenses, the Landfill Gas has additional expense accrued for maintenance that is usually billed to us at the end of the year. We have requested to receive this information more timely and will hopefully be adjusting this expense to actual on a quarterly basis. Maintenance Expenses are over budget and the prior year numbers, and are consistent with the prior year to date total. Last year at this time maintenance was more focused on overhead projects, this year it is more focused on street lighting and meters. Interest expense is down from the prior year due to the refunding of bonds in the prior year. Other Operating Expenses are in line with budget and prior year numbers. The categories of Donated Electricity and Transfers to the City are up, which is consistent with the increased revenue numbers. Customer Accounts Expense is down from the prior year and reflects the meter reading cost reduction. Administrative and General Expense is in line with the budgeted amount and down from the prior year. The margin of operating revenue to operating expense is slim at this time of the year. The margin increases slightly in the summer, and then gains in the fall. This year's budget is the slimmest margin we have projected. It will be important to monitor it throughout the year, but it will be best evaluated in the fall and winter, looking at the whole year, because the first 3/4 of the year are projected to have losses, even if we are on track. A good snapshot of the year, and a month at a time, is the cash flow detail on page 5 of the financials. For January, the Electric Department has a Net Loss (which is expected this time of year) of $94,721, and is less than the budgeted loss of $139,898 and the prior year loss of $151,705.