2.3. ERMUSR FINANCIAL 08-13-2012

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PROFIT AND LOSS NARRATIVE June 2012 Electric P&L June Operating Revenue of$2,506,934 is up from budgeted numbers by 4.8% and up from the prior year by 8.7%. Within the revenue categories, Residential usage is increased 16%, Small Commercial usage is decreased 3%, and Large Commercial usage is increased 5%from the prior year. Other Operating Revenue is up 5%. Connection Fees continue to be up over budget and the prior year. Purchased Power of$1,524,238 is over budgeted numbers by 11%,and over last year by 17%, and consistent with sales. There was a PCA the prior year of approximately$120,000, and this year is was$80,000. For other expenses, most items are consistent with prior year. Customer Accounts Expense is increased year to date over the prior year for the increased costs with the various customer service enhancements. Landfill expenses had a$14,000 expense this month for maintenance testing. For May,the Electric Department has a Net Profit of$430,614 compared to last year's Net Profit of$442,085, and is ahead of the prior year to date by$352,804. Water P&L Water Operating Revenues are up from last year by 41%, and up from budget by 32%. In the various revenue categories, Residential usage is up 50% and Commercial usage is up 29%. Other Revenue is up this month from last year due to Connect Fees,which are from Spectrum. Year to date Connect Fees are only 5%behind the prior year. Total Revenue is 74% ahead of last year for the month of June, due to the increased usage and Connection Fees. Total Expenses are increased compared to last year by 8%. Customer Accounts Expense is increased over the prior year due to the same items noted above for the electric department. This month there were expenses of$7,000 related to the Wellhead Protection Program,which are high for this month's budget,however in line with the total budget. For May,the Water Department has a Net Profit of$47,834 compared to last year's Net Loss of ($68,387) (due to lower sales and lower connection fees), and is ahead of the prior year to date Net Loss by$18,174.