ERMUSR FINANCIALS 06-10-2008 - Laserfiche WebLink

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PROFIT AND LOSS NARRATIVE Electric P&L The Operating Revenue is up 19% over the prior year with residential and demand services seeing the biggest increases. This month's revenues include approximately $120,000 of a Power Cost Adjustment (PCA) charge. We still have approximately $100,000 to recoup, and we will continue to incur charges for a few months that will need be recouped as well. Other revenues are down slightly from a year ago. Interest income is down because last year the bond proceeds were in the bank accounts while the construction projects were being completed, and therefore, earning some interest. Miscellaneous Revenue is also an account that is down from. last year. Items included in Miscellaneous are scrap metal returns, and miscellaneous fees collected for returned checks and red tags. Purchased power continues to be the largest operating expense variance over last year, up 35%. While the increased usage accounts for some of the increase, the PCA this month was approximately $80,000. Other operating expenses are actually down slightly from last year (plant supplies and maintenance are down) but this is not likely to be a trend. Distribution and General Maintenance expenses are up over last as has been noted in prior months. With the workforce being able to focus on repair and sustenance of existing infrastructure (as opposed to building new) there is some very timely maintenance being done. I say timely because in this process there have been several instances of items that have been able to be repaired that otherwise would not have been attended to and would have resulted in small outages. Again this month, tree trimming, overhead and underground distribution, and line transformers have seen the greatest increases. Interest Expense and Services to the City have been addressed before in prior months' narratives. Customer Accounts Expense reflects the write-offs that were handled in April. Administrative and General Expenses are very comparable to this month last year in total, although the accounts within vary somewhat, and year to date is increased over last year. Insurance and trainings are the biggest increases. Year to date profit is approximately $310,000 lower than last year at this time and is still in line with our budget, which is expected to be approximately $305,000 below last year. Keep in mind that there is still remaining PCA to be recouped and that will affect these numbers. Barring any additional unforeseen loss of revenue or increase in expenses, I would expect to see the $310,000 margin go down and then build back up at the end of the year. ~Q