Thursday, Feb. 26, 2009 | 6:01 p.m.
Southwest Gas Corp. of Las Vegas today said foreclosures and warmer weather contributed to a decline in its revenue and profit for the fourth quarter of 2008.
The company, which serves 1.8 million customers in Nevada, Arizona and California, reported a quarterly profit of $31.2 million or 71 cents per share vs. a profit in the 2007 quarter of $43.1 million or $1 per share. Revenue fell from $560.3 million to $509.4 million.
"Differences in heating demand caused primarily by weather variations between periods resulted in a $4 million operating margin decrease as warmer-than-normal temperatures were experienced,’’ the company said.
Customer growth dropped to its lowest level in more than two decades as the continued slowdown in the housing market and associated increase in unoccupied homes due to foreclosures limited the company to 6,000 net new customers in 2008, Chief Executive Jeffrey Shaw said.
For 2008, the company’s construction subsidiary’s profit fell $3.5 million because of the slowdown in the new housing market.
Other factors that dampened earnings for the full year and the quarter included declines in the cash surrender values of company insurance policies and higher operating expenses.
“Despite the challenges that 2008 brought to us, we had stable operating cash flows, an improved capital structure, lower financing costs, and a strong liquidity position. And notwithstanding the slowdown in customer growth, efficiency initiatives have helped to improve Southwest’s customer-to-employee ratio from 714 to 1 to an impressive 743 to 1,’’ Shaw said in a statement.
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