Contents
Independent Auditors’ Report
Consolidated Balance Sheets
Consolidated Statements of Income
Consolidated Statements of Comprehensive Income
Consolidated Statement of Changes in Stockholder’s Equity Current Year
Consolidated Statement of Changes in Stockholder’s Equity Prior Year
Consolidated Statements of Cash Flows
Notes to the Consolidated Financial Statements
I]
Pennichuck Corporation and Subsidiaries
Audited Consolidated Financial Statements
December 31, 2015 and 2014
Company Goals - 2016
The Company’s main goals for 2016 are as follows:
Complete the construction of the new operations facility
Complete construction of the Merrimack River raw water main
Continued “roll-out” of the Company’s asset management system
Evaluate and upgrade the Company’s fixed asset tracking system in support
of the asset management system
Complete the reconstruction of the Harris Dam Spillway
Review and redevelopment of the Company’s IT and Safety and Security
Policies and Procedures
-8-
Water Infrastructure and Conservation Adjustment (WICA)
On April 30, 2015, the Public Utilities Commission issued Order No. 25,784 approving a WICA
surcharge of 1.81% for customers of Pennichuck Water Works, Inc. in the Nashua Core System.
The surcharge is effective for service rendered on and after June 1, 2015. The order was
effective May 20, 2015.
Financing
Notes to Balance Sheet
Note | (Other Current Assets) - At December 31, 2015, approximately $1,335,000 of this
balance is comprised of prepaid property taxes, which will be expensed in the first quarter of
2016, relating to taxes paid in November and December of 2015 for the second half of the
property tax year ended March 31, 2016.
Note 2 - In accordance with GAAP, the Acquisition Premium is being written-off over the
30-year life of the principal of the City Acquisition Debt.
Balance Sheet ($000’s)
As of As of
December 31, 2015 December 31, 2014
(Audited) (Audited)
Assets:
Property, Plant & Equipment, Net $ 183,241 $ 173,287
Current Assets:
Cash 1,246 2,987
Restricted Cash 5,729 5,264
Investments — 2014 and 2015 Bond Project Funds 19,779 16,847
Investments — Bond Refund Escrow - 23,725
Accounts Receivable 4,502 4,631
Inventory 712 802
Other Current Assets “°*! 2.232 1,682
Total Current Assets 34,200 55,938
Other Assets:
Unaudited Cash Flow Statement
Cash Flow on a GAAP basis for the fourth quarter of 2015 as compared to the fourth quarter of
2014, and the year-to-date 2015 versus 2014, are as follows:
($000’s)
-4-
An increase in interest expense from 2014 to 2015 of approximately $0.8 million
is primarily due to the increased financed amounts for capital projects.
Pre-tax loss for the fourth quarter increased from $1.6 million in 2014 to
$2.2 million in 2015 due to an increase in interest cost associated with the
financing of capital projects, as well as the increase in operating expenses, offset _
by the higher year-over-year revenues.
-2-
Second, retaining the corporate structure provided continuity for the regulatory and financial
Status of the companies and their respective businesses. The New Hampshire Public Utilities
Commission continues to provide regulatory oversight for the utility companies, and banks,
lenders and other contract parties continue to be able to rely on existing contracts and other rules
with respect to financing and other operations.
