W

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d)

OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2007

Commission File Number 000-00643

 

 

CORNING NATURAL GAS CORPORATION

(Exact name of Registrant as specified in its charter)

**New York **16-0397420
(State of incorporation)
(I.R.S. Employer Identification No.)
**330 West William Street, Corning New York 14830**
(Address of principal executive offices) (Zip Code)
**(607) 936-3755**
(Registrant's telephone number, including area code)

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X]No [ ]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of "accelerated filer and large accelerated filer" in rule 12b-2 of the Exchange Act. (Check one):

Large Accelerated Filer [ ]	Accelerated Filer [ ]	Non-accelerated Filer [X]

Indicate by check mark whether the Registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes [ ] No[X]

Indicate the number of Shares outstanding of each of the issuer's common stock as of the latest practicable date.

Common Stock, $5.00 par value
506,918
Class
Shares outstanding as of May 11, 2007

As used in this Form 10-Q, the terms "Company," "Corning," "Registrant," "we," "us," and "our" mean Corning Natural Gas Corporation and its consolidated subsidiaries, taken as a whole, unless the context indicates otherwise. Except as otherwise stated, the information contained in this Form 10-Q is as of March 31, 2007.
** **
 
 
 
 **PART I. **FINANCIAL INFORMATION
 
Item 1. 
Financial Statements (Unaudited) 
 
 
Item 2. 
Management's Discussion and Analysis of Financial
 
 
 
Condition and Results of Operations
 
 
Item 3. 
Quantitative and Qualitative Disclosures about Market Risk
 
 
Item 4. 
Controls and Procedures
 **PART II. **Other Information
 
 
Item 1. 
Legal Proceedings 
 
 
Item 1A.
Risk Factors
 
 
Item 2.
Unregistered Sales of Equity Securities and Use of Proceeds
 
 
Item 3. 
Defaults upon Senior Securities
 
 
Item 4. 
Submission of Matters to a Vote of Security Holders
 
 
Item 5. 
Other Information
 
 
Item 6. 
Exhibits
 
 **SIGNATURES
 
 
**PART I

FINANCIAL INFORMATION

Item 1. 	Financial Statements.

 

CORNING NATURAL GAS CORPORATION AND SUBSIDIARY 
Condensed Consolidated Statements of Income 
Unaudited
Quarter Ended
Six Months Ended
March 31, 2007
March 31, 2006
March 31, 2007
March 31, 2006
Utility Operating Revenues
$10,734,184 
$11,733,170 
$16,736,252 
$19,006,809 
Cost and Expense
Natural Gas Purchased
6,932,566 
8,881,936 
10,334,603 
14,196,701 
Operating & Maintenance Expense
1,826,719 
1,312,400 
3,314,151 
2,799,584 
Taxes other than Income Taxes
392,592 
314,435 
771,546 
645,647 
Depreciation
155,667 
132,683 
310,308 
245,108 
Other Deductions, Net
278,306 
7,676 
439,502 
15,300 
Total Costs and Expenses
9,585,850 
10,649,130 
15,170,110 
17,902,340 
Utility Operating Income 
1,148,334 
1,084,040 
1,566,142 
1,104,469 
Other Income and (Expense)
Interest Expense
(389,294)
(376,227)
(775,071)
(740,119)
Interest Income
129,375 
38,501 
165,397 
105,755 
Net Income from Utility Operations, Before Income Tax
888,415 
746,314 
956,468 
470,105 
Income Tax Expense 
(343,319)
(306,022)
(355,028)
(105,164)
Net Income from Continued Operations
545,096 
440,292 
601,440 
364,941 
Income (Loss) from Discontinued Operations, Net of Income Tax
16,650 
(37,839)
7,762 
(65,979)
Net Income 
561,746 
402,453 
609,202 
298,962 
Other Comprehensive Income (Loss)
(44,970)
32,216 
14,808 
12,325 
Total Comprehensive Income 
$516,776 
$434,669 
$624,010 
$311,287 
Weighted average earnings per share-
basic & diluted:
From Continued Operations
$1.08 
$0.87 
$1.19 
$0.72 
From Discontinued Operations
$0.03 
($0.08)
$0.02 
($0.13)
$1.11 
$0.79 
$1.20 
$0.59 
Weighted average shares outstanding
506,918
506,918
506,918
506,918
 

 

 

 

CORNING NATURAL GAS CORPORATION AND SUBSIDIARY
Consolidated Balance Sheets
Assets
March 31, 2007
September 30, 2006
Plant:
Utility property, plant and equipment
$29,000,355 
$28,480,707 
Non-utility assets - discontinued operations, net
17,725 
177,230 
Less: accumulated depreciation
(11,101,337)
(10,770,476)
Total plant utility and non-utility, net
17,916,743 
17,887,461 
Investments:
Marketable securities available-for-sale at fair value
2,615,111 
2,662,009 
Current assets:
Cash and cash equivalents
131,842 
1,170,070 
Customer accounts receivable, (net of allowance for
uncollectible accounts of $151,769 and $97,000)
3,726,468 
1,460,621 
Gas stored underground, at average cost
724,158 
0 
Materials and supplies inventory
363,634 
343,286 
Prepaid expenses
810,715 
717,023 
Current assets - discontinued operations
81,657 
46,113 
Total current assets
5,838,474 
3,737,113 
Deferred debits and other assets:
Regulatory assets:
Unrecovered gas costs
561,694 
64,906
Deferred regulatory costs
2,498,483
2,326,843 
Deferred pension and other
198,979 
202,448 
Unamortized debt issuance cost (net of accumulated
amortization of $281,853 and $269,849)
224,139 
236,143 
Other
30,051 
184,437 
Discontinued Operations- other
85,400 
36,602 
Total deferred debits and other assets
3,598,746 
3,051,379 
Total assets
$29,969,074 
$27,337,962 
See accompanying notes to consolidated financial statements.
 

 

 

 

CORNING NATURAL GAS CORPORATION AND SUBSIDIARY
Consolidated Balance Sheets
March 31, 2007
September 30, 2006
Capitalization and liabilities:
Common stockholders' equity:
Common stock (common stock $5.00 par
value per share. Authorized 1,000,000 shares;
Issued and outstanding 507,000 shares at March 31, 2007
and September 30, 2006)
$2,534,590 
$2,534,590 
Other paid-in capital
959,512 
959,512 
Retained earnings
(47,028)
(656,229)
Accumulated other comprehensive loss
(177,771)
(192,580)
Total common stockholders' equity
3,269,303 
2,645,293 
Long-term debt, less current installments
8,663,162 
8,590,000 
Long-term debt, less current installments - discontinued operations
0 
56,842 
Total Long-term debt
8,663,162 
8,646,842 
Current liabilities:
Current portion of long-term debt
460,319 
455,000 
Demand Note Payable
1,266,660 
1,456,662 
Borrowings under lines-of-credit
6,150,000 
6,550,000 
Accounts payable
3,793,500 
1,333,940 
Accrued expenses
1,099,559 
1,184,617 
Customer deposits and accrued interest
532,341 
1,025,907 
Deferred income taxes 
677,505 
434,635 
Other current liabilities - discontinued operations
13,891 
(63,795)
Total current liabilities
13,993,775 
12,376,966****************