Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Jun. 30, 2018 | Jul. 31, 2018 | |
Document And Entity Information [Abstract] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q3 | |
Entity Registrant Name | RGC RESOURCES INC | |
Entity Central Index Key | 1,069,533 | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 7,986,856 |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) | Jun. 30, 2018 | Sep. 30, 2017 |
CURRENT ASSETS: | ||
Cash and cash equivalents | $ 1,200,502 | $ 69,640 |
Accounts receivable (less allowance for uncollectibles of $347,175 and $99,456, respectively) | 4,027,904 | 3,492,703 |
Materials and supplies | 1,059,181 | 1,021,191 |
Gas in storage | 5,053,727 | 7,701,894 |
Prepaid income taxes | 234,997 | 1,796,825 |
Interest rate swap | 87,926 | 26,777 |
Other | 1,478,827 | 1,576,574 |
Total current assets | 13,143,064 | 15,685,604 |
UTILITY PROPERTY: | ||
In service | 211,493,563 | 204,223,714 |
Accumulated depreciation and amortization | (62,442,675) | (59,765,987) |
In service, net | 149,050,888 | 144,457,727 |
Construction work in progress | 12,054,375 | 3,470,244 |
Utility plant, net | 161,105,263 | 147,927,971 |
OTHER ASSETS: | ||
Regulatory assets | 11,791,176 | 11,796,260 |
Investment in unconsolidated affiliate | 22,026,401 | 7,445,106 |
Interest rate swap | 205,162 | 90,066 |
Other | 484,661 | 190,064 |
Total other assets | 34,507,400 | 19,521,496 |
TOTAL ASSETS | 208,755,727 | 183,135,071 |
CURRENT LIABILITIES: | ||
Dividends payable | 1,241,678 | 1,050,281 |
Accounts payable | 6,789,299 | 5,122,899 |
Capital contributions payable | 9,800,720 | 1,055,504 |
Customer credit balances | 612,140 | 1,220,578 |
Customer deposits | 1,481,512 | 1,471,960 |
Accrued expenses | 2,488,378 | 3,006,936 |
Over-recovery of gas costs | 993,113 | 1,438,074 |
Rate refund | 1,147,829 | 0 |
Total current liabilities | 24,554,669 | 14,366,232 |
LONG-TERM DEBT: | ||
Notes payable | 57,349,200 | 43,812,200 |
Line-of-credit | 0 | 17,791,760 |
Less unamortized debt issuance costs | (294,976) | (291,949) |
Long-term debt net of unamortized debt issuance costs | 57,054,224 | 61,312,011 |
DEFERRED CREDITS AND OTHER LIABILITIES: | ||
Asset retirement obligations | 6,275,752 | 6,069,993 |
Regulatory cost of retirement obligations | 10,896,740 | 10,055,189 |
Benefit plan liabilities | 7,170,588 | 8,214,326 |
Deferred income taxes | 11,631,111 | 23,076,848 |
Regulatory liability - deferred income taxes | 11,742,274 | 0 |
Total deferred credits and other liabilities | 47,716,465 | 47,416,356 |
STOCKHOLDERS’ EQUITY: | ||
Common stock, $5 par value; authorized 10,000,000 shares; issued and outstanding 7,985,752 and 7,240,846, respectively | 39,928,760 | 36,204,230 |
Preferred stock, no par, authorized 5,000,000 shares; no shares issued and outstanding | 0 | 0 |
Capital in excess of par value | 12,832,610 | 292,485 |
Retained earnings | 27,758,594 | 24,746,021 |
Accumulated other comprehensive loss | (1,089,595) | (1,202,264) |
Total stockholders’ equity | 79,430,369 | 60,040,472 |
TOTAL LIABILITIES AND STOCKHOLDERS’ EQUITY | $ 208,755,727 | $ 183,135,071 |
Condensed Consolidated Balance3
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) | Jun. 30, 2018 | Sep. 30, 2017 |
Statement of Financial Position [Abstract] | ||
Accounts receivable, allowance for uncollectibles | $ 347,175 | $ 99,456 |
Common stock, par value (in dollars per share) | $ 5 | $ 5 |
Common stock, shares authorized | 10,000,000 | 10,000,000 |
Common stock, shares issued | 7,985,752 | 7,240,846 |
Common stock, share outstanding | 7,985,752 | 7,240,846 |
Preferred stock, par value (in dollars per share) | $ 0 | $ 0 |
Preferred stock, shares authorized | 5,000,000 | 5,000,000 |
Preferred stock, shares issued | 0 | 0 |
Preferred stock, share outstanding | 0 | 0 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Income - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
OPERATING REVENUES: | ||||
Gas utility | $ 11,546,797 | $ 11,171,499 | $ 54,675,367 | $ 51,346,456 |
Non-utility | 342,773 | 264,325 | 888,227 | 777,966 |
Total operating revenues | 11,889,570 | 11,435,824 | 55,563,594 | 52,124,422 |
OPERATING EXPENSES: | ||||
Cost of gas - utility | 4,870,683 | 4,679,047 | 28,175,366 | 24,862,147 |
Cost of sales - non utility | 176,728 | 122,375 | 465,925 | 407,238 |
Operations and maintenance | 2,782,916 | 3,294,939 | 9,438,283 | 9,880,293 |
General taxes | 458,142 | 450,528 | 1,431,321 | 1,372,870 |
Depreciation and amortization | 1,734,878 | 1,560,728 | 5,204,634 | 4,702,185 |
Total operating expenses | 10,023,347 | 10,107,617 | 44,715,529 | 41,224,733 |
OPERATING INCOME | 1,866,223 | 1,328,207 | 10,848,065 | 10,899,689 |
Equity in earnings of unconsolidated affiliate | 245,075 | 111,626 | 585,399 | 289,791 |
Other (income) expense, net | (6,224) | 8,738 | (1,407) | 23,020 |
Interest expense | 583,592 | 472,300 | 1,829,423 | 1,400,301 |
INCOME BEFORE INCOME TAXES | 1,533,930 | 958,795 | 9,605,448 | 9,766,159 |
INCOME TAX EXPENSE | 446,575 | 343,233 | 2,992,702 | 3,693,180 |
NET INCOME | $ 1,087,355 | $ 615,562 | $ 6,612,746 | $ 6,072,979 |
BASIC EARNINGS PER COMMON SHARE (in dollars per share) | $ 0.14 | $ 0.09 | $ 0.88 | $ 0.84 |
DILUTED EARNINGS PER COMMON SHARE (in dollars per share) | 0.14 | 0.08 | 0.87 | 0.84 |
DIVIDENDS DECLARED PER COMMON SHARE (in dollars per share) | $ 0.155 | $ 0.145 | $ 0.465 | $ 0.435 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Comprehensive Income - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Statement of Comprehensive Income [Abstract] | ||||
NET INCOME | $ 1,087,355 | $ 615,562 | $ 6,612,746 | $ 6,072,979 |
Other comprehensive income (loss), net of tax: | ||||
Interest rate swap | 18,998 | (25,053) | 125,416 | 73,583 |
Defined benefit plans | (4,249) | 39,742 | (12,747) | 119,226 |
Other comprehensive income | 14,749 | 14,689 | 112,669 | 192,809 |
COMPREHENSIVE INCOME | $ 1,102,104 | $ 630,251 | $ 6,725,415 | $ 6,265,788 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows - USD ($) | 9 Months Ended | |
Jun. 30, 2018 | Jun. 30, 2017 | |
CASH FLOWS FROM OPERATING ACTIVITIES: | ||
Net income | $ 6,612,746 | $ 6,072,979 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 5,297,337 | 4,793,270 |
Cost of removal of utility plant, net | (177,175) | (236,292) |
Stock option grants | 0 | 73,780 |
Equity in earnings of unconsolidated affiliate | (585,399) | (289,791) |
Changes in assets and liabilities which provided cash, exclusive of changes and noncash transactions shown separately | 2,711,554 | 5,337,120 |
Net cash provided by operating activities | 13,859,063 | 15,751,066 |
CASH FLOWS FROM INVESTING ACTIVITIES: | ||
Additions to utility plant and nonutility property | (16,093,568) | (16,451,865) |
Investment in unconsolidated affiliate | (5,250,680) | (1,803,100) |
Proceeds from disposal of equipment | 47,606 | 13,971 |
Net cash used in investing activities | (21,296,642) | (18,240,994) |
CASH FLOWS FROM FINANCING ACTIVITIES: | ||
Proceeds from issuance of notes payable | 13,537,000 | 8,924,000 |
Borrowings under line-of-credit agreement | 19,533,761 | 31,170,307 |
Repayments under line-of-credit agreement | (37,325,521) | (35,210,666) |
Debt issuance costs | (32,678) | (16,675) |
Proceeds from issuance of stock (744,906 and 49,101 shares, respectively) | 16,264,655 | 810,689 |
Cash dividends paid | (3,408,776) | (3,067,163) |
Net cash provided by financing activities | 8,568,441 | 2,610,492 |
NET INCREASE IN CASH AND CASH EQUIVALENTS | 1,130,862 | 120,564 |
BEGINNING CASH AND CASH EQUIVALENTS | 69,640 | 643,252 |
ENDING CASH AND CASH EQUIVALENTS | 1,200,502 | 763,816 |
SUPPLEMENTAL CASH FLOW INFORMATION: | ||
Interest paid | 1,955,847 | 1,598,629 |
Income taxes paid | $ 1,180,000 | $ 51,000 |
Condensed Consolidated Stateme7
Condensed Consolidated Statements of Cash Flows (Parenthetical) - shares | 1 Months Ended | 9 Months Ended | |
Mar. 31, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | |
Statement of Cash Flows [Abstract] | |||
Issuance of stock, shares | 700,000 | 744,906 | 49,101 |
Basis of Presentation
Basis of Presentation | 9 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation RGC Resources, Inc. is an energy services company primarily engaged in the sale and distribution of natural gas. The consolidated financial statements include the accounts of RGC Resources, Inc. ("Resources" or the "Company") and its wholly owned subsidiaries: Roanoke Gas Company; Diversified Energy Company; and RGC Midstream, LLC. In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly Resources' financial position as of June 30, 2018 and the results of its operations, cash flows and comprehensive income for the three and nine months ended June 30, 2018 and 2017 . The results of operations for the three and nine months ended June 30, 2018 are not indicative of the results to be expected for the fiscal year ending September 30, 2018 as quarterly earnings are affected by the highly seasonal nature of the business and weather conditions generally result in greater earnings during the winter months. The unaudited condensed consolidated interim financial statements and condensed notes are presented as permitted under the rules and regulations of the Securities and Exchange Commission. Pursuant to those rules, certain information and note disclosures normally included in the annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted, although the Company believes that the disclosures are adequate to make the information not misleading. Therefore, the condensed consolidated financial statements and condensed notes should be read in conjunction with the financial statements and notes contained in the Company’s Form 10-K for the year ended September 30, 2017 . The September 30, 2017 balance sheet was included in the Company’s audited financial statements included in Form 10-K. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company’s significant accounting policies are described in Note 1 to the consolidated financial statements in Form 10-K for the year ended September 30, 2017 . Newly adopted and newly issued accounting standards are discussed below. Certain reclassifications have been made to the prior year income statements to be consistent with the current year presentation by moving cost of gas - utility and cost of sales - non utility under the operating expenses caption. This reclassification makes the Company's income statement presentation consistent with industry peers. Recently Issued or Adopted Accounting Standards In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) that affects any entity that enters into contracts with customers for the transfer of goods or services or transfer of non-financial assets. This guidance supersedes the revenue recognition requirements in Topic 605, Revenue Recognition, and most industry-specific guidance. The core principle of the new guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: (1) identify the contract with the customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when, or as, the entity satisfies the performance obligation. In August 2015, the FASB issued ASU 2015-14 that deferred the effective date of this guidance by one year making the standard effective for the Company's annual reporting period ending September 30, 2019 and interim periods within that annual period. Subsequent ASUs have been issued, which provide additional guidance to assist in the implementation of the new revenue standard. As of June 30, 2018, the Company is completing the review and evaluation of its revenue streams and does not anticipate the adoption of the new standard to have material impact on its financial position, results of operations or cash flows; however, significant new disclosures will be required as a result of the guidance. The Company plans to adopt the new guidance in the first quarter of fiscal 2019 using the modified retrospective approach. In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall: Recognition and Measurement of Financial Assets and Financial Liabilities . The ASU enhances the reporting model for financial instruments to provide users of the financial statements with more useful information through several provisions, including the following: (1) requires equity investments, excluding investments accounted for under the equity method, be measured at fair value with changes in fair value recognized in net income, (2) simplifies the impairment assessment of equity investments without readily determinable fair values, (3) eliminates the requirement to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet, (4) requires entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, and (5) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the accompanying notes to the financial statements. The new guidance is effective for the Company for the annual reporting period ending September 30, 2019 and interim periods within that annual period. Management has not completed its evaluation of the new guidance; however, the Company does not currently expect the new guidance to have a material effect on its financial position, results of operations or cash flows. In February 2016, the FASB issued ASU 2016-02, Leases. The ASU leaves the accounting for leases mostly unchanged for lessors, with the exception of targeted improvements for consistency; however, the new guidance requires lessees to recognize assets and liabilities for leases with terms of more than 12 months. The ASU also revises the definition of a lease as a contract, or part of a contract, that conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. Consistent with current GAAP, the presentation and cash flows arising from a lease by a lessee will primarily depend on its classification as a finance or operating lease. In contrast, the new ASU requires both types of leases to be recognized on the balance sheet. In addition, the new guidance includes quantitative and qualitative disclosure requirements to aid financial statement users in better understanding the amount, timing and uncertainty of cash flows arising from leases. The new guidance is effective for the Company for the annual reporting period ending September 30, 2020 and interim periods within that annual period. Early adoption is permitted. In January 2018, the FASB issued ASU 2018-01, which provides a practical expedient that allows entities the option of not evaluating existing land easements under the new lease standard for those easements that were entered into prior to adoption. New or modified land easements will require evaluation on a prospective basis. Management has not completed its evaluation of the new guidance under ASUs 2016-02 and 2018-01; however, the Company has completed its inventory of leases and does not currently expect the new guidance to have a material effect on its financial position, results of operations or cash flows. In January 2017, the FASB issued ASU 2017-03, Accounting Changes and Error Corrections and Investments - Equity Method and Joint Ventures . This update adds the text of the SEC Staff Announcement, Disclosure of the Impact That Recently Issued Accounting Standards Will Have on the Financial Statements of a Registrant When Such Standards Are Adopted in a Future Period (in accordance with Staff Accounting Bulletin Topic 11.M) as paragraph 250-10-S99-6. Related specifically to ASU 2014-09, ASU 2016-02 and ASU 2016-13, an SEC registrant should evaluate ASUs that have not yet been adopted to determine and include appropriate financial disclosures and MD&A discussions, including consideration of additional qualitative disclosures, to assist financial statement readers in assessing the significance of impact on adoption. The new guidance is effective immediately. The nature of this guidance relates to the effectiveness and quality of disclosures related to ASUs not yet adopted; however, there is no effect on the Company's financial position, results of operations or cash flows. In March 2017, the FASB issued ASU 2017-07, Compensation - Retirement Benefits . The primary objective of this guidance is to improve the financial statement presentation of net periodic pension and postretirement benefit costs; however, it also changes which cost components are eligible for capitalization. The amendments in the ASU require that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and, if a subtotal for income from operations is presented, outside of income from operations. In addition, the ASU allows only the service cost component of periodic benefit cost to be eligible for capitalization when applicable. This change to capitalization eligibility differs from the treatment currently applied by the Company. The new guidance is effective for the Company for the annual reporting period ending September 30, 2019 and interim periods within that annual period. Early adoption is permitted. Management has had discussions with its state regulators regarding the adoption of this ASU for regulatory purposes. The regulatory body has not taken a position on the change in capitalization requirements for these benefit costs and will evaluate the impact of this ASU on a case by case basis. The Company intends to adopt this ASU effective October 1, 2018 with the change in expense classification on a retrospective basis and the change in capitalization of costs beginning prospectively. If the regulatory body ultimately determines that changes to the capitalization of these retirement benefits is not appropriate for regulatory purposes, the Company may have to establish regulatory assets or liabilities for those costs or benefits excluded from capitalization under this ASU. Management does not expect the new guidance to have a material effect on the Company's consolidated financial statements. In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging: Targeted Improvements to Accounting For Hedging Activities . The ASU is meant to simplify recognition and presentation guidance in an effort to improve financial reporting of cash flow and fair value hedging relationships to better portray the economic results of an entity's risk management activities. This is achieved through changes to both the designation and measurement guidance for qualifying hedging relationships, as well as changes to the presentation of hedge results. The new guidance is effective for the Company for the annual reporting period ending September 30, 2020 and interim periods within that annual period. Early adoption is permitted. Management has not completed its evaluation of the new guidance; however, it does not currently expect the new guidance to have a material effect on its financial position, results of operations or cash flows. In February 2018, the FASB issued ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220) - Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income . The ASU provides the option to reclassify stranded tax effects within AOCI to retained earnings in each period in which the effects of the change in the U.S. federal corporate income tax rate, per the Tax Cuts and Jobs Act, is recorded. The new guidance is effective for the Company for the annual reporting period ending September 30, 2020 and interim periods within that annual period. Early adoption is permitted. Management has not completed its evaluation of the new guidance; however, it believes the new guidance will improve the presentation of AOCI by removing the stranded tax effects related to tax reform and transferring the amount to retained earnings. Management does not currently expect the new guidance to have a material effect on its financial position, results of operations or cash flows. Other accounting standards that have been issued by the FASB or other standard-setting bodies are not currently applicable to the Company or are not expected to have a material impact on the Company’s financial position, results of operations or cash flows. |
Stock Issue
Stock Issue | 9 Months Ended |
Jun. 30, 2018 | |
Equity [Abstract] | |
Stock Issue | Stock Issue In March 2018, the Company issued 700,000 shares of common stock resulting in proceeds of $15,114,823 net of underwriting and other expenses. The Company issued the common stock primarily to provide funding for Roanoke Gas' infrastructure improvement and replacement programs. The stock issue also strengthened the Company's balance sheet by increasing the equity component of its total capitalization ratio. |
Income Taxes
Income Taxes | 9 Months Ended |
Jun. 30, 2018 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes On December 22, 2017, the Tax Cuts and Jobs Act, ("Tax Act") became law. The most significant impact of the new law is the reduction of the maximum corporate federal income tax rate from 35% to 21% beginning January 1, 2018. As the Company is a fiscal year taxpayer, the Company will have a transition or blended rate of 24.3% determined based on the number of days of the Company's fiscal year at 34% and the number of days in the year at 21% . Under the provisions of ASC 740 - Income Taxes , the deferred tax assets and liabilities of the Company must be revalued to reflect the reduction in the federal tax rate. Furthermore, revaluing the deferred tax balances to the ultimate 21% federal tax rate required the Company to project the deferred tax activity for the balance of the year and to estimate the impact to current taxes based on the valuation adjustments to this activity. In accordance with the guidance provided by the SEC Staff Accounting Bulletin ("SAB") 118, the Company has made reasonable estimates of the effect of the tax rate change on its deferred tax assets and liabilities. As of December 31, 2017, the Company reduced the net deferred tax liability by $11,533,986 to revalue the liability from a 34% federal tax rate to a 21% federal tax rate. $11,742,274 related to Roanoke Gas and was reclassified to a regulatory liability as discussed in Note 4, while $208,288 was charged to income tax expense during the first quarter related to the unregulated operations of the Company. These estimates are subject to further clarification of provisions of the Tax Act and regulatory approvals from Roanoke Gas' regulatory body. |
Rates and Regulatory Matters
Rates and Regulatory Matters | 9 Months Ended |
Jun. 30, 2018 | |
Regulated Operations [Abstract] | |
Rates and Regulatory Matters | Rates and Regulatory Matters The State Corporation Commission of Virginia (“SCC”) exercises regulatory authority over the natural gas operations of Roanoke Gas. Such regulation encompasses terms, conditions and rates to be charged to customers for natural gas service; safety standards; extension of service; and accounting and depreciation. As referenced in Note 3, the Tax Act provides for a reduction in the federal corporate tax rate to 21% . The Company has revalued its deferred tax assets and liabilities to reflect the new federal tax rate. Under the provisions of ASC 740, the corresponding adjustment to deferred income taxes generally flows through to income tax expense. For rate regulated entities such as Roanoke Gas, these excess deferred taxes were originally recovered from its customers based on billing rates derived using a federal income tax rate of 34% . Therefore, the adjustment to the net deferred tax liabilities of Roanoke Gas, to the extent such net deferred tax liabilities are attributable to rate base or cost of service for customers, are refundable to customers. Roanoke Gas established a regulatory liability in the amount of $11,742,274 related to these excess deferred income taxes. With the implementation of the Tax Act, the Company has a blended federal tax rate of 24.3% for the current fiscal year. On January 8, 2018, the SCC issued a directive requiring the accrual of a regulatory liability for excess revenues collected from customers attributable to the higher federal income tax rate, currently included as a component of customer billing rates, until such time as the SCC approves lower billing rates incorporating the lower tax rate. For the nine-month period through June 30, 2018, the Company has recorded a reduction to revenue and established a regulatory liability in the amount of $1,147,829 reflecting the estimated excess revenue collected from customers since October 1, 2017. The reduction in the estimated excess revenues is expected to correlate with a similar reduction in corporate income tax expense for the regulated operations of Roanoke Gas for the fiscal year. However, the impact to revenues and tax expense on a quarterly basis is subject to variability and will result in variations in net income with the corresponding quarters in the prior fiscal year. This refund of excess revenue as well as the regulatory liability related to the excess deferred taxes on Roanoke Gas are estimates based on the best information currently available. These estimates will be adjusted as necessary in future financial statements once the SCC completes their review and issues a final order. The amount and timing of the refunds will ultimately be determined by the SCC. Roanoke Gas contracts with a third party asset manager to manage its pipeline transportation, storage rights and gas supply inventories and deliveries. In return for the right to utilize the excess capacities of the transportation and storage rights, the asset manager credits Roanoke Gas a monthly utilization fee. In February 2018, Roanoke Gas filed an application with the SCC for a gas supply incentive mechanism, requesting that the Company be allowed to share the utilization fee credit with its customers. In June 2018, the SCC issued an order approving, retroactive to April 2018, the incentive mechanism, whereby for annual periods beginning April and running through March, customers would receive the initial $700,000 of the utilization fee collected through reduced gas costs and thereafter every additional dollar received during the annual period would be split with 25% to the Company under the incentive mechanism and 75% to benefit its customers. With the retroactive application back to April 2018, the Company did not recognize any amount under the incentive mechanism during the current quarter. Beginning in July 2018, the Company will begin recognizing its 25% income portion as the $700,000 threshold will have been met. |
Other Investments
Other Investments | 9 Months Ended |
Jun. 30, 2018 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Other Investments | Other Investments In October 2015, the Company, through its wholly-owned subsidiary, RGC Midstream, LLC ("Midstream"), acquired a 1% equity interest in the Mountain Valley Pipeline, LLC (the “LLC”). The LLC was established to construct and operate a natural gas pipeline originating in northern West Virginia and extending through south central Virginia. The proposed pipeline will have the capacity to transport approximately 2 million decatherms of natural gas per day. The pipeline has received Federal Energy Regulatory Commission ("FERC") approval and is under construction. The total project cost is estimated by the LLC managing partner to be between $3.5 billion and $3.7 billion. The Company's 1% equity interest in the LLC will require a total estimated cash investment of between $35 million and $37 million, by periodic capital contributions throughout the design and construction phases of the project. On a quarterly basis, the LLC issues a capital call notice, which specifies the capital contributions to be paid over the subsequent 3 months . As of June 30, 2018 , the Company had $9,800,720 remaining to be paid under the most recent notice. The capital contribution payable has been reflected on the Company's balance sheet as of June 30, 2018 , with a corresponding increase to Investment in unconsolidated affiliate. Related to capital contributions payable, there was a non-cash $8,745,216 increase in the Investment in unconsolidated affiliate in the nine months ended June 30, 2018 . Funding for Midstream's investment in the LLC is being provided through two unsecured promissory notes, each with a 5 -year term. The Company is participating in the earnings of the LLC in proportion to its level of investment. The Company is utilizing the equity method to account for the transactions and activity of the investment. The financial statement locations of the investment in the LLC are as follows: Balance Sheet Location of Other Investments: June 30, 2018 September 30, 2017 Other Assets: Investment in unconsolidated affiliate $ 22,026,401 $ 7,445,106 Current Liabilities: Capital contributions payable $ 9,800,720 $ 1,055,504 Three Months Ended Nine Months Ended Income Statement Location of Other Investments: June 30, 2018 June 30, 2017 June 30, 2018 June 30, 2017 Equity in earnings of unconsolidated affiliate $ 245,075 $ 111,626 $ 585,399 $ 289,791 |
Derivatives and Hedging
Derivatives and Hedging | 9 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivatives and Hedging | Derivatives and Hedging The Company’s risk management policy allows management to enter into derivatives for the purpose of managing the commodity and financial market risks of its business operations. The Company’s risk management policy specifically prohibits the use of derivatives for speculative purposes. The key market risks that the Company seeks to hedge include the price of natural gas and the cost of borrowed funds. The Company has one interest rate swap associated with its $7,000,000 term note as discussed in Note 7. Effective November 1, 2017, the swap agreement converted the floating rate note based on LIBOR into a fixed rate debt with a 2.30% effective interest rate. The swap qualifies as a cash flow hedge with changes in fair value reported in other comprehensive income. No portion of the swap was deemed ineffective during the periods presented. The table below reflects the fair values of the derivative instrument and its corresponding classification in the condensed consolidated balance sheet: June 30, 2018 September 30, 2017 Derivative designated as hedging instrument: Current assets: Interest rate swap $87,926 $26,777 Other assets: Interest rate swap $205,162 $90,066 Total derivatives designed as hedging instruments $293,088 $116,843 The table in Note 8 reflects the effect on income and other comprehensive income of the Company's cash flow hedge. |
Long-Term Debt
Long-Term Debt | 9 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Long-Term Debt On October 2, 2017, Roanoke Gas entered into ten -year unsecured notes in the total principal amount of $8,000,000 with a fixed interest rate of 3.58% per annum. The proceeds from the notes were used to convert a portion of the Company's line-of-credit balance into longer-term financing. On March 26, 2018, Roanoke Gas entered into a new unsecured line-of-credit agreement. This new agreement replaced the prior line-of-credit agreement scheduled to expire March 31, 2019. The new agreement is for a two -year term expiring March 31, 2020 with a maximum borrowing limit of $25,000,000 . Amounts drawn against the new agreement are considered to be non-current as the balance under the line-of-credit is not subject to repayment within the next 12-month period. The new agreement maintains the same variable interest rate based on 30-day LIBOR plus 100 basis points and an availability fee of 15 basis points . The prior agreement was replaced to revise the multi-tiered borrowing limits associated with the seasonal borrowing demands of the Company. The Company's total available borrowing limits during the term of the new agreement range from $2,000,000 to $25,000,000 . Roanoke Gas has a 5 -year unsecured note in the principal amount of $7,000,000 . This note is variable rate with interest based on 30-day LIBOR plus 90 basis points with the interest rate hedged by a swap agreement which converts the variable rate debt into a fixed-rate instrument with an annual interest rate of 2.30% . On April 11, 2018, Midstream entered into the First Amendment to Credit Agreement ("Amendment") and amendments to the two related Promissory Notes ("Notes") originally issued in December 2015 to finance the capital investment in the LLC. Under the amended agreements, Midstream's total borrowing limits increased from $25 million to $38 million and the interest rate declined to 30-day LIBOR plus 135 basis points . The Amendment now allows for the entire investment in the LLC to be funded through the amended Notes. The increased limits under the Notes provide Midstream with additional funding resources in the event the cost of its investment in the LLC exceeds current projections. All of the debt agreements set forth certain representations, warranties and covenants to which the Company is subject, including financial covenants that limit consolidated long-term indebtedness to not more than 65% of total capitalization. All of the debt agreements, except for the line-of-credit, provide for priority indebtedness to not exceed 15% of consolidated total assets. Long-term debt consists of the following: June 30, 2018 September 30, 2017 Principal Unamortized Debt Issuance Costs Principal Unamortized Debt Issuance Costs Roanoke Gas Company: Unsecured senior notes payable, at 4.26% due on September 18, 2034 $ 30,500,000 $ 156,879 $ 30,500,000 $ 164,119 Unsecured term note payable, at 30-day LIBOR plus 0.90%, due November 1, 2021 7,000,000 11,116 7,000,000 13,618 Unsecured term notes payable, at 3.58% due on October 2, 2027 8,000,000 44,548 — 48,160 RGC Midstream, LLC: Unsecured term notes payable, at 30-day LIBOR plus 1.35%, due December 29, 2020 11,849,200 82,433 6,312,200 66,052 Total notes payable $ 57,349,200 $ 294,976 $ 43,812,200 $ 291,949 Line-of-credit, at 30-day LIBOR plus 1.00%, due March 31, 2020 $ — $ — $ 17,791,760 $ — Total long-term debt $ 57,349,200 $ 294,976 $ 61,603,960 $ 291,949 |
Other Comprehensive Income
Other Comprehensive Income | 9 Months Ended |
Jun. 30, 2018 | |
Equity [Abstract] | |
Other Comprehensive Income | Other Comprehensive Income A summary of other comprehensive income and loss is provided below: Before-Tax Amount Tax (Expense) or Benefit Net-of-Tax Amount Three Months Ended June 30, 2018 Interest rate swap: Unrealized gains $ 35,969 $ (10,373 ) $ 25,596 Transfer of realized gains to interest expense (9,272 ) 2,674 (6,598 ) Net interest rate swap 26,697 (7,699 ) 18,998 Defined benefit plans: Amortization of actuarial gains (5,971 ) 1,722 (4,249 ) Other comprehensive income $ 20,726 $ (5,977 ) $ 14,749 Three Months Ended June 30, 2017 Interest rate swap: Unrealized losses $ (40,382 ) $ 15,329 $ (25,053 ) Defined benefit plans: Amortization of actuarial losses 64,058 (24,316 ) 39,742 Other comprehensive income $ 23,676 $ (8,987 ) $ 14,689 Before-Tax Amount Tax (Expense) or Benefit Net-of-Tax Amount Nine Months Ended June 30, 2018 Interest rate swap: Unrealized gains $ 187,913 $ (54,194 ) $ 133,719 Transfer of realized gains to interest expense (11,668 ) 3,365 (8,303 ) Net interest rate swap 176,245 (50,829 ) 125,416 Defined benefit plans: Amortization of actuarial gains (17,913 ) 5,166 (12,747 ) Other comprehensive income $ 158,332 $ (45,663 ) $ 112,669 Nine Months Ended June 30, 2017 Interest rate swap: Unrealized gains $ 118,606 $ (45,023 ) $ 73,583 Defined benefit plans: Amortization of actuarial losses 192,174 (72,948 ) 119,226 Other comprehensive income $ 310,780 $ (117,971 ) $ 192,809 The amortization of actuarial losses is included as a component of net periodic pension and postretirement benefit cost in operations and maintenance expense. Reconciliation of Other Accumulated Comprehensive Income (Loss) Accumulated Other Comprehensive Income (Loss) Balance at September 30, 2017 $ (1,202,264 ) Other comprehensive income 112,669 Balance at June 30, 2018 $ (1,089,595 ) |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Jun. 30, 2018 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Roanoke Gas currently holds the only franchises and/or certificates of public convenience and necessity to distribute natural gas in its service area. The current franchise agreements expire December 31, 2035 . The Company's certificates of public convenience and necessity are exclusive and are intended for perpetual duration. Due to the nature of the natural gas distribution business, the Company has entered into agreements with both suppliers and pipelines for natural gas commodity purchases, storage capacity and pipeline delivery capacity. The Company obtains most of its regulated natural gas supply through an asset manager. The Company utilizes an asset manager to assist in optimizing the use of its transportation, storage rights, and gas supply in order to provide a secure and reliable source of natural gas to its customers. The Company also has storage and pipeline capacity contracts to store and deliver natural gas to the Company’s distribution system. Roanoke Gas is currently served directly by two primary pipelines. These two pipelines deliver all of the natural gas supplied to the Company’s distribution system. Depending on weather conditions and the level of customer demand, failure of one or both of these transmission pipelines could have a major adverse impact on the Company's ability to deliver natural gas to its customers and its results of operations. The Mountain Valley Pipeline will provide Roanoke Gas with access to an additional delivery source to its distribution system. |
Earnings Per Share
Earnings Per Share | 9 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share Basic earnings per common share for the three months and nine months ended June 30, 2018 and 2017 were calculated by dividing net income by the weighted average common shares outstanding during the period. Diluted earnings per common share were calculated by dividing net income by the weighted average common shares outstanding during the period plus potential dilutive common shares. A reconciliation of basic and diluted earnings per share is presented below: Three Months Ended June 30, Nine Months Ended June 30, 2018 2017 2018 2017 Net Income $ 1,087,355 $ 615,562 $ 6,612,746 $ 6,072,979 Weighted average common shares 7,982,354 7,227,171 7,533,595 7,212,289 Effect of dilutive securities: Options to purchase common stock 48,698 46,669 46,330 32,275 Diluted average common shares 8,031,052 7,273,840 7,579,925 7,244,564 Earnings Per Share of Common Stock: Basic $ 0.14 $ 0.09 $ 0.88 $ 0.84 Diluted $ 0.14 $ 0.08 $ 0.87 $ 0.84 |
Employee Benefit Plans
Employee Benefit Plans | 9 Months Ended |
Jun. 30, 2018 | |
Retirement Benefits [Abstract] | |
Employee Benefit Plans | Employee Benefit Plans The Company has both a defined benefit pension plan (the “pension plan”) and a postretirement benefit plan (the “postretirement plan”). The pension plan covers substantially all of the Company’s employees and provides retirement income based on years of service and employee compensation. The postretirement plan provides certain health care and supplemental life insurance benefits to retired employees who meet specific age and service requirements. Net pension plan and postretirement plan expense recorded by the Company is detailed as follows: Three Months Ended Nine Months Ended June 30, June 30, 2018 2017 2018 2017 Components of net periodic pension cost: Service cost $ 166,309 $ 176,669 $ 498,927 $ 530,007 Interest cost 272,045 248,900 816,135 746,700 Expected return on plan assets (465,710 ) (404,103 ) (1,397,130 ) (1,212,309 ) Recognized loss 87,758 165,545 263,274 496,635 Net periodic pension cost $ 60,402 $ 187,011 $ 181,206 $ 561,033 Three Months Ended Nine Months Ended June 30, June 30, 2018 2017 2018 2017 Components of postretirement benefit cost: Service cost $ 41,805 $ 45,817 $ 125,415 $ 137,451 Interest cost 160,151 156,706 480,453 470,118 Expected return on plan assets (155,845 ) (142,878 ) (467,535 ) (428,634 ) Recognized loss 70,967 107,440 212,901 322,320 Net postretirement benefit cost $ 117,078 $ 167,085 $ 351,234 $ 501,255 The table below reflects the Company's actual contributions made fiscal year-to-date. The Company revised its funding plan and currently does not expect to make any further contributions to either the pension plan or the postretirement medical plan for the balance of the current fiscal year. Fiscal Year-to-Date Contributions Remaining Fiscal Year Contributions Defined benefit pension plan $ 800,000 $ — Postretirement medical plan 300,000 — Total $ 1,100,000 $ — |
Fair Value Measurements
Fair Value Measurements | 9 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | Fair Value Measurements FASB ASC No. 820, Fair Value Measurements and Disclosures , established a fair value hierarchy that prioritizes each input to the valuation method used to measure fair value of financial and nonfinancial assets and liabilities that are measured and reported on a fair value basis into one of the following three levels: Level 1 – Unadjusted quoted prices in active markets for identical assets or liabilities that the Company has the ability to access at the measurement date. Level 2 – Inputs other than quoted prices in Level 1 that are either for similar assets or liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the asset or liability, or inputs that are derived principally from or corroborated by observable market data by correlation or other means. Level 3 – Unobservable inputs for the asset or liability where there is little, if any, market activity for the asset or liability at the measurement date. The fair value hierarchy gives the highest priority to unadjusted quoted prices in active markets (Level 1) and the lowest priority to unobservable inputs (Level 3). The following table summarizes the Company’s financial assets and liabilities that are measured at fair value on a recurring basis as required by existing guidance and the fair value measurements by level within the fair value hierarchy as of June 30, 2018 and September 30, 2017 : Fair Value Measurements - June 30, 2018 Fair Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Interest rate swap $ 293,088 $ — $ 293,088 $ — Total $ 293,088 $ — $ 293,088 $ — Liabilities: Natural gas purchases $ 1,556,372 $ — $ 1,556,372 $ — Total $ 1,556,372 $ — $ 1,556,372 $ — Fair Value Measurements - September 30, 2017 Fair Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Interest rate swap $ 116,843 $ — $ 116,843 $ — Total $ 116,843 $ — $ 116,843 $ — Liabilities: Natural gas purchases $ 805,159 $ — $ 805,159 $ — Total $ 805,159 $ — $ 805,159 $ — The fair value of the interest rate swap is determined by using the counterparty's proprietary models and certain assumptions regarding past, present and future market conditions. Under the asset management contract, a timing difference can exist between the payment for natural gas purchases and the actual receipt of such purchases. Payments are made based on a predetermined monthly volume with the price based on weighted average first of the month index prices corresponding to the month of the scheduled payment. At June 30, 2018 and September 30, 2017 , the Company had recorded in accounts payable the estimated fair value of the liability valued at the corresponding first of month index prices for which the liability is expected to be settled. The Company’s nonfinancial assets and liabilities measured at fair value on a nonrecurring basis consist of its asset retirement obligations. The asset retirement obligations are measured at fair value at initial recognition based on expected future cash flows required to settle the obligation. The carrying value of cash and cash equivalents, accounts receivable, accounts payable (with the exception of the timing difference under the asset management contract), customer credit balances and customer deposits is a reasonable estimate of fair value due to the short-term nature of these financial instruments. In addition, the carrying amount of the variable rate line-of-credit is a reasonable approximation of its fair value. The following table summarizes the fair value of the Company’s financial assets and liabilities that are not adjusted to fair value in the financial statements as of June 30, 2018 and September 30, 2017 : Fair Value Measurements - June 30, 2018 Carrying Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Liabilities: Long-term debt $ 57,349,200 $ — $ — $ 56,910,578 Total $ 57,349,200 $ — $ — $ 56,910,578 Fair Value Measurements - September 30, 2017 Carrying Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Liabilities: Long-term debt $ 43,812,200 $ — $ — $ 45,689,238 Total $ 43,812,200 $ — $ — $ 45,689,238 The fair value of long-term debt is estimated by discounting the future cash flows of the debt based on current market rates and corresponding interest rate spread. FASB ASC 825, Financial Instruments , requires disclosures regarding concentrations of credit risk from financial instruments. Cash equivalents are investments in high-grade, short-term securities (original maturity less than three months), placed with financially sound institutions. Accounts receivable are from a diverse group of customers including individuals and small and large companies in various industries. As of June 30, 2018 and September 30, 2017 , no single customer accounted for more than 5% of the total accounts receivable balance. The Company maintains certain credit standards with its customers and requires a customer deposit if such evaluation warrants. |
Subsequent Events
Subsequent Events | 9 Months Ended |
Jun. 30, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events On August 3, 2018, FERC issued an order directing the immediate halt to the construction of the Mountain Valley Pipeline pending re-evaluation of environmental issues by the U.S. Forest Service and the Bureau of Land Management. Due to the legal challenges, the LLC is evaluating its construction plan for the Mountain Valley Pipeline on a daily basis and moved its target in-service date for the pipeline from the fourth quarter of calendar 2018 to the first quarter of calendar 2019. The Company has evaluated subsequent events through the date the financial statements were issued. There were no items not otherwise disclosed above which would have materially impacted the Company’s condensed consolidated financial statements. |
Basis of Presentation (Policies
Basis of Presentation (Policies) | 9 Months Ended |
Jun. 30, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation RGC Resources, Inc. is an energy services company primarily engaged in the sale and distribution of natural gas. The consolidated financial statements include the accounts of RGC Resources, Inc. ("Resources" or the "Company") and its wholly owned subsidiaries: Roanoke Gas Company; Diversified Energy Company; and RGC Midstream, LLC. In the opinion of management, the accompanying unaudited condensed consolidated financial statements contain all adjustments (consisting of only normal recurring accruals) necessary to present fairly Resources' financial position as of June 30, 2018 and the results of its operations, cash flows and comprehensive income for the three and nine months ended June 30, 2018 and 2017 . The results of operations for the three and nine months ended June 30, 2018 are not indicative of the results to be expected for the fiscal year ending September 30, 2018 as quarterly earnings are affected by the highly seasonal nature of the business and weather conditions generally result in greater earnings during the winter months. The unaudited condensed consolidated interim financial statements and condensed notes are presented as permitted under the rules and regulations of the Securities and Exchange Commission. Pursuant to those rules, certain information and note disclosures normally included in the annual financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted, although the Company believes that the disclosures are adequate to make the information not misleading. Therefore, the condensed consolidated financial statements and condensed notes should be read in conjunction with the financial statements and notes contained in the Company’s Form 10-K for the year ended September 30, 2017 . The September 30, 2017 balance sheet was included in the Company’s audited financial statements included in Form 10-K. The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The Company’s significant accounting policies are described in Note 1 to the consolidated financial statements in Form 10-K for the year ended September 30, 2017 . Newly adopted and newly issued accounting standards are discussed below. Certain reclassifications have been made to the prior year income statements to be consistent with the current year presentation by moving cost of gas - utility and cost of sales - non utility under the operating expenses caption. This reclassification makes the Company's income statement presentation consistent with industry peers. |
Recently Issued or Adopted Accounting Standards | Recently Issued or Adopted Accounting Standards In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers (Topic 606) that affects any entity that enters into contracts with customers for the transfer of goods or services or transfer of non-financial assets. This guidance supersedes the revenue recognition requirements in Topic 605, Revenue Recognition, and most industry-specific guidance. The core principle of the new guidance is that an entity should recognize revenue to depict the transfer of promised goods or services to customers in an amount that reflects the consideration to which the entity expects to be entitled in exchange for those goods or services. To achieve that core principle, an entity should apply the following steps: (1) identify the contract with the customer, (2) identify the performance obligations in the contract, (3) determine the transaction price, (4) allocate the transaction price to the performance obligations in the contract, and (5) recognize revenue when, or as, the entity satisfies the performance obligation. In August 2015, the FASB issued ASU 2015-14 that deferred the effective date of this guidance by one year making the standard effective for the Company's annual reporting period ending September 30, 2019 and interim periods within that annual period. Subsequent ASUs have been issued, which provide additional guidance to assist in the implementation of the new revenue standard. As of June 30, 2018, the Company is completing the review and evaluation of its revenue streams and does not anticipate the adoption of the new standard to have material impact on its financial position, results of operations or cash flows; however, significant new disclosures will be required as a result of the guidance. The Company plans to adopt the new guidance in the first quarter of fiscal 2019 using the modified retrospective approach. In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall: Recognition and Measurement of Financial Assets and Financial Liabilities . The ASU enhances the reporting model for financial instruments to provide users of the financial statements with more useful information through several provisions, including the following: (1) requires equity investments, excluding investments accounted for under the equity method, be measured at fair value with changes in fair value recognized in net income, (2) simplifies the impairment assessment of equity investments without readily determinable fair values, (3) eliminates the requirement to disclose the method(s) and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost on the balance sheet, (4) requires entities to use the exit price notion when measuring the fair value of financial instruments for disclosure purposes, and (5) requires separate presentation of financial assets and financial liabilities by measurement category and form of financial asset on the balance sheet or the accompanying notes to the financial statements. The new guidance is effective for the Company for the annual reporting period ending September 30, 2019 and interim periods within that annual period. Management has not completed its evaluation of the new guidance; however, the Company does not currently expect the new guidance to have a material effect on its financial position, results of operations or cash flows. In February 2016, the FASB issued ASU 2016-02, Leases. The ASU leaves the accounting for leases mostly unchanged for lessors, with the exception of targeted improvements for consistency; however, the new guidance requires lessees to recognize assets and liabilities for leases with terms of more than 12 months. The ASU also revises the definition of a lease as a contract, or part of a contract, that conveys the right to control the use of identified property, plant or equipment for a period of time in exchange for consideration. Consistent with current GAAP, the presentation and cash flows arising from a lease by a lessee will primarily depend on its classification as a finance or operating lease. In contrast, the new ASU requires both types of leases to be recognized on the balance sheet. In addition, the new guidance includes quantitative and qualitative disclosure requirements to aid financial statement users in better understanding the amount, timing and uncertainty of cash flows arising from leases. The new guidance is effective for the Company for the annual reporting period ending September 30, 2020 and interim periods within that annual period. Early adoption is permitted. In January 2018, the FASB issued ASU 2018-01, which provides a practical expedient that allows entities the option of not evaluating existing land easements under the new lease standard for those easements that were entered into prior to adoption. New or modified land easements will require evaluation on a prospective basis. Management has not completed its evaluation of the new guidance under ASUs 2016-02 and 2018-01; however, the Company has completed its inventory of leases and does not currently expect the new guidance to have a material effect on its financial position, results of operations or cash flows. In January 2017, the FASB issued ASU 2017-03, Accounting Changes and Error Corrections and Investments - Equity Method and Joint Ventures . This update adds the text of the SEC Staff Announcement, Disclosure of the Impact That Recently Issued Accounting Standards Will Have on the Financial Statements of a Registrant When Such Standards Are Adopted in a Future Period (in accordance with Staff Accounting Bulletin Topic 11.M) as paragraph 250-10-S99-6. Related specifically to ASU 2014-09, ASU 2016-02 and ASU 2016-13, an SEC registrant should evaluate ASUs that have not yet been adopted to determine and include appropriate financial disclosures and MD&A discussions, including consideration of additional qualitative disclosures, to assist financial statement readers in assessing the significance of impact on adoption. The new guidance is effective immediately. The nature of this guidance relates to the effectiveness and quality of disclosures related to ASUs not yet adopted; however, there is no effect on the Company's financial position, results of operations or cash flows. In March 2017, the FASB issued ASU 2017-07, Compensation - Retirement Benefits . The primary objective of this guidance is to improve the financial statement presentation of net periodic pension and postretirement benefit costs; however, it also changes which cost components are eligible for capitalization. The amendments in the ASU require that an employer report the service cost component in the same line item or items as other compensation costs arising from services rendered by the employees during the period. The other components of net benefit cost are required to be presented in the income statement separately from the service cost component and, if a subtotal for income from operations is presented, outside of income from operations. In addition, the ASU allows only the service cost component of periodic benefit cost to be eligible for capitalization when applicable. This change to capitalization eligibility differs from the treatment currently applied by the Company. The new guidance is effective for the Company for the annual reporting period ending September 30, 2019 and interim periods within that annual period. Early adoption is permitted. Management has had discussions with its state regulators regarding the adoption of this ASU for regulatory purposes. The regulatory body has not taken a position on the change in capitalization requirements for these benefit costs and will evaluate the impact of this ASU on a case by case basis. The Company intends to adopt this ASU effective October 1, 2018 with the change in expense classification on a retrospective basis and the change in capitalization of costs beginning prospectively. If the regulatory body ultimately determines that changes to the capitalization of these retirement benefits is not appropriate for regulatory purposes, the Company may have to establish regulatory assets or liabilities for those costs or benefits excluded from capitalization under this ASU. Management does not expect the new guidance to have a material effect on the Company's consolidated financial statements. In August 2017, the FASB issued ASU 2017-12, Derivatives and Hedging: Targeted Improvements to Accounting For Hedging Activities . The ASU is meant to simplify recognition and presentation guidance in an effort to improve financial reporting of cash flow and fair value hedging relationships to better portray the economic results of an entity's risk management activities. This is achieved through changes to both the designation and measurement guidance for qualifying hedging relationships, as well as changes to the presentation of hedge results. The new guidance is effective for the Company for the annual reporting period ending September 30, 2020 and interim periods within that annual period. Early adoption is permitted. Management has not completed its evaluation of the new guidance; however, it does not currently expect the new guidance to have a material effect on its financial position, results of operations or cash flows. In February 2018, the FASB issued ASU 2018-02, Income Statement - Reporting Comprehensive Income (Topic 220) - Reclassification of Certain Tax Effects from Accumulated Other Comprehensive Income . The ASU provides the option to reclassify stranded tax effects within AOCI to retained earnings in each period in which the effects of the change in the U.S. federal corporate income tax rate, per the Tax Cuts and Jobs Act, is recorded. The new guidance is effective for the Company for the annual reporting period ending September 30, 2020 and interim periods within that annual period. Early adoption is permitted. Management has not completed its evaluation of the new guidance; however, it believes the new guidance will improve the presentation of AOCI by removing the stranded tax effects related to tax reform and transferring the amount to retained earnings. Management does not currently expect the new guidance to have a material effect on its financial position, results of operations or cash flows. Other accounting standards that have been issued by the FASB or other standard-setting bodies are not currently applicable to the Company or are not expected to have a material impact on the Company’s financial position, results of operations or cash flows. |
Other Investments (Tables)
Other Investments (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Schedule of Other Investments | The financial statement locations of the investment in the LLC are as follows: Balance Sheet Location of Other Investments: June 30, 2018 September 30, 2017 Other Assets: Investment in unconsolidated affiliate $ 22,026,401 $ 7,445,106 Current Liabilities: Capital contributions payable $ 9,800,720 $ 1,055,504 Three Months Ended Nine Months Ended Income Statement Location of Other Investments: June 30, 2018 June 30, 2017 June 30, 2018 June 30, 2017 Equity in earnings of unconsolidated affiliate $ 245,075 $ 111,626 $ 585,399 $ 289,791 |
Derivatives and Hedging (Tables
Derivatives and Hedging (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Fair Values of Derivative Instrument | The table below reflects the fair values of the derivative instrument and its corresponding classification in the condensed consolidated balance sheet: June 30, 2018 September 30, 2017 Derivative designated as hedging instrument: Current assets: Interest rate swap $87,926 $26,777 Other assets: Interest rate swap $205,162 $90,066 Total derivatives designed as hedging instruments $293,088 $116,843 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Debt Disclosure [Abstract] | |
Schedule of Long-Term Debt | Long-term debt consists of the following: June 30, 2018 September 30, 2017 Principal Unamortized Debt Issuance Costs Principal Unamortized Debt Issuance Costs Roanoke Gas Company: Unsecured senior notes payable, at 4.26% due on September 18, 2034 $ 30,500,000 $ 156,879 $ 30,500,000 $ 164,119 Unsecured term note payable, at 30-day LIBOR plus 0.90%, due November 1, 2021 7,000,000 11,116 7,000,000 13,618 Unsecured term notes payable, at 3.58% due on October 2, 2027 8,000,000 44,548 — 48,160 RGC Midstream, LLC: Unsecured term notes payable, at 30-day LIBOR plus 1.35%, due December 29, 2020 11,849,200 82,433 6,312,200 66,052 Total notes payable $ 57,349,200 $ 294,976 $ 43,812,200 $ 291,949 Line-of-credit, at 30-day LIBOR plus 1.00%, due March 31, 2020 $ — $ — $ 17,791,760 $ — Total long-term debt $ 57,349,200 $ 294,976 $ 61,603,960 $ 291,949 |
Other Comprehensive Income (Tab
Other Comprehensive Income (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Equity [Abstract] | |
Summary of Other Comprehensive Income and Loss | A summary of other comprehensive income and loss is provided below: Before-Tax Amount Tax (Expense) or Benefit Net-of-Tax Amount Three Months Ended June 30, 2018 Interest rate swap: Unrealized gains $ 35,969 $ (10,373 ) $ 25,596 Transfer of realized gains to interest expense (9,272 ) 2,674 (6,598 ) Net interest rate swap 26,697 (7,699 ) 18,998 Defined benefit plans: Amortization of actuarial gains (5,971 ) 1,722 (4,249 ) Other comprehensive income $ 20,726 $ (5,977 ) $ 14,749 Three Months Ended June 30, 2017 Interest rate swap: Unrealized losses $ (40,382 ) $ 15,329 $ (25,053 ) Defined benefit plans: Amortization of actuarial losses 64,058 (24,316 ) 39,742 Other comprehensive income $ 23,676 $ (8,987 ) $ 14,689 Before-Tax Amount Tax (Expense) or Benefit Net-of-Tax Amount Nine Months Ended June 30, 2018 Interest rate swap: Unrealized gains $ 187,913 $ (54,194 ) $ 133,719 Transfer of realized gains to interest expense (11,668 ) 3,365 (8,303 ) Net interest rate swap 176,245 (50,829 ) 125,416 Defined benefit plans: Amortization of actuarial gains (17,913 ) 5,166 (12,747 ) Other comprehensive income $ 158,332 $ (45,663 ) $ 112,669 Nine Months Ended June 30, 2017 Interest rate swap: Unrealized gains $ 118,606 $ (45,023 ) $ 73,583 Defined benefit plans: Amortization of actuarial losses 192,174 (72,948 ) 119,226 Other comprehensive income $ 310,780 $ (117,971 ) $ 192,809 |
Reconciliation of Other Accumulated Other Comprehensive Income (Loss) | Reconciliation of Other Accumulated Comprehensive Income (Loss) Accumulated Other Comprehensive Income (Loss) Balance at September 30, 2017 $ (1,202,264 ) Other comprehensive income 112,669 Balance at June 30, 2018 $ (1,089,595 ) |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Earnings Per Share [Abstract] | |
Schedule of Basic and Diluted Earnings Per Share Reconciliation | A reconciliation of basic and diluted earnings per share is presented below: Three Months Ended June 30, Nine Months Ended June 30, 2018 2017 2018 2017 Net Income $ 1,087,355 $ 615,562 $ 6,612,746 $ 6,072,979 Weighted average common shares 7,982,354 7,227,171 7,533,595 7,212,289 Effect of dilutive securities: Options to purchase common stock 48,698 46,669 46,330 32,275 Diluted average common shares 8,031,052 7,273,840 7,579,925 7,244,564 Earnings Per Share of Common Stock: Basic $ 0.14 $ 0.09 $ 0.88 $ 0.84 Diluted $ 0.14 $ 0.08 $ 0.87 $ 0.84 |
Employee Benefit Plans (Tables)
Employee Benefit Plans (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Retirement Benefits [Abstract] | |
Schedule of Components of Net Periodic Pension and Postretirement Benefit Cost | Net pension plan and postretirement plan expense recorded by the Company is detailed as follows: Three Months Ended Nine Months Ended June 30, June 30, 2018 2017 2018 2017 Components of net periodic pension cost: Service cost $ 166,309 $ 176,669 $ 498,927 $ 530,007 Interest cost 272,045 248,900 816,135 746,700 Expected return on plan assets (465,710 ) (404,103 ) (1,397,130 ) (1,212,309 ) Recognized loss 87,758 165,545 263,274 496,635 Net periodic pension cost $ 60,402 $ 187,011 $ 181,206 $ 561,033 Three Months Ended Nine Months Ended June 30, June 30, 2018 2017 2018 2017 Components of postretirement benefit cost: Service cost $ 41,805 $ 45,817 $ 125,415 $ 137,451 Interest cost 160,151 156,706 480,453 470,118 Expected return on plan assets (155,845 ) (142,878 ) (467,535 ) (428,634 ) Recognized loss 70,967 107,440 212,901 322,320 Net postretirement benefit cost $ 117,078 $ 167,085 $ 351,234 $ 501,255 |
Summary of Employer Contributions to Defined Benefit Plans | The table below reflects the Company's actual contributions made fiscal year-to-date. The Company revised its funding plan and currently does not expect to make any further contributions to either the pension plan or the postretirement medical plan for the balance of the current fiscal year. Fiscal Year-to-Date Contributions Remaining Fiscal Year Contributions Defined benefit pension plan $ 800,000 $ — Postretirement medical plan 300,000 — Total $ 1,100,000 $ — |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 9 Months Ended |
Jun. 30, 2018 | |
Fair Value Disclosures [Abstract] | |
Schedule of Fair Value of Financial Assets and Liabilities Measured on a Recurring Basis | The following table summarizes the Company’s financial assets and liabilities that are measured at fair value on a recurring basis as required by existing guidance and the fair value measurements by level within the fair value hierarchy as of June 30, 2018 and September 30, 2017 : Fair Value Measurements - June 30, 2018 Fair Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Interest rate swap $ 293,088 $ — $ 293,088 $ — Total $ 293,088 $ — $ 293,088 $ — Liabilities: Natural gas purchases $ 1,556,372 $ — $ 1,556,372 $ — Total $ 1,556,372 $ — $ 1,556,372 $ — Fair Value Measurements - September 30, 2017 Fair Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Assets: Interest rate swap $ 116,843 $ — $ 116,843 $ — Total $ 116,843 $ — $ 116,843 $ — Liabilities: Natural gas purchases $ 805,159 $ — $ 805,159 $ — Total $ 805,159 $ — $ 805,159 $ — |
Summary of the Fair Value of Financial Assets and Liabilities Not Adjusted to Fair Value | The following table summarizes the fair value of the Company’s financial assets and liabilities that are not adjusted to fair value in the financial statements as of June 30, 2018 and September 30, 2017 : Fair Value Measurements - June 30, 2018 Carrying Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Liabilities: Long-term debt $ 57,349,200 $ — $ — $ 56,910,578 Total $ 57,349,200 $ — $ — $ 56,910,578 Fair Value Measurements - September 30, 2017 Carrying Value Quoted Prices in Active Markets (Level 1) Significant Other Observable Inputs (Level 2) Significant Unobservable Inputs (Level 3) Liabilities: Long-term debt $ 43,812,200 $ — $ — $ 45,689,238 Total $ 43,812,200 $ — $ — $ 45,689,238 |
Stock Issue (Details)
Stock Issue (Details) - USD ($) | 1 Months Ended | 9 Months Ended | |
Mar. 31, 2018 | Jun. 30, 2018 | Jun. 30, 2017 | |
Equity [Abstract] | |||
Equity offering, common stock issued (in shares) | 700,000 | 744,906 | 49,101 |
Schedule of Capitalization, Equity [Line Items] | |||
Equity offering, net proceeds invested in subsidiary | $ 16,264,655 | $ 810,689 | |
Roanoke Gas Company [Member] | |||
Schedule of Capitalization, Equity [Line Items] | |||
Equity offering, net proceeds invested in subsidiary | $ 15,114,823 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended |
Dec. 31, 2017 | Jun. 30, 2018 | Sep. 30, 2018 | |
Income Tax Contingency [Line Items] | |||
Reduction in deferred tax liability resulting from the Tax Act | $ 11,533,986 | ||
Amount reclassified to regulatory liability resulting from the Tax Act | 11,742,274 | $ 11,742,274 | |
Charge to income tax expense related to unregulated operations resulting from the Tax Act | $ 208,288 | ||
Scenario, Forecast [Member] | |||
Income Tax Contingency [Line Items] | |||
Blended tax rate | 24.30% |
Rates and Regulatory Matters Ra
Rates and Regulatory Matters Rates and Regulatory Matters (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | ||
Jun. 30, 2018 | Dec. 31, 2017 | Jun. 30, 2018 | Sep. 30, 2018 | Sep. 30, 2017 | |
Regulatory Liabilities [Line Items] | |||||
Reduction in deferred tax liability resulting from the Tax Act | $ 11,742,274 | $ 11,742,274 | |||
Rate refund | $ 1,147,829 | $ 1,147,829 | $ 0 | ||
Utilization fee, initial customer portion | $ 700,000 | ||||
Utilization fee company portion, percent | 25.00% | ||||
Utilization fee customer portion, percent | 75.00% | ||||
Scenario, Forecast [Member] | |||||
Regulatory Liabilities [Line Items] | |||||
Blended tax rate | 24.30% |
Other Investments (Narrative) (
Other Investments (Narrative) (Details) Bcf in Millions | 1 Months Ended | 9 Months Ended | |
Oct. 31, 2015USD ($)debt_instrumentBcf | Jun. 30, 2018USD ($) | Sep. 30, 2017USD ($) | |
Investment [Line Items] | |||
Capital contributions payable term | 3 months | ||
Capital contributions payable | $ 9,800,720 | $ 1,055,504 | |
Non-cash increase in investment in unconsolidated affiliate | $ 8,745,216 | ||
Midstream [Member] | |||
Investment [Line Items] | |||
Equity interest percentage | 1.00% | ||
Pipeline capacity per day (in bcf) | Bcf | 2 | ||
Number of unsecured Promissory Notes funding the investment | debt_instrument | 2 | ||
Debt term | 5 years | ||
Midstream [Member] | Minimum [Member] | |||
Investment [Line Items] | |||
Total project cost | $ 3,500,000,000 | ||
Total estimated investment | 35,000,000 | ||
Midstream [Member] | Maximum [Member] | |||
Investment [Line Items] | |||
Total project cost | 3,700,000,000 | ||
Total estimated investment | $ 37,000,000 |
Other Investments (Schedule of
Other Investments (Schedule of Other Investments) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | Sep. 30, 2017 | |
Other Assets: | |||||
Investment in unconsolidated affiliate | $ 22,026,401 | $ 22,026,401 | $ 7,445,106 | ||
Current Liabilities: | |||||
Capital contributions payable | 9,800,720 | 9,800,720 | $ 1,055,504 | ||
Income Statement Location of Other Investments: | |||||
Equity in earnings of unconsolidated affiliate | $ 245,075 | $ 111,626 | $ 585,399 | $ 289,791 |
Derivatives and Hedging (Narrat
Derivatives and Hedging (Narrative) (Details) | Jun. 30, 2018USD ($)instrument_held |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |
Number of interest rate swap associated with the term note | instrument_held | 1 |
Roanoke Gas Company [Member] | Unsecured Term Notes [Member] | Unsecured Term Notes Payable, at 30-day LIBOR plus 0.90%, due November 1, 2021 [Member] | |
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |
Debt instrument, borrowing amount | $ | $ 7,000,000 |
Effective interest rate | 2.30% |
Derivatives and Hedging (Schedu
Derivatives and Hedging (Schedule of Fair Value of Marked-to-Market Transactions) (Details) - USD ($) | Jun. 30, 2018 | Sep. 30, 2017 |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | ||
Interest rate swap, current assets | $ 87,926 | $ 26,777 |
Interest rate swap, other assets | 205,162 | 90,066 |
Total derivatives designated as hedging instruments | $ 293,088 | $ 116,843 |
Long-Term Debt (Narrative) (Det
Long-Term Debt (Narrative) (Details) | Apr. 11, 2018USD ($)instrument_held | Mar. 26, 2018USD ($) | Oct. 02, 2017USD ($) | Oct. 31, 2015debt_instrument | Jun. 30, 2018USD ($) | Dec. 31, 2015USD ($) |
Debt Instrument [Line Items] | ||||||
Maximum percentage of Consolidated Long Term Indebtedness to Consolidated Total Capitalization | 65.00% | |||||
Roanoke Gas [Member] | Unsecured Term Notes [Member] | Unsecured Term Notes Payable, at 3.58%, due October 2, 2027 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt term | 10 years | |||||
Debt instrument, borrowing amount | $ 8,000,000 | |||||
Stated percentage rate | 3.58% | 3.58% | ||||
Maximum percentage of Priority Indebtedness to Consolidated Total Assets | 15.00% | |||||
Roanoke Gas [Member] | Unsecured Term Notes [Member] | Unsecured Term Notes Payable, at 30-day LIBOR plus 0.90%, due November 1, 2021 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt term | 5 years | |||||
Debt instrument, borrowing amount | $ 7,000,000 | |||||
Effective interest rate | 2.30% | |||||
Maximum percentage of Priority Indebtedness to Consolidated Total Assets | 15.00% | |||||
Roanoke Gas [Member] | Unsecured Term Notes [Member] | Unsecured Term Notes Payable, at 30-day LIBOR plus 0.90%, due November 1, 2021 [Member] | 30-day LIBOR [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Variable rate basis points (as a percent) | 0.90% | |||||
Roanoke Gas [Member] | Line of Credit [Member] | Line of Credit, at 30-day LIBOR plus 1.00%, due March 31, 2020 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt term | 2 years | |||||
Availability fee (as a percent) | 0.15% | |||||
Roanoke Gas [Member] | Line of Credit [Member] | Line of Credit, at 30-day LIBOR plus 1.00%, due March 31, 2020 [Member] | 30-day LIBOR [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Variable rate basis points (as a percent) | 1.00% | 1.00% | ||||
Roanoke Gas [Member] | Line of Credit [Member] | Line of Credit, at 30-day LIBOR plus 1.00%, due March 31, 2020 [Member] | Maximum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit, maximum borrowing limit | $ 25,000,000 | |||||
Roanoke Gas [Member] | Line of Credit [Member] | Line of Credit, at 30-day LIBOR plus 1.00%, due March 31, 2020 [Member] | Minimum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Line of credit, maximum borrowing limit | $ 2,000,000 | |||||
Midstream [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt term | 5 years | |||||
Number of unsecured Promissory Notes funding the investment | debt_instrument | 2 | |||||
Midstream [Member] | Unsecured Term Notes [Member] | Unsecured Term Notes Payable, at 30-day LIBOR plus 1.35%, due December 29, 2020 [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Number of unsecured Promissory Notes funding the investment | instrument_held | 2 | |||||
Maximum percentage of Priority Indebtedness to Consolidated Total Assets | 15.00% | |||||
Midstream [Member] | Unsecured Term Notes [Member] | Unsecured Term Notes Payable, at 30-day LIBOR plus 1.35%, due December 29, 2020 [Member] | 30-day LIBOR [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Variable rate basis points (as a percent) | 1.35% | 1.35% | ||||
Midstream [Member] | Unsecured Term Notes [Member] | Unsecured Term Notes Payable, at 30-day LIBOR plus 1.35%, due December 29, 2020 [Member] | Maximum [Member] | ||||||
Debt Instrument [Line Items] | ||||||
Debt instrument, borrowing amount | $ 38,000,000 | $ 25,000,000 |
Long-Term Debt (Schedule of Lon
Long-Term Debt (Schedule of Long-Term Debt) (Details) - USD ($) | Apr. 11, 2018 | Mar. 26, 2018 | Jun. 30, 2018 | Oct. 02, 2017 | Sep. 30, 2017 |
Debt Instrument [Line Items] | |||||
Notes payable | $ 57,349,200 | $ 43,812,200 | |||
Principal | 57,349,200 | 61,603,960 | |||
Unamortized Debt Issuance Costs | 294,976 | 291,949 | |||
Notes Payable [Member] | |||||
Debt Instrument [Line Items] | |||||
Notes payable | 57,349,200 | 43,812,200 | |||
Unamortized Debt Issuance Costs | 294,976 | 291,949 | |||
Roanoke Gas Company [Member] | Unsecured Senior Notes [Member] | Unsecured Senior Notes Payable, at 4.26%, due on September 18, 2034 [Member] | |||||
Debt Instrument [Line Items] | |||||
Notes payable | 30,500,000 | 30,500,000 | |||
Unamortized Debt Issuance Costs | $ 156,879 | 164,119 | |||
Stated percentage rate | 4.26% | ||||
Roanoke Gas Company [Member] | Unsecured Term Notes [Member] | Unsecured Term Notes Payable, at 30-day LIBOR plus 0.90%, due November 1, 2021 [Member] | |||||
Debt Instrument [Line Items] | |||||
Notes payable | $ 7,000,000 | 7,000,000 | |||
Unamortized Debt Issuance Costs | $ 11,116 | 13,618 | |||
Roanoke Gas Company [Member] | Unsecured Term Notes [Member] | Unsecured Term Notes Payable, at 30-day LIBOR plus 0.90%, due November 1, 2021 [Member] | 30-day LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Variable rate basis points (as a percent) | 0.90% | ||||
Roanoke Gas Company [Member] | Unsecured Term Notes [Member] | Unsecured Term Notes Payable, at 3.58%, due October 2, 2027 [Member] | |||||
Debt Instrument [Line Items] | |||||
Notes payable | $ 8,000,000 | 0 | |||
Unamortized Debt Issuance Costs | $ 44,548 | 48,160 | |||
Stated percentage rate | 3.58% | 3.58% | |||
Roanoke Gas Company [Member] | Line of Credit [Member] | Line of Credit, at 30-day LIBOR plus 1.00%, due March 31, 2020 [Member] | |||||
Debt Instrument [Line Items] | |||||
Line-of-credit | $ 0 | 17,791,760 | |||
Unamortized Debt Issuance Costs | $ 0 | 0 | |||
Roanoke Gas Company [Member] | Line of Credit [Member] | Line of Credit, at 30-day LIBOR plus 1.00%, due March 31, 2020 [Member] | 30-day LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Variable rate basis points (as a percent) | 1.00% | 1.00% | |||
RGC Midstream LLC [Member] | Unsecured Term Notes [Member] | Unsecured Term Notes Payable, at 30-day LIBOR plus 1.35%, due December 29, 2020 [Member] | |||||
Debt Instrument [Line Items] | |||||
Notes payable | $ 11,849,200 | 6,312,200 | |||
Unamortized Debt Issuance Costs | $ 82,433 | $ 66,052 | |||
RGC Midstream LLC [Member] | Unsecured Term Notes [Member] | Unsecured Term Notes Payable, at 30-day LIBOR plus 1.35%, due December 29, 2020 [Member] | 30-day LIBOR [Member] | |||||
Debt Instrument [Line Items] | |||||
Variable rate basis points (as a percent) | 1.35% | 1.35% |
Other Comprehensive Income (Sch
Other Comprehensive Income (Schedule of Other Comprehensive Income and Loss) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Before-Tax Amount | ||||
Other comprehensive income | $ 20,726 | $ 23,676 | $ 158,332 | $ 310,780 |
Tax (Expense) or Benefit | ||||
Other comprehensive income | (5,977) | (8,987) | (45,663) | (117,971) |
Net-of-Tax Amount | ||||
Other comprehensive income | 14,749 | 14,689 | 112,669 | 192,809 |
Interest rate swap [Member] | ||||
Before-Tax Amount | ||||
Other comprehensive income before reclassifications | 35,969 | (40,382) | 187,913 | 118,606 |
Reclassifications from accumulated other comprehensive income | (9,272) | (11,668) | ||
Other comprehensive income | 26,697 | 176,245 | ||
Tax (Expense) or Benefit | ||||
Other comprehensive income before reclassifications | (10,373) | 15,329 | (54,194) | (45,023) |
Reclassifications from accumulated other comprehensive income | 2,674 | 3,365 | ||
Other comprehensive income | (7,699) | (50,829) | ||
Net-of-Tax Amount | ||||
Other comprehensive income before reclassifications | 25,596 | (25,053) | 133,719 | 73,583 |
Reclassifications from accumulated other comprehensive income | (6,598) | (8,303) | ||
Other comprehensive income | 18,998 | 125,416 | ||
Defined benefit plans [Member] | ||||
Before-Tax Amount | ||||
Other comprehensive income | (5,971) | 64,058 | (17,913) | 192,174 |
Tax (Expense) or Benefit | ||||
Other comprehensive income | 1,722 | (24,316) | 5,166 | (72,948) |
Net-of-Tax Amount | ||||
Other comprehensive income | $ (4,249) | $ 39,742 | $ (12,747) | $ 119,226 |
Other Comprehensive Income (Rec
Other Comprehensive Income (Reconciliation of Accumulated Comprehensive Income (Loss)) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Increase (Decrease) in Other Accumulated Comprehensive Income (Loss) [Roll Forward] | ||||
Balance at beginning of period | $ 60,040,472 | |||
Other comprehensive income | $ 14,749 | $ 14,689 | 112,669 | $ 192,809 |
Balance at end of period | 79,430,369 | 79,430,369 | ||
Accumulated Other Comprehensive Income (Loss) [Member] | ||||
Increase (Decrease) in Other Accumulated Comprehensive Income (Loss) [Roll Forward] | ||||
Balance at beginning of period | (1,202,264) | |||
Balance at end of period | $ (1,089,595) | $ (1,089,595) |
Commitments and Contingencies (
Commitments and Contingencies (Details) | 9 Months Ended |
Jun. 30, 2018pipeline | |
Commitments and Contingencies Disclosure [Abstract] | |
Number of pipelines serving Roanoke Gas | 2 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Earnings Per Share [Abstract] | ||||
Net income | $ 1,087,355 | $ 615,562 | $ 6,612,746 | $ 6,072,979 |
Weighted average common shares | 7,982,354 | 7,227,171 | 7,533,595 | 7,212,289 |
Effect of dilutive securities: | ||||
Options to purchase common stock (in shares) | 48,698 | 46,669 | 46,330 | 32,275 |
Diluted average common shares | 8,031,052 | 7,273,840 | 7,579,925 | 7,244,564 |
Earnings Per Share of Common Stock: | ||||
Basic (in dollars per share) | $ 0.14 | $ 0.09 | $ 0.88 | $ 0.84 |
Diluted (in dollars per share) | $ 0.14 | $ 0.08 | $ 0.87 | $ 0.84 |
Employee Benefit Plans (Schedul
Employee Benefit Plans (Schedule of Components of Net Periodic Pension and Postretirement Benefit Cost) (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Jun. 30, 2018 | Jun. 30, 2017 | Jun. 30, 2018 | Jun. 30, 2017 | |
Pension Plan [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 166,309 | $ 176,669 | $ 498,927 | $ 530,007 |
Interest cost | 272,045 | 248,900 | 816,135 | 746,700 |
Expected return on plan assets | (465,710) | (404,103) | (1,397,130) | (1,212,309) |
Recognized loss | 87,758 | 165,545 | 263,274 | 496,635 |
Net periodic/postretirement pension/benefit cost | 60,402 | 187,011 | 181,206 | 561,033 |
Postretirement Plan [Member] | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 41,805 | 45,817 | 125,415 | 137,451 |
Interest cost | 160,151 | 156,706 | 480,453 | 470,118 |
Expected return on plan assets | (155,845) | (142,878) | (467,535) | (428,634) |
Recognized loss | 70,967 | 107,440 | 212,901 | 322,320 |
Net periodic/postretirement pension/benefit cost | $ 117,078 | $ 167,085 | $ 351,234 | $ 501,255 |
Employee Benefit Plans (Sched43
Employee Benefit Plans (Schedule of Actual and Expected Employer Contributions) (Details) | 9 Months Ended |
Jun. 30, 2018USD ($) | |
Defined Benefit Plan Disclosure [Line Items] | |
Fiscal Year-to-Date Contributions | $ 1,100,000 |
Remaining Fiscal Year Contributions | 0 |
Defined Benefit Pension Plan [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Fiscal Year-to-Date Contributions | 800,000 |
Remaining Fiscal Year Contributions | 0 |
Postretirement Medical Plan [Member] | |
Defined Benefit Plan Disclosure [Line Items] | |
Fiscal Year-to-Date Contributions | 300,000 |
Remaining Fiscal Year Contributions | $ 0 |
Fair Value Measurements (Schedu
Fair Value Measurements (Schedule of Fair Value of Financial Assets and Liabilities Measured on a Recurring Basis) (Details) - USD ($) | Jun. 30, 2018 | Sep. 30, 2017 |
Assets: | ||
Interest rate swap | $ 293,088 | $ 116,843 |
Total | 293,088 | 116,843 |
Liabilities: | ||
Total | 1,556,372 | 805,159 |
Quoted Prices in Active Markets (Level 1) [Member] | ||
Assets: | ||
Total | 0 | 0 |
Liabilities: | ||
Total | 0 | 0 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Assets: | ||
Total | 293,088 | 116,843 |
Liabilities: | ||
Total | 1,556,372 | 805,159 |
Significant Unobservable Inputs (Level 3) [Member] | ||
Assets: | ||
Total | 0 | 0 |
Liabilities: | ||
Total | 0 | 0 |
Recurring [Member] | ||
Liabilities: | ||
Natural gas purchases | 1,556,372 | 805,159 |
Recurring [Member] | Interest Rate Swap [Member] | ||
Assets: | ||
Interest rate swap | 293,088 | 116,843 |
Recurring [Member] | Quoted Prices in Active Markets (Level 1) [Member] | ||
Liabilities: | ||
Natural gas purchases | 0 | 0 |
Recurring [Member] | Quoted Prices in Active Markets (Level 1) [Member] | Interest Rate Swap [Member] | ||
Assets: | ||
Interest rate swap | 0 | 0 |
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | ||
Liabilities: | ||
Natural gas purchases | 1,556,372 | 805,159 |
Recurring [Member] | Significant Other Observable Inputs (Level 2) [Member] | Interest Rate Swap [Member] | ||
Assets: | ||
Interest rate swap | 293,088 | 116,843 |
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | ||
Liabilities: | ||
Natural gas purchases | 0 | 0 |
Recurring [Member] | Significant Unobservable Inputs (Level 3) [Member] | Interest Rate Swap [Member] | ||
Assets: | ||
Interest rate swap | $ 0 | $ 0 |
Fair Value Measurements (Summar
Fair Value Measurements (Summary of the Fair Value of Financial Assets and Liabilities Not Adjusted to Fair Value) (Details) - USD ($) | Jun. 30, 2018 | Sep. 30, 2017 |
Quoted Prices in Active Markets (Level 1) [Member] | ||
Liabilities: | ||
Long-term debt | $ 0 | $ 0 |
Total | 0 | 0 |
Significant Other Observable Inputs (Level 2) [Member] | ||
Liabilities: | ||
Long-term debt | 0 | 0 |
Total | 0 | 0 |
Significant Unobservable Inputs (Level 3) [Member] | ||
Liabilities: | ||
Long-term debt | 56,910,578 | 45,689,238 |
Total | 56,910,578 | 45,689,238 |
Carrying Value [Member] | ||
Liabilities: | ||
Long-term debt | 57,349,200 | 43,812,200 |
Total | $ 57,349,200 | $ 43,812,200 |