Our regulated utilities periodically seek rate increases to cover the cost of increased operating expenses, increased financing expenses due to additional investments in utility plant and other costs of doing business. In Delaware, utilities are permitted by law to place rates into effect, under bond, on a temporary basis pending completion of a rate increase proceeding. The first temporary increase may be up to the lesser of $2.5 million on an annual basis or 15% of annual gross water sales. Should the rate case not be completed within seven months, by law, the utility may put the lesser of the entire requested rate relief or 15% of annual gross water sales in effect, under bond, until a final resolution is ordered and placed into effect. If such rates are found to be in excess of rates the PSC finds to be appropriate, we must refund the portion found in excess to customers with interest. The timing of our rate increase requests are therefore dependent upon the estimated cost of the administrative process in relation to the investments and expenses that we hope to recover through the rate increase. We can provide no assurances that rate increase requests will be approved by the applicable regulatory agencies; and, if approved, we cannot guarantee that these rate increases will be granted in a timely or sufficient manner to cover the investments and expenses for which we initially sought the rate increase.
We are affected by inflation, most notably by the continually increasing costs required to maintain, improve and expand our service capability. The cumulative effect of inflation results in significantly higher facility costs compared to investments made 20 to 40 years ago, which must be recovered from future cash flows.
Delaware statute permits utilities to put into effect, on a semi-annual basis, increases related to specific types of distribution system improvements through DSIC. This charge is available to water utilities to be implemented between general rate increase applications that normally recognize changes in a water utility’s overall financial position. The DSIC process is less costly when compared to the approval process for general rate increase requests.
On April 10, 2006, the PSC made effective new Regulations Docket 15 that governs the terms and conditions under which water utilities require advances or contributions from customers or developers. These regulations require that developers pay for all water facilities within a new development, with such facilities recorded as contributions in aid of construction by the water utility. In addition, the utility is required to receive a contribution in aid of construction of $1,500 for each new residential connection to its system towards the cost of water supply, treatment and storage facilities. These required contributions are intended to place a greater burden upon new customers to pay for the cost of facilities required to serve them.
Revenues totaled $12.0 million for the three months ended June 30, 2006, $0.5 million, or 4.4% above revenues for the three months ended June 30, 2005 of $11.5 million. Water sales revenues increased 5.8% for the three months ended June 30, 2006, over the corresponding period in 2005. A portion of the increase in water sales revenue reflects a 2.77% increase in the number of customers served. The remaining increase in operating revenues for the three months ended June 30, 2006 is primarily due to approximately $126,000 generated by the increase in DSIC. The decrease in the non-utility revenues of $149,000 was due to a decrease in wastewater project activity compared to the same period last year. We realized 91.6% of our total revenue for the three months ended June 30, 2006 from the sale of water, compared to 90.4% during the same period last year.
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On April 11, 2006, the PSC approved a rate increase for Artesian Water in response to a February 5, 2004 rate request. Artesian Water filed an initial application in February 2004 with the PSC for a 24% rate increase to generate additional revenue of approximately $8.8 million on an annualized basis to recover the significant increase in utility plant and equipment placed in service and increased operating expenses. On March 26, 2004, Artesian Water filed a supplemental application reducing the requested increase to 23.8% or approximately $8.7 million on an annualized basis. On April 6, 2004, Artesian Water implemented a temporary rate increase designed to generate an increase in annual operating revenue of approximately 6.98%, or $2.5 million on an annualized basis. On September 7, 2004, an additional $3.0 million in temporary rates, for a total increase of 15%, was placed into effect as permitted by law. On June 21, 2005, the PSC ruled on various issues within Artesian Water’s rate application. However, on July 5, 2005, the PSC remanded two issues related to rate base valuation to the Hearing Examiner for further consideration. These two issues related to approximately $320,000 of the requested increase in annual revenue. In addition, effective July 1, 2005, Chester Water Authority and the City of Wilmington increased their rates for water purchased by Artesian Water. On August 15, 2005, Artesian Water filed a petition with the PSC to place into effect increased rates resulting from these increased costs. The PSC elected to consolidate this petition with the pending remanded issues in the rate case. On April 11, 2006, the PSC ruled in Artesian Water’s favor on all three issues. Based on the PSC decision, Artesian Water’s new rates will generate approximately $4.9 million in additional revenue on an annual basis, or an increase of approximately 13.4%, over rates in effect before the implementation of temporary rates in 2004. Since Artesian was permitted to bill customers under temporary rates that were found to be in excess of rates finally approved, Artesian Water will be required to refund the portion of the temporary rate increase in excess of the approved 13.4% increase to its customers. This amount has been held in reserve and was not reflected in income. The refund, plus interest which has been reflected in interest expense during the appropriate period, will be applied to the customers’ future bills. As of June 30, 2006, we had reserved $1,023,000 of the total received under temporary rates in anticipation of a refund.
Operating Expenses
Operating expenses, excluding depreciation and income taxes, increased $0.3 million, or 4.6%, to $7.2 million for the three months ended June 30, 2006, compared to $6.9 million for the same period in 2005. The components of the increase in operating expenses included an increase in utility operating expenses of $736,000 and an increase in property taxes of $49,000. Non-utility operating expenses decreased $467,000 in the first quarter of 2006, or 52.6%, compared to the same period last year.
The increase in utility operating expense of $736,000 for the quarter ended June 30, 2006, or 13.6%, over the same period in 2005, is comprised of increases in payroll and employee benefits, administration expense, and purchased power costs.
Payroll and employee benefit expense increased $569,000, or 21.0%, compared to the same period in 2005, primarily due to stock bonus awards and to a decrease in the capitalization of payroll and benefits associated with our internal staffing efforts in 2005 to convert our customer information system, which was placed into service on January 2, 2006.
Administration expense increased $79,000, or 9.3%, compared to the same period in 2005, due to PSC’s assessment of costs associated with a generic water utility docket (Docket 15), consulting costs associated with the implementation of GIS (Geographic Information System) software implementation, which is used by our engineering, field operations and planning departments, and additional postage for distributing the annual water quality report to our customers.
Utility operating expense also increased $79,000, or 26.0%, compared to the same period in 2005, due to an increase in electric rates of approximately 92% effective May 2006.
Non-utility expense decreased approximately $467,000 for the three months ended June 30, 2006, from the three months ended June 30, 2005, due to less project activity as compared to the same period in 2005.
Property taxes assessed on property, primarily held by Artesian Water, increased by $49,000, or 8.3%, compared to the same period in 2005, reflecting increases in tax rates charged for public schools in various areas where Artesian holds property and increases in the amount of plant owned by Artesian. Property taxes are assessed on land, buildings and certain utility plant, which includes the footage and size of pipe, hydrants and wells owned by Artesian Water.
The ratio of operating expense, excluding depreciation and income taxes, to total revenue was 60.2% for the three months ended June 30, 2006, compared to 60.1% for the three months ended June 30, 2005.
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Depreciation and amortization expense decreased $59,000, or 5.5%, over the three months ended June 30, 2006, due to contra-depreciation recorded on contributions and advances received for utility plant.
Federal and State income tax expense increased $69,000 due to higher profitability for the three months ended June 30, 2006, compared to the three months ended June 30, 2005.
Other Income, Net
Our Allowance for Funds Used During Construction, or AFUDC, increased $13,000, or 18.1%, compared to the same period in 2005, as a result of higher long-term construction activity subject to AFUDC for the second quarter of 2006 compared to the same period in 2005.
Interest Charges
Interest charges increased $39,000, or 2.5%, for the three months ended June 30, 2006, compared to the three months ended June 30, 2005, primarily due to higher long-term debt outstanding.
Net Income
Our net income increased $156,000, or 13.0%, for the three months ended June 30, 2006, compared to the same period a year ago. The increase in net income for the three months was due to improved operating income margins from our non-utility subsidiaries in the second quarter compared to the same period a year ago.
Results of Operations – Analysis of the Six Months Ended June 30, 2006 Compared to the Six Months Ended June 30, 2005
Operating Revenues
Revenues totaled $22.5 million for the six months ended June 30, 2006, $1.1 million, or 5.1% above revenues for the six months ended June 30, 2005, of $21.4 million. Water sales revenues increased 6.7% for the six months ended June 30, 2006, over the corresponding period in 2005. A portion of the increase in water sales revenue reflects a 2.77% increase in the number of customers served. In addition, since Artesian Water did not record as income in 2005 certain revenues received that we could not reasonably be certain we would retain, we reflected $154,000 for income received under rates approved in the remand in the first six months of 2006, further described below. The remaining increase in operating revenues for the six months ended June 30, 2006 is primarily due to additional revenues of approximately $258,000 generated by the increase in DSIC and slightly higher volumes of water delivered to customers. The decrease in the non-utility revenues in the amount of $282,000 was due to a decrease in wastewater construction activity compared to the same period last year. We realized 93.4% of our total revenue for the six months ended June 30, 2006 from the sale of water, compared to 92.0% during the same period last year.
On April 11, 2006, the PSC approved a rate increase for Artesian Water in response to Artesian Water’s February 5, 2004 rate request. For more details regarding this proceeding, see Results of Operations – Analysis of the Three Months Ended June 30, 2006 Compared to the Three Months Ended June 30, 2005 above.
Operating Expenses
Operating expenses, excluding depreciation and income taxes, increased $0.7 million, or 5.5%, to $13.8 million for the six months ended June 30, 2006, compared to $13.1 million for the same period in 2005. The components of the increase in operating expenses included an increase in utility operating expenses of $1.2 million and an increase in property taxes of $103,000. Non-utility operating expenses decreased $541,000 in the first six months of 2006, or 47.3%, compared to the same period last year primarily due to less construction activity in 2006.
The increase in utility operating expense of $1.2 million for the six months ended June 30, 2006, or 10.7%, over the same period in 2005, is comprised of increases in payroll and employee benefits, administration expense, purchased power expense, purchased water costs and water treatment expense.
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Payroll and employee benefit expense increased $662,000, or 12.0%, compared to the same period in 2005, primarily due to a decrease in the capitalization of payroll and benefits associated with our internal staff efforts in 2005 to convert our customer information system, which was placed into service on January 2, 2006. Additional staffing and wage increases also contributed to the increase.
Administration expense increased $266,000, or 17.0%, compared to the same period in 2005, due primarily to additional legal and consultant expenses related to the 2004 rate proceeding remand that were not expected nor included in the rate expenses approved in the proceeding. Regulatory expenses related to the millage assessed to public utilities in Delaware, which increased 50% in 2005, and Public Service Commission expenses related to our water self sufficiency and a generic water utility docket to address developer contributions also increased administrative expense by $48,000.
Purchased Power expense increased $107,000, or 17.1%, compared to the same period in 2005, due to an increase in electric rates of approximately 92% effective May 2006.
Utility operating expense also increased $48,000, or 3.1%, compared to the same period in 2005, due to the recognition of an increase in rates charged for water purchased from neighboring utilities under minimum take or pay agreements. Water treatment expense increased by $58,000, or 17.5%, compared to the same period in 2005, as a result of increases in the cost of chemicals used in the water treatment process.
Non-utility expense decreased approximately $541,000 for the six months ended June 30, 2006, from the six months ended June 30, 2005, primarily due to the timing of implementation for certain contracted engineering design services for projects for Artesian Utility. The engineering fees, related to construction projects, are charged back to developers under contract and the associated revenues have been reflected in our operating revenues under non-utility revenue.
Property taxes assessed on property, primarily held by Artesian Water, increased by $103,000, or 8.8%, compared to the same period in 2005, reflecting increases in tax rates charged for public schools in various areas where Artesian holds property and increases in the amount of plant owned by Artesian. Property taxes are assessed on land, buildings and certain utility plant, which includes the footage and size of pipe, hydrants and wells owned by Artesian Water.
The ratio of operating expense, excluding depreciation and income taxes, to total revenue was 61.5% for the six months ended June 30, 2006, compared to 61.3% for the six months ended June 30, 2005.
Depreciation and amortization expense increased $63,000, or 3.0%, over the six months ended June 30, 2005, due to increases in our utility plant in service providing supply, treatment, storage and distribution of water.
Federal and State income tax expense increased $83,000, or 5.7%, due to higher profitability for the six months ended June 30, 2006, compared to the six months ended June 30, 2005.
Other Income, Net
Our AFUDC decreased $4,000, or 3.3%, compared to the same period in 2005, as a result of lower long-term construction activity subject to AFUDC for the first three months of 2006 compared to the same period in 2005. Miscellaneous Income increased $32,000 primarily due to recording dividends associated with our investment in CoBank. CoBank is a cooperative bank that distributes equity and cash income to its customer-owners. Our ownership interest in CoBank is the result of our issuance of $50 million in First Mortgage Bonds to CoBank as currently reflected on our Balance Sheet.
Interest Charges
Interest charges increased $60,000, or 2.0%, for the six months ended June 30, 2006, compared to the six months ended June 30, 2005, primarily due to higher long-term debt outstanding, partially offset by lower borrowings on our lines of credit in 2006 compared to 2005.
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Net Income
Our net income increased $197,000, or 9.1%, for the six months ended June 30, 2006, compared to the same period a year ago. The increase in net income for the six months was due to improved operating income margins from our non-utility subsidiaries compared to the same period a year ago.
LIQUIDITY AND CAPITAL RESOURCES
Our primary sources of liquidity for the six months ended June 30, 2006 were $6.2 million provided by cash flow from operating activities and $8.3 million in net contributions and advances from developers. Cash flow from operating activities is primarily provided by our utility operations, and is impacted by the timeliness and adequacy of rate increases and changes in water consumption as a result of year-to-year variations in weather conditions particularly during the summer. A significant part of our ability to maintain and meet our financial objectives is to assure our investments in utility plant and equipment are recovered in the rates charged to customers. As such, from time to time we file rate increase requests to recover increases in operating expenses and investments in utility plant and equipment.
On May 9, 2006, Artesian Water Company filed a petition with the PSC to implement new rates to meet a requested increase in revenue of 23%, or approximately $9.9 million, on an annualized basis. This request is primarily due to the Company’s significant investment in infrastructure, as well as an approximately 92% increase in purchased power expense due to the deregulation of the electric industry in Delaware. On July 10, 2006, Artesian Water filed a supplemental application reducing the requested increase to 20.5% or approximately $8.7 million on an annual basis. As permitted by law, on July 10, 2006 Artesian Water placed into effect temporary rates designed to generate an increase in annual operating revenue of approximately 5.9%, or $2.5 million on an annual basis, under bond until the level of permanent rates is decided by the Delaware Public Service Commission.
We invested $17.1 million in capital expenditures during the first six months of 2006 compared to $10.2 million invested during the same period in 2005. The primary focus of Artesian Water’s investment was to continue to provide high quality reliable service to our growing service territory. We are constructing a new one million gallon elevated storage facility in southern New Castle County to serve customers in and around the town of Middletown and invested $2.1 million in the first six months of 2006. When completed, Artesian Water will have invested approximately $2.5 million in the facility. In addition, we are continuing our regional approach to building infrastructure through connecting existing supply infrastructure to new developments and at the same time providing redundancy to existing developments by connecting them to the regional system. These efforts resulted in an investment of $2.1 million in the first six months of 2006. Artesian Wastewater invested $1.1 million in constructing two new wastewater treatment facilities in Sussex County. When completed, Artesian Wastewater will have invested approximately $3.0 million in these facilities, which will be capable of serving approximately 1,000 customers. In addition, Artesian Wastewater took ownership of a wastewater treatment plant in a Sussex County development known as the Reserves. The $1.4 million facility was contributed to Artesian Wastewater by the developer. The facility was constructed to serve 97 customers.
At June 30, 2006, Artesian Water had lines of credit totaling $40.0 million to meet temporary cash requirements. These revolving credit facilities are unsecured. As of June 30, 2006, we had $34.7 million of available funds under these lines. The interest rate for borrowings under each of these lines is the London Interbank Offering Rate, or “LIBOR,” plus 1.0% or, at our discretion, the banks’ federal funds rate plus 1.0%. Each bank reviews all of their facilities annually for renewal. At June 30, 2006, Artesian Utility and Artesian Wastewater had lines of credit with a financial institution for $3.5 million and $1.5 million, respectively, to meet temporary cash requirements. These revolving credit facilities are unsecured. As of June 30, 2006, we had not borrowed funds under these lines. The interest rate for borrowings under each of these lines is the LIBOR plus 1.75%. The bank reviews its facilities annually for renewal.
We believe that our available cash and cash equivalents, cash from operations and cash available under our lines of credit will be sufficient to finance our operations, planned capital expenditures and commitments for the next twelve months.
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Contractual Obligations
| | Payments Due by Period | |
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In thousands | | Less than
1 Year | | 1-3
Years | | 4-5
Years | | After 5
Years | | Total | |
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First Mortgage Bonds | | $ | 5,544 | | $ | 11,097 | | $ | 11,093 | | $ | 173,950 | | $ | 201,684 | |
State revolving fund loans | | | 591 | | | 1,770 | | | 1,180 | | | 6,363 | | | 9,904 | |
Operating leases | | | 140 | | | 170 | | | 83 | | | 1,833 | | | 2,226 | |
Unconditional purchase obligations | | | 3,082 | | | 5,547 | | | 5,540 | | | 30,490 | | | 44,659 | |
Tank painting contractual obligation | | | 200 | | | 749 | | | 749 | | | 174 | | | 1,872 | |
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Total contractual cash obligations | | $ | 9,557 | | $ | 19,333 | | $ | 18,645 | | $ | 212,810 | | $ | 260,345 | |
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Long-term debt obligations reflect the maturities of certain series of our first mortgage bonds, which we intend to refinance when due. The state revolving fund loan obligation has an amortizing mortgage payment payable over a 20-year period, and will be refinanced as future securities are issued. Both the long-term debt and the state revolving fund loan have certain financial covenant provisions, the violation of which could result in default and require the obligation to be immediately repaid, including all interest. We have not experienced conditions that would result in our default under these agreements, and we do not anticipate any such occurrence. Payments for unconditional purchase obligations reflect minimum water purchase obligations based on rates that are subject to change under our interconnection agreements with the Chester Water Authority and the City of Wilmington. The Chester Water Authority provided notice on February 15, 2006 regarding another rate increase effective July 1, 2006. We incorporated the increases in calculating the future obligations noted above.
On June 20, 2006, Artesian Water provided the City of Wilmington (City) with notice of non-renewal of the interconnection agreement with the City upon its December 22, 2006 termination. Artesian Water will no longer be required to purchase 200 million gallons annually from the City after December 22, 2006.
Commitments | | Committed | | Less than 1 Year | | 1-3 Years | | 4-5 Years | | Over 5 Years | |
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Lines of Credit | | $ | 5,282 | | $ | 5,282 | |
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CAUTIONARY STATEMENT
Statements in this Quarterly Report on Form 10-Q which express our “belief,” “anticipation” or “expectation,” as well as other statements which are not historical fact, including statements regarding our goals, the impact of weather on our operations and the execution of our strategic initiatives, our expectations regarding the resolution of our May 2006 rate request, exact amounts that may be collected under temporary rate increases and the potential impact of revenue in 2006, contract operations opportunities, our expectations regarding the sale of land to Commonwealth, appropriate investment in infrastructure regarding the filing of the certification of sufficient sources of self-supply, our expectations regarding recent accounting pronouncements, our liquidity needs, our belief that we have sufficient capital resources to finance our operations, planned capital expenditures and commitments for the next twelve months, and our expectations to be in compliance with the financial covenants in our debt instruments are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and involve risks and uncertainties that could cause actual results to differ materially from those projected. Certain factors, such as changes in weather, changes in our contractual obligations, changes in government policies, the timing and results of our rate requests, changes in economic and market conditions generally, and other matters could cause results to differ materially from those in the forward-looking statements. While the Company may elect to update forward-looking statements, we specifically disclaim any obligation to do so and you should not rely on any forward-looking statement as representation of the Company’s views as of any date subsequent to the date of the filing of this Quarterly Report on Form 10-Q.
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ITEM 3 - QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
We are subject to the risk of fluctuating interest rates in the normal course of business. Our policy is to manage interest rates through the use of fixed rate, long-term debt and, to a lesser extent, short-term debt. The Company’s interest rate risk related to existing fixed rate, long-term debt is not material due to the terms of our First Mortgage Bonds, which have maturity dates ranging from 2018 to 2043.
Artesian Water had lines of credit totaling $40.0 million to meet temporary cash requirements. These revolving credit facilities are unsecured. As of June 30, 2006, we had $34.7 million of available funds under these lines. The interest rate for borrowings under each of these lines is the LIBOR plus 1.0% or, at our discretion, the banks’ federal funds rate plus 1.0%. As such these rates are subject to the risk of fluctuating in the normal of course of business. Consequently, our interest expense for short term debt could be materially affected should interest rates change materially and we have material outstanding balances due on our lines of credit.
ITEM 4 – CONTROLS AND PROCEDURES
| (a) | Evaluation of Disclosure Controls and Procedures |
Our management, with the participation of our Chief Executive Officer and Chief Financial Officer, evaluated the effectiveness of our disclosure controls and procedures as of the end of the period covered by this report. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures as of the end of the period covered by this report are functioning effectively to provide reasonable assurance that the information required to be disclosed by us in reports filed under the Securities Exchange Act of 1934 is (i) recorded, processed, summarized and reported within the time periods specified in the SEC’s rules and forms and (ii) accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding disclosure. A controls system cannot provide absolute assurance, however, that the objectives of the controls system are met, and no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within a company have been detected.
| (b) | Change in Internal Control over Financial Reporting |
No change in our internal control over financial reporting occurred during the Company’s most recent fiscal quarter that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
PART II - OTHER INFORMATION
ITEM 1 - LEGAL PROCEEDINGS
There are no material legal proceedings pending at this time to which we or any of our properties is the subject that are material or are expected to have a material effect on our financial position or operations.
ITEM 1A – RISK FACTORS
In addition to the other information set forth in this report, you should carefully consider the factors discussed in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the year ended December 31, 2005, which could materially affect our business, financial condition or future results. The risks described in our Annual Report on Form 10-K are not the only risks facing us. Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition and/or operating results.
ITEM 4 – SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
| (a) | The Company held its 2005 Annual Meeting of Stockholders on May 12, 2005 |
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| (b) | At the annual meeting, Mr. Kenneth R. Biederman was elected to serve as director for a three year term and until his respective successor shall be elected and qualified or until his earlier resignation or removal. Only holders of record of the Company’s Class B Common Stock were entitled to vote in respect to the election of directors. Votes were cast as follows with respect to Mr. Biederman’s election: 515,448 votes for, 2,727 votes against, no abstentions and no broker non-votes. The following directors continued to serve as directors of the Company immediately after the annual meeting: Mr. Norman H. Taylor, Jr., Mr. William C. Wyer, Mr. John R. Eisenbrey, Jr. and Ms. Dian C. Taylor. |
ITEM 5 - EXHIBITS
31.1 | Certification of Chief Executive Officer of the Registrant required by Rule 13a – 14 (a) under the Securities Act of 1934. |
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31.2 | Certification of Chief Financial Officer of the Registrant required by Rule 13a – 14 (a) under the Securities Act of 1934. |
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32 | Certification of Chief Executive Officer and Chief Financial Officer of the Registrant required by Rule 13a – 14 (b) under the Securities Act of 1934. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
| | ARTESIAN RESOURCES CORPORATION |
Date: August 8, 2006
| | By: |
/s/ DIAN C. TAYLOR
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| | Dian C. Taylor (Principal Executive Officer) |
Date: August 8, 2006
| | By: |
/s/ DAVID B. SPACHT
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| | David B. Spacht (Principal Financial and Accounting Officer) |
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INDEX TO EXHIBITS
Exhibit
Number | | Description |
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31.1 | | Certification of Chief Executive Officer of the Registrant required by Rule 13a – 14 (a) under the Securities Act of 1934. |
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31.2 | | Certification of Chief Financial Officer of the Registrant required by Rule 13a – 14 (a) under the Securities Act of 1934. |
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32 | | Certification of Chief Executive Officer and Chief Financial Officer of the Registrant required by Rule 13a – 14 (b) under the Securities Act of 1934. |
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