FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON D.C. 20549
QUARTERLY REPORT UNDER SECTION 13 OR 15 (d)
OF THE SECURITIES EXCHANGE ACT OF 1934
For Quarter Ended March 31, 1996 Commission File Number 0-6028
BIRMINGHAM UTILITIES, INC.
(Exact name of registrant as specified in its charter)
CONNECTICUT 06-0878647
(State of other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
230 Beaver Street, Ansonia, Connecticut 06401
(Address of principal executive office (Zip Code)
(Registrant's telephone number
including area code) (203) 735-1888
None
(Former name, former address and former fiscal year, if changed
since last report)
Indicate by check mark whether the registrant (1) has filed
all reports required to be filed by Section 13 or 15 (d) of the
Securities Exchange Act of 1934 during the preceding 12 months (or
for such shorter period that the registrant was required to file
such reports; and (2) has been subject to such filing requirements
for the past 90 days.
Yes X No
Indicate the number of shares outstanding of each of the
issuer's classes of common stock, as of the latest practicable
date.
Class Outstanding at April 30, 1996
Common stock, no par value 753,587
ITEM I. FINANCIAL STATEMENTS
BIRMINGHAM UTILITIES, INC.
BALANCE SHEETS
As of March 31, 1996, December 31, 1995 and March 31, 1995
(Unaudited) (Unaudited)
March 31, Dec. 31, March 31,
1996 1995 1995
ASSETS:
Utility Plant $16,448,920 $16,352,307 $15,868,232
Accumulated depreciation (5,227,781) (5,130,305) (4,866,587)
11,221,139 11,222,002 11,001,645
Current Assets:
Cash and cash equivalent 25,515 398,869 16,328
Accounts receivable, net of
allowance for doubtful
accounts 677,125 725,154 810,616
Accrued utility revenue 407,131 412,876 514,985
Materials & supplies 52,425 50,840 50,393
Prepayments 111,671 27,160 121,449
Total current assets 1,273,867 1,614,899 1,513,771
Note receivable 0 0 1,013,222
Deferred Charges 763,919 713,417 738,903
Unamortized debt expense 201,696 205,429 216,630
Income taxes recoverable 456,659 456,659 372,247
Other assets 422,354 411,352 373,731
1,844,628 1,786,857 2,714,733
$14,339,634 $14,623,758 $15,230,149
STOCKHOLDERS' EQUITY AND LIABILITIES
Stockholders' Equity:
Common Stock, no par value,
authorized 2,000,000 shares;
issued and outstanding
1996-753,587; 12/31/95-752,282;
3/31/95-749,168 $ 2,185,166 $ 2,172,116 $ 2,142,318
Retained earnings 1,215,269 1,235,482 1,069,435
3,400,435 3,407,598 3,211,753
Note Payable 1,281,250 1,300,000 1,766,250
Long-term debt 4,700,564 4,700,564 4,703,753
5,981,814 6,000,564 6,470,003
Current Liabilities:
Current portion of note payable 135,000 75,000 125,000
Accounts payable and accrued
liabilities 396,643 674,488 597,135
Total current liabilities 531,643 749,488 722,135
Customers' advances for construction 1,229,985 1,229,985 1,160,531
Contributions in aid of construction 719,736 719,736 719,736
Regulatory liability-income taxes
refundable 195,049 195,049 202,641
Deferred income taxes 1,286,358 1,263,932 1,118,375
Deferred income on disposition
of land 994,614 1,057,406 1,624,975
$14,339,634 $14,623,758 $15,230,149
The accompanying notes are an integral part of these financial
statements.
BIRMINGHAM UTILITIES, INC.
STATEMENTS OF INCOME AND RETAINED EARNINGS
FOR THE THREE MONTHS ENDED MARCH 31, 1996 AND 1995
(Unaudited)
Three Months Ended Three Months Ended
March 31, 1996 March 31, 1995
Operating Revenue $1,058,752 $ 983,456
Operating Expenses:
Operations and Maintenance 201,003 199,852
Purchased Water 151,633 170,589
Administrative and General 274,781 275,111
Depreciation 97,476 94,552
Taxes Other Than Income 142,090 132,355
Taxes on Income 20,175 (14,697)
Total Operating Expense 887,158 857,762
Utility Operating Income 171,594 125,694
Amortization of Prior Years'
Deferred Income on Land
Dispositions, net
(Net of income taxes of
$26,532 in 1996 and
$19,626 in 1995) 36,690 26,416
Other Income, net 7,152 36,246
Income before interest expense 215,436 188,356
Interest and Amortization of
Debt Discount 145,375 152,700
Income from Current Year Land
Sales, net
(net of income taxes of
$32,935 in 1995) 0 46,494
Net income 70,061 82,150
Retained earnings, beginning 1,235,482 1,077,185
Dividends paid 90,274 89,900
Retained earnings, ending $1,215,269 $1,069,435
Earnings per share $0.09 $0.11
Dividends per share $0.12 $0.12
The accompanying notes are an integral part of these financial statements.
BIRMINGHAM UTILITIES, INC.
STATEMENTS OF CASH FLOWS
THREE MONTHS ENDED MARCH 31, 1996 AND 1995
(Unaudited)
Three Months Ended Three Months Ended
March 31, 1996 March 31, 1995
Cash Flows From Operating
Activities
Net Income $ 70,061 $ 82,150
Adjustments to reconcile net
income to net cash provided
by operating activities:
Depreciation and amortization 115,816 101,328
Amortization of deferred
income, net of tax (36,690) (26,416)
Income from current year land
dispositions, net of tax -0- (46,494)
Increases and decreases in assets
and liabilities:
Accounts receivable and accrued
utility revenue 53,774 (102,563)
Materials and supplies ( 1,585) ( 4,944)
Prepayments (84,511) ( 82,023)
Accounts payable and accrued
expenses (277,845) 21,714
Other assets and deferred
charges, net ( 79,787) ( 9,340)
Deferred income taxes -0- ( 60,711)
Customer advance (refund) for
construction -0- 2,076
Total Adjustments (310,828) (207,373)
Net cash flows used in operating
activities (240,766) (125,223)
Cash flows from investing
activities:
Net construction expenditures ( 96,613) (129,110)
Proceeds from sale of utility
plant -0- 499
Proceeds from land dispositions -0- 200,000
Net Cash flows provided by (used
in)investing activities ( 96,613) 71,389
Cash flows from financing activities:
Increase (decrease) in current
note payable 60,000 ( 40,000)
Increase (decrease) in
long-term debt ( 18,750) 141,250
Dividends paid ( 90,274) ( 89,900)
Dividends reinvested 13,050 -0-
Net Cash flows provided by (used
in) financing activities: (35,974) 11,350
Net increase (decrease) in cash &
cash equivalents (373,354) ( 42,484)
Cash & cash equivalents, beginning 398,869 58,812
Cash, ending $ 25,515 $ 16,328
Supplemental disclosure of cash
flow information:
Cash paid for
Interest $254,885 $262,210
Income Taxes $175,450 $ 34,975
Supplemental disclosure of non-cash
flow information:
The Company receives contributions
of plant from builders and developers.
These contributions of plant are
reported in utility plant and in
customers' advances for construction.
The contributions are deducted
from construction expenditures to
determine cash expenditures by the
Company.
Gross Plant, additions $ 96,613 $129,110
Customers' advances for
construction -0- 2,076
Capital expenditures, net $ 96,613 $127,034
The accompanying notes are an integral part of these financial
statements.
BIRMINGHAM UTILITIES, INC.
NOTES TO FINANCIAL STATEMENTS
(Unaudited)
Note A. - UNAUDITED STATEMENTS
The statements as of and for the three months ended March 31, 1996
are prepared without audit, however, in the opinion of management, all
material adjustments for a fair statement of results have been made. The
balance sheet as of December 31, 1995 has been audited.
Note B. - SEASONALITY OF REVENUE
The Company's business of selling water is to a certain extent
seasonal because water consumption normally increases during the drier and
warmer summer months. Accordingly, the results of operations for the three
months ended March 31, 1996 and March 31, 1995, if annualized, do not
necessarily reflect annual results.
Note C. - ACCOUNTS RECEIVABLES, NET OF ALLOWANCE FOR DOUBTFUL ACCOUNTS
Accounts Receivable, net declined $48,029 in the first quarter of
1996 compared to the first quarter of 1995 as the result of a more
formalized collection effort developed during the course of 1995. The
$85,462 decline from March 31, 1995 to year end 1995 primarily reflects the
collection of one long-standing past due commercial account in April, 1995.
Note D. - ACCRUED UTILITY REVENUE
Accrued Utility Revenue at March 31, 1996 and December 31, 1995
includes $84,380 in costs incurred by the Company to date on a Main
replacement project required by the State of Connecticut. At March 31,
1995 the balance due for that project totaled $158,346. The Company's
costs are reimbursable to the Company by the State of Connecticut. - See
Note H - Accounts Payable and Accrued Expenses.
Note E. - PREPAYMENTS
Prepayments consist of:
March 31, Dec. 31, March 31,
1996 1995 1995
Insurance $ 63,504 $ 7,545 $ 63,274
Legal & accounting fees 27,695 0 30,903
Other prepaid expenses 20,472 19,615 27,272
$111,671 $27,160 $121,449
The fluctuation in total prepayments as of the ends of the periods
noted was caused primarily by the fluctuation in prepaid insurance.
Insurance premium payments are made during the first quarter, since January
1 is the beginning of the policy period, and amortized throughout the year.
The fluctuation in "Legal and Accounting Fees" reflects certain
large, expenses which regularly occur in the first quarter and are
amortized over the remaining part of the year to better match costs to the
annual time period benefitted.
Note F. - NOTE RECEIVABLE:
In September 1992, the Company modified a 1990 agreement with a real
estate developer to provide for the sale of approximately 152 acres of land
to the developer for $1,388,222. Under the terms of the modification, a
payment of $175,000 was made in 1992 and a promissory note in the amount
of $1,213,222, due on April 30, 1995 was received. Due to uncertainties
regarding the developer's ability to obtain the necessary financing and
governmental and regulatory approvals, the sale was accounted for under the
installment method. Revenues and gains were recognized only when payments
were made on the developer's note payable to the Company. The promissory
note was paid in full during 1995, with $200,000 of the principal being
received during the first quarter and the balance in the fourth quarter.
Note G. - LONG TERM DEBT
March 31, Dec. 31, March 31,
1996 1995 1996
First mortgage bonds,
Series E 9.64% due
September 2011 $4,700,000 $4,700,000 $4,700,000
Note Payable 1,218,250 1,300,000 1,766,250
Other 564 564 3,753
$5,981,814 $6,000,564 $6,470,003
First Mortgage Bonds
Pursuant to its Amended and Restated Mortgage Indenture, the
Company has outstanding a series of first mortgage bonds in the amount of
$4,700,000 due on September 1, 2011. The terms of the Indenture provide
for, among other things, annual sinking fund payments commencing September
1, 1997, and limitations on (a) payment of cash dividends and (b)
incurrence of additional bonded indebtedness. Pursuant to this agreement,
approximately $362,305 was available to pay dividends at March 31, 1996,
after the quarterly dividend payment made on that date. Interest is
payable semi-annually on the first day of March and September. The
indenture is secured by a lien on all of the Company's utility property
other than excess land available for sale.
There are no maturities of bonds until September 1, 1997, when the
Company is required to begin payments of $94,000 on each September 1, until
the bonds are paid in full.
Note Payable
In April 1994, the Company (a) converted certain short term
borrowings to a ten-year $1,500,000 secured term loan, (b) established a
$1,500,000 two-year secured revolving line of credit to fund additional
capital improvements, and (c) obtained a one-year, unsecured line of credit
of $600,000 to be used for working capital purposes. The two-year
revolving period expired in April 1996 and has been renewed for another two
year period through April, 1998, at which time the outstanding balance may
be converted to a term loan with the same maturity and payment terms as the
original term loan. Both the term loan and the revolving line of credit
are secured by a lien subordinate to the lien of the Mortgage Bond
Indenture (See First Mortgage Bonds, above) on all of the Company's utility
property other than its excess land available for sale.
The term loan portion of the facility has both fixed and variable interest
rate options. The applicable interest rate at December 31, 1995 and
through July 2000 is 8.18%. Interest is payable monthly. The renewed two-
year revolving line of credit also has various interest rate options,
including a variable rate at 1% above the prime rate and LIBOR rate
options, fixed for various short term periods including 30, 60 or 90 days,
at 1.75% over the applicable LIBOR rate. Interest is payable monthly.
There were no outstanding borrowings on the revolving line of credit at
March 31, 1996.
In April 1996, the unsecured, working capital line of credit was also
extended for another year. The unsecured line of credit also provides for
various interest rate options, including a variable rate at 0.25% above the
prime rate, a variable rate at 1.75% above the bank's cost of funds (as
provided by the bank), and the LIBOR options also available under the two-
year revolving line of credit. Outstanding borrowings on the unsecured
line of credit at March 31, 1996 were $60,000.
All three facilities provide that a default under any of them or under the
Mortgage Bond Indenture is considered a default under the others. They
also provide that the net proceeds from the sale of any of the Company's
excess land must be used to reduce the balance of the two year line of
credit first and then the term loan.
Note H. - ACCOUNTS PAYABLE AND ACCRUED EXPENSES
March 31, Dec. 31, March 31,
1996 1995 1995
Accounts Payable $121,598 $116,313 $275,693
Accrued Expenses:
Taxes 116,912 297,810 148,565
Interest 37,928 151,172 37,886
Pension 74,621 72,710 78,397
Other 45,584 36,483 56,594
$396,643 $674,488 $597,135
The fluctuation in "Accounts Payable" reflects primarily a $115,000
progress payment owed to the contractor on a main replacement project,
included as a payable at March 31, 1995. The main replacement is required
by the State of Connecticut and the costs will be reimbursed by the State
to the Company. - See Note D - Accrued Utility Revenue. The fluctuation
in "Accrued Interest" reflects primarily the semi-annual interest payment
requirement on the Company's bonds. See Note G - Long Term Debt, First
Mortgage Bonds. The fluctuation in taxes primarily reflects the increased
liability for federal income taxes as of year-end due to increased taxable
income for 1995 over that in 1994.
Note I. - DEFERRED GAINS ON LAND DISPOSITIONS
The DPUC has prescribed a rate making accounting procedure for income from
land dispositions which has the effect of sharing the economic benefits of
such dispositions between ratepayers and shareholders over a period of
time. Accordingly, the Company includes in its income in years in which
it has a land disposition only a portion of the income that is realized
from such disposition. The balance of the income is deferred and amortized
to the Company's rate base and equity for rate making purposes, and to
income for financial reporting purposes, over the period of time during
which the rate making procedure is in effect. For the three months ended
March 31, 1996 and 1995, $36,690 and $26,416 (net of income taxes),
respectively, of such deferred land disposition gains was included in
income.
There was a "land sale" in March of 1995, resulting from the receipt of
a $200,000 installment payment from a developer - see Note F, Note
Receivable, and Management's Discussion and Analysis. The gain recognized
from this payment in March 1995 was $46,494, net of tax. The remaining
portion of this gain was deferred and is to be amortized. There were no
land sales during the first quarter of 1996.
Note J. - EARNINGS PER SHARE
The Company has only one class of stock outstanding; earnings per share are
computed by dividing the outstanding weighted average shares of common
stock, on a year to date basis through the balance sheet date, into the
earnings for all periods presented. Average shares outstanding were
752,296 and 749,168 for the three month periods ended March 31, 1996 and
1995, respectively.
Note K. - RATE MATTERS
Effective January 1, 1996, the DPUC granted the Company increased rates
designed to produce additional annual revenues of $289,333 (an increase of
approximately 6.89% over previous rates).
Note L. - EQUITY
Stock Option Plans
On September 13, 1994, the Company adopted two stock option plans. A
nonemployee director option plan and a key employee option plan. 75,000
shares were authorized under the two plans which provide for options to
purchase common stock of the Company at the fair market value at the date
of the grant. The options vest over various periods. As of December 31,
1995, options for 57,750 shares had been granted to directors and employees
of the Company under both plans.
Dividend Reinvestment Plan
On September 13, 1994, the Company adopted a dividend reinvestment plan
which provides for the issuance and sale of up to 70,000 shares of the
Company's authorized but unissued common stock to its shareholders who
elect to reinvest cash dividends on the Company's existing shares. Shares
available under the plan may be purchased at their fair market value price
on the date of the dividends to be invested in the new shares.
In 1995 the Company issued 3,114 shares of common stock at a value of
$31,108 in lieu of cash dividends, in connection with its dividend
reinvestment plan. In 1996, an additional 1,305 shares of common stock at
a value of $13,050 in lieu of cash dividends were issued.
ITEM II
MANAGEMENT'S DISCUSSION AND ANALYSIS OF
RESULTS OF OPERATIONS AND FINANCIAL CONDITIONS
RESULTS OF OPERATIONS
Net Income
Net income decreased $12,089 from $82,150 in the first quarter of 1995
to $70,061 in the first quarter of 1996. This decrease reflected the fact
that the Company had a $46,494 gain, net of tax, on the sale of land during
the first quarter of 1995 and no current year land sale gains during the
first quarter of 1996.
Without the effect of the land sale gain in the first quarter of 1995,
that quarter's net income would have been only $35,656; the 1996 first
quarter net income of $70,061 exceeded the 1995 first quarter net income
without the effect of the land sale by $34,405, or by approximately 96%.
The 1996 first quarter net income was positively affected by increased
operating revenues of $75,296, and a corresponding increase in operating
income of $45,900 over the first quarter of 1995. First quarter net income
in 1996 was also positively affected by an increase of $10,274 in the
amortization of prior years' deferred income on land dispositions
(resulting from the completion in 1995 of a land sale, a portion of the
gain from which is now being amortized to future years - see Note I -
Deferred Gains on Land Dispositions) and by a reduction of $7,325 in
interest expense compared to the first quarter of 1995. A reduction of
$29,094 in other income, net, from the first quarter of 1995 to the first
quarter of 1996 partially offset the above first quarter 1996 improvement.
Operating Revenues
For the first quarter, 1996, operating revenues increased $75,296
(approximately 8%) compared to the same period of 1995. The increase
results from a 6.89% rate increase, which became effective in January 1,
1996, and increased consumption, primarily residential.
Operating Expenses
Operating expenses increased $29,396 (approximately 3%) comparing
the first quarter of 1996 to the first quarter of 1995. The primary reason
for this increase was a $34,872 increase in income taxes on the increased
level of taxable operating income, excluding land sale gains - current and
amortized. Taxes on the change in operating income at comparable overall
effective tax rates on taxable income in 1996, produced a tax provision of
$20,175 in 1996's first quarter versus a tax credit of $14,697 in the first
quarter of 1995.
Taxes other than income increased (7%) from $132,355 in the first
quarter 1995 to $142,090 in the first quarter 1996. Expense for purchased
water declined $18,956 partially offsetting the tax increases noted.
Other Income, net
Other income, net, decreased $29,094 in the first quarter of 1996
compared to the first quarter of 1995 due primarily to the elimination of
interest income on a $1,213,222 note receivable, which note receivable was
paid in full in November of 1995. During 1995, the note receivable had
been accruing and paying interest at the prime rate.
Interest and Amortization of Debt Discount & Expense
Interest expense incurred during the first quarter of 1996
decreased by $7,325 (approximately 5%) from interest expense incurred in
the same quarter of 1995. The decrease was caused by a lower level of
outstanding debt resulting from applying the net, after-tax proceeds from
the 1995 payment to the Company of the full principal amount of note
receivable to the outstanding balance of the Company's two year revolving
line of credit. (See Note F - Note Receivable, Note G - Long Term Debt,
Note Payable, and Note I - Deferred Gains on Land Dispositions.)
FINANCIAL CONDITION
The Company applied to the Department of Public Utility Control
("DPUC") on July 3, 1995 for authority to increase rates generally.
Effective January 1, 1996, the DPUC granted the Company increased rates,
designed to provide additional annual revenues of $289,333 (6.89%).
The Company expects that in 1996 it will have sufficient funds
available from operations to meet its day-to-day operational needs. It
will not, however, be able to generate sufficient funds from sales of water
to satisfy all of its construction plans. Completion of the Company's
Long-Term Capital Improvement Program is dependent upon the Company's
ability to raise capital from external sources, including, for the purpose
of this analysis, proceeds from the sale of the Company's holdings of
excess land. The Company believes that by selling excess lands it can
generate sufficient equity capital to support its 10 year capital budget,
currently estimated at $8,770,000. Such land dispositions are subject to
approval by the DPUC. Such sales also depend, to a certain extent, on a
viable local and regional real estate market. No assurances can be given
that sufficient amounts of real property can be sold at prices, or within
the appropriate time periods, sufficient to meet the Company's current 10-
year capital budget. In the event that land sale proceeds are not
sufficient to meet required equity needs, the Company will have to secure
equity financing from other sources, including issuance of new equity
securities.
The Company's 1996 Capital Budget of $1,140,000 is two-tiered. The
first tier, totalling $805,000, includes $268,000 for routine annual
expenditures for services, mains, hydrants, and meters, as well as $240,000
for low system distribution improvements, $115,000 for the painting of a
standpipe, $150,000 for small main replacements and $32,000 toward Level
"A' Mapping to be used in the process of protecting the Housatonic Well
Field aquifer. The Company expects to fund the routine annual expenditures
from internally generated funds and the balance of the first tier budget
items from borrowings under its $1,500,000 secured, two-year revolving line
of credit.
The second tier of the 1996 Capital Budget consists of replacements
and betterments which are part of the Company's Long Term Capital
Improvement Program and includes $335,000 of budgeted plant additions.
Plant additions from this part of the 1996 budget will require external
financing in addition to the Company's line of credit. The second tier
plant additions can be, and portions of it are expected to be, deferred to
future years if funds are not available for their construction in 1996.
As of March 31, 1996, the Company has approximately 1,460 acres of
excess land available for sale, consisting of land currently classified as
Class III, non-watershed land under the statutory classification system for
water company lands. The Company defers the costs it incurs to prepare the
excess land for sale. It allocates specific costs to the parcels for which
they were incurred and allocates non-specific land sale costs among all
parcels available for sale, based upon the total acres available for sale
when the costs are incurred. The costs are charged against the proceeds
received when a parcel is sold. The $50,502 increase in deferred charges
during the first quarter 1996 reflects costs for surveys and maps related
to readying these land parcels for sale.
On April 30, 1996, the Company entered into a Purchase and Sale
Agreement with the City of Ansonia, Connecticut (the "City") for the sale
by the Company to the City of approximately 59.24 acres of unimproved real
property for purchase price of $1,041,350. The sale of the property is
conditioned upon the Company obtaining approval by the Connecticut
Department of Public Utility Control ("DPUC") and the City obtaining
approval of its Board of Aldermen. It is also conditioned on the City
receiving by May 30, 1996 final approval of a partial funding grant from
the State of Connecticut.
The City's Board of Aldermen approved the purchase on May 7, 1996.
By referendum earlier in April, the City's voters had already approved a
comprehensive school building and renovation project which included, in
concept, the construction of a new high school on the property in question.
The Company may not file its application for approval of the sale
with the DPUC until June 7, 1996, and by law the DPUC may take up to 150
days from the date of the application in which to issue its Decision.
Although no assurances can be made, the Company knows of no reason why the
DPUC should not approve the proposed sale.
The Company is actively pursuing additional sales of real property.
Because of the delays required by the regulatory process, however, it does
not expect to be able to consummate any such sales during 1996, even if
current discussions lead to a sales agreement in the near future.
In 1994 the Company entered into a credit facility with Fleet Bank,
N.A. consisting of $1,500,000 of new long term debt due in the year 2004
and a new, secured, two-year line of credit also in the principal amount
of $1,500,000. On May 1, 1996, the DPUC granted approval to the Company
to renew its two year revolving facility in accordance with Fleet Bank's
commitment. The secured line of credit is being used to provide funds to
continue the Company's construction program; at the Company's option it may
be converted to a six year term loan at the end of the two year revolving
period. The Company also maintains an additional one-year, unsecured line
of credit in the amount of $600,000 to be used for working capital
purposes.
The DPUC has prohibited the Company from drawing down funds under
the revolving line of credit, if at the time of or as a result of the draw
down, the amount of the Company's long-term debt (including amounts
outstanding under the two year revolving line of credit) would exceed 67%
of the Company's total capitalization. There was no outstanding balance
under the two year revolving line of credit at March 31, 1996. The effect
of the limitation noted above was, as of March 31, 1996, to limit the
Company to $900,000 additional borrowing on the revolver until the Company
obtains additional equity capital. The DPUC has also required that the
Company's ratio of long-term debt to total capital be reduced to 62% by the
end of the new two-year revolving period.
In 1994, the Company's Board of Directors approved a common stock
Dividend Reinvestment Plan (the "Plan") pursuant to which shareholders will
be entitled to purchase up to 70,000 new shares of the Company's common
stock by applying to the purchase price of the new shares cash dividends
which otherwise would be issued by the Company with respect to its existing
common stock. The Dividend Reinvestment Plan provides that the purchase
price for the new shares will be their fair market value at the time of the
purchase. The plan was approved by the DPUC on May 24, 1995. The Company
cannot predict what percentage of its cash dividends will from time to time
be reinvested in new shares of the Company's common stock. Since
implemented just prior to the June 30, 1995 dividend, a total of $31,108
was reinvested in 1995 and $13,050 was reinvested in the first quarter of
1996.
PART II - OTHER INFORMATION
Item 1. Legal Proceedings. Not applicable.
Item 2. Changes in Securities. Not applicable.
Item 3. Default Upon Senior Securities. Not applicable.
Item 4. Submission of Matters to a Vote of Security Holders.
None.
Item 5. Other Information. None.
Item 6. Exhibits and Reports on Form 8-K.
(a) Exhibits - None.
(b) Reports on Form 8-K - None.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of
1934, the Company has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
BIRMINGHAM UTILITIES, INC.
Registrant
Date: May 14, 1996 /s/ Aldore J. Rivers, President
Aldore J. Rivers, President
Date: May 14, 1996 /s/ Paul V. Erwin, Treasurer
Paul V. Erwin, Treasurer