Hurricane Isaac contributed to an increase in repairs and maintenance expenses, generally, in the form of replacement of wind-damaged pipe and tank insulation at facilities on the Lower Mississippi River. Excluding the expenses incurred in connection with the storm damage, free cash flow would have increased by approximately 12.5% in the third quarter of 2012 compared with the third quarter of 2011.
The smaller contribution to IMTT’s financial results from its environmental services business in 2012 reflects a reduced level of spill response activity this year compared with last. Through nine months the environmental services business operated at a small net loss.
IMTT has now paid all of the distributions that are due to MIC and its co-investor through and including the third quarter of 2012 under the Shareholders’ Agreement.
Hawaii GasMIC’s gas processing and distribution business in Hawaii, previously referred to as The Gas Company, has been rebranded as Hawaii Gas. Hawaii Gas is the owner and operator of the only regulated (“utility”) gas processing and pipeline distribution network on the islands of Hawaii. The business is also the owner and operator of the largest unregulated (“non-utility”) gas distribution operation on the islands. In 2012 compared with the prior comparable periods in 2011:
- Non-utility contribution margin increased 19.1% and 29.3% in the quarter and nine months ended September 30, 2012, respectively - the impact of margin management and lower input costs was partially offset by a modest 1.4% decrease in the volume of gas sold during the quarter however the volume of gas sold has increased 5.1% year to date; and
- Utility contribution margin decreased 2.2% in the quarter and increased 0.2% for the nine months ended September 30, 2012 – higher transportation costs offset a 1.4% increase in the volume of gas sold in the third quarter and a 1.9% increase in the volume of gas sold year to date.