Superior Plus Reports Higher Gross Profit from Retail Energy Supply

Superior Plus Corp. reported higher gross profit from its fixed-price energy services business of $8.3 million for the first quarter, up from $7.4 million a year ago (all figures Canadian).

Natural gas gross profit was $7.1 million, up from $6.5 million a year ago, due to higher margins offset in part by lower volumes. Gross profit per unit was 126.8 cents per gigajoules (GJ), a 42% increase from 89.5 cents per GJ from the prior year quarter.

The increase in natural gas gross margin was due to higher transportation revenue, lower transportation costs, and favorable market pricing.

Natural gas sales volumes were 5.6 million GJ for the quarter, down from 7.4 million GJ a year ago, as reduced residential volumes were partially offset by higher commercial volumes. Natural gas sales volumes declined due to the decision to exit the Ontario and B.C. direct residential natural markets over the last 24 months, offset in part by continued growth in commercial volumes.

Electricity gross profit in the first quarter of 2011 was $1.2 million, up 33% from $900,000 a year ago, due to the aggregation of additional commercial customers over the past year, and higher volumes and gross margins. Quarterly electric volumes were higher at 117.1 GWh versus 73.8 GWh a year ago.

As previously reported (1/5), Superior Plus entered the Pennsylvania electricity market during the first quarter, primarily focusing on cross-selling to existing heating oil and propane customers.

During an earnings call, Superior Plus reaffirmed its intent to expand such cross-selling to its heating oil and propane customers in other parts of Pennsylvania, and additional states in the Northeast and Mid-Atlantic.