RGC Resources is a Roanoke Valley gas distributor that converted an expedited Virginia rate case into a staff settlement, and the equity debate is whether that settlement is enough once inflation, a lost industrial load, and a damaged peak-shaving plant sit in the same picture. Interim rates have been in force since January and remain subject to refund. The staff deal locks incremental annual revenue of $3.85 million. That figure sits below the original request and is the price of closing the case before winter. The market now treats the regulatory chapter as largely finished even though the commission's final order is still pending.
The June quarter showed why the settlement is not a free lunch. Operating margin improved on the new non-gas base rates. Operating expenses rose by a similar amount and left operating income essentially unchanged. A top-five industrial customer idled in March after decades on the system. Winter Storm Fern also damaged the liquefied natural gas peak-shaving tank, taking on-system storage out for the coming heating season. Equity earnings from the Mountain Valley Pipeline affiliate still cushioned the seasonally thin quarter.
Nine-month diluted earnings reached $1.37 against a narrowed full-year range that now sits just below that year-to-date print. The implied path is a typical seasonal loss in the fiscal fourth quarter. The quarterly dividend continues at $0.2175. The question for the next year is whether settled rates, infrastructure riders, and pipeline cash cover the storage outage and the refinanced note without another trip to the commission.