Operations and maintenance expense for the fourth quarter of 2012 decreased by $1.5 million, or 4% compared to 2011, primarily due to lower expense at Gill Ranch, partially offset by higher payroll and payroll related costs at the utility.
Cash provided by operations for the year ended Dec. 31, 2012 was $168.8 million, compared to $233.5 million in 2011. The decrease was primarily due to the gas cost refunds to customers in 2012, compared to the timing of monies received from environmental insurance recoveries and federal tax refunds in 2011. Cash requirements for investing activities in 2012 totaled $184.7 million, compared to $153.1 million in 2011 with the increase primarily due to capital expenditures for utility training and emergency back-up facilities as well as ongoing gas reserve investments.
NW Natural's consolidated capitalization at Dec. 31, 2012 reflected 45.4% common equity, 42.8% long-term debt, and 11.8% short-term debt. This compared to 46.5% common equity, 41.7% long-term debt, and 11.8% short-term debt and current maturities of long-term debt at Dec. 31, 2011.
2013 earnings guidance
The Company is providing earnings guidance to be in the range of $2.15 to $2.35 per share for 2013. The Company's 2013 earnings guidance assumes a continued slow economic recovery and customer growth, average weather conditions, no changes to the recoverability of our regulatory assets, and no significant changes in prevailing legislative and regulatory policies or outcomes.
The board of directors of NW Natural declared a quarterly dividend of 45.5 cents a share on the Company's common stock. The dividends were paid Feb. 15, 2013 to shareholders of record on Jan. 31, 2013. The Company's indicated annual dividend rate is $1.82 per share.
Presentation of results
In addition to presenting results of operations and earnings amounts in accordance with generally accepted accounting principles (GAAP), NW Natural has expressed certain measures in this press release on an equivalent cents per share basis, which are non-GAAP financial measures. These amounts reflect factors that directly impact the Company's earnings. In calculating these financial disclosures, we allocate income tax expense based on the effective tax rate, where applicable. These non-GAAP financial measures should not be used to the exclusion of GAAP financial measures. NW Natural believes that these non-GAAP financial measures provide useful information to the reader by removing the effects of variances in GAAP reported results of operations that we believe are not indicative of fundamental changes in our financial condition or results of operations.
Conference call arrangements
As previously reported, NW Natural will conduct a conference call and webcast starting at 8 a.m. Pacific Time (11 a.m. Eastern Time) on Mar. 1, 2013 to review the Company's financial and operating results for the year and three months ended Dec. 31, 2012.
To hear the conference call live, please dial 1-877-317-6789 within the United States and 1-866-605-3852 from Canada. International callers can dial 1-412-317-6789. To access the conference replay, please call 1-877-344-7529 and enter the conference identification pass code (10023662). To hear the replay from international locations, please dial 1-412-317-0088.
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