• A record-high net income of $26.1 million, or $2.73 per share, in 2010, compared to $15.9 million and $2.15 per share in 2009.
  • Excluding the impact of the FPU merger and merger-related costs, Chesapeake’s legacy businesses generated net income of $17.2 million, or $2.44 per share, in 2010, compared to $15.3 million, or $2.20 per share, in 2009. The $0.24 per share increase generated by Chesapeake’s legacy businesses in 2010 represents an 11-percent growth in earnings per share.
  • FPU’s net income increased by $7.5 million as a result of the inclusion of a full year’s results and improved performance, generating an increase of $0.22 per share in 2010.
  • The decrease in merger-related costs added $0.12 per share in 2010.

Dover, Delaware — Chesapeake Utilities Corporation (NYSE: CPK) today announced increased financial results for both the year and quarter ended December 31, 2010. The Company’s net income for the year ended December 31, 2010 was $26.1 million, or $2.73 per share, an increase of $10.2 million, or $0.58 per share, compared to $15.9 million, or $2.15 per share, for the year ended December 31, 2009. Excluding the impact of the FPU merger and merger-related costs, Chesapeake’s legacy businesses continued to experience strong earnings growth and generated net income of $17.2 million, or $2.44 per share, in 2010, compared to $15.3 million, or $2.20 per share, in 2009, representing an 11-percent growth in earnings per share. Chesapeake’s legacy businesses generated 41 percent of the increase in consolidated earnings per share for the year. The results of the legacy businesses reflect continued growth and expansions of the natural gas distribution and transmission systems on the Delmarva Peninsula, a rate increase for the Company’s Central Florida Gas division, favorable weather impacts and improved performance in the advanced information services business. These increases were partially offset by a decline in earnings from the natural gas marketing and propane wholesale marketing businesses. Florida Public Utilities Company (“FPU”) added $0.22 per share to the increase in the Company’s overall results in 2010 due to the inclusion of a full year’s results and improved performance. FPU’s results have been included in the Company’s consolidated results since the completion of the merger on October 28, 2009. The decrease in merger-related costs also added $0.12 per share to the increase in 2010.

The Company’s net income for the quarter ended December 31, 2010 was $7.1 million, or $0.74 per share, an increase of $923,000, or $0.03 per share, compared to $6.2 million, or $0.71 per share, for the same period in 2009. Excluding the impact of the FPU merger and merger-related costs, Chesapeake’s legacy businesses generated net income of $5.4 million, or $0.77 per share, in the fourth quarter of 2010, compared to $5.1 million, or $0.73 per share, for the same period in 2009, representing a five-percent growth in diluted earnings per share. Strong performance by the Delmarva propane distribution operation based on higher volume and retail margins, a rate increase for the Company’s Central Florida Gas division and favorable weather impacts all contributed to the increase generated by Chesapeake’s legacy businesses. FPU’s results for the fourth quarter of 2010, which include an additional accrual of $250,000 for the regulatory risk associated with FPU’s natural gas earnings and recovery of the purchase premium, decreased the earnings per share by $0.05 per share. Discussions with the Florida Office of Public Counsel (“Florida OPC”) and the Florida Public Service Commission (“Florida PSC”) staff regarding such matters are ongoing. Offsetting this decrease in earnings were lower merger-related costs expensed in the fourth quarter of 2010, compared to the same period in 2009, which added $0.04 per share.

“2010 was an exceptional year for Chesapeake,” stated Michael P. McMasters, President and Chief Executive Officer of Chesapeake Utilities Corporation. “We achieved significant growth on the Delmarva Peninsula with our continued efforts to expand the use of natural gas by very aggressively promoting the pricing advantage and environmentally-friendly features of natural gas. We also exceeded our goal to produce earnings accretion in the first year after the FPU merger as a result of