American States Water Company Announces Second Quarter 2018 Results
Second Quarter 2018 Results
The table below sets forth a comparison of the second quarter-diluted earnings per share by business segment, as reported:
Diluted Earnings per Share | |||||||||||||||||||||
Three Months Ended | |||||||||||||||||||||
6/30/2018 | 6/30/2017 | CHANGE | |||||||||||||||||||
Water, excluding one-time gain on sale of Ojai water system | $ | 0.35 | $ | 0.35 | $ | — | |||||||||||||||
Electric | 0.02 | 0.02 | — | ||||||||||||||||||
Contracted services | 0.06 | 0.12 | (0.06 | ) | |||||||||||||||||
AWR (parent) | 0.01 | — | 0.01 | ||||||||||||||||||
Consolidated diluted earnings per share, adjusted | 0.44 | 0.49 | (0.05 | ) | |||||||||||||||||
Gain on sale of Ojai water system | — | 0.13 | (0.13 | ) | |||||||||||||||||
Consolidated diluted earnings per share, as reported | $ | 0.44 | $ | 0.62 | $ | (0.18 | ) | ||||||||||||||
Water Segment:
Excluding the one-time gain from the sale of the
Before reflecting the effects of the new rate of return authorized by
the CPUC and the Tax Act, third-year rate increases are expected to add
approximately
Overall, operating expenses at the water segment (other than supply
costs) were also flat during the second quarter of 2018 as compared to
2017 due, in part, to the cessation of the
Electric Segment:
For the three months ended June 30, 2018 and 2017, diluted earnings from
the electric segment were
Contracted Services Segment:
For the three months ended June 30, 2018, diluted earnings per share
from AWR’s contracted services subsidiary,
Excluding the effects of the retroactive revenues discussed above,
diluted earnings per share from the contracted services segment
decreased by
AWR (parent):
Diluted earnings from AWR (parent) increased by
Year-to-Date 2018 Results
Basic and fully diluted earnings were
Diluted Earnings per Share | |||||||||||||||||||||
Six Months Ended | |||||||||||||||||||||
6/30/2018 | 6/30/2017 | CHANGE | |||||||||||||||||||
Water, excluding one-time gain on sale of Ojai water system | $ | 0.55 | $ | 0.60 | $ | (0.05 | ) | ||||||||||||||
Electric | 0.06 | 0.06 | — | ||||||||||||||||||
Contracted services | 0.11 | 0.16 | (0.05 | ) | |||||||||||||||||
AWR (parent) | 0.01 | 0.01 | — | ||||||||||||||||||
Consolidated diluted earnings per share, adjusted | 0.73 | 0.83 | (0.10 | ) | |||||||||||||||||
Gain on sale of Ojai water system | — | 0.13 | (0.13 | ) | |||||||||||||||||
Consolidated diluted earnings per share, as reported | $ | 0.73 | $ | 0.96 | $ | (0.23 | ) | ||||||||||||||
Water Segment:
Included in earnings for the first six months of 2017 was the
-
A decrease in the water gross margin, which reduced net earnings by
approximately
$0.01 per share. This decrease was due, in part, to the cessation of theOjai operations in June of 2017, as well as the revenue impact from the lower authorized rate of return in the cost of capital proceeding approved by the CPUC effective in 2018. These decreases were largely offset by the impact of third-year rate increases effectiveJanuary 1, 2018 . -
An overall increase in operating expenses (excluding supply costs)
lowered net earnings by approximately
$0.01 per share resulting primarily from higher conservation and regulatory expenses, unplanned maintenance, depreciation, and property taxes, as compared to the same period in 2017. -
Lower gains generated from GSWC's investments held to fund a
retirement benefit plan negatively impacted earnings by
$0.01 per share, as compared to the same period in 2017 due to changes in market conditions.
Electric Segment:
For the six months ended June 30, 2018 and 2017, diluted earnings from
the electric segment were
Contracted Services Segment:
As previously discussed, included in the results for the six months
ended
The decreases in contracted services earnings discussed above were
partially offset by (i) the successful resolution of various price
adjustments during 2017 and 2018, and (ii) earnings generated from Eglin
upon the commencement of the operation of its water and wastewater
systems by ASUS in
Regulatory Matters
In
Liquidity and Capital Resources
AWR has access to a
Dividends
On
Non-GAAP Financial Measures
This press release includes a discussion on the water gross margin for
various periods, which is computed by subtracting total water supply
costs from total water revenues. The discussion also includes AWR’s
operations in terms of diluted earnings per share by business segment,
which is each business segment’s net income divided by the company’s
weighted average number of diluted shares. These items are derived from
consolidated financial information but are not presented in our
financial statements that are prepared in accordance with accounting
principles generally accepted in
The non-GAAP financial measures supplement our GAAP disclosures and should not be considered as alternatives to the GAAP measures. Furthermore, the non-GAAP financial measures may not be comparable to similarly titled non-GAAP financial measures of other registrants. The company uses the water gross margin and earnings per share by business segment as important measures in evaluating its operating results and believes these measures are useful internal benchmarks in evaluating the performance of its operating segments. The company reviews these measures regularly and compares them to historical periods and to the operating budget.
Forward-Looking Statements
Certain matters discussed in this news release with regard to the
company’s expectations may be forward-looking statements that involve
risks and uncertainties. The assumptions and risk factors that could
cause actual results to differ materially include those described in the
company’s most recent Form 10-Q and Form 10-K filed with the
Conference Call
The company will host a conference call on
About
American States Water Company | |||||||||||||||||||||||||
Consolidated | |||||||||||||||||||||||||
Comparative Condensed Balance Sheets | |||||||||||||||||||||||||
June 30, | December 31, | ||||||||||||||||||||||||
(in thousands) | 2018 | 2017 | |||||||||||||||||||||||
(Unaudited) | |||||||||||||||||||||||||
Assets | |||||||||||||||||||||||||
Utility Plant-Net | $ | 1,238,789 | $ | 1,204,992 | |||||||||||||||||||||
Goodwill | 1,116 | $ | 1,116 | ||||||||||||||||||||||
Other Property and Investments | 24,073 | $ | 24,070 | ||||||||||||||||||||||
Current Assets | 141,167 | $ | 155,463 | ||||||||||||||||||||||
Regulatory and Other Assets | 35,977 | 31,093 | |||||||||||||||||||||||
Total Assets | $ | 1,441,122 | $ | 1,416,734 | |||||||||||||||||||||
Capitalization and Liabilities | |||||||||||||||||||||||||
Capitalization | $ | 820,241 | $ | 850,984 | |||||||||||||||||||||
Current Liabilities | 129,840 | 156,662 | |||||||||||||||||||||||
Other Credits | 491,041 | 409,088 | |||||||||||||||||||||||
Total Capitalization and Liabilities | $ | 1,441,122 | $ | 1,416,734 | |||||||||||||||||||||
Condensed Statements of Income | Three months ended | Six months ended | |||||||||||||||||||||||
(in thousands, except per share amounts) | June 30, | June 30, | |||||||||||||||||||||||
2018 | 2017 | 2018 | 2017 | ||||||||||||||||||||||
(Unaudited) | (Unaudited) | ||||||||||||||||||||||||
Operating Revenues | |||||||||||||||||||||||||
Water | $ | 76,733 | $ | 80,734 | $ | 141,145 | $ | 147,138 | |||||||||||||||||
Electric | 7,841 | 7,612 | 17,673 | 18,114 | |||||||||||||||||||||
Contracted services | 22,327 | 24,849 | 42,811 | 46,753 | |||||||||||||||||||||
Total operating revenues | $ | 106,901 | $ | 113,195 | $ | 201,629 | $ | 212,005 | |||||||||||||||||
Operating Expenses | |||||||||||||||||||||||||
Water purchased | $ | 16,608 | $ | 17,937 | $ | 30,215 | $ | 30,043 | |||||||||||||||||
Power purchased for pumping | 2,231 | 2,157 | 3,924 | 3,754 | |||||||||||||||||||||
Groundwater production assessment | 4,534 | 4,931 | 9,185 | 8,306 | |||||||||||||||||||||
Power purchased for resale | 2,384 | 2,308 | 5,792 | 5,408 | |||||||||||||||||||||
Supply cost balancing accounts | (2,029 | ) | (5,293 | ) | (5,898 | ) | (7,042 | ) | |||||||||||||||||
Other operation | 7,782 | 8,172 | 15,770 | 14,332 | |||||||||||||||||||||
Administrative and general | 20,213 | 20,248 | 40,506 | 40,696 | |||||||||||||||||||||
Depreciation and amortization | 10,010 | 9,647 | 19,676 | 19,330 | |||||||||||||||||||||
Maintenance | 3,670 | 3,606 | 7,499 | 7,070 | |||||||||||||||||||||
Property and other taxes | 4,372 | 4,345 | 9,171 | 8,911 | |||||||||||||||||||||
ASUS construction | 11,576 | 11,412 | 21,548 | 22,896 | |||||||||||||||||||||
Gain on sale of assets | (18 | ) | (8,301 | ) | (18 | ) | (8,301 | ) | |||||||||||||||||
Total operating expenses | $ | 81,333 | $ | 71,169 | $ | 157,370 | $ | 145,403 | |||||||||||||||||
Operating income | $ | 25,568 | $ | 42,026 | $ | 44,259 | $ | 66,602 | |||||||||||||||||
Other Income and Expenses | |||||||||||||||||||||||||
Interest expense | (6,048 | ) | (5,926 | ) | (11,971 | ) | (11,831 | ) | |||||||||||||||||
Interest income | 636 | 620 | 1,172 | 879 | |||||||||||||||||||||
Other, net | 579 | 379 | 621 | 1,005 | |||||||||||||||||||||
Total other income and expenses, net | (4,833 | ) | (4,927 | ) | (10,178 | ) | (9,947 | ) | |||||||||||||||||
Income Before Income Tax Expense | $ | 20,735 | $ | 37,099 | $ | 34,081 | $ | 56,655 | |||||||||||||||||
Income tax expense | 4,387 | 14,307 | 6,951 | 21,162 | |||||||||||||||||||||
Net Income | $ | 16,348 | $ | 22,792 | $ | 27,130 | $ | 35,493 | |||||||||||||||||
Weighted average shares outstanding | 36,733 | 36,624 | 36,723 | 36,607 | |||||||||||||||||||||
Basic earnings per Common Share | $ | 0.44 | $ | 0.62 | $ | 0.74 | $ | 0.96 | |||||||||||||||||
Weighted average diluted shares | 36,912 | 36,825 | 36,896 | 36,799 | |||||||||||||||||||||
Fully diluted earnings per Common Share | $ | 0.44 | $ | 0.62 | $ | 0.73 | $ | 0.96 | |||||||||||||||||
Dividends declared per Common Share | $ | 0.255 | $ | 0.242 | $ | 0.510 | $ | 0.484 |
View source version on businesswire.com: https://www.businesswire.com/news/home/20180806005609/en/
Source:
American States Water Company
Eva G. Tang
Senior Vice
President-Finance, Chief Financial Officer,
Corporate Secretary and
Treasurer
(909) 394-3600, ext. 707