American States Water Company Announces Earnings for the Second Quarter of 2014
Second Quarter 2014 Results
The table below sets forth a
comparison of the second quarter diluted earnings per share by business
segment, as reported:
3 Months Ended | |||||||
6/30/2014 | 6/30/2013 | Change | |||||
Water | $0.33 | $0.33 |
$ --- |
||||
Electric | 0.02 | 0.03 | (0.01 | ) | |||
Contracted services | 0.04 | 0.07 | (0.03 | ) | |||
Consolidated diluted earnings | $0.39 | $0.43 | ($0.04 | ) |
Water
For the three months ended
June 30, 2014 and 2013, diluted earnings from the water segment were
Electric
For the three months ended
June 30, 2014, diluted earnings from the electric segment were
Contracted Services
Diluted earnings
from contracted services decreased by
Year-to-Date 2014 Results
Basic and fully diluted earnings
per share were
Year-to-Date | |||||||
6/30/2014 | 6/30/2013 | Change | |||||
Water | $0.54 | $0.59 | (0.05 | ) | |||
Electric | 0.04 | 0.04 | --- | ||||
Contracted services | 0.08 | 0.14 | (0.06 | ) | |||
AWR Parent | 0.01 | --- | 0.01 | ||||
Consolidated diluted earnings | $0.67 | $0.77 | ($0.10 | ) |
Increase/ |
||||
Reconciliation of changes in YTD EPS from 2013 to 2014: |
(Decrease) |
|||
Water Segment: |
||||
Recovery of previously incurred costs in 2013 (did not recur in 2014) | $ | (0.05 | ) | |
Water gross margin contribution due to rate increases (excluding surcharges*) | 0.02 | |||
Higher depreciation expense | (0.02 | ) | ||
Lower planned maintenance expense | 0.02 | |||
Higher other operating expenses (excluding surcharges*) | (0.02 | ) | ||
Electric Segment: |
||||
Recovery in 2013 of previously incurred costs (did not recur in 2014) | (0.01 | ) | ||
Lower effective income tax rate due to flow-through adjustments | 0.01 | |||
Contracted Services Segment: |
||||
Lower capital upgrade work in 2014 as several large construction projects were completed in 2013 or are near completion, and lower renewal and replacement capital work |
(0.07 | ) | ||
Lower operating expenses | 0.01 | |||
AWR Parent: |
||||
Increase due primarily to state income tax benefits recorded at AWR parent | 0.01 | |||
YTD 2014 EPS decrease |
$ | (0.10 | ) |
* | Surcharges billed to customers for previously incurred costs are recorded as revenues with a corresponding increase in operating expenses. These surcharges have no impact to net earnings and; therefore, are excluded from the table above. |
Regulatory Matters
In
Dividends
Non-GAAP Financial Measures
This press release includes a
discussion on the water gross margin, which is computed by taking total
water revenues, less total supply costs. The discussion also includes
AWR’s operations in terms of diluted earnings per share by business
segment, which is each business segment’s earnings 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 Generally
Accepted Accounting Principles (“GAAP”) 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 water gross margins 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 measurements 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 Form 10-Q for the
quarter ended
Second Quarter 2014 Earnings Release Conference Call - The
Company will host a conference call tomorrow,
The call will also be archived on our website and can be replayed
beginning Wednesday, August 6, 2014 at
American States Water Company | ||||||||||||
Consolidated | ||||||||||||
Comparative Condensed Balance Sheets | ||||||||||||
June 30, | December 31, | |||||||||||
(in thousands) | 2014 | 2013 | ||||||||||
(Unaudited) | ||||||||||||
Assets | ||||||||||||
Utility Plant-Net | $988,668 | $981,477 | ||||||||||
Goodwill | 1,116 | 1,116 | ||||||||||
Other Property and Investments | 16,118 | 15,806 | ||||||||||
Current Assets | 197,850 | 191,617 | ||||||||||
Regulatory and Other Assets | 123,340 | 120,167 | ||||||||||
Total Assets | $1,327,092 | $1,310,183 | ||||||||||
Capitalization and Liabilities | ||||||||||||
Capitalization | 806,093 | 818,483 | ||||||||||
Current Liabilities | 127,501 | 100,906 | ||||||||||
Other Credits | 393,498 | 390,794 | ||||||||||
Total Capitalization and Liabilities | $1,327,092 | $1,310,183 | ||||||||||
Condensed Statements of Income | Three months ended | Six months ended | ||||||||||
(in thousands, except per share amounts) | June 30, | June 30, | ||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||
(Unaudited) | (Unaudited) | |||||||||||
Operating Revenues | ||||||||||||
Water | $86,232 | $84,069 | $156,989 | $153,302 | ||||||||
Electric | 8,328 | 8,397 | 18,784 | 19,131 | ||||||||
Contracted services | 21,081 | 28,229 | 41,813 | 58,814 | ||||||||
Total operating revenues | $115,641 | $120,695 | $217,586 | $231,247 | ||||||||
Operating Expenses | ||||||||||||
Water purchased | $16,263 | $16,670 | $27,487 | $27,402 | ||||||||
Power purchased for pumping | 2,570 | 2,332 | 4,534 | 3,971 | ||||||||
Groundwater production assessment | 4,853 | 3,823 | 8,393 | 7,010 | ||||||||
Power purchased for resale | 1,988 | 2,828 | 4,687 | 6,508 | ||||||||
Supply cost balancing accounts | (106 | ) | (377 | ) | 712 | 994 | ||||||
Other operation | 7,085 | 6,519 | 14,032 | 11,973 | ||||||||
Administrative and general | 19,407 | 18,113 | 39,591 | 36,020 | ||||||||
Depreciation and amortization | 10,525 | 9,768 | 21,055 | 19,584 | ||||||||
Maintenance | 4,327 | 4,913 | 7,816 | 8,847 | ||||||||
Property and other taxes | 3,965 | 3,748 | 8,290 | 7,896 | ||||||||
ASUS construction | 13,764 | 19,064 | 27,221 | 39,797 | ||||||||
Net gain on sale of property | - | - | - | (12 | ) | |||||||
Total operating expenses | $84,641 | $87,401 | $163,818 | $169,990 | ||||||||
Operating income | $31,000 | $33,294 | $53,768 | $61,257 | ||||||||
Other Income and Expenses | ||||||||||||
Interest expense | (5,778 | ) | (5,768 | ) | (11,405 | ) | (11,546 | ) | ||||
Interest income | 123 | 140 | 235 | 327 | ||||||||
Other, net | 271 | 84 | 396 | 426 | ||||||||
Total other income and expenses | (5,384 | ) | (5,544 | ) | (10,774 | ) | (10,793 | ) | ||||
Income Before Income Tax Expense | $25,616 | $27,750 | $42,994 | $50,464 | ||||||||
Income tax expense | 10,262 | 11,148 | 16,619 | 20,397 | ||||||||
Net Income | $15,354 | $16,602 | $26,375 | $30,067 | ||||||||
Weighted average shares outstanding | 38,781 | 38,612 | 38,764 | 38,570 | ||||||||
Basic earnings per Common Share | $0.39 | $0.43 | $0.68 | $0.77 | ||||||||
Weighted average diluted shares | 39,001 | 38,692 | 38,974 | 38,648 | ||||||||
Fully diluted earnings per Common Share | $0.39 | $0.43 | $0.67 | $0.77 | ||||||||
Dividends Declared Per Common Share | $0.2025 | $0.1775 | $0.405 | $0.355 |
Source:
American States Water Company
Eva G. Tang
Senior Vice
President-Finance, Chief Financial Officer, Corporate Secretary and
Treasurer
Telephone: (909) 394-3600, ext. 707