American States Water Company Announces Third Quarter 2017 Results
Third Quarter 2017 Results
The table below sets forth a comparison of the third quarter diluted earnings per share by business segment, as reported:
Diluted Earnings per Share | |||||||||||||||
Three Months Ended | |||||||||||||||
9/30/2017 | 9/30/2016 | CHANGE | |||||||||||||
Water | $ | 0.44 | $ | 0.47 | $ | (0.03 | ) | ||||||||
Electric | 0.03 | 0.02 | 0.01 | ||||||||||||
Contracted services | 0.10 | 0.10 | — | ||||||||||||
Consolidated diluted earnings per share, as reported | $ | 0.57 | $ | 0.59 | $ | (0.02 | ) | ||||||||
Water Segment:
For the three months ended September 30, 2017, diluted earnings per
share from the water segment decreased by
Excluding the impact of the item discussed above and surcharges
implemented to recover previously incurred costs which have no impact to
earnings, diluted earnings from the water segment for the quarter were
unchanged as compared to the same period in 2016. There was an overall
decrease in operating expenses (excluding supply costs) resulting mainly
from lower maintenance costs, as well as lower legal expenses related to
condemnation matters as compared to the same period in 2016. There was
also CPUC-approved second year rate increases effective
Electric Segment:
For the three months ended September 30, 2017, diluted earnings from the
electric segment increased by
Contracted Services Segment:
For the three months ended September 30, 2017 and 2016, diluted earnings
per share from the contracted services segment were
Year-to-Date 2017 Results
Basic and fully diluted earnings were
Diluted Earnings per Share | |||||||||||||||
Nine Months Ended | |||||||||||||||
9/30/2017 | 9/30/2016 | CHANGE | |||||||||||||
Water | $ | 1.17 | $ | 1.04 | $ | 0.13 | |||||||||
Electric | 0.09 | 0.06 | 0.03 | ||||||||||||
Contracted services | 0.26 | 0.20 | 0.06 | ||||||||||||
AWR (parent) | 0.01 | 0.02 | (0.01 | ) | |||||||||||
Consolidated diluted earnings per share, as reported | $ | 1.53 | $ | 1.32 | $ | 0.21 | |||||||||
Water Segment:
For the nine months ended September 30, 2017, diluted earnings per share
from the water segment increased by
-
A decrease in the water gross margin of
$5.2 million , or$0.08 per share, was not reflected in the results for the nine months endedSeptember 30, 2016 due to the delay by the CPUC in issuing a decision on the water general rate case. When the decision was issued inDecember 2016 with new rates retroactive to January 1, 2016, a cumulative downward adjustment of$5.2 million was recorded to the water gross margin in the fourth quarter of 2016, which related to the first three quarters of 2016. -
In
February 2017 , the CPUC approved recovery of incremental costs related toCalifornia's drought state of emergency, which were previously expensed. As a result of this approval, during the nine months endedSeptember 30, 2017 GSWC recorded a regulatory asset and a corresponding increase to pretax earnings of$1.5 million , or$0.02 per share, of which$1.2 million was reflected as a reduction to other operation expenses and approximately$260,000 as additional revenue.
Excluding the impact of the items discussed above and a
-
A decrease in operating expenses (excluding supply costs) of
$3.2 million , or$0.05 per share, due mostly to lower legal expenses related to condemnation matters, as well as lower maintenance costs. -
An increase in interest and other income of
$1.1 million , or$0.02 per share, due to amounts collected from developers on certain outstanding balances owed to GSWC and higher gains recorded on investments as compared to 2016. -
A higher effective income tax rate, negatively impacting earnings by
$0.01 per share, resulting from differences between book and taxable income that are treated as flow-through adjustments in accordance with regulatory requirements (primarily plant, rate case and compensation-related items).
Electric Segment:
For the nine months ended September 30, 2017, diluted earnings from the
electric segment were
Contracted Services Segment:
For the nine months ended September 30, 2017, diluted earnings per share
from the contracted services segment increased by
New Privatization Contract Award
On
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 | ||||||||||||||||||||||
September 30, | December 31, | |||||||||||||||||||||
(in thousands) | 2017 | 2016 | ||||||||||||||||||||
(Unaudited) | ||||||||||||||||||||||
Assets | ||||||||||||||||||||||
Utility Plant-Net | $ | 1,181,616 | $ | 1,150,926 | ||||||||||||||||||
Goodwill | 1,116 | 1,116 | ||||||||||||||||||||
Other Property and Investments | 23,346 | 20,836 | ||||||||||||||||||||
Current Assets | 146,663 | 166,875 | ||||||||||||||||||||
Regulatory and Other Assets | 133,745 | 130,740 | ||||||||||||||||||||
Total Assets | $ | 1,486,486 | $ | 1,470,493 | ||||||||||||||||||
Capitalization and Liabilities | ||||||||||||||||||||||
Capitalization | $ | 846,761 | $ | 815,278 | ||||||||||||||||||
Current Liabilities | 151,869 | 177,944 | ||||||||||||||||||||
Other Credits | 487,856 | 477,271 | ||||||||||||||||||||
Total Capitalization and Liabilities | $ | 1,486,486 | $ | 1,470,493 | ||||||||||||||||||
Condensed Statements of Income | Three months ended | Nine months ended | ||||||||||||||||||||
(in thousands, except per share amounts) | September 30, | September 30, | ||||||||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||||||||
(Unaudited) | (Unaudited) | |||||||||||||||||||||
Operating Revenues | ||||||||||||||||||||||
Water | $ | 91,919 | $ | 90,617 | $ | 239,057 | $ | 237,987 | ||||||||||||||
Electric | 7,994 | 8,146 | 26,108 | 26,420 | ||||||||||||||||||
Contracted services | 24,505 | 25,043 | 71,258 | 64,880 | ||||||||||||||||||
Total operating revenues | $ | 124,418 | $ | 123,806 | $ | 336,423 | $ | 329,287 | ||||||||||||||
Operating Expenses | ||||||||||||||||||||||
Water purchased | $ | 20,576 | $ | 19,631 | $ | 50,619 | $ | 49,265 | ||||||||||||||
Power purchased for pumping | 2,913 | 2,988 | 6,667 | 6,752 | ||||||||||||||||||
Groundwater production assessment | 5,870 | 4,482 | 14,176 | 11,150 | ||||||||||||||||||
Power purchased for resale | 2,439 | 2,394 | 7,847 | 7,481 | ||||||||||||||||||
Supply cost balancing accounts | (4,621 | ) | (4,213 | ) | (11,663 | ) | (10,145 | ) | ||||||||||||||
Other operation | 7,657 | 7,448 | 21,989 | 21,331 | ||||||||||||||||||
Administrative and general | 21,790 | 19,768 | 62,534 | 61,829 | ||||||||||||||||||
Depreciation and amortization | 9,854 | 9,486 | 29,184 | 28,878 | ||||||||||||||||||
Maintenance | 3,222 | 4,203 | 10,292 | 11,908 | ||||||||||||||||||
Property and other taxes | 4,475 | 4,317 | 13,386 | 12,863 | ||||||||||||||||||
ASUS construction | 11,693 | 13,685 | 34,589 | 35,351 | ||||||||||||||||||
Gain on sale of assets | (17 | ) | - | (8,318 | ) | - | ||||||||||||||||
Total operating expenses | $ | 85,851 | $ | 84,189 | $ | 231,302 | $ | 236,663 | ||||||||||||||
Operating income | $ | 38,567 | $ | 39,617 | $ | 105,121 | $ | 92,624 | ||||||||||||||
Other Income and Expenses | ||||||||||||||||||||||
Interest expense | (5,775 | ) | (5,730 | ) | (17,606 | ) | (16,956 | ) | ||||||||||||||
Interest income | 321 | 206 | 1,200 | 568 | ||||||||||||||||||
Other, net | 401 | 254 | 1,454 | 872 | ||||||||||||||||||
Total other income and expenses, net | (5,053 | ) | (5,270 | ) | (14,952 | ) | (15,516 | ) | ||||||||||||||
Income Before Income Tax Expense | $ | 33,514 | $ | 34,347 | $ | 90,169 | $ | 77,108 | ||||||||||||||
Income tax expense | 12,508 | 12,708 | 33,670 | 28,577 | ||||||||||||||||||
Net Income | $ | 21,006 | $ | 21,639 | $ | 56,499 | $ | 48,531 | ||||||||||||||
Weighted average shares outstanding | 36,659 | 36,561 | 36,625 | 36,546 | ||||||||||||||||||
Basic earnings per Common Share | $ | 0.57 | $ | 0.59 | $ | 1.53 | $ | 1.32 | ||||||||||||||
Weighted average diluted shares | 36,856 | 36,762 | 36,813 | 36,743 | ||||||||||||||||||
Fully diluted earnings per Common Share | $ | 0.57 | $ | 0.59 | $ | 1.53 | $ | 1.32 | ||||||||||||||
Dividends declared per Common Share |
$ | 0.255 | $ | 0.224 | $ | 0.739 | $ | 0.672 | ||||||||||||||
View source version on businesswire.com: http://www.businesswire.com/news/home/20171106006282/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