American States Water Company Announces Fourth Quarter and Full Year 2017 Results
Fourth Quarter 2017 Results
The table below sets forth a comparison of the fourth quarter 2017 diluted earnings per share by business segment with diluted earnings per share for the fourth quarter of 2016, as reported:
Diluted Earnings per Share | ||||||||||||
Three Months Ended | ||||||||||||
12/31/2017 | 12/31/2016 | CHANGE | ||||||||||
Water | $ | 0.18 | $ | 0.13 | $ | 0.05 | ||||||
Electric | 0.02 | 0.04 | (0.02 | ) | ||||||||
Contracted services | 0.11 | 0.13 | (0.02 | ) | ||||||||
AWR (parent) | 0.04 | — | 0.04 | |||||||||
Consolidated diluted earnings per share, as reported | $ | 0.35 | $ | 0.30 | $ | 0.05 | ||||||
Water Segment
For the three months ended December 31, 2017, fully diluted earnings
from the water segment of AWR’s
-
A downward adjustment to earnings of
$0.08 per share was recorded in the fourth quarter of 2016 related to the first three quarters of 2016 due to a delayed general rate case decision issued inDecember 2016 by theCalifornia Public Utilities Commission (“CPUC”) to set rates for years 2016 - 2018. -
An overall decrease in the water gross margin in the fourth quarter of
2017 primarily due to the cessation of GSWC’s
Ojai operations resulting from the sale of this water system inJune 2017 , partially offset by CPUC-approved second year rate increases effectiveJanuary 1, 2017 . - An increase in interest and other income (net of interest expense) due primarily to (i) higher gains recorded on investments as compared to 2016, (ii) interest income related to a settlement payment received in December 2017, and (iii) higher interest income earned on regulatory assets resulting mostly from an increase in the 90-day commercial paper rate.
Overall, operating expenses remained relatively flat due to a decrease in legal expenses related to condemnation matters mostly offset by increases in conservation costs, regulatory-related expenses, and property and other taxes.
Electric Segment
For the three months ended
Contracted Services Segment
For the three months ended
AWR (parent)
For the three months ended
Full Year 2017 Results
Fully diluted earnings for the year ended December 31, 2017 were
Diluted Earnings per Share | |||||||||||
For The Year Ended | |||||||||||
12/31/2017 | 12/31/2016 | CHANGE | |||||||||
Water | $ | 1.35 | $ | 1.17 | $ | 0.18 | |||||
Electric | 0.11 | 0.10 | 0.01 | ||||||||
Contracted services | 0.37 | 0.33 | 0.04 | ||||||||
AWR (parent) | 0.05 | 0.02 | 0.03 | ||||||||
Consolidated diluted earnings per share, as reported | $ | 1.88 | $ | 1.62 | $ | 0.26 | |||||
Water Segment
For the year ended December 31, 2017, diluted earnings from the water
segment increased by
Excluding the impact of the two items discussed above and the
- An overall decrease in operating expenses (excluding supply costs) due mostly to lower legal expenses related to condemnation matters, and
- An increase in interest and other income (net of interest expense) due primarily to (i) higher gains recorded on investments as compared to 2016, (ii) amounts collected from developers on certain outstanding balances owed to GSWC, (iii) higher interest income on GSWC's regulatory assets resulting mostly from an increase in the 90-day commercial paper rate, and (iv) interest income related to a settlement payment received in December 2017.
The increase in water’s diluted earnings discussed above was partially
offset by an overall decrease in the water gross margin mainly due to
the cessation of
Electric Segment
For the year ended December 31, 2017, diluted earnings from the electric
segment increased by
Contracted Services Segment
For the year ended December 31, 2017, diluted earnings from contracted
services were
AWR (parent)
For the year ended December 31, 2017, diluted earnings from AWR (parent)
increased $0.03 per share compared to 2016 due to lower state taxes
recorded at the parent level, as well as the remeasurement of federal
deferred tax liabilities associated with the
Dividends
On
Non-GAAP Financial Measures
This press release includes a discussion on the water and electric gross
margins for various periods, which are computed by subtracting total
supply costs from total revenues. 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 the water and electric 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 press 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-K for the year ended December 31, 2017 as filed with
the
Conference Call
The company will host a conference call on February 27, 2018 at
About
American States Water Company | ||||||||||||||||
Consolidated | ||||||||||||||||
Comparative Condensed Balance Sheets | ||||||||||||||||
December 31, | ||||||||||||||||
(in thousands) | 2017 | 2016 | ||||||||||||||
Assets | ||||||||||||||||
Utility Plant-Net | $ | 1,204,992 | $ | 1,150,926 | ||||||||||||
Goodwill | 1,116 | 1,116 | ||||||||||||||
Other Property and Investments | 24,070 | 20,836 | ||||||||||||||
Current Assets | 155,463 | 166,875 | ||||||||||||||
Regulatory and Other Assets | 31,093 | 130,740 | ||||||||||||||
$ | 1,416,734 | $ | 1,470,493 | |||||||||||||
Capitalization and Liabilities | ||||||||||||||||
Capitalization | $ | 850,984 | $ | 815,278 | ||||||||||||
Current Liabilities | 156,662 | 177,944 | ||||||||||||||
Other Credits | 409,088 | 477,271 | ||||||||||||||
$ | 1,416,734 | $ | 1,470,493 | |||||||||||||
Condensed Statements of Income | Three months ended | Twelve months ended | ||||||||||||||
(in thousands, except per share amounts) | December 31, | December 31, | ||||||||||||||
2017 | 2016 | 2017 | 2016 | |||||||||||||
(Unaudited) | ||||||||||||||||
Operating Revenues | ||||||||||||||||
Water | $ | 67,275 | $ | 64,944 | $ | 306,332 | $ | 302,931 | ||||||||
Electric | 7,861 | 9,351 | 33,969 | 35,771 | ||||||||||||
Contracted services | 29,044 | 32,505 | 100,302 | 97,385 | ||||||||||||
Total operating revenues | $ | 104,180 | $ | 106,800 | $ | 440,603 | $ | 436,087 | ||||||||
Operating Expenses | ||||||||||||||||
Water purchased | $ | 17,683 | $ | 15,177 | $ | 68,302 | $ | 64,442 | ||||||||
Power purchased for pumping | 1,851 | 1,911 | 8,518 | 8,663 | ||||||||||||
Groundwater production assessment | 4,462 | 3,843 | 18,638 | 14,993 | ||||||||||||
Power purchased for resale | 2,873 | 2,906 | 10,720 | 10,387 | ||||||||||||
Supply cost balancing accounts | (6,276 | ) | (2,061 | ) | (17,939 | ) | (12,206 | ) | ||||||||
Other operation | 8,005 | 6,926 | 29,994 | 28,257 | ||||||||||||
Administrative and general | 19,128 | 19,165 | 81,662 | 80,994 | ||||||||||||
Depreciation and amortization | 9,847 | 9,972 | 39,031 | 38,850 | ||||||||||||
Maintenance | 4,884 | 4,562 | 15,176 | 16,470 | ||||||||||||
Property and other taxes | 4,519 | 3,938 | 17,905 | 16,801 | ||||||||||||
ASUS construction | 15,249 | 18,369 | 49,838 | 53,720 | ||||||||||||
Gain on sale of assets | - | - | (8,318 | ) | - | |||||||||||
Total operating expenses | 82,225 | 84,708 | 313,527 | 321,371 | ||||||||||||
Operating income | $ | 21,955 | $ | 22,092 | $ | 127,076 | $ | 114,716 | ||||||||
Other Income and Expenses | ||||||||||||||||
Interest expense | (4,976 | ) | (5,036 | ) | (22,582 | ) | (21,992 | ) | ||||||||
Interest income | 590 | 189 | 1,790 | 757 | ||||||||||||
Other, net | 603 | 125 | 2,057 | 997 | ||||||||||||
Total other income and expenses | (3,783 | ) | (4,722 | ) | (18,735 | ) | (20,238 | ) | ||||||||
Income from Operations Before Income Tax Expense | $ | 18,172 | $ | 17,370 | $ | 108,341 | $ | 94,478 | ||||||||
Income tax expense | 5,304 | 6,158 | 38,974 | 34,735 | ||||||||||||
Net Income | $ | 12,868 | $ | 11,212 | $ | 69,367 | $ | 59,743 | ||||||||
Basic Earnings Per Share | $ | 0.35 | $ | 0.30 | $ | 1.88 | $ | 1.63 | ||||||||
Fully Diluted Earnings Per Share | $ | 0.35 | $ | 0.30 | $ | 1.88 | $ | 1.62 | ||||||||
Weighted average shares outstanding | 36,680 | 36,570 | 36,638 | 36,552 | ||||||||||||
Weighted average diluted shares | 36,898 | 36,772 | 36,844 | 36,750 | ||||||||||||
Dividends paid per Common Share | $ | 0.255 | $ | 0.242 | $ | 0.994 | $ | 0.914 | ||||||||
View source version on businesswire.com: http://www.businesswire.com/news/home/20180226006449/en/
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