- Operating revenue was $187.8 million
and regulated segment revenue increased to $186.3 million
- Reported earnings per share of
$0.28
- Affirms earnings per diluted common
share guidance of $1.34 to $1.39 for full year 2017
Aqua America, Inc. (NYSE: WTR) today reported results for the
first quarter ended March 31, 2017.
First Quarter Operating Results
Aqua America’s operating revenues were $187.8 million in the
quarter. Regulated segment revenues increased to $186.3 million in
the first quarter of 2017. Rates, surcharges, regulated customer
growth, and other factors increased revenues by approximately $2.1
million in the quarter. Reduced revenue from market-based
activities offset the increase by $5.2 million, with lower
consumption contributing to the decreased revenue in the
quarter.
Operations and maintenance expenses were $69.1 million for the
first quarter of 2017, compared to $73.5 million in the first
quarter of 2016. Lower employee-related costs, a decrease in
expenses tied to market-based activities, and other factors
collectively decreased operating expenses by $4.4 million
year-over-year for the first quarter.
Net income for the first quarter was $49.1 million compared to
$51.7 million in the first quarter of 2016. Earnings per diluted
common share were $0.28 for the quarter compared to $0.29 in the
first quarter of 2016. Aqua benefited from the sale of a utility
system in North Carolina as well as a favorable tax settlement in
Ohio during the first quarter of 2016 which impacted the year over
year comparison.
“We continue to efficiently operate our utility while
steadfastly serving our customers with dependable, high-quality
water, and purposefully growing our customer base,” said Aqua
America President and CEO Christopher Franklin. “Further, we are
comfortable with our full-year guidance and remain excited about
growth opportunities in the water and waste water space that will
help us welcome more customers and communities to Aqua.”
Capital Expenditures
Through the first quarter of 2017, Aqua invested approximately
$95 million to improve its infrastructure systems. The company
expects to invest more than $450 million in 2017 and more than $1.2
billion through 2019. Capital investments made in the
infrastructure of the communities Aqua serves are paramount to
helping the company accomplish its mission of protecting and
providing Earth’s most essential resource.
Dividend
Today, Aqua America’s Board of Directors declared a quarterly
cash dividend of $0.1913 per share of common stock. This dividend
will be payable on June 1, 2017 to shareholders of record on May
17, 2017. Aqua has paid consecutive quarterly cash dividends for 72
years and has increased the dividend 26 times in the last 25
years.
Rate Activity
To date in 2017, the company’s state subsidiaries in Indiana,
Illinois, New Jersey, North Carolina and Ohio have received rate
awards or infrastructure surcharges totaling $10.7 million.
Additionally, the company currently has rate proceedings pending in
Illinois and Virginia for $12.2 million. The timing and extent to
which these rate increases might be granted can vary by the
applicable regulatory agency.
Acquisition Growth in Regulated Operations
Year to date, Aqua has added approximately 262 customer
connections through acquisitions in Indiana. Acquisitions and
organic growth have increased the company’s customer base by more
than 0.2 percent year-to-date in 2017.
“In the first quarter of 2017, we acquired two small
investor-owned utilities from our backlog of small private deals.
For the balance of 2017, we have four municipal systems under
contract, and combined, they represent a purchase price of $113
million and nearly 9,000 customers or 12,000 equivalent dwelling
units,” noted Franklin. “We expect to close these deals and onboard
these new customers later this year.”
“We are enthusiastic about our acquisition strategy and remain
optimistic about providing solutions for both municipal and private
water and waste-water systems. We continue to work closely with
local and Federal officials to improve infrastructure for current
and future generations,” said Franklin.
Financial Information
As of March 31, 2017, Aqua America’s weighted average cost of
fixed-rate long-term debt was 4.35 percent and the company had $287
million available on its credit lines.
2017 Guidance
Aqua America continues to affirm guidance for 2017, which
remains unchanged from last quarter:
- Earnings per diluted common share of
$1.34 to $1.39
- Same-system operations and
maintenance expenses increase of 1 to 2 percent
- More than $450 million in
infrastructure improvements in 2017 for communities served by
Aqua
- More than $1.2 billion in
infrastructure improvements planned through 2019 in existing
operations to improve and strengthen systems
- Aqua Pennsylvania expected to file
distribution system improvement charge in 2017 and rate case filing
likely in 2018, with resolution expected in 2019
- Total customer growth of 1.5 to 2
percent
Aqua America does not guarantee future results of any kind.
Guidance is subject to risks and uncertainties, including, without
limitation, those factors outlined in the “Forward Looking
Statements” of this release and the “Risk Factors” section of the
company’s annual and quarterly reports filed with the Securities
and Exchange Commission (SEC).
Earnings Call Information
Date: May 4, 2017Time: 11 a.m. EDT (please dial in by 10:45
a.m.)Webcast and slide presentation link:
http://ir.aquaamerica.com/events.cfmReplay Dial-in #: 888.203.1112
(U.S.) & +1 719.457.0820 (International)Confirmation code:
5632698
The company’s conference call with financial analysts will take
place on Thursday, May 4, 2017 at 11 a.m. Eastern Daylight Time.
The call and slide presentation will be webcast live so that
interested parties may listen over the Internet by logging on to
AquaAmerica.com and following the link for Investor Relations. The
webcast will be archived in the investor relations section of the
company’s website for 90 days following the call. Additionally, the
call will be recorded and made available for replay at 2 p.m. on
May 4, 2017 for 10 business days following the call. To access the
audio replay in the U.S., dial 888.203.1112 (pass code 5632698).
International callers can dial +1 719.457.0820 (pass code
5632698).
About Aqua America
Aqua America is one of the largest U.S.-based, publicly traded
water utilities and serves nearly 3 million people in Pennsylvania,
Ohio, North Carolina, Illinois, Texas, New Jersey, Indiana and
Virginia. Aqua America is listed on the New York Stock Exchange
under the ticker symbol WTR. Visit AquaAmerica.com for more
information.
Forward-Looking Statements
This release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995,
including, among others: the guidance range of earnings per share
for the fiscal year ending in 2017; the continuation of the
company's growth-through-acquisition program and the expectations
for customer growth from this program; the expected increase in
customer base for the fiscal years ending in 2017; the company's
expected same-system operations and maintenance expense increase
for the fiscal year ending in 2017; the anticipated amount of
capital investment from 2017 through 2019; the company’s filing of
a Pennsylvania DSIC case in 2017 and a Pennsylvania rate case in
2018; the success of the rate proceedings in Illinois and Virginia;
the closing of the four municipally owned systems presently under
agreement; and, the volume and pace of opportunities in the water
and wastewater field. There are important factors that could cause
actual results to differ materially from those expressed or implied
by such forward-looking statements including: the company's
continued ability to adapt itself for the future and build value by
fully optimizing company assets; general economic business
conditions; the company's ability to fund needed infrastructure;
housing and customer growth trends; unfavorable weather conditions;
the success of certain cost containment initiatives; changes in
regulations or regulatory treatment; availability and access to
capital; the cost of capital; disruptions in the credit markets;
the success of growth initiatives; the company's ability to
continue to deliver strong results; the company's ability to grow
its dividend, add shareholder value and to grow earnings;
municipalities willingness to privatize its water and/or wastewater
utilities; the company's ability to control expenses and create and
maintain efficiencies; the company’s success in its Pennsylvania
DSIC and rate filings; the company’s ability to successfully
complete its Pennsylvania DSIC and rate filings in a timely manner;
and other factors discussed in our Annual Report on Form 10-K and
our Quarterly Report on Form 10-Q, which is filed with the
Securities and Exchange Commission. For more information regarding
risks and uncertainties associated with Aqua America's business,
please refer to Aqua America's annual, quarterly and other SEC
filings. Aqua America is not under any obligation - and expressly
disclaims any such obligation - to update or alter its
forward-looking statements whether as a result of new information,
future events or otherwise.
WTRF
Aqua America, Inc. and Subsidiaries
Selected Operating Data (In thousands, except per share amounts)
(Unaudited) Quarter Ended
March 31,
2017
2016
Operating revenues $ 187,787 $ 192,607
Operations and maintenance expense
$ 69,128 $ 73,541 Regulated segment: Operating
revenues $ 186,349 $ 186,006 Operations and
maintenance expense $ 67,510 $ 67,325 Net
income $ 49,072 $ 51,737 Basic net income per
common share $ 0.28 $ 0.29 Diluted net income per common share $
0.28 $ 0.29 Basic average common shares
outstanding 177,479 177,104 Diluted average common shares
outstanding 177,969 177,819
Aqua America, Inc. and Subsidiaries
Condensed Consolidated Balance Sheets (In thousands of dollars)
(Unaudited) March 31, December 31,
2017
2016
Net property, plant and equipment $ 5,057,826 $ 5,001,615
Current assets 122,463 128,650 Regulatory assets and other assets
1,055,306 1,028,726 $ 6,235,595
$ 6,158,991 Total equity $ 1,867,227 $
1,850,068 Long-term debt, excluding current portion, net of debt
issuance costs 1,797,511 1,737,605 Current portion of long-term
debt and loans payable 147,028 157,206 Other current liabilities
130,572 144,330 Deferred credits and other liabilities
2,293,257 2,269,782 $ 6,235,595
$ 6,158,991 Aqua America, Inc.
and Subsidiaries Consolidated Statement of Income (In thousands,
except per share amounts) (Unaudited) Quarter Ended
March 31,
2017
2016
Operating revenues $ 187,787 $ 192,607 Cost &
expenses: Operations and maintenance 69,128 73,541 Depreciation
33,837 32,145 Amortization 189 450 Taxes other than income taxes
14,737 14,140 Total
117,891 120,276
Operating income 69,896 72,331 Other expense (income):
Interest expense, net 21,326 19,853 Allowance for funds used during
construction (3,193 ) (2,308 ) Gain on sale of other assets (269 )
(207 ) Equity loss in joint venture 30
249 Income before income taxes 52,002 54,744
Provision for income taxes 2,930
3,007 Net income $ 49,072 $ 51,737
Net income per common share: Basic $ 0.28 $ 0.29
Diluted $ 0.28 $ 0.29 Average common shares outstanding:
Basic 177,479 177,104
Diluted 177,969 177,819
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version on businesswire.com: http://www.businesswire.com/news/home/20170503006642/en/
Aqua America, Inc.Brian DingerdissenInvestor RelationsO:
610-645-1191BJDingerdissen@AquaAmerica.comorStacey HajdakMarketing
& CommunicationsO: 610-520-6309SMHajdak@AquaAmerica.com
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