Company Overview - Essential Utilities (WTRG) is headquartered in Bryn Mawr and operates in the Utilities sector [3] - The stock has experienced a price change of 2.42% since the beginning of the year [3] Dividend Information - Essential Utilities currently pays a dividend of $0.33 per share, resulting in a dividend yield of 3.5% [3] - The Utility - Water Supply industry's average yield is 2.64%, while the S&P 500's yield is 1.48% [3] - The company's annualized dividend of $1.30 has increased by 2.8% from the previous year [4] - Over the last 5 years, the company has raised its dividend 5 times, averaging an annual increase of 6.53% [4] - The current payout ratio is 58%, indicating that the company paid out 58% of its trailing 12-month EPS as dividends [4] Earnings Growth - The Zacks Consensus Estimate for 2025 earnings is $2.10 per share, reflecting a year-over-year growth rate of 6.60% [5] Investment Appeal - Essential Utilities is considered a compelling investment opportunity due to its attractive dividend and strong Zacks Rank of 2 (Buy) [6]

Core Insights - Essential Utilities (WTRG) has a strong track record of beating earnings estimates, particularly in the last two quarters with an average surprise of 15.13% [1][5] - The most recent earnings report showed a surprise of 28.75%, with actual earnings of $0.80 per share against an expectation of $1.03 [2] - The previous quarter also saw a positive surprise of 1.52%, with actual earnings of $0.67 per share compared to a consensus estimate of $0.66 [2] Earnings Estimates and Predictions - There has been a favorable change in earnings estimates for Essential Utilities, indicated by a positive Earnings ESP (Expected Surprise Prediction) of +6.90% [5][8] - The combination of a positive Earnings ESP and a Zacks Rank 1 (Strong Buy) suggests a high likelihood of another earnings beat in the upcoming report [8] - Historically, stocks with a positive Earnings ESP and a Zacks Rank of 3 or better have a nearly 70% chance of beating consensus estimates [6][8] Earnings ESP Metric - The Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate, with the Most Accurate Estimate reflecting the latest analyst revisions [7] - A negative Earnings ESP reduces predictive power but does not necessarily indicate an earnings miss [9] - Companies often beat consensus EPS estimates for various reasons, and the Earnings ESP is a crucial metric to consider before earnings releases [10]

Company Overview - Essential Utilities (WTRG) is based in Bryn Mawr and operates in the Utilities sector, with a year-to-date share price change of 2.78% [3] - The company currently pays a dividend of $0.33 per share, resulting in a dividend yield of 3.49%, which is higher than the Utility - Water Supply industry's yield of 2.53% and the S&P 500's yield of 1.52% [3] Dividend Performance - The current annualized dividend of Essential Utilities is $1.30, reflecting a 2.8% increase from the previous year [4] - Over the past five years, the company has increased its dividend five times, achieving an average annual increase of 6.53% [4] - The current payout ratio is 58%, indicating that the company paid out 58% of its trailing 12-month earnings per share as dividends [4] Earnings Growth and Investment Appeal - The Zacks Consensus Estimate for 2025 projects earnings of $2.10 per share, which represents a year-over-year earnings growth rate of 6.60% [5] - Essential Utilities is considered an attractive investment opportunity due to its strong dividend yield and a Zacks Rank of 2 (Buy), suggesting favorable market conditions for the stock [6]

Core Viewpoint - Essential Utilities (WTRG) is experiencing growth through acquisitions, organic ventures, and capital expenditures, which are enhancing its water and wastewater operations [1] Group 1: Investment Plans and Infrastructure - The company plans to invest $7.8 billion from 2025 to 2029 to improve its water and natural gas systems, with an investment of $1.4-$1.5 billion in infrastructure planned for 2025 [2][8] - Essential Utilities has expanded its utility operations significantly since 2015, completing numerous acquisitions that have added over 129,000 customers, with five pending acquisitions expected to add more than 210,000 customers [4][8] Group 2: Operational Stability and Emission Reduction - A majority of the water distributed by the company is self-sourced, which contributes to business stability, and the company aims to reduce annual Scope 1 and 2 emissions by 60% by 2035 compared to 2019 levels [3] - The focus on new and advanced assets is expected to lower operational costs [3] Group 3: Challenges and Risks - Water utilities face risks related to water contamination, which can lead to service disruptions and additional costs for testing and treatment [5] - Weather fluctuations, such as cooler winters and increased rainfall, can negatively impact water demand and the company's performance [6] Group 4: Stock Performance - Over the past six months, WTRG's shares have increased by 3.8%, which is lower than the industry's growth of 17.6% [7][8]

Company Overview - Essential Utilities (WTRG) shares have increased by approximately 2.2% over the past month, underperforming the S&P 500 [1] - The most recent earnings report is crucial for understanding the stock's performance and future outlook [1] Earnings Estimates - Fresh estimates for Essential Utilities have trended downward, with the consensus estimate shifting by -13.68% [2] - The stock has a Zacks Rank of 3 (Hold), indicating an expectation of in-line returns in the coming months [4] VGM Scores - Essential Utilities has a Growth Score of B and a Momentum Score of B, but a Value Score of D, placing it in the bottom 40% for value investment strategy [3] - The overall aggregate VGM Score for the stock is C, which is relevant for investors not focused on a single strategy [3] Industry Comparison - Essential Utilities is part of the Zacks Utility - Water Supply industry, where California Water Service Group (CWT) has seen a 3.3% increase in the past month [5] - California Water Service Group reported revenues of $203.97 million, reflecting a year-over-year decline of -24.7%, with an EPS of $0.22 compared to $1.21 a year ago [6] - The expected earnings for California Water Service Group for the current quarter is $0.40 per share, indicating a year-over-year change of -42.9% [6] - California Water Service Group holds a Zacks Rank of 2 (Buy) based on the direction and magnitude of estimate revisions, despite having a VGM Score of F [7]

Group 1 - The stock market is compared to a supermarket, with various investment options available across 11 GICS sectors [1] - iREIT® offers in-depth research on various investment vehicles including REITs, mREITs, Preferreds, BDCs, MLPs, ETFs, Builders, and Asset Managers [2] - The iREIT® Tracker provides data on over 250 tickers, including quality scores, buy targets, and trim targets [2] Group 2 - A new Ratings Tracker called iREIT Buy Zone has been introduced to help members screen for value [2] - The offer includes a 2-week free trial along with a free book [4]

[Part I – Financial Information](index=2&type=section&id=Part%20I%20%E2%80%93%20Financial%20Information) [Financial Statements](index=2&type=section&id=Item%201.%20Financial%20Statements) The company's financial statements for the quarter ended March 31, 2025, show a significant increase in operating revenues to $783.6 million from $612.1 million year-over-year, driven by both the Regulated Water and Natural Gas segments. Net income rose to $283.8 million, or $1.03 per diluted share, compared to $265.8 million, or $0.97 per diluted share, in the prior year. Total assets grew to $18.33 billion from $18.03 billion at the end of 2024. Cash flow from operations increased to $299.5 million from $240.7 million in the prior-year period Condensed Consolidated Statements of Operations Highlights (Unaudited) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | **Operating revenues** | $783,626 thousand | $612,069 thousand | | **Operating income** | $338,905 thousand | $230,666 thousand | | **Net income** | $283,789 thousand | $265,772 thousand | | **Diluted EPS** | $1.03 | $0.97 | Condensed Consolidated Balance Sheets Highlights (Unaudited) | Metric | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Total Assets** | $18,327,161 thousand | $18,026,554 thousand | | **Total Liabilities** | $11,177,612 thousand | $11,138,900 thousand | | **Total Stockholders' Equity** | $6,460,091 thousand | $6,198,809 thousand | Condensed Consolidated Statements of Cash Flow Highlights (Unaudited) | Metric | Three Months Ended March 31, 2025 | Three Months Ended March 31, 2024 | | :--- | :--- | :--- | | **Net cash flows from operating activities** | $299,517 thousand | $240,713 thousand | | **Net cash flows used in investing activities** | ($287,880) thousand | ($86,483) thousand | | **Net cash flows used in financing activities** | ($9) thousand | ($123,642) thousand | | **Cash and cash equivalents at end of period** | $20,784 thousand | $35,200 thousand | [Note 2 – Revenue Recognition](index=11&type=section&id=Note%202%20%E2%80%93%20Revenue%20Recognition) Total revenues from contracts with customers for the three months ended March 31, 2025, were $773.4 million, a significant increase from $602.4 million in the same period of 2024. The Natural Gas segment was the largest contributor with $472.0 million, followed by the Water segment with $247.2 million Revenues from Contracts with Customers by Segment (Three Months Ended March 31) | Segment | 2025 Revenue (in thousands) | 2024 Revenue (in thousands) | | :--- | :--- | :--- | | Water | $247,227 | $227,698 | | Wastewater | $51,303 | $48,743 | | Natural Gas | $471,985 | $323,180 | | Other | $2,891 | $2,810 | | **Total** | **$773,406** | **$602,431** | [Note 3 – Water and Wastewater Utility Acquisitions](index=11&type=section&id=Note%203%20%E2%80%93%20Water%20and%20Wastewater%20Utility%20Acquisitions) In Q1 2025, the company completed two acquisitions: the Village of Midvale's water system in Ohio for $2.95 million and Greenville Sanitary Authority's wastewater assets in Pennsylvania for $18 million. Several other acquisitions are pending, including the significant DELCORA wastewater system for $276.5 million. The East Whiteland acquisition remains under appeal at the Pennsylvania Supreme Court - Completed the acquisition of Greenville Sanitary Authority's wastewater assets for **$18 million**, serving 2,300 customers, and the Village of Midvale's water system for **$2.95 million**, serving 1,000 customers[25](index=25&type=chunk) - The acquisition of the Delaware County Regional Water Quality Control Authority (DELCORA) for **$276.5 million** is pending, subject to regulatory approval and ongoing litigation[32](index=32&type=chunk) - The acquisition of East Whiteland Township's wastewater assets is currently under appeal at the Pennsylvania Supreme Court, with arguments scheduled for May 2025[31](index=31&type=chunk) [Note 4 – Dispositions](index=13&type=section&id=Note%204%20%E2%80%93%20Dispositions) In January 2024, the company completed the sale of its interest in three non-utility local microgrid and distributed energy projects for $165 million, recognizing a gain of $91.2 million in the first quarter of 2024 - The company sold its interest in three non-utility microgrid projects for **$165 million** in January 2024[33](index=33&type=chunk) - A gain of **$91.2 million** was recognized from this sale during Q1 2024[33](index=33&type=chunk) [Note 6 – Capitalization](index=13&type=section&id=Note%206%20%E2%80%93%20Capitalization) The company raised approximately $63 million in net proceeds during Q1 2025 through its at-the-market (ATM) equity program. In March 2025, a new $1 billion commercial paper program was established to support general corporate purposes, though no notes were outstanding as of March 31, 2025. The company remained in compliance with all debt covenants - Issued **1,627,009 shares** under its at-the-market (ATM) program for net proceeds of approximately **$63 million** in Q1 2025[35](index=35&type=chunk) - Established a new **$1 billion** commercial paper program in March 2025, reinforced by the company's revolving credit facility[37](index=37&type=chunk) - The company was in compliance with all debt covenants as of March 31, 2025[39](index=39&type=chunk) [Note 11 – Rate Activity](index=20&type=section&id=Note%2011%20%E2%80%93%20Rate%20Activity) During Q1 2025, the company implemented approved base rate increases and surcharges expected to increase annual operating revenues by a total of $89.6 million. This includes a major $73 million increase for Aqua Pennsylvania. A rate case is pending in Kentucky, and a new application was filed in North Carolina in April 2025 - In February 2025, Aqua Pennsylvania received approval for a base rate increase designed to boost annual operating revenues by **$73 million**[56](index=56&type=chunk)[57](index=57&type=chunk) - In Q1 2025, other rate increases in Ohio and North Carolina, plus infrastructure surcharges in Pennsylvania, Ohio, and Kentucky, are expected to add a combined **$16.6 million** in annual revenues[58](index=58&type=chunk) - A rate case is pending in Kentucky seeking a **$10.9 million** annual increase, and a new multi-year rate case was filed in North Carolina in April 2025[64](index=64&type=chunk)[65](index=65&type=chunk) [Note 13 – Segment Information](index=22&type=section&id=Note%2013%20%E2%80%93%20Segment%20Information) For Q1 2025, the Regulated Natural Gas segment generated the highest operating revenue at $470.8 million and net income of $189.5 million. The Regulated Water segment reported revenues of $300.8 million and net income of $107.9 million. Capital expenditures were primarily split between the Regulated Water segment ($155.7 million) and the Regulated Natural Gas segment ($114.9 million) Segment Performance (Three Months Ended March 31, 2025) | Segment | Total Operating Revenues (in thousands) | Net Income (Loss) (in thousands) | Capital Expenditures (in thousands) | | :--- | :--- | :--- | :--- | | Regulated Water | $300,848 | $107,922 | $155,688 | | Regulated Natural Gas | $470,797 | $189,505 | $114,851 | | Other and Elims | $11,981 | ($13,638) | $0 | | **Consolidated** | **$783,626** | **$283,789** | **$270,539** | [Management's Discussion and Analysis of Financial Condition and Results of Operations](index=26&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management attributes the 28.0% increase in Q1 2025 consolidated operating revenues primarily to higher rates and increased volume in the Regulated Natural Gas segment due to colder weather, alongside rate increases in the Regulated Water segment. Net income grew 6.8% despite the absence of a significant asset sale gain recorded in Q1 2024. The company invested $270.5 million in capital expenditures and plans to invest approximately $7.8 billion through 2029. Liquidity remains strong, supported by operating cash flow, an at-the-market equity program, and a new $1 billion commercial paper program - The company plans to invest approximately **$7.8 billion** from 2025 through 2029 to improve its water and natural gas systems[100](index=100&type=chunk) - Operating cash flow increased by **$58.8 million** to **$299.5 million** in Q1 2025, driven by higher revenues from regulatory recoveries and increased gas volumes[102](index=102&type=chunk) - In January 2024, the company sold its interest in three non-utility microgrid projects for **$165 million**, resulting in a pre-tax gain of **$91.2 million**, which impacts year-over-year comparisons[92](index=92&type=chunk) [Regulatory Developments](index=28&type=section&id=Regulatory%20Developments) In the first three months of 2025, the company secured regulatory approvals for base rate increases that are expected to add $78.8 million in annualized revenue. The most significant of these was a combined $73 million increase for water and wastewater services in Pennsylvania Annualized Revenue Increases from Base Rate Cases in 2025 | State | Segment | Annualized Revenue Increase (in thousands) | | :--- | :--- | :--- | | Pennsylvania | Water & Wastewater | $73,000 | | North Carolina | Water & Wastewater | $4,130 | | Ohio | Water | $1,690 | | **Total** | | **$78,820** | [Growth Through Acquisitions and Capital Investment](index=29&type=section&id=Growth%20Through%20Acquisitions%20and%20Capital%20Investment) The company is actively pursuing growth through acquisitions, with six signed purchase agreements for water and wastewater systems pending, totaling approximately $340 million in purchase price. This includes the major DELCORA acquisition. In Q1 2025, the company invested $270.5 million in capital expenditures to improve its regulated infrastructure - Six signed purchase agreements for water and wastewater systems are pending, expected to add approximately **211,000** equivalent retail customers for a total purchase price of about **$340 million**[99](index=99&type=chunk) - Invested **$270.5 million** in Q1 2025 to improve regulated water and natural gas infrastructure[100](index=100&type=chunk) [Liquidity and Capital Resources](index=29&type=section&id=Liquidity%20and%20Capital%20Resources) The company maintains a strong liquidity position, with $299.5 million in operating cash flow for Q1 2025. Financing activities included raising $63 million from its ATM program and establishing a new $1 billion commercial paper program. As of March 31, 2025, the company had $417.4 million available under its revolving credit facility and $310.7 million under short-term lines of credit. Credit ratings remain at investment grade levels, though S&P lowered its rating to A- in March 2024 - Net cash from operations was **$299.5 million** for Q1 2025, up from **$240.7 million** in Q1 2024[102](index=102&type=chunk) - Issued **1.6 million shares** via its ATM program for **$63 million** in net proceeds in Q1 2025[104](index=104&type=chunk) - S&P lowered the company's credit rating from **A** to **A-** in March 2024, citing inflationary pressures and significant capital spending, but maintained a stable outlook[109](index=109&type=chunk) [Results of Operations](index=31&type=section&id=Results%20of%20Operations) Consolidated operating revenues for Q1 2025 increased by 28.0% to $783.6 million, while net income rose 6.8% to $283.8 million. The revenue growth was driven by rate increases and higher volumes in the natural gas segment due to colder weather. The increase in net income was achieved despite the absence of a $91.6 million gain on asset sale that benefited the prior-year period. The Regulated Water segment saw net income increase by 68.9% due to rate increases and a significant income tax benefit, while the Regulated Natural Gas segment's net income decreased by 9.7% due to the aforementioned asset sale gain in 2024 Consolidated Results of Operations (Three Months Ended March 31) | Metric (in thousands) | 2025 | 2024 | % Change | | :--- | :--- | :--- | :--- | | **Operating revenues** | $783,626 | $612,069 | 28.0% | | **Operations and maintenance** | $137,824 | $136,900 | 0.7% | | **Purchased gas** | $184,641 | $129,675 | 42.4% | | **Net income** | $283,789 | $265,772 | 6.8% | - The increase in purchased gas cost by **$55.0 million** was due to a combination of higher average gas costs (**$27.0 million**) and higher usage (**$28.3 million**) from colder weather[114](index=114&type=chunk) - The effective income tax rate was a benefit of **7.8%** in Q1 2025, compared to a **4.2%** benefit in Q1 2024, primarily due to the release of a **$22.6 million** income tax reserve regulatory liability in the Regulated Water segment[120](index=120&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=37&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company is exposed to market risks, including changes in interest rates and equity prices. There were no material changes to the market risk disclosures from the company's 2024 Annual Report on Form 10-K - The company is subject to market risks from changes in interest rates and equity prices. No significant changes were reported for the quarter[139](index=139&type=chunk) [Controls and Procedures](index=37&type=section&id=Item%204.%20Controls%20and%20Procedures) Management, including the CEO and CFO, evaluated the company's disclosure controls and procedures and concluded they were effective as of March 31, 2025. No material changes to internal control over financial reporting occurred during the quarter - The CEO and CFO concluded that disclosure controls and procedures were effective as of the end of the reporting period[139](index=139&type=chunk) - No material changes in internal control over financial reporting were identified during the quarter ended March 31, 2025[140](index=140&type=chunk) [Part II – Other Information](index=37&type=section&id=Part%20II%20%E2%80%93%20Other%20Information) [Legal Proceedings](index=37&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in various legal matters. Key proceedings include an ongoing class action lawsuit related to a 2019 'do not consume' advisory in Illinois, for which an accrual has been made. The company is also a party in multi-district litigation against PFAS manufacturers, with several defendants having agreed to settle - The company is defending a class action lawsuit in Illinois related to a 2019 'do not consume' advisory. An accrual for probable and estimable loss has been recorded[75](index=75&type=chunk) - The company is part of a multi-district litigation (MDL) against PFAS manufacturers and has submitted claims under approved settlement agreements with DuPont and 3M, though the recovery amount is uncertain[77](index=77&type=chunk) [Risk Factors](index=38&type=section&id=Item%201A.%20Risk%20Factors) There were no material changes to the risk factors disclosed in the company's Annual Report on Form 10-K for the year ended December 31, 2024 - Investors are directed to review the risk factors in the 2024 Annual Report on Form 10-K[141](index=141&type=chunk) [Other Information](index=38&type=section&id=Item%205.%20Other%20Information) During the quarter, Christopher Luning, Executive Vice President & General Counsel, adopted a Rule 10b5-1(c) trading plan on March 14, 2025, for the potential sale of up to 24,224 shares - Christopher Luning, EVP & General Counsel, adopted a Rule 10b5-1 trading plan on March 14, 2025, to sell up to **24,224 shares** between June 13, 2025, and December 15, 2025[143](index=143&type=chunk) [Exhibits](index=39&type=section&id=Item%206.%20Exhibits) This section lists the exhibits filed with the Form 10-Q, including CEO and CFO certifications and Inline XBRL data files - Filed exhibits include CEO and CFO certifications under Rule 13a-14(a) and Section 1350, as well as Inline XBRL documents[144](index=144&type=chunk)

Core Insights - Essential Utilities Inc. (WTRG) reported first-quarter 2025 operating earnings per share (EPS) of $1.03, exceeding the Zacks Consensus Estimate of 80 cents by 28.8% and showing a year-over-year improvement of 41.1% [1] - Total operating revenues reached $784 million, surpassing the Zacks Consensus Estimate of $691 million by 13.3% and reflecting a year-over-year increase of 28.1% [2] - The regulated Water segment generated revenues of $300.8 million, a 7.5% increase from $279.9 million in the first quarter of 2024, driven by higher rates and surcharges [2] - The regulated Natural Gas segment reported revenues of $470.8 million, up from $324.3 million in the first quarter of 2024, primarily due to higher purchased gas costs and increased delivery volumes from colder weather [3] Financial Performance - Operating income totaled $338.9 million, marking a 46.9% year-over-year increase, while operation and maintenance expenses rose slightly by 0.7% to $137.8 million [4] - Interest expenses increased by 12% to $82.1 million from $73.3 million in the prior-year quarter [4] - Current assets were $494.5 million as of March 31, 2025, compared to $485.9 million as of December 31, 2024, while long-term debt rose to $7.52 billion from $7.36 billion [5] Future Outlook - The company reaffirmed its 2025 EPS guidance in the range of $2.07-$2.11, with the Zacks Consensus Estimate at $2.10, exceeding the midpoint of the projected range [6] - Management anticipates a 2-3% expansion in the customer base for the water segment through acquisitions and organic growth [6] - Essential Utilities plans to invest $1.4-$1.5 billion in infrastructure in 2025 and a total of $7.8 billion from 2025 to 2029 to enhance water and natural gas systems and improve customer service [7]

Financial Data and Key Metrics Changes - The company reported GAAP earnings per share of $1.3, a 6% increase compared to the same quarter last year [5] - Revenues increased by 28% from $612.1 million to $783.6 million year-over-year [22][23] - The company reaffirmed its 2025 earnings per share guidance range of $2.07 to $2.11, compared to last year's $1.97 on a non-GAAP basis [6] Business Line Data and Key Metrics Changes - Both the Water and Gas businesses performed well, contributing to the overall strong results [5] - The Gas segment reported an increase in volumes due to normal weather conditions compared to significantly warmer weather in the previous year [23] Market Data and Key Metrics Changes - The company has begun to raise equity through its ATM program, issuing approximately $210 million so far this year [6] - The company expects to receive approximately $100 million in proceeds from settlements with polluters [9] Company Strategy and Development Direction - The company plans to invest between $1.4 billion and $1.5 billion in infrastructure improvements in 2025 [6] - The company is focusing on water and wastewater utility acquisitions, having acquired over $518 million in rate base since 2015 [31] - The company is actively working on PFAS compliance and expects to meet the $450 million capital spend rate to achieve compliance by 2028 [9][56] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in meeting the full-year earnings per share guidance, citing strong first-quarter performance but cautioning about potential headwinds in the remaining quarters [52] - The company is optimistic about the legislative developments in Texas and Ohio that could positively impact rate cases [10][11] Other Important Information - The company has been recognized for its environmental stewardship, being named to USA TODAY's list of climate leaders for three consecutive years [9] - The company is exploring opportunities related to data center development and on-site power generation, representing up to five gigawatts of needed power generation in the Pittsburgh region [20] Q&A Session Summary Question: Equity issuance and market conditions - Management indicated that they are focused on raising the remaining $315 million in equity for 2025 and will consider market conditions for further issuance [40][41] Question: Texas rate case expectations - Management stated that they plan to file the Texas rate case by the end of the month and expect it to be consistent with other states [42][44] Question: EPS guidance and performance - Management acknowledged strong first-quarter performance but emphasized the need to wait for clarity as the year progresses before adjusting guidance [50][52] Question: PFAS operational strategy - Management confirmed that they are proceeding with their PFAS mitigation strategy and remain on track with their budget [55][56] Question: Data center opportunities - Management discussed various approaches to support data center development, including behind-the-meter generation and increased distribution volume [64][66] Question: Beaver Falls case timeline - Management expects the Beaver Falls case to be on the agenda in June and remains hopeful for a favorable outcome [90]

Financial Data and Key Metrics Changes - The company reported GAAP earnings per share of $1.3, a 6% increase compared to the same quarter last year [6] - Revenues increased by 28% from $612.1 million to $783.6 million year-over-year [24] - The company reaffirmed its 2025 earnings per share guidance range of $2.07 to $2.11, compared to last year's non-GAAP earnings of $1.97 per share [7] Business Line Data and Key Metrics Changes - Both the Water and Gas businesses performed well, contributing to the overall strong results [6] - The Gas segment reported an increase in volumes due to normal weather conditions compared to significantly warmer weather in the previous year [24] Market Data and Key Metrics Changes - The company has begun to raise equity through its ATM program, issuing approximately $210 million so far this year [8] - The company is in discussions with data center developers representing up to five gigawatts of needed power generation in the Pittsburgh region [21] Company Strategy and Development Direction - The company plans to invest between $1.4 billion and $1.5 billion in infrastructure improvements in 2025, with $270.5 million already invested by March 31 [7] - The company is focusing on water and wastewater utility acquisitions, having acquired over $518 million in rate base since 2015 [32] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in meeting the full-year earnings per share guidance, citing strong first-quarter performance but cautioning about potential headwinds in the remaining quarters [52] - The company is committed to addressing PFAS compliance and expects to spend approximately $450 million to achieve compliance by 2028 [10][56] Other Important Information - The company has been recognized for its operational achievements, including a 99.8% water quality compliance rate [9] - New rates went into effect for Aqua Pennsylvania, expected to increase total annual revenues by $73 million [31] Q&A Session Summary Question: Regarding equity issuance and share price - Management indicated that the focus is on raising the $315 million in equity needed for 2025 rather than considering 2026 equity needs at this time [43] Question: Texas rate case expectations - Management stated that they plan to file the Texas rate case by the end of the month and will provide details on revenue requests and equity layers at that time [45] Question: EPS guidance and performance - Management acknowledged strong first-quarter performance but emphasized the need to wait for clarity as the year progresses before adjusting guidance [52] Question: Impact of EPA announcement on PFAS - Management confirmed that they are proceeding with their PFAS mitigation plans and remain on track with their budget [56] Question: Data centers and gas supply - Management discussed various approaches to support data center development, including behind-the-meter generation and increased distribution volume [65] Question: Beaver Falls settlement status - Management expressed optimism about the Beaver Falls case being on the agenda in June and highlighted the importance of resolving such cases for water supply [90]