Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON DC 20549 FORM 10-Q (Mark One) S QUARTERLY REPORT PURSUANT TO SECTION 13 or 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the quarterly period ended March 31, 2021 £ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the transition period from_______________ to _______________ Commission File Number 1-6659 ESSENTIAL UTILITIES, INC. (Exact name of registrant as specified in its charter ...

| --- | --- | --- | --- | --- | --- | --- | |-------------|---------------------------------------------|-------|-------|-------|-------|-------| | | | | | | | | | May 6, 2021 | Essential. EARNINGS CALL First Quarter 2021 | | | | | | | | | | | | | | WTRG NYSE LISTED Welcome | --- | --- | --- | --- | --- | |-------|--------------------------------------------------------------------------------------------|-------|-------|----------| | | | | | | | | | | | | | | Brian Dingerdissen Vice President, Chief of Sta ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K (Mark One) þ ANNUAL REPORT PURSUANT TO SECTION 13 or 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2020 Or ¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to __________ Commission File number 1-6659 ESSENTIAL UTILITIES, INC. (Exact name of registrant as specified in its charter) Pennsylvania 23-1702594 (St ...

Part I – Financial Information [Financial Statements](index=2&type=section&id=Item%201.%20Financial%20Statements%3A) Presents unaudited consolidated financial statements, highlighting the impact of the Peoples Gas Acquisition [Consolidated Balance Sheets](index=3&type=section&id=Consolidated%20Balance%20Sheets) Total assets increased to $13.4 billion, primarily due to the Peoples Gas Acquisition, raising long-term debt to $5.15 billion Consolidated Balance Sheet Highlights (in thousands) | Account | September 30, 2020 | December 31, 2019 | | :--- | :--- | :--- | | **Total Assets** | **$13,399,488** | **$9,361,985** | | Net property, plant and equipment | $9,260,460 | $6,345,790 | | Goodwill | $2,333,627 | $63,822 | | Cash and cash equivalents | $8,494 | $1,868,922 | | **Total Liabilities and Equity** | **$13,399,488** | **$9,361,985** | | Long-term debt, net | $5,152,973 | $2,943,327 | | Total stockholders' equity | $4,635,753 | $3,880,860 | [Consolidated Statements of Operations and Comprehensive Income](index=5&type=section&id=Consolidated%20Statements%20of%20Operations%20and%20Comprehensive%20Income) Operating revenues rose significantly due to the Peoples Gas Acquisition, impacting Q3 and nine-month net income trends Q3 Performance (in thousands, except per share) | Metric | Q3 2020 | Q3 2019 | | :--- | :--- | :--- | | Operating Revenues | $348,647 | $243,626 | | Operating Income | $105,233 | $106,470 | | Net Income | $55,732 | $88,489 | | Diluted EPS | $0.22 | $0.38 | Nine-Month Performance (in thousands, except per share) | Metric | YTD 2020 | YTD 2019 | | :--- | :--- | :--- | | Operating Revenues | $988,700 | $663,650 | | Operating Income | $301,849 | $254,858 | | Net Income | $182,142 | $160,316 | | Diluted EPS | $0.71 | $0.76 | [Consolidated Statements of Cash Flow](index=10&type=section&id=Consolidated%20Statements%20of%20Cash%20Flow) Net cash from operations increased, while investing activities used $4.02 billion for the Peoples Gas Acquisition Cash Flow Summary - Nine Months Ended Sep 30 (in thousands) | Cash Flow Activity | 2020 | 2019 | | :--- | :--- | :--- | | Net cash from operating activities | $420,655 | $228,029 | | Net cash used in investing activities | ($4,019,645) | ($397,520) | | Net cash from financing activities | $1,738,562 | $2,196,432 | | Net change in cash and cash equivalents | ($1,860,428) | $2,026,941 | [Notes to Consolidated Financial Statements](index=11&type=section&id=Notes%20to%20Consolidated%20Financial%20Statements) Detailed notes explain financial statements, focusing on the $3.47 billion Peoples Gas Acquisition and its impact - The Peoples Gas Acquisition was completed on **March 16, 2020**, for cash consideration of **$3.47 billion**, expanding the company's business to include natural gas distribution[25](index=25&type=chunk)[41](index=41&type=chunk) - As a result of the acquisition, the company now has two reportable segments: Regulated Water and Regulated Natural Gas[115](index=115&type=chunk) - The acquisition was financed through a series of transactions including common stock offerings, a private placement, tangible equity units, and debt issuances[42](index=42&type=chunk) [Management's Discussion and Analysis of Financial Condition and Results of Operations (MD&A)](index=43&type=section&id=Item%202.%20Management%27s%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial condition and results, emphasizing the transformative Peoples Gas Acquisition and COVID-19 impact [Financial Condition](index=46&type=section&id=Financial%20Condition) Financial condition altered by $3.47 billion Peoples Gas Acquisition, financed by equity and debt, with $837.6 million credit - Completed the Peoples Gas Acquisition on **March 16, 2020**, for cash consideration of **$3.47 billion**[161](index=161&type=chunk) - In April 2020, issued **$1.1 billion** of long-term debt to repay short-term debt assumed in the acquisition and borrowings under the revolving credit facility[170](index=170&type=chunk) - As of September 30, 2020, the company had **$837.6 million** available for borrowing under its **$1 billion** unsecured revolving credit facility[167](index=167&type=chunk) [Consolidated Results of Operations](index=49&type=section&id=Consolidated%20Results%20of%20Operations) Revenues significantly increased due to the Peoples Gas Acquisition, impacting both Q3 and nine-month results, alongside COVID-19 effects - Q3 2020 revenues increased by **$105.0 million** (**43.1%**), primarily due to **$92.1 million** in natural gas revenues from the Peoples Gas Acquisition[172](index=172&type=chunk) - Q3 2020 operations and maintenance expenses increased by **$54.2 million** (**66.0%**), with **$62.2 million** attributable to the Peoples Gas Acquisition[172](index=172&type=chunk) - Nine-month 2020 revenues increased by **$325.1 million** (**49.0%**), with **$280.3 million** from the Peoples Gas Acquisition[183](index=183&type=chunk) - Nine-month 2020 operations and maintenance expenses increased by **$123.6 million** (**49.9%**), with **$123.7 million** from the Peoples Gas Acquisition[184](index=184&type=chunk) [Results of Operations – Regulated Natural Gas Segment](index=54&type=section&id=Results%20of%20Operations%20%E2%80%93%20Regulated%20Natural%20Gas%20Segment) The new Regulated Natural Gas segment contributed $280.3 million in revenues and $6.1 million in earnings Regulated Natural Gas Segment Performance (in thousands) | Metric | Q3 2020 | Nine Months 2020 | | :--- | :--- | :--- | | Operating revenues (GAAP) | $88,880 | $273,798 | | Purchased gas | $14,841 | $68,807 | | **Gross margin (non-GAAP)** | **$74,039** | **$204,991** | - Since the acquisition date of March 16, 2020, the natural gas operations contributed operating revenues of **$280.3 million** and earnings of **$6.1 million** to consolidated results[202](index=202&type=chunk) [Quantitative and Qualitative Disclosures About Market Risk](index=56&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) The company faces market risks from interest rates and equity prices, potentially impacting pension plan assets - The company is subject to market risks from changes in interest rates and equity prices[206](index=206&type=chunk) - Volatile equity markets due to the COVID-19 pandemic could negatively affect pension and post-retirement plan asset values, potentially increasing future funding requirements[206](index=206&type=chunk) [Controls and Procedures](index=56&type=section&id=Item%204.%20Controls%20and%20Procedures) Disclosure controls were effective, but the Peoples Gas Acquisition caused a material change in internal controls - The CEO and CFO concluded that disclosure controls and procedures were effective as of the end of the reporting period[207](index=207&type=chunk) - The Peoples Gas Acquisition is considered a material event that has affected internal control over financial reporting, and the integration of its controls is ongoing[208](index=208&type=chunk) Part II – Other Information [Legal Proceedings](index=56&type=section&id=Item%201.%20Legal%20Proceedings) The company is involved in ordinary course legal proceedings, none expected to materially affect financial position - The company states that there are no pending legal proceedings expected to have a material adverse effect on its financial position, operations, or cash flows[210](index=210&type=chunk) [Risk Factors](index=57&type=section&id=Item%201A.%20Risk%20Factors) Key risks include stock price volatility from equity issuances and the natural gas business's sensitivity to weather - The sale or issuance of substantial amounts of common stock, including from stock purchase contracts and forward sale agreements, could adversely affect the market price[212](index=212&type=chunk) - The natural gas business is seasonal and temperature-sensitive, with warmer-than-normal weather potentially harming demand and financial results[213](index=213&type=chunk) [Unregistered Sales of Equity Securities and Use of Proceeds](index=58&type=section&id=Item%202.%20Unregistered%20Sales%20of%20Equity%20Securities%20and%20Use%20of%20Proceeds) The company acquired 44 common shares from employees in Q3 2020 to satisfy tax obligations from stock compensation Issuer Purchases of Equity Securities (Q3 2020) | Period | Total Number of Shares Purchased | Average Price Paid per Share | | :--- | :--- | :--- | | July 1-31, 2020 | 11 | $42.86 | | August 1-31, 2020 | 32 | $45.31 | | September 1-30, 2020 | 1 | $45.31 | | **Total** | **44** | **$44.69** | - The shares were acquired from employees to pay withholding taxes upon the vesting of stock-based compensation[216](index=216&type=chunk) [Exhibits](index=59&type=section&id=Item%206.%20Exhibits) This section lists filed exhibits, including CEO and CFO certifications and Inline XBRL data files - Lists filed exhibits, including CEO and CFO certifications (Rule 13a-14(a) and Section 1350) and Inline XBRL documents[218](index=218&type=chunk)

Financial Data and Key Metrics Changes - The second quarter ended with revenues of $384.5 million, up 75.6% year-over-year, with the Peoples acquisition contributing $149.6 million to this growth [31] - Net income increased by 35.9% year-over-year from $54.9 million to $74.6 million, and GAAP EPS rose 16% to $0.29 [31][20] - Operations and maintenance (O&M) expenses increased to $128.6 million, up 48.8% from $86.4 million last year, primarily due to the addition of Peoples operations [31][37] Business Line Data and Key Metrics Changes - The regulated water segment saw significant revenue growth, with new revenue related to Peoples being the main driver, adding almost $150 million [33] - The regulated natural gas segment also contributed to revenue growth, with $129 million invested in infrastructure [17] - The municipal acquisition strategy remains strong, with signed agreements totaling over $300 million in expected rate base and over 200,000 new customers [21] Market Data and Key Metrics Changes - Residential water usage increased nearly 10%, offsetting declines in commercial and industrial segments due to COVID-19 [34] - The company secured a $500 million term loan as a precautionary liquidity measure during the pandemic, which was repaid in June [36] Company Strategy and Development Direction - The company is focused on a municipal acquisition program as a primary growth engine, with significant opportunities in water and wastewater transactions [50] - The company aims to maintain a balanced rate base mix of approximately 70% water and 30% gas, with a focus on strategic acquisitions [52] - The company is committed to ESG initiatives and has appointed a manager to enhance its ESG program [67] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving full-year earnings per share guidance of $1.53 to $1.58, despite ongoing pandemic challenges [69] - The company is closely monitoring COVID-19 impacts on operations, including consumption, billing, and collections [32] - Management emphasized the importance of affordability for customers and the need for a balanced approach to regulatory moratoriums on service disconnections [90][91] Other Important Information - The board approved a 7% dividend increase, marking the 29th consecutive year of dividend increases [23][24] - The company has a robust capital investment plan, anticipating approximately $2.8 billion in investments across the Essential platform through 2022 [70] Q&A Session Summary Question: Can you provide more color around the acquisition platform in Texas? - Management expressed optimism about opportunities in Texas, highlighting the recent fair market value deal and ongoing discussions for additional acquisitions [74][75] Question: Any regulatory update on service disconnection moratoriums in Pennsylvania? - Management noted that the Pennsylvania PUC has provided relief for COVID-related debt expenses and anticipates action on disconnection moratoriums by September [84][85] Question: How is the company managing the balance between operational costs and customer affordability during COVID-19? - Management emphasized a surgical approach to handling collections and providing assistance to customers, while advocating for a balanced regulatory approach [90][91] Question: What factors are enabling the company to outpace the industry in municipal acquisitions? - Management attributed success to a strong reputation in the community, proactive engagement with municipalities, and a focus on providing solutions during financial constraints [93]

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON DC 20549 FORM 10-Q (Mark One) S QUARTERLY REPORT PURSUANT TO SECTION 13 or 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the quarterly period ended June 30, 2020 £ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the transition period from_______________ to _______________ Table of Contents Commission File Number 1-6659 ESSENTIAL UTILITIES, INC. (Exact name of registrant as specified in its charter) ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON DC 20549 FORM 10-Q (Mark One) S QUARTERLY REPORT PURSUANT TO SECTION 13 or 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the quarterly period ended March 31, 2020 £ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the transition period from_______________ to _______________ Commission File Number 1-6659 ESSENTIAL UTILITIES, INC. (Exact name of registrant as specified in its charter ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C. 20549 FORM 10-K (Mark One) þ ANNUAL REPORT PURSUANT TO SECTION 13 or 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the fiscal year ended December 31, 2019 Or ¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from __________ to __________ Commission File number 1-6659 ESSENTIAL UTILITIES, INC. (Exact name of registrant as specified in its charter) (State or other jurisdictio ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON DC 20549 FORM 10-Q (Mark One) S QUARTERLY REPORT PURSUANT TO SECTION 13 or 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the quarterly period ended September 30, 2019 £ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the transition period from_______________ to _______________ Commission File Number 1-6659 AQUA AMERICA, INC. (Exact name of registrant as specified in its charter) P ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON DC 20549 FORM 10-Q (Mark One) S QUARTERLY REPORT PURSUANT TO SECTION 13 or 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the quarterly period ended June 30, 2019 £ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934. For the transition period from_______________ to _______________ Commission File Number 1-6659 AQUA AMERICA, INC. (Exact name of registrant as specified in its charter) Pennsy ...