Group 1 - The article discusses the investment potential of Northwest Natural (NWN), highlighting its growing water utility subsidiary as a key area of opportunity [1] - The author expresses a bullish outlook on Northwest Natural, suggesting that the market may be undervaluing the company's prospects [1] - The investment group led by Ian Bezek offers various features including market analysis, trade alerts, and direct access to the author for members [1] Group 2 - Ian Bezek has a background as a hedge fund analyst and has extensive experience conducting research in Latin American markets [2] - The focus of the analysis includes high-quality compounders and growth stocks available at reasonable prices in both the US and developed markets [2]

Core Insights - The article highlights the significance of dividend stocks in long-term investing, emphasizing that they have historically outperformed non-dividend stocks and provided stability during market fluctuations [2][3][5]. Company Insights - York Water has paid a continuous dividend since 1816, making it the longest-running dividend-paying public company in the U.S., surpassing other notable companies like Stanley Black & Decker by 60 years [12]. - The company operates as a water and wastewater utility, servicing 57 municipalities in South-Central Pennsylvania, which contributes to its low trading volume and limited public awareness [11]. - York Water's business model benefits from predictable operating cash flow due to its monopoly status in its service areas, allowing for stable revenue projections [13][15]. - The company has a strong track record of securing rate increases from the Pennsylvania Public Utility Commission, with a recent request that could increase annual revenue by $24.2 million, or 32% [16]. Industry Insights - Approximately 80% of S&P 500 companies pay dividends, but only 56 qualify as Dividend Kings, having increased their payouts for at least 50 years [7][8]. - The rarity of companies like York Water, which have paid dividends for over a century, positions them as unique investment opportunities within the broader dividend stock market [9]. - York Water's current valuation is historically low, trading at less than 20 times forward-year earnings, which is a 33% discount compared to its average over the past five years, combined with a 2.8% dividend yield [17].

Industry Overview - The Zacks Utility - Water Supply industry provides essential drinking water and wastewater services across the U.S., managing nearly 2.2 million miles of aging pipelines [3] - The industry is capital-intensive, benefiting from lower interest rates that reduce financing costs for infrastructure investments [3][5] Current Trends - The U.S. water industry is fragmented with over 50,000 community water systems, leading to inefficiencies; consolidation through mergers and acquisitions is necessary for improving service quality [4] - Aging infrastructure is a significant concern, with the American Society of Civil Engineers estimating a need for $1.25 trillion in investments over the next 20 years [6] Financial Performance - The Zacks Utility Water Supply industry has underperformed compared to the S&P 500 and the broader utility sector, gaining only 5% over the past 12 months compared to the sector's 9% and the S&P 500's 15.4% [10] - The industry is currently trading at a trailing 12-month EV/EBITDA of 10.55X, significantly lower than the S&P 500's 17.7X and the sector's 15.15X [13] Company Highlights - California Water Service Group plans to invest $2.06 billion from 2025 to 2027 to strengthen its infrastructure [19] - Global Water Resources focuses on Total Water Management, optimizing the use of recycled water, with a long-term earnings growth rate pegged at 15% [23][24] - The York Water Company plans to invest $94.5 million from 2025 to 2026 and has seen a 1.5% increase in the Zacks Consensus Estimate for 2025 earnings per share [27][28]

Core Viewpoint - York Water (YORW) reported quarterly earnings of $0.35 per share, exceeding the Zacks Consensus Estimate of $0.33 per share, with a year-over-year comparison showing no change in earnings [1][2] Financial Performance - The company achieved revenues of $19.2 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 1.05%, compared to $18.75 million in the same quarter last year [2] - Over the last four quarters, York Water has exceeded consensus EPS estimates only once [2] Stock Performance - York Water shares have declined approximately 5.5% since the beginning of the year, while the S&P 500 has gained 8.4% [3] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the market in the near future [6] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.41 on revenues of $21 million, and for the current fiscal year, it is $1.33 on revenues of $78 million [7] - The trend of estimate revisions for York Water was mixed prior to the earnings release, which may change following the recent report [6] Industry Context - The Utility - Water Supply industry, to which York Water belongs, is currently ranked in the top 37% of over 250 Zacks industries, suggesting a favorable outlook compared to lower-ranked industries [8]

[Form 10-Q Filing Information](index=1&type=section&id=Form%2010-Q%20Filing%20Information) Details the filing of The York Water Company's Form 10-Q, including registrant information and key company identifiers [Registrant Information](index=1&type=section&id=Registrant%20Information) The York Water Company filed its Form 10-Q for Q2 2025, identifying as a non-accelerated, smaller reporting company with 14.4 million shares outstanding - The York Water Company (**YORW**) filed its Form 10-Q for the quarter ended **June 30, 2025**[2](index=2&type=chunk) - The company is a **non-accelerated filer** and a **smaller reporting company**[5](index=5&type=chunk) Registrant Details | Metric | Value | | :-------------------------------- | :-------------------- | | Commission File Number | 001-34245 | | Trading Symbol | YORW | | Exchange | The Nasdaq Global Select Market | | Common Stock Outstanding (as of Aug 12, 2025) | 14,421,177 Shares | [PART I - FINANCIAL INFORMATION](index=3&type=section&id=PART%20I%20Financial%20Information) Presents the unaudited interim financial statements and management's discussion and analysis of financial condition and operations [Item 1. Financial Statements](index=3&type=section&id=Item%201.%20Financial%20Statements) Includes unaudited interim financial statements: Balance Sheets, Income, Equity, and Cash Flows, with accompanying notes for Q2 2025 [Balance Sheets (Unaudited)](index=3&type=section&id=Balance%20Sheets%20(Unaudited)) Total assets and stockholders' equity increased from December 2024 to June 2025, driven by net utility plant and long-term debt Balance Sheet Summary (in thousands) | Metric (in thousands) | Jun. 30, 2025 | Dec. 31, 2024 | Change | | :-------------------- | :------------ | :------------ | :----- | | Total Assets | $653,731 | $633,473 | +$20,258 | | Net utility plant | $548,715 | $531,007 | +$17,708 | | Total common stockholders' equity | $234,551 | $231,192 | +$3,359 | | Long-term debt | $218,056 | $205,561 | +$12,495 | | Total Stockholders' Equity and Liabilities | $653,731 | $633,473 | +$20,258 | [Statements of Income (Unaudited)](index=5&type=section&id=Statements%20of%20Income%20(Unaudited)) Net income slightly increased for Q2 2025 but decreased for H1 2025, influenced by revenues, interest, and tax expense Income Statement Summary (in thousands) | Metric (in thousands) | Three Months Ended Jun 30, 2025 | Three Months Ended Jun 30, 2024 | YoY Change | Six Months Ended Jun 30, 2025 | Six Months Ended Jun 30, 2024 | YoY Change | | :-------------------- | :------------------------------ | :------------------------------ | :--------- | :---------------------------- | :---------------------------- | :--------- | | Operating Revenues | $19,199 | $18,750 | +2.4% | $37,655 | $36,378 | +3.5% | | Operating Expenses | $12,113 | $11,688 | +3.6% | $24,286 | $23,101 | +5.1% | | Operating Income | $7,086 | $7,062 | +0.3% | $13,369 | $13,277 | +0.7% | | Interest on debt | $(2,521) | $(2,183) | +15.5% | $(4,940) | $(4,306) | +14.7% | | Income before income taxes | $4,685 | $5,514 | -15.1% | $8,795 | $10,443 | -15.8% | | Income tax expense (benefit) | $(367) | $521 | -170.4% | $105 | $1,123 | -90.7% | | Net Income | $5,052 | $4,993 | +1.2% | $8,690 | $9,320 | -6.8% | | Basic Earnings Per Share | $0.35 | $0.35 | 0.0% | $0.60 | $0.65 | -7.7% | [Statements of Common Stockholders' Equity (Unaudited)](index=6&type=section&id=Statements%20of%20Common%20Stockholders'%20Equity%20(Unaudited)) Common stockholders' equity grew from December 2024 to June 2025, driven by net income and stock issuance, offset by dividends Common Stockholders' Equity (in thousands) | Metric (in thousands) | Balance, Dec 31, 2024 | Net Income | Cash Dividends Declared | Issuance of Common Stock | Stock-based Compensation | Balance, Jun 30, 2025 | | :-------------------- | :-------------------- | :--------- | :---------------------- | :----------------------- | :----------------------- | :-------------------- | | Common Stock Amount | $138,089 | – | – | $812 | $170 | $139,071 | | Retained Earnings | $93,103 | $8,690 | $(6,313) | – | – | $95,480 | | Total | $231,192 | $8,690 | $(6,313) | $812 | $170 | $234,551 | [Statements of Cash Flows (Unaudited)](index=7&type=section&id=Statements%20of%20Cash%20Flows%20(Unaudited)) Operating cash flow increased for H1 2025, investing cash use rose, and financing cash provided more, mainly from debt issues Cash Flow Summary (in thousands) | Cash Flow Activity (in thousands) | Six Months Ended Jun 30, 2025 | Six Months Ended Jun 30, 2024 | YoY Change | | :-------------------------------- | :---------------------------- | :---------------------------- | :--------- | | Net cash provided by operating activities | $13,603 | $12,841 | +$762 | | Net cash used in investing activities | $(22,182) | $(20,919) | -$(1,263) | | Net cash provided by financing activities | $8,579 | $8,078 | +$501 | | Net change in cash and cash equivalents | $0 | $0 | $0 | - Utility plant additions, including debt portion of allowance for funds used during construction, were **$22,182 thousand** in 2025, up from **$20,867 thousand** in 2024[23](index=23&type=chunk) - Proceeds from long-term debt issues were **$26,423 thousand** in 2025, compared to **$56,565 thousand** in 2024[23](index=23&type=chunk) [Notes to Interim Financial Statements](index=8&type=section&id=Notes%20to%20Interim%20Financial%20Statements) Provides detailed context for interim financial statements, covering accounting policies, debt, derivatives, revenue, rates, pensions, and taxes [1. Basis of Presentation](index=8&type=section&id=1.%20Basis%20of%20Presentation) Interim financial statements are unaudited, include normal accruals, and should be read with the 2024 10-K; interim results are not indicative of the full year - Interim financial statements are **unaudited** and reflect normal recurring accruals[25](index=25&type=chunk) - Results for the interim period are **not indicative** of full-year performance[26](index=26&type=chunk) [2. Accounts Receivable and Unbilled Revenue](index=8&type=section&id=2.%20Accounts%20Receivable%20and%20Unbilled%20Revenue) Net accounts receivable increased to **$7,484 thousand** by June 2025, primarily due to normal timing differences in customer payments Accounts Receivable and Unbilled Revenue (in thousands) | Metric (in thousands) | Jun. 30, 2025 | Dec. 31, 2024 | Change | | :-------------------- | :------------ | :------------ | :----- | | Accounts receivable – customers | $8,725 | $8,392 | +$333 | | Other receivables | $369 | $467 | -$(98) | | Less: allowance for doubtful accounts | $(1,610) | $(1,610) | $0 | | Accounts receivable, net | $7,484 | $7,249 | +$235 | | Unbilled revenue | $3,493 | $3,604 | -$(111) | - Changes in accounts receivable and unbilled revenue are primarily due to **normal timing differences** between service provision and customer payments[27](index=27&type=chunk) [3. Common Stock and Earnings Per Share](index=8&type=section&id=3.%20Common%20Stock%20and%20Earnings%20Per%20Share) EPS calculations use weighted average shares; no shares were repurchased, with **618,004 shares** remaining authorized for repurchase Weighted Average Common Shares | Metric | Three Months Ended Jun 30, 2025 | Three Months Ended Jun 30, 2024 | Six Months Ended Jun 30, 2025 | Six Months Ended Jun 30, 2024 | | :------------------------------ | :------------------------------ | :------------------------------ | :---------------------------- | :---------------------------- | | Weighted average common shares, basic | 14,396,648 | 14,340,575 | 14,388,712 | 14,332,727 | | Weighted average common shares, diluted | 14,396,648 | 14,340,832 | 14,388,712 | 14,332,941 | - **No shares** were repurchased during the three or six months ended June 30, 2025 and 2024[30](index=30&type=chunk) - As of June 30, 2025, **618,004 shares** remain authorized for repurchase under the program[30](index=30&type=chunk) [4. Debt](index=9&type=section&id=4.%20Debt) Long-term debt increased to **$218,056 thousand** by June 2025, mainly from line of credit borrowings, with no new long-term debt arrangements Debt Summary (in thousands) | Metric (in thousands) | Jun. 30, 2025 | Dec. 31, 2024 | Change | | :-------------------- | :------------ | :------------ | :----- | | Committed Line of Credit, due September 2026 | $28,539 | $15,808 | +$12,731 | | Total long-term debt | $220,909 | $208,178 | +$12,731 | | Long-term portion | $218,056 | $205,561 | +$12,495 | - The Company **did not enter** into any new long-term debt arrangements or modify its outstanding long-term debt for the six months ended June 30, 2025[31](index=31&type=chunk) [5. Interest Rate Swap Agreement](index=10&type=section&id=5.%20Interest%20Rate%20Swap%20Agreement) An interest rate swap converts **$12,000 thousand** variable-rate debt to a **3.16%** fixed rate, recorded as a **$535 thousand** regulatory liability expiring in 2029 - The Company uses an interest rate swap to convert **$12,000 thousand** variable-rate debt to a fixed rate of **3.16%**[33](index=33&type=chunk) - The swap is recorded at fair value as a **regulatory liability**, deferring unrealized gains and losses[34](index=34&type=chunk)[35](index=35&type=chunk) - The swap was in a liability position of approximately **$535 thousand** as of June 30, 2025, and expires **October 1, 2029**[36](index=36&type=chunk)[37](index=37&type=chunk) [6. Fair Value of Financial Instruments](index=10&type=section&id=6.%20Fair%20Value%20of%20Financial%20Instruments) Interest rate swap liability was **$525 thousand** at fair value (Level 2 inputs); long-term debt's estimated fair value was **$197,000 thousand** versus **$220,909 thousand** carrying value Fair Value of Financial Instruments (in thousands) | Description | Jun. 30, 2025 (Fair Value) | Dec. 31, 2024 (Fair Value) | | :---------- | :------------------------- | :------------------------- | | Interest Rate Swap | $525 | $386 | | Long-term Debt (Carrying Value) | $220,909 | $208,178 | | Long-term Debt (Estimated Fair Value) | ~$197,000 | ~$189,000 | - Fair values are measured using **Level 2 inputs**, such as discounted cash flow techniques incorporating market interest yield curves[41](index=41&type=chunk)[42](index=42&type=chunk) [7. Commitments](index=11&type=section&id=7.%20Commitments) PPUC approved replacing **400 lead service lines** annually; **$2,018 thousand** incurred by June 2025, recorded as a regulatory asset for recovery - PPUC approved tariff modification to replace up to **400 lead customer-owned service lines** annually over nine years[44](index=44&type=chunk) - Costs are recorded as a **regulatory asset** to be recovered in future base rates over a four-year period[44](index=44&type=chunk) Lead Service Line Replacement Costs (in thousands) | Metric (in thousands) | Jun. 30, 2025 | Dec. 31, 2024 | | :-------------------- | :------------ | :------------ | | Cost for lead service line replacements | $2,018 | $1,961 | | Estimated total cost | $2,100 | N/A | [8. Revenue](index=12&type=section&id=8.%20Revenue) Total operating revenue increased to **$19,199 thousand** for Q2 2025 and **$37,655 thousand** for H1 2025, mainly from utility services Revenue by Source (in thousands) | Revenue Source (in thousands) | Three Months Ended Jun 30, 2025 | Three Months Ended Jun 30, 2024 | Six Months Ended Jun 30, 2025 | Six Months Ended Jun 30, 2024 | | :---------------------------- | :------------------------------ | :------------------------------ | :---------------------------- | :---------------------------- | | Water utility service | $17,054 | $16,654 | $33,430 | $32,235 | | Wastewater utility service | $1,963 | $1,854 | $3,890 | $3,644 | | Billing and revenue collection services | $17 | $122 | $43 | $252 | | Collection services | $30 | $0 | $33 | $3 | | Other revenue | $19 | $6 | $29 | $16 | | Total Revenue from Contracts with Customers | $19,083 | $18,636 | $37,425 | $36,150 | | Rents from regulated property | $116 | $114 | $230 | $228 | | Total Operating Revenue | $19,199 | $18,750 | $37,655 | $36,378 | - Utility service revenue is recognized **over time** using an output method, based on fixed charges and per-unit rates[48](index=48&type=chunk) - Billing and revenue collection services, and collection services, are satisfied **at a point in time** when bills are sent or services are completed[49](index=49&type=chunk)[51](index=51&type=chunk) [9. Rate Matters](index=13&type=section&id=9.%20Rate%20Matters) A rate increase request was filed for **28.9%** water and **44.5%** wastewater rates, effective by March 2026; DSIC revenue significantly increased - Filed a rate increase request on **May 30, 2025**, seeking a **28.9%** increase in water rates and a **44.5%** increase in wastewater rates[53](index=53&type=chunk) - Any approved rate increase will be effective no later than **March 1, 2026**[53](index=53&type=chunk) DSIC Revenue (in thousands) | DSIC Revenue (in thousands) | Three Months Ended Jun 30, 2025 | Three Months Ended Jun 30, 2024 | Six Months Ended Jun 30, 2025 | Six Months Ended Jun 30, 2024 | | :-------------------------- | :------------------------------ | :------------------------------ | :---------------------------- | :---------------------------- | | DSIC provided revenues | $531 | $34 | $917 | $34 | [10. Pensions](index=14&type=section&id=10.%20Pensions) Net periodic pension cost was **zero** for H1 2025, with no employer contributions made or expected for the remainder of 2025 Net Periodic Pension Cost (in thousands) | Metric (in thousands) | Three Months Ended Jun 30, 2025 | Three Months Ended Jun 30, 2024 | Six Months Ended Jun 30, 2025 | Six Months Ended Jun 30, 2024 | | :-------------------- | :------------------------------ | :------------------------------ | :---------------------------- | :---------------------------- | | Net periodic pension cost | $0 | $(278) | $0 | $111 | - **No employer contributions** were made to pension plans for the six months ended June 30, 2025, and none are expected for the rest of 2025[57](index=57&type=chunk) [11. Stock-Based Compensation](index=14&type=section&id=11.%20Stock-Based%20Compensation) The 2025 LTIP added **150,000 shares**; stock-based compensation was **$170 thousand** for H1 2025, with **$349 thousand** unrecognized - The 2025 LTIP was amended to add **150,000 shares** for awards over ten years[58](index=58&type=chunk) Stock-Based Compensation (in thousands) | Metric (in thousands) | Three Months Ended Jun 30, 2025 | Three Months Ended Jun 30, 2024 | Six Months Ended Jun 30, 2025 | Six Months Ended Jun 30, 2024 | | :-------------------- | :------------------------------ | :------------------------------ | :---------------------------- | :---------------------------- | | Stock-based compensation | $98 | $97 | $170 | $140 | | Related recognized tax benefits | $26 | $27 | $46 | $39 | - Total unrecognized stock-based compensation for nonvested awards is **$349 thousand** as of June 30, 2025, to be recognized over three years[63](index=63&type=chunk) [12. Income Taxes](index=15&type=section&id=12.%20Income%20Taxes) Effective tax rate was **(7.8)%** for Q2 and **1.2%** for H1 2025, significantly lower due to IRS TPR deductions; OBBBA is not expected to materially impact Effective Tax Rate | Metric | Three Months Ended Jun 30, 2025 | Three Months Ended Jun 30, 2024 | Six Months Ended Jun 30, 2025 | Six Months Ended Jun 30, 2024 | | :----- | :------------------------------ | :------------------------------ | :---------------------------- | :---------------------------- | | Effective tax rate | (7.8)% | 9.4% | 1.2% | 10.8% | - The reduction in effective tax rate is due to deductions for asset improvements under **IRS tangible property regulations (TPR)**[64](index=64&type=chunk)[65](index=65&type=chunk) - The One Big Beautiful Bill Act (OBBBA), signed **July 4, 2025**, is **not expected to materially impact** the Company[66](index=66&type=chunk) [Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations](index=16&type=section&id=Item%202.%20Management's%20Discussion%20and%20Analysis%20of%20Financial%20Condition%20and%20Results%20of%20Operations) Management discusses financial condition, operations, liquidity, and capital resources, including forward-looking statements, acquisitions, and capital expenditures [Forward-looking Statements](index=16&type=section&id=Forward-looking%20Statements) Forward-looking statements on strategy, prospects, and growth are subject to material differences due to weather, rate relief, and economic conditions - **Forward-looking statements** cover business strategy, future prospects, profitability, growth, and regulatory matters[68](index=68&type=chunk) - Actual results may **differ materially** due to factors like rate changes, weather, natural disasters, economic conditions, and changes in government policies[69](index=69&type=chunk)[70](index=70&type=chunk) [General Information](index=17&type=section&id=General%20Information) The York Water Company provides water and wastewater services across 57 PA municipalities, regulated by PPUC, with growth driven by rates, customers, and acquisitions - Primary business is **water impoundment, purification, and distribution**, along with **wastewater collection and treatment**[71](index=71&type=chunk) - Operates in **57 municipalities** across four counties in south-central Pennsylvania, regulated by the **PPUC**[71](index=71&type=chunk) - Water business is **vulnerable to weather conditions**, especially in summer, but minimum customer charges mitigate some fixed cost risks[73](index=73&type=chunk) - **Growth strategies** include timely rate increases, increased water volumes, customer growth, and water/wastewater system acquisitions[74](index=74&type=chunk) [Results of Operations](index=18&type=section&id=Results%20of%20Operations) Q2 2025 net income increased **1.2%** YoY, while H1 2025 net income decreased **6.8%**, influenced by revenues, expenses, and interest Results of Operations Summary (in thousands) | Metric (in thousands) | Three Months Ended Jun 30, 2025 | Three Months Ended Jun 30, 2024 | YoY Change | Six Months Ended Jun 30, 2025 | Six Months Ended Jun 30, 2024 | YoY Change | | :-------------------- | :------------------------------ | :------------------------------ | :--------- | :---------------------------- | :---------------------------- | :--------- | | Net Income | $5,052 | $4,993 | +1.2% | $8,690 | $9,320 | -6.8% | | Operating Revenues | $19,199 | $18,750 | +2.4% | $37,655 | $36,378 | +3.5% | | Operating Expenses | $12,113 | $11,688 | +3.6% | $24,286 | $23,101 | +5.1% | | Interest on debt | $(2,521) | $(2,183) | +15.5% | $(4,940) | $(4,306) | +14.7% | | Income tax expense (benefit) | $(367) | $521 | -170.4% | $105 | $1,123 | -90.7% | - Operating revenue increases were primarily due to customer base growth and increased DSIC revenues (**$497 thousand** for Q2, **$883 thousand** for H1)[78](index=78&type=chunk)[84](index=84&type=chunk) - **Operating expense increases** were driven by higher depreciation and amortization, wages and benefits, water treatment, and insurance costs[79](index=79&type=chunk)[85](index=85&type=chunk) [Rate Matters](index=19&type=section&id=Rate%20Matters_MD%26A) Effective July 1, 2025, the tariff includes a **3.90%** DSIC on revenues, allowing recovery of infrastructure replacement costs - Effective **July 1, 2025**, the Company's tariff includes a DSIC on revenues of **3.90%**[90](index=90&type=chunk) [Acquisitions and Growth](index=20&type=section&id=Acquisitions%20and%20Growth) Agreements for four wastewater and water system acquisitions are expected to add **485 customers** by early 2026, supporting growth - Signed agreements to acquire wastewater and water assets from Pine Run Retirement Community (**100 wastewater customers**, H1 2026 close), Eagle View Manufactured Housing Community (**140 water customers**, H2 2025 close), CMV Sewage Co., Inc. (**280 wastewater customers**, H2 2025 close), and Margaretta Mobile Home Park (**65 wastewater customers**, H2 2025 close)[92](index=92&type=chunk)[93](index=93&type=chunk)[94](index=94&type=chunk)[95](index=95&type=chunk) - These acquisitions are expected to be **immaterial** to Company results but support growth and offset consumption declines[96](index=96&type=chunk) [Capital Expenditures](index=20&type=section&id=Capital%20Expenditures) Invested **$22,182 thousand** in Q2 2025 construction expenditures; **$23,800 thousand** anticipated for H2 2025, funded by internal funds and credit - Invested **$22,182 thousand** in construction expenditures for Q2 2025, including main extensions, software upgrades, and infrastructure improvements[97](index=97&type=chunk) - Anticipates approximately **$23,800 thousand** in construction expenditures for the remainder of 2025[98](index=98&type=chunk) - Funding sources include internally-generated funds, line of credit, stock purchase plans, and customer advances/contributions (**5-10%** of funding)[98](index=98&type=chunk) [Liquidity and Capital Resources](index=21&type=section&id=Liquidity%20and%20Capital%20Resources) Liquidity is managed via a credit line; internally-generated funds increased, and capitalization ratios for equity (**51.5%**) and debt (**48.5%**) are within target ranges - Cash management account linked to line of credit provides liquidity; **$28,539 thousand** borrowed on line of credit as of June 30, 2025[100](index=100&type=chunk)[105](index=105&type=chunk) - Internally-generated funds from operations increased to **$13,603 thousand** for the first six months of 2025, up from **$12,841 thousand** in 2024[102](index=102&type=chunk) Capitalization Ratios | Metric | Jun. 30, 2025 | Dec. 31, 2024 | | :-------------------------------- | :------------ | :------------ | | Common stockholders' equity as % of total capitalization | 51.5% | 52.6% | | Long-term debt as % of total capitalization | 48.5% | 47.4% | - The Company expects to extend the maturity of its **$50,000 thousand** committed line of credit into 2027[105](index=105&type=chunk) [Cash](index=21&type=section&id=Cash) Cash management account linked to credit line provides liquidity; **$28,539 thousand** borrowed on credit line with a **$1,035 thousand** cash overdraft as of June 2025 - Cash management account is **directly connected** to the line of credit for automatic cash management[100](index=100&type=chunk) - As of June 30, 2025, the Company had **$28,539 thousand** borrowed on its line of credit and a cash overdraft of **$1,035 thousand**[100](index=100&type=chunk) [Accounts Receivable](index=21&type=section&id=Accounts%20Receivable_MD%26A) Accounts receivable align with revenue and payment timeliness; a reserve for doubtful accounts is maintained based on historical and forecasted factors - Accounts receivable balance follows revenue changes and is affected by payment timeliness and **reserve for doubtful accounts**[101](index=101&type=chunk) - Reserve for doubtful accounts is based on **historical write-offs, current conditions, and reasonable forecasts**[101](index=101&type=chunk) [Internally-generated Funds](index=21&type=section&id=Internally-generated%20Funds) Internally-generated funds increased to **$13,603 thousand** for H1 2025, influenced by rate relief, water usage, customer growth, and expenses - **Internally-generated funds** are influenced by rate relief, regulations, water usage, customer growth, and expenses[102](index=102&type=chunk) Internally-generated Funds (in thousands) | Metric (in thousands) | Six Months Ended Jun 30, 2025 | Six Months Ended Jun 30, 2024 | YoY Change | | :-------------------- | :---------------------------- | :---------------------------- | :--------- | | Internally-generated funds from operations | $13,603 | $12,841 | +$762 | [Common Stock](index=21&type=section&id=Common%20Stock_MD%26A) Common stockholders' equity was **51.5%** of total capitalization, within the **50-55%** target range, with future financing expected from long-term debt Common Stockholders' Equity as % of Total Capitalization | Metric | Jun. 30, 2025 | Dec. 31, 2024 | | :-------------------------------- | :------------ | :------------ | | Common stockholders' equity as % of total capitalization | 51.5% | 52.6% | - The Company targets equity between **50%** and **55%** of total capitalization[103](index=103&type=chunk) - An effective 'shelf' Registration Statement on Form S-3 allows for offering up to **$60,000 thousand** of common stock or debt securities[104](index=104&type=chunk) [Credit Line](index=21&type=section&id=Credit%20Line) Maintains a **$50,000 thousand** unsecured credit line, with **$28,539 thousand** borrowed at **5.49%**; maturity expected to extend to 2027 - Maintains a **$50,000 thousand** unsecured line of credit, with **$28,539 thousand** borrowed as of June 30, 2025[105](index=105&type=chunk) - Interest rate on the line of credit borrowing was **5.49%** as of June 30, 2025[105](index=105&type=chunk) - Expects to extend the line of credit maturity into **2027** and believes adequate capacity exists through **2026**[105](index=105&type=chunk)[107](index=107&type=chunk) [Long-term Debt](index=22&type=section&id=Long-term%20Debt_MD%26A) Long-term debt as a percentage of total capitalization increased to **48.5%**, targeting a **45-50%** ratio acceptable to the PPUC Long-term Debt as % of Total Capitalization | Metric | Jun. 30, 2025 | Dec. 31, 2024 | | :-------------------------------- | :------------ | :------------ | | Total long-term debt as % of total capitalization | 48.5% | 47.4% | - The Company aims for a debt to total capitalization ratio between **45%** and **50%**[109](index=109&type=chunk) [Income Taxes, Deferred Income Taxes and Uncertain Tax Positions](index=22&type=section&id=Income%20Taxes%2C%20Deferred%20Income%20Taxes%20and%20Uncertain%20Tax%20Positions) IRS TPR deductions reduce the effective tax rate, increasing deferred tax liabilities; the rate is expected to rise in H2 2025, with no material OBBBA impact or uncertain tax positions - Ongoing deduction of asset improvements under **IRS TPR** reduces effective tax rate and increases deferred tax liabilities and regulatory assets[110](index=110&type=chunk) - Effective tax rate for the remainder of 2025 is **expected to increase** due to a lower level of eligible asset improvements expensed[111](index=111&type=chunk)[89](index=89&type=chunk) - **No uncertain tax positions** require recognition as of June 30, 2025[115](index=115&type=chunk) [Credit Rating](index=22&type=section&id=Credit%20Rating) S&P affirmed the Company's credit rating at **A-** with a **stable outlook** on **July 30, 2025**, contingent on rate relief and cash flow - Standard & Poor's affirmed credit rating at **A-** with a **stable outlook** and adequate liquidity on **July 30, 2025**[116](index=116&type=chunk) - Credit rating maintenance relies on **adequate rate relief, balanced capital expenditure funding, and strong cash flow**[116](index=116&type=chunk) [Physical and Cyber Security](index=23&type=section&id=Physical%20and%20Cyber%20Security) The Company maintains physical and cyber security measures, with costs recoverable; IT reliance creates cyber risk despite robust controls and insurance - Maintains security measures at facilities and collaborates with authorities on threats; costs are **expected to be recoverable** in rates[118](index=118&type=chunk) - Relies on IT systems for customer service, billing, accounting, and operational monitoring, making it **vulnerable to cyber security attacks**[119](index=119&type=chunk) - Implemented processes, procedures, and controls, and maintains insurance, but **cannot guarantee** full coverage or prevention of adverse effects from cyber incidents[121](index=121&type=chunk) [Environmental Matters](index=23&type=section&id=Environmental%20Matters) PPUC approved replacing **400 lead service lines** annually; **$2,018 thousand** incurred by June 2025, recorded as a regulatory asset for recovery - PPUC approved tariff modification to replace up to **400 lead customer-owned service lines** annually over nine years[122](index=122&type=chunk) - Costs are recorded as a **regulatory asset** to be recovered in future base rates over a four-year period[122](index=122&type=chunk) Lead Service Line Replacement Costs (in thousands) | Metric (in thousands) | Jun. 30, 2025 | Dec. 31, 2024 | | :-------------------- | :------------ | :------------ | | Cost for lead service line replacements | $2,018 | $1,961 | | Estimated total cost | $2,100 | N/A | [Drought](index=23&type=section&id=Drought) Adams, York, Lancaster, and Franklin Counties returned to normal drought status in June and July 2025, with no current restrictions - Adams, York, and Lancaster Counties returned to **normal drought status** on **June 9, 2025**[123](index=123&type=chunk) - Franklin County returned to **normal drought status** on **July 2, 2025**[123](index=123&type=chunk) - Drought measures could **impact future revenues, operating expenses, and net income** depending on severity and length[123](index=123&type=chunk) [Critical Accounting Estimates](index=24&type=section&id=Critical%20Accounting%20Estimates) Critical accounting estimates include regulatory assets, revenue, pensions, and income taxes, with no significant changes during Q2 2025 - **Critical accounting estimates** include regulatory assets and liabilities, revenue recognition, pension plans, and income taxes[125](index=125&type=chunk) - **No significant changes** in accounting estimates or methods occurred during the quarter ended June 30, 2025[125](index=125&type=chunk) [Off-Balance Sheet Arrangements](index=24&type=section&id=Off-Balance%20Sheet%20Arrangements) The Company does not use off-balance sheet arrangements, securitization, or unconsolidated entities, with an interest rate swap as its only derivative - The Company **does not use** off-balance sheet transactions, securitization of receivables, or unconsolidated entities[126](index=126&type=chunk) - The **only derivative financial instrument** used is an interest rate swap agreement for risk management, as discussed in Note 5[126](index=126&type=chunk) [Item 3. Quantitative and Qualitative Disclosures About Market Risk](index=24&type=section&id=Item%203.%20Quantitative%20and%20Qualitative%20Disclosures%20About%20Market%20Risk) Item 3, Quantitative and Qualitative Disclosures About Market Risk, is stated as **not applicable** by the Company - The Company states that Item 3, Quantitative and Qualitative Disclosures About Market Risk, is **not applicable**[127](index=127&type=chunk) [Item 4. Controls and Procedures](index=24&type=section&id=Item%204.%20Controls%20and%20Procedures) Management concluded disclosure controls and procedures were **effective** as of June 30, 2025, with no material changes in internal control - Management, with CEO and CFO participation, concluded that disclosure controls and procedures were **effective** as of June 30, 2025[128](index=128&type=chunk) - **No material changes** in internal control over financial reporting occurred during the most recent fiscal quarter[129](index=129&type=chunk) [PART II - OTHER INFORMATION](index=25&type=section&id=PART%20II%20Other%20Information) Presents other information not covered in Part I, including trading arrangements, exhibits, and official signatures [Item 5. Other Information](index=25&type=section&id=Item%205.%20Other%20Information) No Rule 10b5-1 or non-Rule 10b5-1 trading arrangements were adopted or terminated by the Company or its officers/directors in Q2 2025 - **No Rule 10b5-1 or non-Rule 10b5-1 trading arrangements** were adopted or terminated by the Company, its directors, or officers during the quarter ended June 30, 2025[132](index=132&type=chunk) [Item 6. Exhibits](index=26&type=section&id=Item%206.%20Exhibits) Lists exhibits filed with the Form 10-Q, including corporate governance documents, CEO/CFO certifications, and Inline XBRL documents - Exhibits include **Amended and Restated Articles of Incorporation and By-Laws, Change in Control Agreement, CEO and CFO certifications** (pursuant to Rule 13a-14(a)/15d-14(a) and 18 U.S.C. Section 1350), and **Inline XBRL documents**[135](index=135&type=chunk) [Signatures](index=27&type=section&id=Signatures) The report was signed by Joseph T. Hand, Principal Executive Officer, and Matthew E. Poff, Principal Financial and Accounting Officer, on August 12, 2025 - The report was signed by **Joseph T. Hand**, Principal Executive Officer, and **Matthew E. Poff**, Principal Financial and Accounting Officer, on **August 12, 2025**[139](index=139&type=chunk)

[FORM 8-K Filing Information](index=1&type=section&id=FORM%208-K%20Filing%20Information) This section provides essential details regarding the Form 8-K filing, including registrant information and filing specifics [Registrant Information](index=1&type=section&id=Registrant%20Information) This section details The York Water Company as the registrant, including its incorporation jurisdiction and principal executive offices - Registrant: The York Water Company, incorporated in Pennsylvania[2](index=2&type=chunk) - Principal Executive Offices: 130 East Market Street, York, Pennsylvania 17401-1219[2](index=2&type=chunk) [Filing Details](index=1&type=section&id=Filing%20Details) This section outlines the Form 8-K filing date, relevant Securities Exchange Act sections, and registered securities information - Date of Report: August 12, 2025[2](index=2&type=chunk) Securities Registered | Title of Class | Trading Symbol | Name of Each Exchange on Which Registered | | :--------------- | :------------- | :---------------------------------------- | | COMMON STOCK, NO PAR VALUE | YORW | The Nasdaq Global Select Market | - The registrant is not an emerging growth company[3](index=3&type=chunk) [Item 2.02 Results of Operations and Financial Condition](index=2&type=section&id=Item%202.02%20Results%20of%20Operations%20and%20Financial%20Condition) This section addresses the announcement of the company's financial results for the second quarter and first six months of 2025 [Announcement of Financial Results](index=2&type=section&id=Announcement%20of%20Financial%20Results) The York Water Company announced its Q2 and first six months 2025 financial results via a press release furnished as Exhibit 99.1 - The York Water Company issued a press release on August 12, 2025, announcing its second quarter and first six months 2025 financial results[5](index=5&type=chunk) - The press release is furnished as Exhibit 99.1 with this Current Report on Form 8-K[5](index=5&type=chunk) [Item 9.01 Financial Statements and Exhibits](index=2&type=section&id=Item%209.01%20Financial%20Statements%20and%20Exhibits) This section provides a comprehensive list of financial statements and exhibits accompanying the Form 8-K filing [List of Exhibits](index=2&type=section&id=List%20of%20Exhibits) This section enumerates the exhibits included with the Form 8-K filing, specifically detailing the financial results press release Exhibits | Exhibit No. | Description of Exhibit | | :------------ | :--------------------------------- | | 99.1 | Press Release, August 12, 2025, issued by The York Water Company | [SIGNATURES](index=3&type=section&id=SIGNATURES) This section contains the official authorization and signatory details for the Form 8-K report [Authorization and Signatory](index=3&type=section&id=Authorization%20and%20Signatory) The report is officially signed by Matthew E. Poff, Chief Financial Officer of The York Water Company, on August 12, 2025 - The report was signed by Matthew E. Poff, Chief Financial Officer, on August 12, 2025[10](index=10&type=chunk)

Financial Performance - The York Water Company reported second quarter operating revenues of $19,199,000, an increase of $449,000 compared to the second quarter of 2024 [2] - Net income for the second quarter was $5,052,000, up by $59,000 year-over-year [2] - For the first six months of 2025, operating revenues reached $37,655,000, an increase of $1,277,000, while net income decreased to $8,690,000, down by $630,000 compared to the same period in 2024 [3] Earnings Per Share - Basic and diluted earnings per share for the second quarter remained unchanged at $0.35 compared to the same period last year [2] - For the first six months, basic and diluted earnings per share decreased to $0.60, down by $0.05 from the previous year [3] Revenue Drivers - Revenue growth was primarily driven by an increase in the customer base and revenues from the Distribution System Improvement Charge (DSIC) [2][3] - The DSIC is a charge allowed by the Pennsylvania Public Utility Commission for the replacement of aging infrastructure [2] Tax and Expense Factors - Income taxes decreased due to higher deductions from IRS tangible property regulations [2][3] - Increased revenues and lower income taxes were offset by higher operation and maintenance expenses, depreciation, higher interest on debt, and lower allowance for funds used during construction (AFUDC) [2][3] Capital Investments - The company invested $22.2 million in capital projects during the first six months of 2025, focusing on main extensions, software upgrades, and infrastructure improvements [4] - An additional investment of $23.8 million is estimated for 2025, excluding acquisitions, for further infrastructure enhancements [4]

Core Insights - The article highlights York Water as a unique U.S.-listed public company with a 209-year history of consecutive dividend payments, making it a standout in the dividend stock arena [5][11][12] Company Overview - York Water is a regulated water utility serving over 212,000 people in South-Central Pennsylvania, providing water and wastewater services [11][15] - The company has maintained its dividend payments since 1816, longer than any other public company, with a streak that surpasses Stanley Black & Decker by 60 years [11][12] Financial Performance - York Water's stock is currently trading at a significant discount, valued at approximately 1.9 times book value, the lowest since 2010 [19] - The company has filed for a rate increase with the Pennsylvania Public Utility Commission, which could boost annual sales by over $24 million, representing a 32% increase [17] Competitive Advantages - As a regulated utility, York Water benefits from predictable cash flow and avoids the volatility associated with wholesale markets [16] - The company has a history of making bolt-on acquisitions, leveraging its steady cash flow to expand without harming profitability [18] Market Position - York Water is positioned as a top dividend stock, with analysts projecting earnings of $1.58 per share in 2026, resulting in a forward price-to-earnings (P/E) ratio of 19.4, the lowest in over a decade [19]

Core Insights - The article discusses potential investment opportunities in YORW, indicating a possible long position within the next 72 hours [1]. Group 1 - The author expresses a personal opinion on the investment landscape without any compensation from the companies mentioned [1]. - There is an emphasis on the necessity for investors to conduct their own due diligence and research prior to making any investment decisions [2]. - The article clarifies that past performance does not guarantee future results, and no specific investment recommendations are provided [3].

Core Viewpoint - The York Water Company has filed for a general increase in rates for water and wastewater services, citing the need for significant capital investments to maintain and improve infrastructure [1][2]. Summary by Sections Rate Increase Request - The company is requesting a $24.2 million increase in annual revenues, which would result in an additional cost of $14.16 per month for water and $35.85 per month for wastewater services for the typical residential customer [3]. Capital Investments - Since the last rate increase in 2022, the company has made $145 million in capital investments aimed at replacing and upgrading aging infrastructure, including water mains, meters, and treatment facilities [2]. Infrastructure Improvement - The investments are intended to ensure compliance with current regulations, enhance the reliability of services, and expand wastewater treatment capacity to accommodate growing communities [2]. Effective Date and Process - If approved, the rate increase could take effect on August 1, 2025, although the Pennsylvania Public Utility Commission (PUC) may delay this until March 2026 [4]. Customer Base - The York Water Company serves over 212,000 people across 57 municipalities in Adams, Franklin, Lancaster, and York counties [4].