American States Water pany(US:AWR)2024-08-06 20:28Financial Performance - American States Water Company reported a consolidated net income of $15 million for the six months ended June 30, 2024, compared to $12 million for the same period in 2023, representing a 25% increase[13]. - Earnings per share (EPS) for the second quarter of 2024 was $0.50, up from $0.40 in the same quarter of 2023, reflecting a 25% growth[13]. - Net income for Q2 2024 was $31,864,000, down 17.3% from $38,521,000 in Q2 2023[23]. - Net income for the six months ended June 30, 2024, was $54,999,000, a decrease from $72,928,000 in the same period of 2023, representing a decline of approximately 24.6%[33]. - Consolidated net income for the three months ended June 30, 2024, was $31.864 million, a decrease of 17.3% compared to $38.521 million in the same period in 2023[131]. - AWR's consolidated diluted earnings for the six months ended June 30, 2024, were $1.47 per share, compared to $1.97 per share for the same period in 2023, a decrease of $0.50 per share[124]. Revenue and Consumption - Customer water consumption increased by 5% year-over-year, contributing to higher revenue generation[10]. - The company anticipates a revenue growth of 8% for the fiscal year 2024, driven by increased customer rates and demand for services[10]. - Total operating revenues for Q2 2024 were $155,328,000, a decrease of 1.36% from $157,400,000 in Q2 2023[23]. - Total water revenues for AWR in the six months ended June 30, 2024, were $200.7 million, a decrease of 12.7% from $229.6 million in the same period of 2023[64]. - Billed water consumption increased by approximately 3.2% in Q2 2024 compared to Q2 2023, attributed to lower seasonal precipitation[134]. Assets and Liabilities - The company’s total assets as of June 30, 2024, were $1.2 billion, an increase from $1.1 billion as of December 31, 2023, indicating a growth of approximately 9%[15]. - Total assets increased to $2,348,320,000 as of June 30, 2024, up from $2,246,122,000 at the end of 2023, representing a growth of 4.55%[20]. - Long-term debt increased to $640,028,000 as of June 30, 2024, up from $575,555,000 at the end of 2023, marking an increase of 11.22%[20]. - Total current liabilities surged to $299,118,000 in Q2 2024, compared to $166,623,000 in Q4 2023, indicating an increase of 79.5%[20]. - The company reported a current liabilities total of $222,747 as of June 30, 2024, significantly higher than $99,949 at the end of 2023[38]. Capital Expenditures and Investments - American States Water Company is investing $50 million in infrastructure improvements to enhance service reliability and compliance with regulatory standards[10]. - Capital expenditures for the six months ended June 30, 2024, were $109,298,000, up from $88,649,000 in 2023, marking an increase of approximately 23.3%[33]. - AWR's net cash used in investing activities was $108.9 million for the six months ended June 30, 2024, compared to $87.8 million for the same period in 2023, primarily for capital expenditures[203]. Dividends and Shareholder Equity - Dividends paid per common share increased to $0.4300 in Q2 2024 from $0.3975 in Q2 2023, reflecting an increase of 8.1%[23]. - Dividends paid increased to $31,929,000 in 2024 from $29,394,000 in 2023, reflecting an increase of about 8.7%[33]. - Total common shareholders' equity rose to $833,477,000 in Q2 2024, an increase of 7.37% from $776,109,000 in Q4 2023[20]. Regulatory and Compliance Issues - The company is facing regulatory challenges that may impact its ability to pass through increased operational costs to customers, particularly related to climate change initiatives[10]. - GSWC implemented surcharges in October 2023 to recover cumulative retroactive rate differences over 36 months following the CPUC's final decision on the general rate case[71]. - GSWC's request for a full sales and revenue decoupling mechanism is still subject to CPUC approval following a court ruling that set aside the previous order mandating its discontinuation[107]. Sustainability and Environmental Initiatives - American States Water Company is committed to sustainability, aiming to reduce greenhouse gas emissions by 30% by 2030 through various initiatives[10]. - The new power purchase agreement approved in July 2023 will allow BVES to procure renewable energy from November 1, 2024, through December 31, 2035[80]. - GSWC has spent approximately $6.7 million on environmental cleanup and remediation as of June 30, 2024, with an estimated remaining cost of $1.3 million to complete the cleanup[91]. Interest and Financing - Interest expense for the six months ended June 30, 2024, was $19,108, compared to $14,757 in the same period of 2023, reflecting a rise of 29.9%[42]. - AWR anticipates an increase in interest expense in future periods due to the need for additional external capital for construction programs[194]. - GSWC issued $65 million in unsecured private placement notes with a 5.50% coupon rate, maturing in June 2027, to pay down borrowings and fund operations[58].