American Water Works pany(AWK) - 2025 Q2 - Quarterly Results

Q2 2025 Earnings Release Performance Highlights and Outlook American Water reported strong Q2 2025 diluted EPS of $1.48, narrowed 2025 EPS guidance to $5.70-$5.75, affirmed long-term growth targets, and progressed on capital investments and acquisitions Q2 & YTD 2025 Earnings Per Share (EPS) | Period | 2025 Diluted EPS | 2024 Diluted EPS | Change | | :--- | :--- | :--- | :--- | | Second Quarter | $1.48 | $1.42 | +$0.06 | | Year-to-Date | $2.53 | $2.37 | +$0.16 | 2025 EPS Guidance (Weather-Normalized) | Guidance | Range | | :--- | :--- | | Previous | $5.65 - $5.75 | | Narrowed | $5.70 - $5.75 | - The company affirmed its long-term financial targets, including an EPS and dividend growth rate of 7-9%[5] - Announced an agreement to purchase Nexus Water Group systems, adding to its acquisition growth strategy. As of July 30, 2025, the company has approximately 87,000 customer connections under agreement in total[4][6] - The 2025 capital investment plan of $3.3 billion is on track, with $1.3 billion invested through June 30, 2025[6][8] Financial and Operational Review The company's financial and operational performance for Q2 and H1 2025 is reviewed, highlighting revenue growth drivers, increased expenses, and the latest dividend declaration Consolidated Results Consolidated EPS for Q2 2025 increased to $1.48, driven by new rates in Regulated Businesses, partially offset by higher operating and financing costs, with a $0.06 unfavorable weather impact - Growth was primarily driven by increased revenues from new rates in the Regulated Businesses, offset by higher operating, depreciation, and financing costs[7] - Weather had an estimated net unfavorable impact of $0.06 per share for the six months ended June 30, 2025, compared to the same period in 2024[7] - The company invested $1.3 billion in the first six months of 2025, on track to meet its full-year capital plan of approximately $3.3 billion[8] Regulated Businesses Performance The Regulated Businesses segment reported increased net income for Q2 and H1 2025, driven by authorized rate increases, partially offset by higher operating, depreciation, and interest expenses Regulated Businesses Net Income (in millions) | Period | 2025 Net Income | 2024 Net Income | | :--- | :--- | :--- | | Second Quarter | $288 | $274 | | First Six Months | $489 | $459 | - Operating revenues increased by $121 million for Q2 and $242 million for the first six months of 2025, mainly due to authorized revenue increases from rate cases and infrastructure proceedings[10] - Since January 1, 2025, the company has been authorized additional annualized revenues of $270 million and has pending requests for an additional $126 million[11] - Operating expenses rose by $83 million for Q2 and $161 million for the first six months, driven by employee costs, technology, taxes, and depreciation. Interest expense also increased due to debt used to fund capital investments[12][13] Dividends The Board of Directors declared a quarterly cash dividend of $0.8275 per share, payable on September 3, 2025, to shareholders of record as of August 12, 2025 Quarterly Dividend Declaration | Metric | Value | | :--- | :--- | | Dividend per Share | $0.8275 | | Record Date | August 12, 2025 | | Payment Date | September 3, 2025 | Financial Statements This section presents the unaudited consolidated Statements of Operations and Balance Sheets as of June 30, 2025, detailing the company's financial performance and position Consolidated Statements of Operations For the six months ended June 30, 2025, operating revenues increased to $2,418 million, leading to higher operating income and net income attributable to common shareholders Consolidated Statements of Operations Highlights (Six Months Ended June 30, in millions) | Account | 2025 | 2024 | | :--- | :--- | :--- | | Operating revenues | $2,418 | $2,160 | | Operating income | $860 | $775 | | Net income attributable to common shareholders | $494 | $462 | Consolidated Balance Sheets As of June 30, 2025, total assets increased to $33,913 million, driven by property, plant, and equipment growth, with total common shareholders' equity rising to $10,682 million Consolidated Balance Sheet Highlights (in millions) | Account | June 30, 2025 | Dec 31, 2024 | | :--- | :--- | :--- | | Total assets | $33,913 | $32,830 | | Property, plant and equipment, net | $28,932 | $28,038 | | Total liabilities | $21,631 | $20,977 | | Long-term debt | $12,281 | $12,521 | | Total common shareholders' equity | $10,682 | $10,332 | Corporate Information and Forward-Looking Statements This section provides general corporate information, details for the earnings conference call, and a cautionary statement regarding forward-looking statements and associated risks About American Water American Water is the largest regulated water and wastewater utility in the United States, serving over 14 million people across 14 states and 18 military installations - American Water is the largest regulated water and wastewater utility in the U.S., serving over 14 million people[17] Conference Call Information The Q2 2025 earnings conference call is scheduled for July 31, 2025, at 9 a.m. ET, with an audio webcast and presentation slides available on the investor relations website - The Q2 2025 earnings conference call is scheduled for July 31, 2025, at 9 a.m. ET, with a webcast available at ir.amwater.com[15] Cautionary Statement Concerning Forward-Looking Statements This section cautions that forward-looking statements, including earnings guidance and growth targets, are subject to significant risks and uncertainties, advising readers to consult SEC filings for comprehensive risk factors - Forward-looking statements regarding guidance, growth targets, and capital expenditures are not guarantees of future performance and are subject to significant risks and uncertainties[19] - Key risks include regulatory decisions, changes in customer demand, weather events, infrastructure challenges, cybersecurity threats, and changes in economic conditions[19][20]