The York Water(US:YORW)2026-03-03 15:59Customer Growth and Revenue - The Company increased its customer base from 79,771 to 81,292 during the year ended December 31, 2025, reflecting growth through acquisitions and organic expansion [41]. - Revenue for the year ended December 31, 2025, was $77,488, an increase of $2,529 or 3.4% compared to $74,959 in 2024 [43]. - In 2025, operating revenue increased primarily due to a rise in the number of customers and higher revenues from the distribution system improvement charge (DSIC) [90]. - Operating revenues for 2025 increased by $2,529, or 3.4%, from $74,959 in 2024 to $77,488 in 2025, driven by customer base growth and DSIC revenues [100]. Water Supply and Infrastructure - The average daily availability of water as of December 31, 2025, was 41.1 million gallons, while average daily consumption was approximately 23.7 million gallons [22]. - The Company installed additional water distribution mains, resulting in a total of 1,105 miles of water mains as of December 31, 2025 [42]. - The Company has two reservoirs, Lake Williams and Lake Redman, with a combined capacity of approximately 2.5 billion gallons [22]. - The Company operates a primary water filtration plant with a rated capacity of 39.0 million gallons per day, with a maximum supply of 42.0 million gallons for short periods [73]. - The Company has a combined permitted flow capacity of 1,352,500 gallons across its twelve wastewater treatment facilities [76]. - The Company owns approximately 1,105 miles of water main lines and has storage capacity for approximately 58.7 million gallons of potable water [77]. Financial Performance - The Company experienced a decrease in net income of 1.3% in 2025 compared to 2024, with a return on year-end common equity of 8.3% [97]. - Net income for 2025 was $20,058, a decrease of $267, or 1.3%, from $20,325 in 2024 [99]. - Operating expenses for 2025 increased by $2,865, or 6.1%, from $46,918 in 2024 to $49,783 in 2025, primarily due to higher depreciation and wages [102]. - Interest on debt for 2025 increased by $1,358, or 15.3%, from $8,904 in 2024 to $10,262 in 2025, due to higher long-term debt and interest rates [103]. - The effective tax rate for 2025 was (4.2)%, down from 6.2% in 2024, due to higher deductions under IRS TPR regulations [106]. - Total assets increased to $680,888,000 in 2025 from $633,473,000 in 2024, representing a growth of approximately 7.4% [167]. - Total common stockholders' equity increased to $240,347,000 in 2025 from $231,192,000 in 2024, a growth of about 4.8% [170]. - Long-term debt rose to $221,900,000 in 2025, compared to $205,561,000 in 2024, indicating an increase of approximately 7.9% [170]. - Cash flows from operating activities were $29,860,000 in 2025, down from $30,559,000 in 2024, a decrease of about 2.3% [178]. Cost Management and Efficiency - The efficiency ratio for 2025 was 25.9%, lower than the five-year average of 31.0%, primarily due to increased operating expenses and higher interest expense [98]. - The Company focuses on minimizing costs through initiatives like paperless billing and negotiating favorable service costs [95]. - The Company aims to grow revenues through customer increases, infrastructure investments, and timely rate filings [92]. Regulatory Compliance and Quality Control - The Company is subject to regulations under the Safe Drinking Water Act and the Clean Water Act, ensuring compliance with water quality standards [28]. - The Company conducts over 70,000 laboratory tests annually to comply with state and federal water quality regulations [30]. Future Outlook and Investments - The Company expects construction and acquisition expenditures for 2026 and 2027 to be approximately $48,000 each year [117]. - The Company signed agreements to acquire water and wastewater assets, expected to add approximately 430 customers upon completion in 2026 [109][110][112][113]. - The Company has agreements with municipalities for billing and collection services and is exploring further expansion opportunities [94]. Cybersecurity and Risk Management - The Company has implemented processes and controls to mitigate cyber security risks, although it cannot guarantee that its measures will fully prevent adverse effects from potential attacks [141]. - The Company has not experienced a material impact from cyber security attacks, but acknowledges the potential for significant remediation costs and reputational damage [140]. Dividend and Shareholder Returns - The Company's dividend payout ratios for 2025 were 63.7% relative to net income and 42.3% relative to net cash provided by operating activities, with a 4.0% increase in the quarterly dividend to $0.2280 per share [145]. - The company declared cash dividends of $0.8856 per share in 2025, up from $0.8516 per share in 2024, representing an increase of approximately 4.3% [176]. Other Financial Metrics - The reserve for doubtful accounts is based on lifetime expected credit losses and the aging of account balances, reflecting a proactive approach to credit risk management [190]. - The Company maintains cash balances exceeding federally insured limits without experiencing significant credit risk, indicating strong liquidity management [189]. - The Company has a substantial deferred income tax asset primarily due to excess accumulated deferred income taxes on accelerated depreciation, with no valuation allowance required due to expected future taxable income generation [133]. - The Company has seen an increase in deferred income tax liability amounts due to accelerated depreciation deductions, which is expected to continue as significant capital expenditures are made [134].