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Essential Utilities Beats Q3 Earnings Estimates, Plans to Invest $8B
WTRGEssential Utilities(WTRG) ZACKS·2024-11-05 17:36

Core Insights - Essential Utilities Inc. (WTRG) reported third-quarter 2024 operating earnings per share (EPS) of 25 cents, exceeding the Zacks Consensus Estimate of 23 cents by 8.7%, but down 16.7% from 30 cents in the same quarter last year [1][2] Financial Performance - Total operating revenues reached 435million,surpassingtheZacksConsensusEstimateof435 million, surpassing the Zacks Consensus Estimate of 420 million by 3.8%, and reflecting a year-over-year increase of 5.8% [2] - Operating income was 155.1million,markinga12.9155.1 million, marking a 12.9% increase year over year, while interest expenses rose by 11.9% to 76.9 million from 68.6millionintheprior−yearquarter[3]−Currentassetswerereportedat68.6 million in the prior-year quarter [3] - Current assets were reported at 373.9 million as of September 30, 2024, down from 492millionasofDecember31,2023,andlong−termdebtincreasedto492 million as of December 31, 2023, and long-term debt increased to 7.23 billion from 6.82billionduringthesameperiod[5]OperationalHighlights−Operationandmaintenanceexpensesdecreasedby1.86.82 billion during the same period [5] Operational Highlights - Operation and maintenance expenses decreased by 1.8% to 144.4 million compared to 147millioninthepreviousyear,attributedtolowerbaddebtexpensesandreducedcostsfromthesaleofWestVirginiagasutilityandenergyplantassets[2]−Thecompanysignedsevenpurchaseagreementstoacquireadditionalwastewatersystems,whichwilladd213,000retailcustomers[3]RegulatoryandInvestmentActivities−Theregulatedwatersegmentreceivedrateawardsorinfrastructuresurchargestotaling147 million in the previous year, attributed to lower bad debt expenses and reduced costs from the sale of West Virginia gas utility and energy plant assets [2] - The company signed seven purchase agreements to acquire additional wastewater systems, which will add 213,000 retail customers [3] Regulatory and Investment Activities - The regulated water segment received rate awards or infrastructure surcharges totaling 51 million across several states, while the regulated natural gas segment received 21.8millionininfrastructuresurcharges[4]−EssentialUtilitiesinvested21.8 million in infrastructure surcharges [4] - Essential Utilities invested 932.5 million in the first nine months of 2024 to enhance its regulated water and natural gas infrastructure [6] Future Guidance - The company reaffirmed its 2024 EPS guidance range of 1.96−1.96-2, with the Zacks Consensus Estimate at 1.99,andexpects2025EPStobebetween1.99, and expects 2025 EPS to be between 2.05 and 2.11[7]−Planstoinvest2.11 [7] - Plans to invest 1.4-1.5billionininfrastructurein2025and1.5 billion in infrastructure in 2025 and 8 billion from 2025 to 2029 to improve systems and customer service [8] - Long-term earnings per share are projected to grow at a compounded annual growth rate of 5% to 7% through 2027 [8] Market Position - Essential Utilities currently holds a Zacks Rank 2 (Buy), indicating a favorable outlook in the market [9]