Q4 2025 Earnings Conference Call March 6, 2026 | 8:30 a.m. ET Forward-Looking Statements Certain written statements included herein and/or oral statements made in connection with the presentation contained herein c onstitute "forward-looking information" within the meaning of applicable securities laws in each of the provinces and territories of Canada and the respective policies, regulations and rules under such laws and "forward -looking statements" within the meaning of the U.S. Private Securities Litiga ...

Core Viewpoint - Global Water Resources reported significant growth in active service connections and capital investments, while facing challenges from rising operating expenses and regulatory lag impacting earnings [4][5][6]. Customer Growth - Total active service connections increased by 6.3% year-over-year to 68,577 as of December 31, 2025, with 3.2% organic growth excluding acquisitions [1][6]. - The company invested $67.3 million in infrastructure improvements to enhance service reliability [1][6]. Capital Investment - The company had a near-record year for capital spending, focusing on projects such as recommissioning a water reclamation facility and acquiring Tucson water systems [2][4]. - The collective rate base increased by $70 million, or 59%, across 2024 and 2025 [3][6]. Financial Performance - Revenue rose by 5.8% to $55.8 million, driven by the Tucson acquisition and organic growth [5][10]. - Operating expenses increased by approximately 12.2% to $48.6 million, leading to a decline in net income to $3.0 million from $5.8 million the previous year [5][12]. Regulatory Developments - The Arizona Corporation Commission (ACC) approved the Tucson acquisition and is reviewing rate relief requests for Santa Cruz and Palo Verde, with a hearing set for August 2026 [5][16][13]. - The company is focused on securing rate relief related to significant capital investments and rising expenses [13]. Market Conditions - Single-family housing permits declined nearly 20% in 2025, but the company anticipates long-term growth in the Phoenix MSA [7][8]. - The City of Maricopa was noted as one of the fastest-growing municipalities, with a growth rate of 7.4% in 2024 [9]. Future Outlook - The company plans to control expenses in 2026 and has reduced the pace of capital investments following heavy spending in 2025 [20]. - Management is exploring the use of artificial intelligence to improve customer service and operational efficiency [19].

Core Viewpoint - The company is experiencing significant changes in its financial strategy and operational performance due to regulatory challenges and market conditions, with a focus on expense control and long-term growth opportunities through legislative changes [1] Financial Performance - Management increased collective rate baseable assets by $70 million or 59% over 2024-2025, driven by the recommissioning of the Southwest plant and the City of Tucson acquisition [1] - The 2025 performance was characterized by 'regulatory lag,' where heavy upfront capital investments increased depreciation and operating expenses before new rates could be approved [1] - A $1.3 million one-time asset write-off occurred due to the recommissioning of the previously mothballed Southwest plant, which was originally built prior to the 2008 recession [1] Operational Challenges - Operating expenses were pressured by unprecedented growth in medical costs and increased personnel requirements following the integration of seven new Tucson water systems [1] Strategic Direction - Management is pivoting 2026 strategy toward strict expense control and a reduced pace of capital investment to mitigate current financial headwinds [1] - The 'Ag-to-Urban' water legislation is expected to drive long-term growth by converting historical farming land into residential developments within the company's service areas [1]

Financial Data and Key Metrics Changes - Total revenue for 2025 was $55.8 million, an increase of $3.1 million or 5.8% compared to 2024 [12] - Operating expenses increased approximately $5.3 million or 12.2% to $48.6 million compared to $43.3 million in 2024 [12] - Net income for 2025 was $3 million or $0.11 per diluted share, down from $5.8 million or $0.24 per diluted share in 2024 [14] - Adjusted EBITDA decreased 0.7% to $26.5 million from $26.7 million in the prior year [15] Business Line Data and Key Metrics Changes - The company increased its collective rate base by $70 million or 59% over 2024 and 2025 [4] - Total active service connections increased 6.3% to 68,577 at December 31, 2025 [9] - The company invested $67.3 million into infrastructure improvements in existing utilities [10] Market Data and Key Metrics Changes - The single-family dwelling unit market in the Phoenix Greater Metro Area saw a decrease of nearly 20% in building permits from 2024 to 2025 [10] - The Maricopa market realized 600 building permits in 2025, representing a 39% decrease from the same period in 2024 [11] - Despite the decline in permits, the company achieved a 3.2% year-over-year organic increase in active connections [11] Company Strategy and Development Direction - The company aims to control expenses in 2026 and has reduced the pace of capital investments [6] - The Arizona Governor signed water legislation known as Ag-to-Urban, expected to improve aquifer sustainability and support growth [7] - The company is focused on expanding its Total Water Management platform and applying expertise to new utilities [18] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the need for new rates to keep up with investments and inflation [6] - The company believes the decline in permits is temporary and remains well-positioned for long-term growth in the Phoenix MSA [11] - Management expressed pride in the team's execution in 2025 and commitment to growth despite challenges [18] Other Important Information - The company faced increased operating expenses due to higher medical costs, legal expenses, and elevated municipal licensing fees [13] - Other expenses for 2025 were $3.2 million, up from $1.5 million in 2024, primarily due to a loss on asset disposals [14] - The company is actively engaging with regulatory stakeholders regarding rate relief for capital investments [16] Q&A Session Summary Question: Inquiry about future rate cases and potential changes - Management acknowledged the frustration with the current rate case process and noted the unique circumstances surrounding the recommissioning of the Southwest Plant [23][24] - They emphasized the importance of learning from each rate case and maintaining communication with regulatory stakeholders [26] Question: Use of AI in operations - Management discussed potential AI applications, particularly in call centers to improve customer service and operational efficiency [27][28] Question: Options for re-filing if the current rate case does not go as hoped - Management is evaluating options for re-filing and considering the best course of action if necessary [30] Question: Clarification on the rate base-able assets - Management reiterated that the $70 million of rate base-able assets are now in service, indicating a matter of timing for rate case outcomes [32]

Financial Data and Key Metrics Changes - Total revenue for 2025 was $55.8 million, an increase of $3.1 million or 5.8% compared to 2024 [12] - Operating expenses increased approximately $5.3 million or 12.2% to $48.6 million compared to $43.3 million in 2024 [12] - Net income for 2025 was $3 million or $0.11 per diluted share, down from $5.8 million or $0.24 per diluted share in 2024 [14] - Adjusted EBITDA decreased 0.7% to $26.5 million from $26.7 million in the prior year [15] Business Line Data and Key Metrics Changes - The company increased its collective rate base by $70 million or 59% over 2024 and 2025 [4] - Total active service connections increased 6.3% to 68,577 at December 31, 2025 [9] - The company invested $67.3 million into infrastructure improvements in existing utilities [10] Market Data and Key Metrics Changes - The single-family dwelling unit market in the Phoenix Greater Metro Area saw a decrease of nearly 20% in building permits from 2024 [10] - The Maricopa market experienced a 39% decrease in building permits from the previous year [11] - Despite the decline in permits, the company achieved a 3.2% year-over-year organic increase in active connections [11] Company Strategy and Development Direction - The company aims to control expenses in 2026 and has reduced the pace of capital investments [6] - The Arizona Governor signed significant water legislation known as Ag-to-Urban, expected to improve aquifer sustainability and support growth [7] - The company is focused on expanding its Total Water Management platform and applying expertise to new utilities [18] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges of regulatory lag and the need for new rates to keep up with investments and inflation [5] - The company believes the decline in permits is temporary and remains well-positioned for long-term growth in the Phoenix MSA [11] - Management expressed confidence in the future, stating it is a matter of when, not if, the rate case will be resolved favorably [32] Other Important Information - The company faced increased operating expenses due to higher medical costs, professional fees, and utility costs [13] - Other expenses for 2025 were $3.2 million, up from $1.5 million in 2024, primarily due to asset disposals [14] - The company is actively engaging with regulatory stakeholders regarding rate relief for significant capital investments [16] Q&A Session Questions and Answers Question: Analysis on future rate cases - Management acknowledged the frustration with the current rate case and noted the unique circumstances surrounding the recommissioning of the Southwest Plant [23][24] Question: Use cases for AI in operations - Management discussed potential AI applications in call centers and operational efficiencies, emphasizing security considerations before broader implementation [27][28] Question: Options if the rate case does not go as hoped - Management is evaluating options for potential re-filing if necessary, but no specific plans were announced [30]

Financial Data and Key Metrics Changes - Total revenue for 2025 was $55.8 million, an increase of $3.1 million or 5.8% compared to 2024, driven by the City of Tucson acquisition, organic growth in connections, and higher rates [12] - Operating expenses rose by approximately $5.3 million or 12.2% to $48.6 million, with notable increases in depreciation and amortization expenses [12][13] - Net income for 2025 was $3 million or $0.11 per diluted share, down from $5.8 million or $0.24 per diluted share in 2024 [15] Business Line Data and Key Metrics Changes - The company increased its collective rate base by $70 million or 59% over 2024 and 2025, reflecting significant capital investments [4] - Total active service connections grew by 6.3% to 68,577 as of December 31, 2025, with a 3.2% growth rate excluding the Tucson acquisition [9][10] Market Data and Key Metrics Changes - The single-family dwelling unit market in the Phoenix Greater Metro Area saw a decrease of nearly 20% in building permits from 2024 to 2025, with Maricopa experiencing a 39% decrease [10][11] - Despite the decline in permits, the company reported a 3.2% year-over-year organic increase in active connections, indicating resilience in the market [11] Company Strategy and Development Direction - The company aims to control expenses in 2026 while reducing the pace of capital investments, focusing on long-term value creation [6] - The Arizona Governor signed the Ag-to-Urban water legislation in 2025, which is expected to enhance aquifer sustainability and support growth in service areas [7] - The company is committed to expanding its Total Water Management platform and applying expertise to new utilities, which is seen as beneficial for stakeholders [19] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the challenges posed by rising expenses and the need for new rates to keep pace with investments and inflation [5][6] - The company remains optimistic about long-term growth in the Phoenix MSA, despite temporary declines in permit activity [11] Other Important Information - Adjusted net income for 2025 was $3.9 million or $0.14 per diluted share, down from $6.3 million or $0.26 per diluted share in 2024 [15] - Adjusted EBITDA decreased by 0.7% to $26.5 million from $26.7 million in the prior year [16] Q&A Session Summary Question: Inquiry about future rate cases and potential changes - Management acknowledged the frustration with the current rate case process and emphasized the uniqueness of the situation regarding the recommissioning of the Southwest Plant [24][26] Question: Use of AI in operations - Management discussed potential AI applications, particularly in call centers, to improve customer service and operational efficiency, while noting security considerations [28][29] Question: Options if the rate case does not proceed as hoped - Management is evaluating options for a potential refiling if necessary, but no specific announcements were made [30]

Core Insights - The article highlights four companies known as "Dividend Kings," which have raised their dividends for over 50 years, emphasizing their reliability for investors seeking passive income [1] Group 1: Company Profiles - **American States Water (AWR)**: This company has a remarkable 72-year history of dividend increases and currently offers a 2.7% annual dividend yield. Its adjusted diluted earnings per share (EPS) grew from $3.04 in 2024 to $3.37 in 2025, indicating strong financial health [1] - **Procter & Gamble (PG)**: With a 70-year track record of dividend growth, Procter & Gamble has increased its diluted net earnings from $8.589 billion in the six months ending December 31, 2024, to $9.07 billion in the same period in 2025. The company offers a 2.53% dividend yield [1] - **National Fuel Gas (NFG)**: This company has raised its dividends for 56 consecutive years and reported adjusted earnings growth from $151.9 million in Q1 FY2025 to $187.7 million in Q1 FY2026. It provides a 2.35% annual dividend yield [1] - **Automatic Data Processing (ADP)**: Recently recognized as a Dividend King, ADP has a 51-year history of dividend increases. The company reported an 11% year-over-year adjusted earnings increase to $2.62 per share for Q2 FY2026, with total revenue improving by 6% to $5.359 billion. It offers a 3.17% annual dividend yield [1]

Core Viewpoint - Global Water Resources, Inc. reported a 5.8% increase in total revenue for the year ended December 31, 2025, driven by acquisitions and organic growth, despite a significant decrease in net income due to increased expenses related to capital investments and operational costs [8][22][24]. Financial Highlights - Total revenue rose to $55.8 million from $52.7 million in 2024, primarily due to the acquisition of seven water systems and increased consumption [8][14]. - Net income decreased by 48.9% to $3.0 million, or $0.11 per share, compared to $5.8 million, or $0.24 per share in 2024 [22][45]. - Adjusted net income fell to $3.9 million, or $0.14 per diluted share, down from $6.3 million, or $0.26 per diluted share in 2024 [24][48]. - Adjusted EBITDA decreased by 0.7% to $26.5 million from $26.7 million in 2024 [23][48]. - The company declared three monthly cash dividends of $0.02533 per common share, totaling $0.30396 on an annualized basis [25]. Operational Highlights - The company achieved a 6.3% increase in total active service connections, reaching 68,577 by December 31, 2025 [27]. - Water consumption increased by 5.9% year-over-year to 4.28 billion gallons in 2025 [8]. - Capital investments for the year totaled $67.3 million, with $17.7 million invested in Q4 2025 alone [8][14]. Management Commentary - The CEO highlighted successful initiatives that grew the rate base and emphasized the need for new rates to keep pace with investments and inflation [4][6]. - The company is working through the commission's rate case process for its largest utilities, anticipating a resolution in 2026 [7][10]. Business Strategy - The near-term growth strategy focuses on increasing service connections, improving operational efficiencies, and pursuing strategic acquisitions [26]. - The company aims to consolidate operations and rates across its customer base to enhance efficiency and value [14]. Industry Context - Arizona's economy is projected to grow, with an expected increase of 486,000 jobs through 2033, significantly impacting demand for water services [13]. - The Phoenix metropolitan area is experiencing population growth, with projections of reaching 5.8 million by 2030 and 6.5 million by 2040 [28].

Core Viewpoint - Global Water Resources, Inc. reported a 5.8% increase in total revenue for the year ended December 31, 2025, driven by acquisitions and organic growth, despite a significant decrease in net income due to increased expenses from capital investments and operational costs [8][20][22]. Financial Highlights - Total revenue rose to $55.8 million, up from $52.7 million in 2024, primarily due to the acquisition of seven water systems and increased consumption [8][14]. - Net income fell to $3.0 million, or $0.11 per share, a decrease of 48.9% year-over-year, largely due to higher depreciation and interest expenses [20][43]. - Adjusted net income decreased to $3.9 million, or $0.14 per diluted share, down from $6.3 million, or $0.26 per diluted share in 2024 [22][47]. - Adjusted EBITDA slightly decreased by 0.7% to $26.5 million compared to $26.7 million in 2024 [21]. Operational Highlights - The company achieved a 6.3% increase in total active service connections, reaching 68,577 by December 31, 2025, with a 3.2% growth rate excluding acquisitions [25][26]. - Water consumption increased by 5.9% year-over-year to 4.28 billion gallons in 2025 [8]. - Capital investments totaled $67.3 million for the year, with $17.7 million invested in Q4 alone, focusing on infrastructure projects [8][14]. Management Commentary - The CEO highlighted successful initiatives that grew the rate base and emphasized the need for new rates to keep pace with investments and inflation [4][6]. - The company is working through the commission's rate case process for its largest utilities, anticipating a resolution in 2026 [7][10]. Business Strategy - The near-term growth strategy includes increasing service connections, improving operational efficiencies, and pursuing strategic acquisitions [24]. - The company aims to consolidate operations and rates across its customer base to enhance efficiency and value [14]. Industry Context - Arizona's economy is projected to grow, with an expected increase in employment by 486,000 jobs through 2033, which is anticipated to drive organic growth for the company [13][28]. - The Phoenix metropolitan area is experiencing population growth, with projections of reaching 5.8 million by 2030, supporting demand for water services [28][29].

Core Insights - California American Water has initiated the Austin Steiner Main Replacement Project, marking the final phase of a multi-year modernization effort for the Fruitridge Vista water system [1] Company Summary - The project is part of a broader initiative to enhance the water infrastructure in California, indicating a commitment to improving service delivery and system reliability [1]