Group 1 - The American States Water Company held a conference call to discuss its fourth quarter and full year 2025 results [1][2] - The call featured presentations from Bob Sprowls, President and CEO, and Eva Tang, Senior Vice President of Finance and CFO [2] - The company provided access to slides related to the call on its website [2] Group 2 - The conference call included forward-looking statements as defined by the Private Securities Litigation Reform Act of 1995 [3] - Listeners were cautioned against placing undue reliance on forward-looking statements due to inherent risks and uncertainties [3] - The company does not commit to updating or revising any forward-looking statements made during the call [4]

Core Viewpoint - Select Water Solutions, Inc. has announced a public offering of $175.0 million of its Class A common stock to support general corporate purposes, including water infrastructure growth, potential acquisitions, and debt repayment [1] Group 1: Offering Details - The public offering is for $175.0 million of Class A common stock, with a par value of $0.01 per share [1] - The company plans to grant underwriters a 30-day option to purchase up to $26.25 million of additional shares at the public offering price [1] - J.P. Morgan Securities LLC and BofA Securities are the lead book-running managers for the offering [1] Group 2: Use of Proceeds - Net proceeds from the offering will be used for general corporate purposes, including water infrastructure growth capital projects, potential acquisitions, or debt repayment under the sustainability-linked credit facility [1] Group 3: Regulatory and Market Conditions - The offering is subject to market and other conditions, with no assurance on the completion or terms of the offering [1] - The offering is being conducted under an effective shelf registration statement filed with the SEC [1]

Core Insights - American States Water reported a productive year in 2025 with significant earnings growth and infrastructure investments, alongside positive regulatory outcomes [3][4][6] Financial Performance - The company achieved earnings of $3.37 per share in 2025, an increase of $0.33 on an adjusted basis compared to 2024's adjusted earnings of $3.04 per share [2][6] - For the fourth quarter, consolidated reported earnings were $0.74 per share, slightly down from $0.75 per share in the prior-year quarter [7] - The contracted-services unit (ASUS) contributed $0.61 per share in 2025, with guidance for 2026 earnings projected between $0.63 and $0.67 per share [4][17] Infrastructure Investment - The company invested $210.9 million in infrastructure at its regulated utilities in 2025, with projected capital expenditures for 2026 estimated between $185 million and $225 million [1][6] Revenue and Expense Drivers - Consolidated revenue for the fourth quarter increased by $21.2 million year over year, with water-segment revenues rising by $17.4 million due to new 2025 water rates [9] - Supply costs increased by $10.7 million, primarily due to higher per-unit purchased water costs [10] Regulatory Developments - The California Public Utilities Commission (CPUC) approved a modified revenue adjustment mechanism (MRAM) effective January 1, 2025, and water rate increases effective January 1, 2026, expected to boost operating revenues by approximately $32 million [5][12] - Golden State Water is preparing its next water rate case, expected to be filed by July 1, 2026 [11] Dividend Policy - The company increased its quarterly cash dividend by 8.3% in 2025, marking the 71st consecutive year of annual dividend increases, with a compound annual growth rate of 8.5% over the last five years [19]

Financial Data and Key Metrics Changes - Reported earnings for 2025 were $3.37 per share, an increase of $0.20 per share compared to 2024, or $0.33 per share higher when adjusted [5][17] - Adjusted earnings for 2024 were $3.04 per share, compared to $3.37 per share for 2025, reflecting a 10.9% increase [17] - Consolidated revenue for the fourth quarter increased by $21.2 million compared to 2024, with water segment revenue increasing by $17.4 million [13][14] Business Line Data and Key Metrics Changes - Golden State Water reported earnings of $0.50 per share for Q4 2025, down from $0.52 per share in 2024, but adjusted earnings increased by $0.11 per share due to new water rates and lower interest expenses [11] - The electric segment reported earnings of $0.11 per share for Q4 2025, down from $0.13 per share in 2024, but adjusted earnings increased by $0.04 per share due to rate increases [12] - ASUS contributed earnings of $0.16 per share for Q4 2025, an increase of $0.05 per share compared to the same quarter last year [13] Market Data and Key Metrics Changes - The company invested $210.9 million in infrastructure at regulated utilities in 2025, reflecting strong execution of its capital plan [6] - ASUS was awarded $29.4 million in new capital upgrade construction projects during 2025, expected to be completed through 2028 [9][35] Company Strategy and Development Direction - The company aims to expand its regulated water operations and has completed transactions to own and operate water and wastewater systems for new planned communities [7][8] - The company is preparing for its next water rate case, expected to be filed by July 1, 2026, transitioning to a modified rate adjustment mechanism [20][21] - The company raised its quarterly cash dividend by 8.3%, marking the 71st consecutive year of annual dividend increases [9][36] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the regulatory outcomes and the ability to invest in utility infrastructure for reliable services [5] - The company noted that the 2025 earnings were positively impacted by a favorable water supply source mix, despite a nearly 4% decrease in water consumption [21] - Management anticipates continued growth in the rate base and earnings from regulated utilities and ASUS in the coming years [30][35] Other Important Information - Net cash provided by operating activities was $229.7 million for 2025, an increase from $198.7 million in 2024, driven by new rates and settlement proceeds [18] - The company raised $67 million under its at-the-market offering program during the year, with a remaining balance of $40.7 million available [19] Q&A Session Summary - There were no questions during the Q&A session, and the call concluded without any inquiries from participants [39]

Financial Data and Key Metrics Changes - Reported earnings for 2025 were $3.37 per share, an increase of $0.20 per share compared to 2024, or $0.33 per share higher when adjusted [5][17] - Adjusted earnings for 2024 were $3.04 per share, compared to $3.37 per share for 2025, reflecting a 10.9% increase [17] - Consolidated revenue for the fourth quarter increased by $21.2 million compared to 2024, with water segment revenue increasing by $17.4 million due to new rates [13][14] Business Line Data and Key Metrics Changes - Golden State Water reported earnings of $0.50 per share for Q4 2025, down from $0.52 per share in 2024, but adjusted earnings increased by $0.11 per share due to new water rates and lower interest expenses [11] - The electric segment reported earnings of $0.11 per share for Q4 2025, down from $0.13 per share in 2024, but adjusted earnings increased by $0.04 per share due to rate increases [12] - ASUS contributed earnings of $0.16 per share for Q4 2025, up from $0.11 per share in the same quarter last year, reflecting higher construction activities [13][35] Market Data and Key Metrics Changes - Golden State Water's average water rate base increased from $980.4 million in 2021 to $1,673.2 million in 2026, representing a compound annual growth rate of 11.3% [30] - The company anticipates a robust growth in its rate base over the next few years, driven by capital investments [30] Company Strategy and Development Direction - The company plans to continue investing in utility infrastructure for safe and reliable services, with $210.9 million invested in 2025 [6][9] - Golden State Water is preparing for its next water rate case, expected to be filed by July 1, 2026, transitioning to a modified rate adjustment mechanism [20][21] - ASUS is expected to contribute $0.63-$0.67 per share in 2026, with confidence in competing for new military base contract awards [36] Management's Comments on Operating Environment and Future Outlook - Management noted that 2025 was a productive year, with constructive regulatory outcomes positioning the company for future growth [4][5] - The company highlighted the potential volatility in revenues and earnings due to changes in water consumption and supply source mix [21] - Management expressed confidence in the company's ability to manage operating expenses and continue dividend growth [9][36] Other Important Information - The company raised its quarterly cash dividend by 8.3%, marking the 71st consecutive year of annual dividend increases [9][36] - ASUS was awarded $29.4 million in new capital upgrade construction projects expected to be completed through 2028 [35] Q&A Session Summary - There were no questions during the Q&A session, and the call concluded without any inquiries [39]

Financial Data and Key Metrics Changes - The company reported earnings of $3.37 per share for 2025, an increase of $0.20 per share compared to 2024, or $0.33 per share higher when adjusted [5][17] - Adjusted earnings for 2024 were $3.04 per share, compared to $3.37 per share for 2025, representing a 10.9% increase [6][17] - Consolidated revenue for the fourth quarter increased by $21.2 million compared to 2024, with water segment revenue increasing by $17.4 million due to new rates [12][13] Business Line Data and Key Metrics Changes - Golden State Water reported earnings of $0.50 per share for Q4 2025, down from $0.52 per share in 2024, but adjusted earnings increased by $0.11 per share due to new water rates and lower interest expenses [10] - The electric segment reported earnings of $0.11 per share for Q4 2025, down from $0.13 per share in 2024, but adjusted earnings increased by $0.04 per share due to rate increases [11] - ASUS contributed earnings of $0.16 per share for Q4 2025, up from $0.11 per share in the same quarter last year, reflecting higher construction activities [12][35] Market Data and Key Metrics Changes - The company invested $210.9 million in infrastructure at regulated utilities in 2025, reflecting strong execution of its capital plan [6] - ASUS was awarded $29.4 million in new capital upgrade construction projects during 2025, expected to be completed through 2028 [8][35] Company Strategy and Development Direction - The company aims to expand its regulated water operations and has completed transactions to own and operate water and wastewater systems for new planned communities [6][7] - The company is preparing for its next water rate case, expected to be filed by July 1, 2026, transitioning to a modified rate adjustment mechanism [20][21] - The company raised its quarterly cash dividend by 8.3%, marking the 71st consecutive year of annual dividend increases [8][36] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the regulatory outcomes and the ability to invest in utility infrastructure for reliable services [5] - The company noted a nearly 4% decrease in water consumption compared to adopted levels, but this did not materially impact earnings due to favorable water supply source mix [21] - Management projected ASUS to contribute $0.63-$0.67 per share in 2026, indicating confidence in competing for new military base contract awards [36] Other Important Information - The company raised proceeds of $67 million under its at-the-market offering program during the year, with a remaining balance of $40.7 million available [19] - The company anticipates a robust growth in its rate base, with a compound annual growth rate of 11.3% from 2021 to 2026 [29] Q&A Session Summary - There were no questions during the Q&A session, and the call concluded without any inquiries from participants [38]

Financial Results Call Presentation Fourth Quarter and Full Year 2025 February 19, 2026 NYSE: AWR Today's Presenters Robert J. Sprowls President & CEO Eva G. Tang SVP – Finance & CFO This conference call includes a discussion of certain measures that are not prepared in accordance with Generally Accepted Accounting Principles ("GAAP") in the United States, and constitute "non-GAAP financial measures" under SEC rules. These non-GAAP financial measures are derived from consolidated financial information but a ...

Core Insights - American Water Works Company (AWK) reported fourth-quarter 2025 adjusted earnings per share (EPS) of $1.24, missing the Zacks Consensus Estimate of $1.28 by 3.1% but showing a 7.8% increase from $1.15 in the same quarter last year [1] - Total revenues for AWK in the fourth quarter reached $1.27 billion, exceeding the Zacks Consensus Estimate of $1.22 billion by 3.9% and reflecting a 5.8% increase from $1.2 billion year-over-year [2] - The company’s total revenues for 2025 were $5.14 billion, up from $4.68 billion in 2024, primarily due to authorized revenue increases from completed rate cases and infrastructure investments [2] Financial Performance - AWK's total operating expenses for Q4 were $866 million, an increase of 8.1% from $801 million in the previous year, driven by higher employee-related costs and production costs [4] - Operating income for the fourth quarter was $405 million, a slight increase of 1.3% from $400 million year-over-year [4] - Cash flow from operating activities in 2025 was $2.06 billion, compared to $2.05 billion in the previous year [5] Segment Performance - Regulated businesses' net revenues in 2025 were $4.7 billion, reflecting a year-over-year increase of 10.3% [3] - Other segments reported net revenues of $417 million in 2025, up 7.5% year-over-year [3] Long-Term Guidance - AWK affirmed its 2026 EPS guidance in the range of $6.02-$6.12, with the Zacks Consensus Estimate at the high end of this range [9] - The company plans to invest $3.7 billion in 2026 and expects long-term EPS growth of 7-9% and rate base growth of 8-9% [8][9] - For the long-term capital expenditure plan, AWK anticipates investments of $19-$20 billion from 2026 to 2030 and $46-$48 billion from 2026 to 2035 [10] Merger Update - On February 10, 2026, shareholders of American Water and Essential Utilities approved their merger-related proposals [6]

Key Insights - American States Water Company (AWR) reported fourth-quarter 2025 operating earnings per share (EPS) of 74 cents, reflecting a 32.1% increase from 56 cents in the same quarter last year [1] - AWR's total revenues for 2025 reached $658.1 million, a 10.52% increase from $595.5 million in 2024 [2] - Operating expenses for the fourth quarter totaled $119.2 million, up 14.2% from $104.4 million a year ago, primarily due to higher costs in water and power purchases [3] - Interest expenses decreased by 2.6% year over year to $10.9 million, attributed to lower average borrowing levels and interest rates [4] - Earnings from the Water segment were 50 cents per share, down 3.85% from 52 cents a year ago, while the Electric segment reported 11 cents per share, down 15.4% from 13 cents [5] - The Contracted Services segment saw EPS rise by 45.5% to 16 cents, driven by increased construction activities and management fee revenues [5] - AWR's cash and cash equivalents as of December 31, 2025, were $18.8 million, down from $26.7 million a year earlier, while long-term debt increased to $782.7 million from $640.4 million [7] - Cash provided by operating activities in 2025 totaled $229.7 million, compared to $198.7 million in the previous year [8] - AWR's regulated utilities are authorized to invest nearly $650 million in capital expenditures, with a target of $185-$225 million for 2026 [9]

Financial Data and Key Metrics Changes - Adjusted earnings per share (EPS) for 2025 were $5.64, an increase from $5.18 in 2024, reflecting an 8.9% growth [4][10] - Consolidated earnings increased by $0.46 per share compared to the previous year, with revenues rising by $1.70 per share due to authorized rate increases [10][11] - Operating costs increased by $0.42 per share, primarily due to employee-related costs and higher production costs [11] Business Line Data and Key Metrics Changes - The company invested over $3 billion in infrastructure in 2025 to enhance service reliability and quality [5][19] - The company completed six rate cases in 2025, with significant revenue increases authorized in various states [11][12] Market Data and Key Metrics Changes - The company serves approximately 14 million people, maintaining residential water bills under 1% of median household income [5][20] - The company has over 104,000 customer connections under agreement heading into 2026, indicating growth in customer base [6][21] Company Strategy and Development Direction - The company is focused on addressing aging infrastructure and water quality challenges while ensuring customer affordability [8][19] - A definitive merger agreement with Essential Utilities was announced, expected to close by the end of Q1 2027, which aims to enhance service offerings [6][9] Management's Comments on Operating Environment and Future Outlook - Management affirmed 2026 EPS guidance of $6.02-$6.12, representing an expected 8% growth compared to 2025 [7][15] - The company is committed to responsible investments and operational efficiencies to support customer affordability and regulatory compliance [15][19] Other Important Information - The company plans to issue approximately $2.5 billion in external equity from 2026 to 2030 to fund growth and maintain financial stability [15][17] - The total debt to capital ratio as of December 31 was 59%, with expectations to remain below 60% [17] Q&A Session Summary Question: What are the plans for the Peoples Gas business post-merger? - The company will review strategic alternatives for Peoples after the merger closes, with proceeds potentially used for debt repayment and reinvestment [24] Question: What is the 2025 realized FFO to debt? - The company typically does not disclose FFO to debt but suggests it can be calculated from financial statements [25] Question: What is the status of the rate cases in Pennsylvania, New Jersey, and Illinois? - The company is progressing as expected in rate cases and is open to settlements if they are beneficial [26][36] Question: What approvals are remaining for the Nexus acquisition? - The company has received approvals in several states but still requires approvals in about five states, with no current challenges anticipated [30] Question: How does affordability scrutiny affect ongoing rate cases in Pennsylvania? - Rate cases are driven by necessary investments, and the company does not foresee changes in the current pace of filings [35]