- Earnings per share increased 3.1
percent to $0.33 vs. $0.32 in 2015
- Quarterly cash dividend increase of
7.5 percent, to $0.1913
Aqua America, Inc. (NYSE: WTR) today reported results for the
second quarter ending June 30, 2016.
Operating Results
For the second quarter of 2016, Aqua America reported revenues
of $203.9 million. Rates, surcharges and acquisitions increased
regulated revenue by approximately $5.1 million compared to the
same quarter of 2015. Lower consumption and divestitures in
market-based activities offset the increase by $7.2 million,
resulting in an overall decrease in revenue of $1.9 million from
the same quarter of the prior year.
Operations and maintenance expenses decreased 7.2 percent to $74
million for the second quarter of 2016, compared to $79.7 million
in the second quarter of 2015. Divestitures in market-based
activities, lower production expenses and other non-recurring
factors collectively reduced operating expenses. Excluding these
factors, same-utility system operations and maintenance expenses
would have increased 1.3 percent.
Net income for the second quarter was $59.6 million, a 3.9
percent increase compared to $57.4 million reported in the same
quarter of 2015. Earnings per diluted common share were $0.33 for
the quarter, an increase of 3.1 percent compared to $0.32 in the
same quarter of the previous year.
As of June 30, Aqua reported year-to-date net income of $111.4
million, a 5.1 percent increase compared to $105.9 million reported
through the same time period of 2015. Earnings per diluted common
share for 2016 increased 5 percent to $0.63, compared to $0.60 in
the first half of 2015. Year-to-date, the company reported revenues
of $396.5 million compared to the $396.1 million reported in the
same time period of 2015. Operations and maintenance expenses
decreased 3.5 percent to $147.5 million versus $152.9 million
through the first two quarters of 2015. Divestitures in
market-based activities, lower production expenses and other
non-recurring factors collectively reduced operating expenses.
Excluding these factors, same-utility system operations and
maintenance expenses would have increased 1.4 percent
year-to-date.
“Management continues to deliver operational excellence
throughout its entire eight-state footprint, allowing the company
to achieve strong results for the second quarter and first six
months of the year,” said Aqua America President and CEO
Christopher Franklin. “We remain steadfast in capitalizing on our
core capabilities, including: prudently investing in
infrastructure, consistently earning credibility with our
stakeholders, and maintaining our status as one of the most
efficient utilities in the nation.”
Capital Expenditures
Aqua invested approximately $168.6 million in the first half of
the year to improve its infrastructure systems. The company expects
to invest more than $350 million in 2016 and more than $1.1 billion
through 2018. The capital investments made to rehabilitate and
expand the infrastructure of the communities Aqua serves are
paramount to helping the company to protect and provide Earth’s
most essential resource.
Dividend
On Aug. 2, Aqua America’s Board of Directors declared a
quarterly cash dividend of $0.1913 per share of common stock. This
dividend will be payable on Sept. 1, 2016 to shareholders of record
on Aug. 18, 2016 and represents an increase of 7.5 percent compared
to the most recent $0.178 dividend paid on June 1, 2016. This marks
the 26th increase in the last 25 years. The company has paid
consecutive quarterly cash dividends for more than 71 years.
“We have a long history of enhancing shareholder value and are
pleased to continue building on that history by increasing our
quarterly dividend for the 26th time in the past 25 years,” said
Franklin. “Strong growth in the dividend is reflective of our
commitment to delivering long-term value to our shareholders.”
Rate Activity
To date in 2016, the company’s state subsidiaries in Illinois,
North Carolina, Ohio, Texas and Virginia have received rate awards
or infrastructure surcharges totaling an estimated increase to
annualized revenues of $5 million. This includes $1.1 million of
revenues collected under interim rates during 2015.
Additionally, the company currently has rate or surcharge
proceedings pending in New Jersey, Indiana and Ohio, collectively
totaling $10.5 million.
Acquisition Growth in Regulated Operations
Aqua added approximately 5,400 customer connections through
acquisitions in Pennsylvania, Indiana, Illinois, North Carolina,
Virginia and New Jersey during the first half of the year.
Acquisitions alone have increased the company’s customer base by
approximately 0.6 percent in 2016. Coupled with organic customer
growth, year-to-date total customer growth is 1.1 percent.
“We feel strongly that there are opportunities to grow in this
highly fragmented market by acquiring both municipal and private
systems,” said Franklin. “Our expertise and financial strength
allows us to competitively bid for water and wastewater systems,
especially those that have neglected to invest in infrastructure
over time. These opportunities allow us to provide better service
for these customers through the ability to make necessary
infrastructure improvements, outstanding customer service, and
expert field operations.”
Financial Information
At quarter-end, Aqua America’s weighted average cost of
fixed-rate long-term debt was 4.57 percent and the company had $203
million available on its credit lines.
2016 Guidance
Aqua America continues to affirm its guidance for 2016, which
remains unchanged from last quarter:
- Earnings per diluted common share of
$1.30 to $1.35
- Total customer base growth of 1.5 to
2.0 percent
- Same-system operations and maintenance
expenses increase of 1 to 2 percent
- More than $350 million in capital
investments; more than $1.1 billion in 2016 through 2018
Aqua America does not guarantee future results of any kind.
Guidance is subject to risks and uncertainties, including, without
limitation, those factors outlined in the “Forward Looking
Statements” of this release and the “Risk Factors” section of the
company’s annual and quarterly reports filed with the Securities
and Exchange Commission (SEC).
Earnings Call Information
Date: Aug. 3, 2016Time: 11 a.m. EDT (please dial in by 10:45
a.m.)Webcast and slide presentation link:
http://ir.aquaamerica.com/events.cfmReplay Dial-in #: 888.203.1112
(U.S.) & +1 719.457.0820 (International)Confirmation code:
8704444
The company’s conference call with financial analysts will take
place on Wednesday, Aug. 3, 2016 at 11 a.m. Eastern Daylight Time.
The call and slide presentation will be webcast live so that
interested parties may listen over the Internet by logging on to
AquaAmerica.com and following the link for Investor Relations. The
webcast will be archived in the investor relations section of the
company’s website for 90 days following the call. Additionally, the
call will be recorded and made available for replay at 2 p.m. on
Aug. 3, 2016 for 10 business days following the call. To access the
audio replay in the U.S., dial 888.203.1112 (pass code 8704444).
International callers can dial +1 719.457.0820 (pass code
8704444).
About Aqua America
Aqua America is one of the largest U.S.-based, publicly traded
water utilities and serves nearly 3 million people in Pennsylvania,
Ohio, North Carolina, Illinois, Texas, New Jersey, Indiana and
Virginia. Aqua America is listed on the New York Stock Exchange
under the ticker symbol WTR. Visit AquaAmerica.com for more
information.
Caution Concerning Forward-Looking Statements
This release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995,
including, among others: the company’s ability to make capital
investments; the anticipated year-end earning per share results;
the anticipated customer growth results for 2016; the anticipated
amount of capital investment through 2018; and the company’s
ability to manage operations and maintenance expenses. There are
important factors that could cause actual results to differ
materially from those expressed or implied by such forward-looking
statements including: the company’s continued ability to adapt
itself for the future and build value by fully optimizing company
assets; general economic business conditions; the company’s ability
to fund needed infrastructure due to its financial position;
housing and customer growth trends; unfavorable weather conditions;
the success of certain cost containment initiatives; changes in
regulations or regulatory treatment; availability and access to
capital; the cost of capital; disruptions in the credit markets;
the success of growth initiatives; the company’s ability to execute
on its core capabilities of prudently deploying capital,
consistently earning credibility with stakeholders, and maintaining
its status as one of the most efficient utilities in the United
States; the company’s ability to grow its dividend, add shareholder
value and to grow earnings; and other factors discussed in our
Annual Report on Form 10-K, which is on file with the Securities
and Exchange Commission. For more information regarding risks and
uncertainties associated with Aqua America’s business, please refer
to Aqua America’s annual, quarterly and other SEC filings. Aqua
America is not under any obligation – and expressly disclaims any
such obligation – to update or alter its forward-looking statements
whether as a result of new information, future events or
otherwise.
WTRF
Aqua America, Inc. and Subsidiaries Selected Operating Data
(In thousands, except per share amounts) (Unaudited)
Quarter Ended Six Months Ended
June 30,
June 30,
2016
2015
2016
2015
Operating revenues $ 203,876 $ 205,760 $ 396,483 $ 396,086
Net income $ 59,626 $ 57,382 $ 111,363 $ 105,927
Basic net income per common share $ 0.34 $ 0.32 $ 0.63 $ 0.60
Diluted net income per common share $ 0.33 $ 0.32 $ 0.63 $ 0.60
Basic average common shares outstanding 177,288 177,084
177,196 176,987 Diluted average common shares outstanding
178,084 177,913 177,920 177,818
Aqua America, Inc. and Subsidiaries Condensed Consolidated Balance
Sheets (In thousands of dollars) (Unaudited)
June 30, December 31,
2016
2015
Net property, plant and equipment $ 4,823,487 $ 4,688,925
Current assets 132,432 128,370 Regulatory assets and other assets
966,920 900,578 Total assets $ 5,922,839 $ 5,717,873
Total equity $ 1,791,163 $ 1,725,930 Long-term debt,
excluding current portion 1,775,874 1,720,447 Current portion of
long-term debt and loans payable 64,451 52,314 Other current
liabilities 114,769 140,885 Deferred credits and other liabilities
2,176,582 2,078,297 Total liabilities and equity $
5,922,839 $ 5,717,873 Aqua America, Inc. and
Subsidiaries Consolidated Statement of Income (In thousands, except
per share amounts) (Unaudited) Quarter Ended
Six Months Ended
June 30,
June 30,
2016
2015
2016
2015
Operating revenues $ 203,876 $ 205,760 $ 396,483 $ 396,086
Cost & expenses: Operations and maintenance 73,994
79,746 147,535 152,935 Depreciation 31,619 31,049 63,764 61,549
Amortization 528 924 978 1,773 Taxes other than income taxes
14,242 13,795 28,382
28,416 Total 120,383 125,514
240,659 244,673 Operating income
83,493 80,246 155,824 151,413 Other expense (income):
Interest expense, net 20,115 18,900 39,968 37,565 Allowance for
funds used during construction (1,871 ) (1,040 ) (4,179 ) (2,222 )
(Gain) loss on sale of other assets (121 ) 1 (328 ) (168 ) Equity
loss in joint venture 229 84 478
798 Income before income taxes 65,141 62,301
119,885 115,440 Provision for income taxes 5,515
4,919 8,522 9,513 Net
income $ 59,626 $ 57,382 $ 111,363 $ 105,927
Net income per common share: Basic $ 0.34 $ 0.32 $
0.63 $ 0.60 Diluted $ 0.33 $ 0.32 $ 0.63 $ 0.60 Average
common shares outstanding: Basic 177,288
177,084 177,196 176,987 Diluted
178,084 177,913 177,920
177,818
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version on businesswire.com: http://www.businesswire.com/news/home/20160802006979/en/
Aqua America, Inc.Brian DingerdissenInvestor RelationsO:
610-645-1191BJDingerdissen@AquaAmerica.comorDonna AlstonManager,
Strategic CommunicationsO: 610-645-1095M:
484-368-4720DPAlston@AquaAmerica.com
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