Artesian Resources Corporation (Nasdaq: ARTNA), a leading provider
of water and wastewater services, and related services, on the
Delmarva Peninsula, today announced second quarter and year-to-date
results for 2022.
- Diluted net income per
share increased to $0.53 in the second quarter and to $1.01
year-to-date
- Net Income increased $0.5
million (12.0%) in the second quarter and $0.8 million (9.4%)
year-to-date
- Invested $29.6 million
year-to-date in water and wastewater infrastructure, including
acquisitions
- In May 2022, completed the
purchase of substantially all the operating water assets of the
Town of Clayton, located in Kent County, Delaware
Second Quarter Results
Net income was $5.0 million, a $0.5 million, or
12.0%, increase compared to net income recorded during the three
months ended June 30, 2021.
Revenues totaled $25.0 million for the three
months ended June 30, 2022, $2.5 million, or 11.3%, more than
revenues for the three months ended June 30, 2021. Comprising this
increase:
Other utility
operating revenue increased approximately $1.9 million primarily
due to an increase in wastewater revenue resulting from the
acquisition of Tidewater Environmental Services, Inc., or TESI, in
January 2022 and an increase in industrial wastewater service
revenue that began in June 2021.
Non-utility operating
revenue increased approximately $1.0 million, primarily due to an
increase in contract service revenue related to a contract for the
design and construction of wastewater infrastructure and an
increase in Service Line Protection Plan revenue.
Water sales revenue
decreased $0.4 million, or 1.8%, primarily due to a decrease in
overall water consumption, partially offset by an increase in fixed
fee revenue related to added customers.
“We are pleased to announce these strong
financial results, with our wastewater operations reflecting the
accretive effect of our acquisition of TESI earlier this year along
with a major industrial user going online in June 2021.
Additionally, we are pleased to welcome our new customers upon
closing on the acquisition of the Town of Clayton’s water system in
May,” said Dian C. Taylor, Chair, President and CEO.
“The completion of these acquisitions
demonstrates our continued focus on expansion and growth. With the
acquisition of TESI, we more than doubled the number of wastewater
customers we serve; and our water system acquisitions, as well as
robust home and business development in our service territories,
increased the number of water customers we serve by 3.3% in the
past year,” said Taylor.
Operating expenses, excluding depreciation and
income taxes, increased $1.5 million, or 12.8%. Utility operating
expense increases primarily are the result of increased costs
associated with repair, maintenance and treatment of our water and
wastewater systems as well as payroll and administrative costs.
These increases are partially offset by a decrease in purchased
water under a new contract, effective January 2022, in which the
minimum amount of water required to be purchased was reduced.
Non-utility operating expenses increased $1.0
million primarily due to an increase in costs associated with a
wastewater infrastructure design and construction contract and an
increase in plumbing services related to Service Line Protection
Plan repairs.
Long-term debt interest expense increased $0.2
million, primarily related to an increase in long-term debt
interest related to the Series W First Mortgage Bond issued on
April 29, 2022.
Year-to-Date Results
Net income was $9.5 million, a $0.8 million, or
9.4%, increase compared to net income recorded during the six
months ended June 30, 2021. Diluted net income per share increased
8.6% to $1.01 for the six months ended June 30, 2022 compared to
$0.93 for the first six months of 2021.
Revenues totaled $47.2 million for the six
months ended June 30, 2022, $4.1 million, or 9.5%, more than
revenues for the six months ended June 30, 2021. Comprising this
increase:
Other utility
operating revenue increased approximately $3.0 million primarily
due to an increase in wastewater revenue resulting from the
acquisition of TESI in January 2022 and an increase in industrial
wastewater service revenue that began in June 2021.
Non-utility operating
revenue increased approximately $1.1 million, primarily due to an
increase in contract service revenue related to a contract for the
design and construction of wastewater infrastructure and an
increase in Service Line Protection Plan revenue.
Water sales revenue
remained consistent for the six months ended June 30, 2022 with the
corresponding period in 2021. Overall water consumption decreased,
partially offset by an increase in fixed fee revenue related to
customer growth.
Operating expenses, excluding depreciation and
income taxes, increased $2.6 million, or 11.1%. Utility operating
expense increases are primarily the result of increased costs
associated with repair, maintenance and treatment of our water and
wastewater systems as well as increases in payroll and
administrative costs. These increases are partially offset by a
decrease in purchased water under a new contract, effective January
2022, in which the minimum amount of water required to be purchased
was reduced.
Non-utility operating expenses increased $1.1
million primarily due to an increase in costs associated with a
wastewater infrastructure design and construction contract and an
increase in plumbing services related to Service Line Protection
Plan repairs.
Long-term debt interest expense increased $0.2
million, primarily related to an increase in long-term debt
interest related to the Series W First Mortgage Bond issued on
April 29, 2022.
Capital Expenditures
As part of Artesian’s ongoing effort to ensure
high-quality reliable service to customers, $29.6 million was
invested in the first six months of 2022 in water and wastewater
infrastructure projects and acquisitions. These investments include
the installation of transmission and distribution facilities,
replacement of aging mains, rehabilitation of treatment facilities
and redevelopment of wells and pumping equipment. We also acquired
wastewater utility plant assets related to the acquisition of TESI
and purchased the Town of Clayton’s water utility plant assets.
“We continue to make strategic capital
investments in infrastructure projects, not only to increase
reliability for our customers but to ensure that supply meets
demands arising from continued growth in the number of customers we
serve. Additionally, we have focused on further enhancing our
self-supply, which resulted in a 42.9% reduction in Delaware’s
purchased water costs year-to-date compared to the same period in
2021,” said Taylor.
About Artesian
ResourcesArtesian Resources Corporation operates as a
holding company of wholly-owned subsidiaries offering water and
wastewater services, and a number of other related core business
services, on the Delmarva Peninsula. Artesian Water Company, the
principal subsidiary, is the oldest and largest regulated water
utility on the Delmarva Peninsula and has been providing water
service since 1905. Artesian supplies 8.4 billion gallons of water
per year through 1,398 miles of main to over a third of
Delawareans.
Forward Looking StatementsThis
release contains forward looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995 regarding,
among other things, our growth strategy, our expectations regarding
infrastructure investments, acquisition agreements and the
continued growth in our business and the number of customers
served. These statements involve risks and uncertainties that could
cause actual results to differ materially from those expressed or
implied by such forward-looking statements including: changes in
weather, changes in our contractual obligations, changes in
government policies, the timing and results of our rate requests,
failure to receive regulatory approval, changes in economic and
market conditions generally and other matters discussed in our
filings with the Securities and Exchange Commission. While the
Company may elect to update forward-looking statements, we
specifically disclaim any obligation to do so and you should not
rely on any forward-looking statement as representation of the
Company’s views as of any date subsequent to the date of this
release.
Contact:Nicki TaylorInvestor
Relations(302) 453-6900ntaylor@artesianwater.com
|
Artesian Resources Corporation |
Condensed Consolidated Statement of Operations |
(In thousands, except per share amounts) |
(Unaudited) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Three months ended |
|
Six months ended |
|
|
June 30, |
|
June 30, |
|
|
|
2022 |
|
|
|
2021 |
|
|
|
2022 |
|
|
|
2021 |
|
Operating
Revenues |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Water sales |
|
$ |
19,722 |
|
|
$ |
20,078 |
|
|
$ |
37,865 |
|
|
$ |
37,908 |
|
Other utility operating revenue |
|
|
2,914 |
|
|
|
1,014 |
|
|
|
5,440 |
|
|
|
2,390 |
|
Non-utility operating revenue |
|
|
2,375 |
|
|
|
1,377 |
|
|
|
3,893 |
|
|
|
2,815 |
|
|
|
|
25,011 |
|
|
|
22,469 |
|
|
|
47,198 |
|
|
|
43,113 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Expenses |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Utility operating expenses |
|
|
10,070 |
|
|
|
9,661 |
|
|
|
20,566 |
|
|
|
19,166 |
|
Non-utility operating expenses |
|
|
1,905 |
|
|
|
862 |
|
|
|
2,847 |
|
|
|
1,777 |
|
Depreciation and amortization |
|
|
3,055 |
|
|
|
2,976 |
|
|
|
6,140 |
|
|
|
5,988 |
|
State and federal income taxes |
|
|
1,725 |
|
|
|
1,542 |
|
|
|
3,144 |
|
|
|
2,893 |
|
Property and other taxes |
|
|
1,413 |
|
|
|
1,341 |
|
|
|
2,914 |
|
|
|
2,761 |
|
|
|
|
18,168 |
|
|
|
16,382 |
|
|
|
35,611 |
|
|
|
32,585 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Operating
Income |
|
|
6,843 |
|
|
|
6,087 |
|
|
|
11,587 |
|
|
|
10,528 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Allowance for funds used during construction |
|
|
324 |
|
|
|
371 |
|
|
|
505 |
|
|
|
615 |
|
Miscellaneous |
|
|
(33 |
) |
|
|
(59 |
) |
|
|
1,412 |
|
|
|
1,343 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Income Before Interest
Charges |
|
|
7,134 |
|
|
|
6,399 |
|
|
|
13,504 |
|
|
|
12,486 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Interest
Charges |
|
|
2,088 |
|
|
|
1,894 |
|
|
|
3,975 |
|
|
|
3,775 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Net
Income |
|
$ |
5,046 |
|
|
$ |
4,505 |
|
|
$ |
9,529 |
|
|
$ |
8,711 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Common Shares Outstanding - Basic |
|
|
9,452 |
|
|
|
9,395 |
|
|
|
9,438 |
|
|
|
9,381 |
|
Net Income per Common Share - Basic |
|
$ |
0.53 |
|
|
$ |
0.48 |
|
|
$ |
1.01 |
|
|
$ |
0.93 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Weighted Average Common Shares Outstanding - Diluted |
|
|
9,470 |
|
|
|
9,425 |
|
|
|
9,464 |
|
|
|
9,416 |
|
Net Income per Common Share - Diluted |
|
$ |
0.53 |
|
|
$ |
0.48 |
|
|
$ |
1.01 |
|
|
$ |
0.93 |
|
Artesian Resources Corporation |
Condensed Consolidated Balance Sheet |
(In thousands) |
(Unaudited) |
|
|
|
June 30, |
|
December 31, |
|
|
2022 |
|
2021 |
Assets |
|
|
|
|
|
|
|
|
Utility Plant, at original cost less |
|
|
|
|
|
|
|
|
accumulated depreciation |
|
$ |
639,513 |
|
|
$ |
590,431 |
|
Current Assets |
|
|
16,931 |
|
|
|
18,664 |
|
Regulatory and Other Assets |
|
|
17,634 |
|
|
|
15,620 |
|
|
|
$ |
674,078 |
|
|
$ |
624,715 |
|
|
|
|
|
|
|
|
|
|
Capitalization and
Liabilities |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Stockholders' Equity |
|
$ |
180,902 |
|
|
$ |
178,010 |
|
Long Term Debt, Net of Current Portion |
|
|
173,597 |
|
|
|
143,259 |
|
Current Liabilities |
|
|
33,490 |
|
|
|
47,206 |
|
Advances for Construction |
|
|
4,174 |
|
|
|
4,295 |
|
Contributions in Aid of Construction |
|
|
206,695 |
|
|
|
176,656 |
|
Other Liabilities |
|
|
75,220 |
|
|
|
75,289 |
|
|
|
$ |
674,078 |
|
|
$ |
624,715 |
|
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