CWT California Water Service Group

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 8-K

 

Current Report Pursuant to Section 13 or 15(d) of
The Securities Exchange Act of 1934

 

Date of Report (date of earliest event reported): July 8, 2024

 

CALIFORNIA WATER SERVICE GROUP

(Exact name of Registrant as Specified in its Charter) 

 

Delaware (State or other jurisdiction of incorporation)

1-13883 (Commission file number)

77-0448994 (I.R.S. Employer Identification Number)

 

1720 North First Street San Jose, California (Address of principal executive offices)

95112 (Zip Code)

 

(408) 367-8200

(Registrant’s telephone number, including area code)

 

N/A

(Former name or former address, if changed since last report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

¨	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
¨	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
¨	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
¨	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Shares, par value $0.01		CWT		New York Stock Exchange

 

Indicate by check mark whether the registrant is an emerging growth company as defined by Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

 

Emerging growth company ¨

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

 

 

 

Item 7.01.

Regulation FD Disclosure.

 

On July 9, 2024, California Water Service Group issued the press release attached as Exhibit 99.1 to this current report and incorporated by reference herein.

 

The information and exhibit furnished pursuant to Item 7.01 of this Current Report shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.

 

Item 9.01.

Financial Statements and Exhibits.

 

We hereby furnish the following exhibits, which shall not be deemed “filed,” with this report:

 

Exhibit No.		Description
99.1		Press Release issued July 9, 2024
104		Cover Page Interactive Data File (embedded within the Inline XBRL document)

 

 

SIGNATURES

 

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

	CALIFORNIA WATER SERVICE GROUP
Date: July 9, 2024	By:	/s/ James P. Lynch
	Name:	James P. Lynch
	Title:	Senior Vice President, Chief Financial Officer & Treasurer

 

 

Exhibit 99.1

 

 

 

July 9, 2024

For immediate release

 

California Water Service Group Subsidiary Files Plan to Invest
$1.6 Billion in its California Water Systems in Upcoming Three Years,
Proposes Program to Decouple Revenue from Water Sales

 

 

SAN JOSE, Calif.—To continue providing safe, clean, reliable tap water to customers across the communities it serves, California Water Service (Cal Water)—the largest subsidiary of California Water Service Group (NYSE: CWT)—yesterday submitted Infrastructure Improvement Plans for its California districts from 2025-2027 in its General Rate Case (GRC) filing with the California Public Utilities Commission (CPUC). The application also proposes a Low-Use Water Equity Program, which would decouple revenue from water sales, to assist low-water-using, lower-income customers.

 

The required, triennial filing begins an approximately 18-month review process by the CPUC, an independent state agency, which will analyze the Infrastructure Improvement Plans, operating budget proposals, and Low-Use Water Equity Program to establish water rates for 2026-2028 that reflect the actual cost of providing safe, reliable water service. Associated rates set by the CPUC would become effective no sooner than January 2026.

 

In the plans, Cal Water proposes to invest more than $1.6 billion in its districts from 2025-2027, including approximately $1.3 billion of newly proposed capital investments. About 46% of the proposed new infrastructure improvements would replace aging water pipelines, which is designed to enhance water supply reliability to support customers’ and firefighters’ everyday and emergency needs. The plans also include, among other projects:

 

●

Water quality upgrades to treat for existing and newly regulated contaminants.

 

●

Infrastructure replacements to help pump and deliver water reliably.

 

●

Equipment such as generators to help withstand power outages and shutoffs, and solar installation projects to help reduce Cal Water’s dependency on the electric power grid and its environmental footprint.

 

 

 

 

 

 

●

Physical and cyber security and safety enhancements to help protect facilities, customers, and employees.

 

●

Water supply initiatives to help safeguard long-term reliability and sustainability of water sources.

 

●

Advanced Metering Infrastructure to aid conservation efforts and enhance water-use efficiency.

 

Cal Water’s proposed Low-Use Water Equity Program would decouple revenue from water sales across its regulated service areas. The program is designed to work in conjunction with Cal Water’s proposed progressive, four-tier rate design and sales forecast proposals to enhance affordability—particularly for low-use and low-income customers—plus reinforce conservation goals, while providing the utility an opportunity to recover its authorized revenue requirement in a timely manner.

 

To support these investments, Cal Water has proposed to the CPUC to increase 2026 total revenue by $140.6 million, or 17.1%. This increase is based on 2026 authorized revenue at current rates. Cal Water also proposes to increase revenue by $74.2 million, or 7.7%, in 2027; and $83.6 million, or 8.1%, in 2028. The company also continues to focus on enhancing efficiency and reducing expenses to help offset the cost of upgrades.

 

“Our multi-year, proactive Infrastructure Improvement Plans reflect our commitment to continue providing safe, clean, and reliable drinking water to our customers and communities,” said Martin A. Kropelnicki, Chairman and CEO. “We believe these ongoing investments and proposed decoupling program will help us fulfill our promise to deliver quality, service, and value, as we navigate issues such as our changing climate, increasingly stringent regulations, and inflation.”

 

 

 

 

 

 

This news release contains forward-looking statements within the meaning established by the Private Securities Litigation Reform Act of 1995 (PSLRA). The forward-looking statements are intended to qualify under provisions of the federal securities laws for "safe harbor" treatment established by the PSLRA. Forward-looking statements in this news release are based on currently available information, expectations, estimates, assumptions and projections, and our management's beliefs, assumptions, judgments and expectations about us, the water utility industry and general economic conditions. These statements are not statements of historical fact. When used in our documents, statements that are not historical in nature, including words like will, would, expects, intends, plans, believes, may, could, estimates, assumes, anticipates, projects, progress, predicts, hopes, targets, forecasts, should, seeks, commits or variations of these words or similar expressions are intended to identify forward-looking statements. Examples of forward-looking statements in this news release include, but are not limited to, statements describing expected timing of and impacts from Cal Water’s GRC filing, including expected revenue increases. Forward-looking statements are not guarantees of future performance. They are based on numerous assumptions that we believe are reasonable but are subject to uncertainty and risks. Actual results may vary materially from what is contained in a forward-looking statement. Factors that may cause actual results to be different than those expected or anticipated include, but are not limited to: governmental and regulatory commissions' decisions; consequences of eminent domain actions relating to our water systems; changes in regulatory commissions' policies and procedures; our ability to invest or apply the proceeds from the issuance of common stock in an accretive manner; increased risk of inverse condemnation losses as a result of climate change and drought; the outcome and timeliness of regulatory commissions' actions concerning rate relief and other actions; changes in water quality standards; changes in environmental compliance and water quality requirements; electric power interruptions; the impact of opposition to rate increases; our ability to recover costs; our ability to renew leases to operate water systems owned by others on beneficial terms; availability of water supplies; housing and customer growth; issues with the implementation, maintenance or security of our information technology systems; civil disturbances or terrorist threats or acts; the adequacy of our efforts to mitigate physical and cyber security risks and threats; the ability of our enterprise risk management processes to identify or address risks adequately; labor relations matters as we negotiate with the unions; changes in customer water use patterns and the effects of conservation; the impact of weather, climate change, natural disasters, and actual or threatened public health emergencies on our operations, water quality, water availability, water sales and operating results and the adequacy of our emergency preparedness; the impact of stagnating or worsening business and economic conditions; the impact of market conditions and volatility on unrealized gains or losses on our operating results; restrictive covenants in or changes to the credit ratings on our current or future debt that could increase our financing costs or affect our ability to borrow, make payments on debt or pay dividends; risks associated with expanding our business and operations geographically; the impact of evolving legal and regulatory requirements, including emerging environmental, social and governance requirements; and other risks and unforeseen events described in our SEC filings. In light of these risks, uncertainties and assumptions, investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this news release. When considering forward-looking statements, you should keep in mind the cautionary statements included in this paragraph, as well as in our Annual 10-K, Quarterly 10-Q's, and other reports filed from time-to-time with the Securities and Exchange Commission (SEC). We are not under any obligation, and we expressly disclaim any obligation to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise.

 

 

# # #

 

Media Contact

Yvonne Kingman

ykingman@calwater.com

310-257-1434

 

 

 

 

 

v3.24.2

Cover	Jul. 08, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Jul. 08, 2024
Entity File Number	1-13883
Entity Registrant Name	CALIFORNIA WATER SERVICE GROUP
Entity Central Index Key	0001035201
Entity Tax Identification Number	77-0448994
Entity Incorporation, State or Country Code	DE
Entity Address, Address Line One	1720 North First Street
Entity Address, City or Town	San Jose
Entity Address, State or Province	CA
Entity Address, Postal Zip Code	95112
City Area Code	408
Local Phone Number	367-8200
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false
Title of 12(b) Security	Common Shares, par value $0.01
Trading Symbol	CWT
Security Exchange Name	NYSE
Entity Emerging Growth Company	false

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