Attached files
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| 8-K - 8-K - SJW GROUP | sjw-8kx3qtr2013.htm |
EXHIBIT 99.1
SJW CORP. ANNOUNCES
THIRD QUARTER FINANCIAL RESULTS
SAN JOSE, CA, October 30, 2013 – SJW Corp. (NYSE: SJW) today reported financial results for the third quarter ended September 30, 2013. Operating revenue was $85.2 million in the quarter compared to $82.4 million in 2012. The $2.8 million increase in revenue was primarily attributable to the net recognition of certain balancing and memorandum accounts of $2.3 million, which management has determined are probable of future recovery or refund, $1.4 million in cumulative rate increases, and $423,000 in revenue from new customers, partially offset by $1.5 million in lower customer water usage. In addition, the Company earned $299,000 in higher revenue from real estate operations.
Water production costs for the third quarter of 2013 were $40.4 million versus $36.6 million for the same period in 2012, an increase of $3.8 million. The increase in water production costs was primarily attributable to $3.4 million in higher per unit costs for purchased water and groundwater extraction charges and approximately $400,000 in higher costs due to a decrease in the availability of surface water supply and a decrease in customer water usage. Operating expenses, excluding water production costs, increased $635,000 to $25.5 million from $24.9 million. The increase was due to $499,000 of higher depreciation expense, $289,000 in higher taxes other than income taxes, partially offset by a decrease of $153,000 in maintenance and administrative and general expenses.
The effective consolidated income tax rates were 39% and 41% for the quarters ended September 30, 2013 and 2012, respectively.
Net income was $9.0 million for the quarter ended September 30, 2013, compared to $10.1 million for the same period in 2012. Diluted earnings per share were $0.44 for the quarter ended September 30, 2013, compared to $0.53 per diluted share for the same period in 2012.
Year-to-date operating revenue increased by $10.5 million to $209.6 million from $199.1 million in the first nine months of 2013. The increase was primarily attributable to the net recognition of certain balancing and memorandum accounts of $4.9 million, which management has determined are probable of future recovery or refund, $4.1 million in cumulative rate increases, and $1.0 million in revenue from new customers. In addition, the Company earned $478,000 in higher revenue from real estate operations and higher customer water usage.
Year-to-date water production costs increased to $91.2 million from $84.1 million in 2012. The $7.1 million increase was primarily attributable to $6.2 million in higher per unit costs for purchased water and groundwater extraction charges and $1.6 million in higher customer water usage, partially offset by $818,000 in lower costs due to an increase in the use of available surface water supply. Operating expenses, excluding water production costs, increased $2.6 million to $76.4 million from $73.8 million. The increase was due to $1.4 million of higher depreciation expense, $518,000 in higher taxes other than income taxes, $425,000 in higher maintenance expenses and $218,000 of higher administrative and general expenses.
Other, net includes a pre-tax gain on the sale of a real estate investment property in Connecticut of approximately $1.1 million.
The effective consolidated income tax rates were 40% and 41% for the nine-month periods ended September 30, 2013 and 2012, respectively.
Year-to-date net income was $17.7 million, compared to $16.4 million in 2012. Diluted earnings per share were $0.89 in the first nine months of 2013, compared to $0.87 per diluted share for the same period in 2012.
Diluted earnings per share for the quarter and year-to-date ended September 30, 2013 includes the weighted average effect of 1,421,000 new shares of common stock issued in April of 2013.
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The Directors of SJW Corp. today declared a quarterly dividend on common stock of $0.1825 per share. The dividend is payable on December 2, 2013 to shareholders of record on November 12, 2013.
SJW Corp. is a publicly traded holding company headquartered in San Jose, California. SJW Corp. is the parent company of San Jose Water Company, SJWTX, Inc., Texas Water Alliance Limited, and SJW Land Company. Together, San Jose Water Company and SJWTX, Inc. provide water service to more than one million people in San Jose, California and nearby communities and in Canyon Lake, Texas and nearby communities. SJW Land Company owns and operates commercial real estate investments.
This press release may contain certain forward-looking statements including but not limited to statements relating to SJW Corp.'s plans, strategies, objectives, expectations and intentions, which are made pursuant to the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of SJW Corp. to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Results for a quarter are not indicative of results for a full year due to seasonality and other factors. Other factors that may cause actual results, performance or achievements to materially differ are described in SJW Corp.'s most recent reports on Form 10-K, Form 10-Q and Form 8-K filed with the Securities and Exchange Commission. SJW Corp. undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.
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SJW Corp.
Condensed Consolidated Statements of Comprehensive Income
(Unaudited)
(in thousands, except per share data)
Three months ended September 30, | Nine months ended September 30, | ||||||||||||
2013 | 2012 | 2013 | 2012 | ||||||||||
OPERATING REVENUE | $ | 85,238 | 82,374 | $ | 209,607 | 199,098 | |||||||
OPERATING EXPENSE: | |||||||||||||
Production Costs: | |||||||||||||
Purchased water | 21,092 | 22,768 | 49,525 | 54,128 | |||||||||
Power | 3,074 | 2,274 | 5,736 | 4,442 | |||||||||
Groundwater extraction charges | 13,142 | 8,672 | 27,257 | 17,057 | |||||||||
Other production costs | 3,080 | 2,914 | 8,675 | 8,511 | |||||||||
Total production costs | 40,388 | 36,628 | 91,193 | 84,138 | |||||||||
Administrative and general | 10,706 | 10,773 | 32,285 | 32,067 | |||||||||
Maintenance | 3,325 | 3,411 | 9,958 | 9,533 | |||||||||
Property taxes and other non-income taxes | 2,686 | 2,397 | 7,769 | 7,251 | |||||||||
Depreciation and amortization | 8,787 | 8,288 | 26,346 | 24,922 | |||||||||
Total operating expense | 65,892 | 61,497 | 167,551 | 157,911 | |||||||||
OPERATING INCOME | 19,346 | 20,877 | 42,056 | 41,187 | |||||||||
Interest expense | (5,009 | ) | (5,063 | ) | (14,987 | ) | (15,188 | ) | |||||
Other, net | 416 | 1,136 | 2,562 | 1,617 | |||||||||
Income before income taxes | 14,753 | 16,950 | 29,631 | 27,616 | |||||||||
Provision for income taxes | 5,803 | 6,866 | 11,924 | 11,222 | |||||||||
NET INCOME | 8,950 | 10,084 | 17,707 | 16,394 | |||||||||
Other comprehensive income, net | 185 | 41 | 450 | 89 | |||||||||
COMPREHENSIVE INCOME | $ | 9,135 | 10,125 | $ | 18,157 | 16,483 | |||||||
EARNINGS PER SHARE | |||||||||||||
Basic | $ | 0.44 | 0.54 | $ | 0.90 | 0.88 | |||||||
Diluted | $ | 0.44 | 0.53 | $ | 0.89 | 0.87 | |||||||
DIVIDENDS PER SHARE | $ | 0.18 | 0.18 | $ | 0.55 | 0.53 | |||||||
WEIGHTED AVERAGE SHARES OUTSTANDING | |||||||||||||
Basic | 20,152 | 18,648 | 19,643 | 18,629 | |||||||||
Diluted | 20,347 | 18,854 | 19,839 | 18,833 | |||||||||
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SJW Corp.
Condensed Consolidated Balance Sheets
(Unaudited)
(in thousands)
September 30, 2013 | December 31, 2012 | |||||
ASSETS | ||||||
Utility plant: | ||||||
Land | $ | 10,389 | 10,156 | |||
Depreciable plant and equipment | 1,231,964 | 1,166,220 | ||||
Construction in progress | 26,968 | 24,298 | ||||
Intangible assets | 18,340 | 15,561 | ||||
Total utility plant | 1,287,661 | 1,216,235 | ||||
Less accumulated depreciation and amortization | 408,888 | 384,675 | ||||
Net utility plant | 878,773 | 831,560 | ||||
Real estate investments | 78,788 | 74,232 | ||||
Less accumulated depreciation and amortization | 10,243 | 9,045 | ||||
Net real estate investments | 68,545 | 65,187 | ||||
CURRENT ASSETS: | ||||||
Cash and cash equivalents | 3,219 | 2,522 | ||||
Accounts receivable and accrued unbilled utility revenue | 42,522 | 29,944 | ||||
Long-lived assets held-for-sale | — | 7,768 | ||||
Prepaid expenses and other | 3,589 | 2,677 | ||||
Total current assets | 49,330 | 42,911 | ||||
OTHER ASSETS: | ||||||
Investment in California Water Service Group | 7,826 | 7,067 | ||||
Debt issuance costs, net of accumulated amortization | 5,276 | 5,226 | ||||
Regulatory assets, net | 134,024 | 130,488 | ||||
Other | 6,066 | 5,060 | ||||
153,192 | 147,841 | |||||
$ | 1,149,840 | 1,087,499 | ||||
CAPITALIZATION AND LIABILITIES | ||||||
CAPITALIZATION: | ||||||
Common stock | $ | 10,501 | 9,724 | |||
Additional paid-in capital | 62,777 | 26,117 | ||||
Retained earnings | 243,300 | 236,453 | ||||
Accumulated other comprehensive income | 2,759 | 2,310 | ||||
Total shareholders' equity | 319,337 | 274,604 | ||||
Long-term debt, less current portion | 335,143 | 335,598 | ||||
Total capitalization | 654,480 | 610,202 | ||||
CURRENT LIABILITIES: | ||||||
Line of credit | 7,000 | 15,300 | ||||
Current portion of long-term debt | 589 | 5,392 | ||||
Accrued groundwater extraction charge, purchased water and purchased power | 11,700 | 5,072 | ||||
Accounts payable | 11,831 | 8,481 | ||||
Accrued interest | 5,552 | 5,355 | ||||
Other current liabilities | 13,076 | 9,507 | ||||
Total current liabilities | 49,748 | 49,107 | ||||
DEFERRED INCOME TAXES AND CREDITS | 158,982 | 149,013 | ||||
ADVANCES FOR CONSTRUCTION AND CONTRIBUTIONS IN AID OF | ||||||
CONSTRUCTION | 201,081 | 196,743 | ||||
POSTRETIREMENT BENEFIT PLANS | 77,737 | 73,425 | ||||
OTHER NONCURRENT LIABILITIES | 7,812 | 9,009 | ||||
$ | 1,149,840 | 1,087,499 | ||||
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