Artesian Resources Corporation Reports Second Quarter and Year-to-Date 2024 Results

NEWARK, Del., Aug. 05, 2024 (GLOBE NEWSWIRE) -- Artesian Resources Corporation (Nasdaq: ARTNA), a leading provider on the Delmarva Peninsula of water and wastewater services, and a number of other related business services, today announced second quarter and year-to-date results for 2024.  

Second Quarter Results

Net income was $5.3 million, a $0.9 million, or 19.9%, increase compared to net income recorded for the three months ended June 30, 2023. Diluted net income per share was $0.52, an 18.2% increase compared to $0.44 for the same period in 2023.

Revenues totaled $27.4 million for the three months ended June 30, 2024, $2.2 million, or 8.6%, more than revenues for the three months ended June 30, 2023.

Water sales revenue increased $1.9 million, or 9.0%, primarily as a result of a temporary rate increase placed into effect on November 28, 2023, as permitted under Delaware law. The temporary rates were replaced with the final approved rates pursuant to a Delaware Public Service Commission, or DEPSC, order with a rate effective date of June 12, 2024. In addition, there was an increase in the number of customers served and an increase in overall water consumption due to warmer and drier weather in late June 2024 compared to June 2023.

Other utility operating revenue increased approximately $0.3 million, or 8.4%, primarily due to an increase in wastewater revenue associated with customer growth and the timing of industrial wastewater revenue.

“We are pleased to see an increase in water sales revenue as a result of the increase in the number of customers served along with the rate increase for Delaware water customers. In addition, recent hotter and drier weather across much of the area raised customer demand,” said Dian C. Taylor, CEO. “Artesian remains committed to our strategic approach to capital investment, ensuring reliable service to our customers. The resolution of this rate case allows for recovery of the $158 million invested in water infrastructure over the nine-year period since our previous rate filing.”

Operating expenses, excluding depreciation and income taxes, increased $0.6 million, or 4.3%. Utility operating expenses increased $0.6 million, or 4.8%, primarily the result of increased costs associated with water supply and treatment, payroll and employee benefits, and administrative expenses.

Depreciation and amortization expense increased $0.2 million, or 6.5%, primarily due to continued investment in utility plant providing supply, treatment, storage and distribution of water to customers and service to our wastewater customers.

Federal and state income tax expense increased $0.4 million, or 22.1%, primarily due to higher pre-tax income in 2024 compared to 2023.

Other income decreased $0.3 million, primarily due to a decrease in allowance for funds used during construction, or AFUDC, as a result of less long-term construction activity subject to AFUDC.

Interest charges decreased $0.2 million, primarily due to lower borrowing levels related to the Company’s lines of credit.

Year-to-Date Results

Net income was $9.7 million, a $1.6 million, or 19.5%, increase compared to net income recorded for the six months ended June 30, 2023. Diluted net income per share was $0.95, a 13.1% increase compared to $0.84 for the same period in 2023.

Revenues totaled $52.0 million for the six months ended June 30, 2024, $4.2 million, or 8.8%, more than revenues for the six months ended June 30, 2023.

Water sales revenue increased $3.7 million, or 9.5%, primarily as a result of a temporary rate increase placed into effect on November 28, 2023, as permitted under Delaware law. The temporary rates were replaced with the final approved rates pursuant to a DEPSC order with a rate effective date of June 12, 2024. In addition, there was an increase in the number of customers served and an increase in overall water consumption due to warmer and drier weather during late June 2024 compared to 2023.

Other utility operating revenue increased approximately $0.5 million, or 7.8%, primarily due to an increase in wastewater revenue associated with customer growth and the timing of industrial wastewater revenue.

Operating expenses, excluding depreciation and income taxes, increased $1.4 million, or 5.0%. Utility operating expenses increased $1.2 million, or 5.4%, primarily the result of increased costs associated with supply and treatment, payroll and employee benefits, and administrative expenses.

Depreciation and amortization expense increased $0.5 million, or 7.0%, primarily due to continued investment in utility plant providing supply, treatment, storage and distribution of water to customers and service to our wastewater customers.

Federal and state income tax expense increased $0.7 million, or 24.8%, primarily due to higher pre-tax income in 2024 compared to 2023.

Other income decreased $0.5 million, primarily due to a decrease in AFUDC, as a result of less long-term construction activity subject to AFUDC.

Interest charges decreased $0.4 million, primarily due to lower borrowing levels related to the Company’s lines of credit.

Capital Expenditures

As part of Artesian’s ongoing effort to ensure high-quality reliable service to customers, $18.4 million was invested in the first six months of 2024 in water and wastewater infrastructure projects. These investments include PFAS treatment equipment, relocation of facilities as a result of government mandates, renewals associated with the rehabilitation of aging infrastructure, installation of new main, purchase of new transportation equipment, upgrading and automating meter reading equipment, construction of a new wastewater treatment plant and upgrading existing pumping stations to better serve our customers.

“Artesian remains steadfast in our commitment to provide high quality water service for our customers,” said Nicki Taylor, President of Artesian Water Company. “We continue to invest, as we have for over a decade, in PFAS treatment technology to remain ahead of new regulations while also strategically focusing on developing the most efficient and cost-effective sources of supply to meet current and future customer needs.”

About Artesian Resources
Artesian 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 Water Company supplies 8.8 billion gallons of water per year through 1,470 miles of main to over a third of Delawareans.

Forward Looking Statements
This release contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding, among other things, recovery of investments in water utility plant and increased operating costs in rates charged to customers, expectations regarding the cost and timing of planned infrastructure investments, the impact of weather on our operations, our growth strategy, our expectations regarding infrastructure investments, our enhanced wastewater operational efficiencies, and 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 Taylor
Investor Relations
(302) 453-6900
ntaylor@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,
		2024				2023				2024			2023
Operating Revenues
Water sales	$	22,501			$	20,636			$	42,326		$	38,652
Other utility operating revenue		3,288				3,032				6,303			5,848
Non-utility operating revenue		1,627				1,583				3,331			3,246
		27,416				25,251				51,960			47,746
Operating Expenses
Utility operating expenses		12,179				11,626				24,136			22,899
Non-utility operating expenses		1,145				1,122				2,261			2,206
Depreciation and amortization		3,425				3,215				6,889			6,439
State and federal income taxes		1,945				1,593				3,627			2,906
Property and other taxes		1,524				1,487				3,130			3,027
		20,218				19,043				40,043			37,477
Operating Income		7,198				6,208				11,917			10,269
Allowance for funds used during construction		367				588				653			1,046
Miscellaneous		(65	)			(12	)			1,508			1,591
Income Before Interest Charges		7,500				6,784				14,078			12,906
Interest Charges		2,175				2,341				4,342			4,758
Net Income	$	5,325			$	4,443			$	9,736		$	8,148
Weighted Average Common Shares Outstanding - Basic		10,293				9,998				10,290			9,752
Net Income per Common Share - Basic	$	0.52			$	0.44			$	0.95		$	0.84
Weighted Average Common Shares Outstanding - Diluted		10,295				10,002				10,293			9,757
Net Income per Common Share - Diluted	$	0.52			$	0.44			$	0.95		$	0.84
Artesian Resources Corporation
Condensed Consolidated Balance Sheet
(In thousands)
(Unaudited)
	June 30,				December 31,
	2024				2023
Assets
Utility Plant, at original cost less
accumulated depreciation	$	723,823			$	714,284
Current Assets		29,140				30,617
Regulatory and Other Assets		30,168				21,931
	$	783,131			$	766,832
Capitalization and Liabilities
Stockholders' Equity	$	234,416			$	230,397
Long Term Debt, Net of Current Portion		177,493				178,307
Current Liabilities		22,434				22,414
Advances for Construction		2,593				2,797
Contributions in Aid of Construction		260,769				247,934
Other Liabilities		85,426				84,983
	$	783,131			$	766,832