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NEWARK, Del., Nov. 06, 2019 (GLOBE NEWSWIRE) -- Artesian Resources Corporation (Nasdaq: ARTNA), a leading provider of water and wastewater services, and related services, on the Delmarva Peninsula, today announced third quarter and year-to-date results for 2019.
For the three months ended September 30, 2019, net income was $4.5 million, a $0.5 million, or 13.5%, increase compared to the same period a year ago. Diluted earnings per share were $0.48 for the three months ended September 30, 2019, a 14.3% increase compared to $0.42 in the third quarter of 2018.
“Artesian remains focused on our ongoing strategy of growing our water and wastewater customer base and service area while investing in utility plant to provide the best possible service and quality to all of our customers,” said Dian C. Taylor, President & CEO.
Revenues totaled $22.5 million for the three months ended September 30, 2019, $0.6 million, or 2.9%, more than revenues for the three months ended September 30, 2018. Water sales revenue increased $0.6 million, or 3.3%, due to an increase in Distribution System Improvement Charge (“DSIC”) revenue and an increase in the number of customers served.
Operating expenses, excluding depreciation and income taxes, increased $0.3 million, or 2.5%, for the three months ended September 30, 2019, compared to the same period in 2018. Increases in expense were primarily related to consulting fees, plumbing services related to the Service Line Protection Plans (“SLP Plans”) and postage.
Depreciation and amortization expense increased $0.2 million, or 6.6%, 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 decreased $0.3 million, or 18.3%, primarily due to the amortization of the deferred tax regulatory liability related to the reduction in the federal corporate income tax rate by the Tax Cuts and Jobs Act of 2017 (“TCJA”) and a reversal of a federal tax reduction, the Domestic Production Activities Deduction, recorded in 2018 that was disallowed by the TCJA.
The allowance for funds used during construction (“AFUDC”) increased $0.4 million, as a result of higher long-term construction activity subject to AFUDC for the three months ended September 30, 2019 compared to the same period in 2018.
Interest expense increased $0.2 million, or 14%, primarily due to long-term debt interest associated with loans issued in August and December 2018 for wastewater utility plant investments. In addition, short-term debt interest increased due to an increase in the amount borrowed under lines of credit and an increase in the interest rate.
For the first nine months of 2019, net income was $11.8 million, a $0.5 million, or 4.4%, increase compared to the same period a year ago. Diluted earnings per share were $1.27 for the nine months ended September 30, 2019, compared to $1.22 for the nine months ended September 30, 2018.
Revenues totaled $62.6 million for the nine months ended September 30, 2019, $1.5 million, or 2.5%, more than revenues recorded for the same period in 2018. Water sales revenue increased $1.2 million, or 2.3%, compared to the same period a year ago, due to an increase in DSIC revenue and an increase in the number of customers served.
Other utility operating revenue, increased $0.2 million, or 7.4%, for the nine months ended September 30, 2019 compared to the same period in 2018, primarily from the addition of new wastewater customers.
Operating expenses, excluding depreciation and income taxes, increased $0.9 million, or 2.6%, for the nine months ended September 30, 2019, compared to the same period in 2018. The increase in expense is primarily due to payroll and benefit costs, plumbing services related to the SLP Plans and higher property and other taxes related to additional utility plant subject to taxation.
About Artesian Resources
Artesian Resources Corporation operates as a holding company of wholly-owned subsidiaries offering water and wastewater services, and related 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 7.9 billion gallons of water per year through 1,311 miles of main to nearly a third of Delaware residents.
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, our investment in infrastructure projects and wastewater facilities and continued growth in 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.
|Artesian Resources Corporation|
|Condensed Consolidated Statement of Operations|
|(In thousands, except per share amounts)|
|Three months ended|
|Other utility operating revenue||1,245||1,189|
|Non-utility operating revenue||1,202||1,266|
|Utility operating expenses||10,495||10,333|
|Non-utility operating expenses||838||735|
|Depreciation and amortization||2,679||2,513|
|State and federal income taxes||1,498||1,834|
|Property and other taxes||1,309||1,265|
|Allowance for funds used during construction||566||146|
|Income Before Interest Charges||6,223||5,477|
|Weighted Average Common Shares Outstanding - Basic||9,283||9,244|
|Net Income per Common Share - Basic||$||0.48||$||0.42|
|Weighted Average Common Shares Outstanding - Diluted||9,329||9,299|
|Net Income per Common Share - Diluted||$||0.48||$||0.42|
|Artesian Resources Corporation|
|Condensed Consolidated Balance Sheet|
|September 30,||December 31,|
|Utility Plant, at original cost less|
|Regulatory and Other Assets||15,446||15,034|
|Capitalization and Liabilities|
|Long Term Debt, Net of Current Portion||114,558||115,862|
|Net Advances for Construction||5,814||6,596|
|Contributions in Aid of Construction||144,785||138,015|