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Jun 30, 2023
SJW Group Q2 2023 Earnings Report
SJW Group's financial performance increased, driven by rate filings and strategic execution.
Key Takeaways
SJW Group reported a strong second quarter with net income increasing by 58% to $18.3 million, or $0.58 per diluted share, compared to the same quarter last year. The increase was primarily driven by rate filings in California and Maine, the delay in SJWC's 2022 GRC, and a decrease in income taxes due to the release of uncertain tax position reserve. Operating revenue increased by 5% to $156.9 million.
Diluted earnings per share increased to $0.58, up from $0.38 in the same quarter last year.
Invested $115.7 million in infrastructure projects during the first half of 2023.
Received a constructive California Cost of Capital Decision, providing a Water Cost of Capital Mechanism (WCCM)-adjusted return on equity of 9.31%.
Declared a quarterly dividend of $0.38 per share.
Forward Guidance
SJW Group reaffirms the company’s 2023 full-year guidance:
Positive Outlook
- Net income per diluted common share of $2.40 to $2.50
- Non-linear long-term diluted EPS growth of 5% to 7%, anchored off of 2022 diluted EPS of $2.43
- Regulated infrastructure investments of approximately $255 million in 2023
- Continued inflation affecting interest costs, labor costs and other expenses
- Usage recovery associated with the end of mandatory water conservation
Challenges Ahead
- No significant rate cases expected in 2023
- Changes in the effective tax rate
- Assumes typical weather conditions in California, Maine and Texas
- Revenue protection in Connecticut via the Water Revenue Adjustment that reconciles actual revenues to authorized revenues
Historical Earnings Impact
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Avg. Return Before/After Earnings
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