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Dec 31, 2020
SJW Group Q4 2020 Earnings Report
Reported financial results for the fourth quarter ended December 31, 2020.
Key Takeaways
SJW Group reported a net income of $13.3 million for the fourth quarter of 2020, compared to a net loss of $5.5 million in 2019. Diluted earnings per share were $0.46, compared to a loss per share of $0.19 in the fourth quarter of 2019. Operating revenue increased to $135.7 million from $125.8 million in the same quarter of the previous year.
Net income for Q4 2020 was $13.3 million, a significant improvement from the $5.5 million net loss in Q4 2019.
Diluted earnings per share reached $0.46, contrasting with a loss per share of $0.19 in the same quarter of the prior year.
Operating revenue saw an increase of $9.9 million, totaling $135.7 million compared to $125.8 million in Q4 2019.
The company's effective consolidated income tax rate decreased primarily due to the capitalization of non-deductible merger costs.
Forward Guidance
SJW Group's 2021 General Rate Case application with the CPUC seeks an increase of nearly $88.0 million in revenue requirement over the three-year period, and authorization for a $435.0 million capital budget. Connecticut Water Company filed an application with the PURA to amend rates for its customers, including those of the former Avon and Heritage Village Water companies, requesting an increase of $20.2 million in annual revenues.
Positive Outlook
- New rates in 2022 - 2024 if the CPUC approves the request as submitted, the overall revenue requirement increase would be 13.35% in 2022, 3.88% in 2023, and 4.24% in 2024.
- CPUC authorized a revenue requirement increase of approximately $12.0 million in 2021, the last year of the current GRC.
- The proposed increase will be applied across the company but may differ by rate divisions, meter size and between customer rate categories, i.e. for residential, commercial, industrial, etc. users.
- The filing proposes a new rate that would provide a 15% reduction in water bills for income eligible customers, which would be the first low-income rate for a Connecticut water utility if approved.
- The filing also includes an inclining block rate structure for residential water customers to promote water conservation.
Challenges Ahead
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