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Dec 31, 2019
Cal Water Q4 2019 Earnings Report
Announced 2019 earnings for the year and fourth quarter.
Key Takeaways
For the fourth quarter of 2019, net income was $11.3 million and diluted earnings per share was $0.24, compared to net income of $15.4 million and diluted earnings per share of $0.32 in the fourth quarter of 2018.
Net income for Q4 2019 was $11.3 million, a decrease compared to $15.4 million in Q4 2018.
Diluted earnings per share for Q4 2019 was $0.24, down from $0.32 in Q4 2018.
Revenue for Q4 2019 increased by $9.5 million, or 5.7%, to $176.9 million.
Total operating expenses for Q4 2019 increased by $15.6 million to $156.5 million.
Cal Water
Cal Water
Forward Guidance
Cal Water anticipates that if the settlement were adopted, it would plan to make capital investments of approximately $809.0 million to $828.0 million in the 2019-2021 period.
Positive Outlook
- Cal Water and the Public Advocates Office agree on infrastructure investments.
- Settlement details investment plans to maintain safe, reliable water service.
- CPUC will consider the settlement agreement.
- Cal Water would be authorized to include $609.0 million to $628.0 million of new projects in rates from 2019-2021.
- An additional $200.0 million for completion of projects begun in 2018 and prior periods.
Challenges Ahead
- A handful of significant matters remain including benefits balancing accounts, the WRAM decoupling mechanism, construction financing costs, and depreciation rates.
- The CPUC will consider, but is not required to adopt, the settlement agreement.
- The CPUC extended its statutory deadline to complete the proceeding by six months, to July 1, 2020.
- Cal Water requested a memorandum account to record the difference between the current rates that would continue to be billed starting January 1, 2020 (considered to be interim rates), and the rates that will eventually be approved in the case (final rates).
- After a GRC decision is adopted and final rates are implemented, the balance in the memorandum account will be reviewed, and customer bills will be adjusted to account for the difference between interim rates and final rates back to January 1, 2020.