Essential Utilities Q4 2019 Earnings Report
Key Takeaways
Essential Utilities reported Q4 2019 revenues of $226.0 million, a 9.9% increase compared to Q4 2018. Net income for Q4 2019 was $64.2 million, or $0.28 per share, compared to a net loss of $3.7 million, or $0.02 per share, for Q4 2018. Excluding the impact of the Peoples transaction, adjusted income for Q4 2019 was $61.4 million, or $0.34 per share, compared to $55.2 million, or $0.31 per share, in 2018.
Revenues increased to $226.0 million, up 9.9% compared to the same period in 2018.
Net income was $64.2 million (GAAP) or $0.28 per share (GAAP) compared to a net loss of $3.7 million (GAAP) or $0.02 per share (GAAP) for the fourth quarter of 2018.
Adjusted income was $61.4 million (non-GAAP) or $0.34 per share (non-GAAP), compared to $55.2 million (non-GAAP) or $0.31 (non-GAAP) in 2018, excluding the impact of the Peoples transaction.
Essential invested $59.7 million to acquire eight water and wastewater systems in 2019, adding approximately 12,000 new customers.
Essential Utilities
Essential Utilities
Forward Guidance
Essential Utilities provided full-year 2020 guidance, including adjusted pro-forma income per diluted common share (non-GAAP) of $1.53 to $1.58.
Positive Outlook
- Adjusted pro-forma income per diluted common share (non-GAAP) of $1.53 to $1.58.
- 3-year earnings growth CAGR 5-7% for 2019 through 2022, such that base is 2019 adjusted income per share (non-GAAP)
- Infrastructure investments of approximately $550 million in 2020 for communities served by the water operations
- Infrastructure investments of approximately $400 million in 2020 for communities served by the gas operations
- Rate base compound annual growth rate of 6 to 7 percent through 2022 in water; and 8 to 10 percent in gas through 2022
Challenges Ahead
- Guidance is subject to risks and uncertainties, including those factors outlined in the “Forward-Looking Statements” of this release and the “Risk Factors” section of the company’s annual and quarterly reports filed with the Securities and Exchange Commission.
- It excludes transaction-related expenses for the Company’s pending Peoples acquisition
- It excludes the impact of Peoples transaction-related rate credits of $23 million to be granted to Pennsylvania water and gas customers
- There is need for adjustment to provide full-year run rate of Peoples operating results, including additional net interest expense
- There are income tax implications of non-GAAP adjustments