×

Artesian Resources Corporation Reports 4th Quarter and 2014 Year End Earnings

NEWARK, Del., March 11, 2015 (GLOBE NEWSWIRE) -- Artesian Resources Corporation (Artesian) (Nasdaq:ARTNA), a leading provider of water, wastewater services and related services on the Delmarva Peninsula, today announced revenue and income for 2014. Revenues were $72.5 million, up 4.9% from $69.1 million in 2013. Net income increased 14.6% to $9.5 million, compared to $8.3 million last year. Diluted net income per common share was up 13.8% at $1.07 for 2014 compared to $0.94 for 2013. Improved water sales revenue and a decrease in legal expenses associated with the litigation against the Chester Water Authority drove the increase in net income and earnings per share.

Water sales revenues increased 4.6%, to $64.7 million in 2014 from $61.8 million in 2013. The increase in water sales resulted from a 1.2% growth in the number of metered customers and greater customer consumption compared to that experienced in 2013. The increase was also a result of the temporary rates placed into effect until permanent rates are determined by the Delaware Public Service Commission.

Non-utility revenue was $4.2 million, up from $4.0 million in 2013, a 4.4% increase. The increase was the result of the growth in revenues generated by Artesian's water and wastewater Service Line Protection Plans, which continue to attract new enrollments. The Service Line Protection Plans provide coverage for all material and labor required to repair or replace participants' leaking water service or clogged sewer lines.

Operating expenses, excluding income taxes and depreciation, increased by 1.5% to $41.4 million in 2014 as compared to $40.8 million in 2013. The increases in operating expenses were related to increased payroll and related employee benefit costs of $1.0 million. Also contributing to the increased operating expenses were costs associated with the pending rate case of $0.2 million and increased property tax expense of $0.2 million, as a result of increases in tax rates charged for public schools and in utility plant subject to taxation. These expenses were offset by a decrease of $0.8 million in legal costs associated with the concluded litigation against Chester Water Authority in regard to the proper determination of the rate the authority charged for water purchased from them under contract. The ratio of operating expenses, excluding depreciation and income taxes, to total revenues was 57.1% for 2014 compared to 59.0% for 2013.

Depreciation and amortization expense increased by $0.4 million, or 5.1%, due to continued investment in utility plant, providing supply, treatment and distribution of water. Income tax expense increased by $0.8 million as a result of improved profitability compared to a year ago.

"Our improved financial results are not only due to increases in utility revenues but also our success in restraining growth of operating expenditures," said Dian C. Taylor, Chair, President and CEO. "We also continued to deliver on our commitment of providing superior service to our customers, investing $23.7 million in 2014 for infrastructure and other improvements to replace aging water mains, enhance existing treatment facilities, rehabilitate pumping equipment and upgrade our computer software system."

For the three months ended December 31, 2014, revenues were $18.1 million, an increase of 7.0% from $16.9 million for the same period in 2013 as a result of increased water sales. Net income increased 38.6% to $2.1 million for the three months ended December 31, 2014 compared to $1.5 million for the same period in 2013. Diluted net income per common share increased 41.2% to $0.24 for the three months ended December 31, 2014 compared to $0.17 for the same period in 2013.

Highlights in 2014 include the following:

  • Completed eleven water main renewal projects replacing nearly 4 miles of main ranging in age from 49 to 71 years old.
  • Completed the first phase of a hydraulic improvement project in the Christiana and Churchmans Crossing area of New Castle County, Delaware, with the installation of 4,150 feet of 16 inch ductile iron main and 1,450 feet of 20 inch high density polyethylene main as well as placing a new 5.1 million gallon per day booster station in service.
  • Completed rehabilitation of the 1950's era Castle Hills 1.3 million gallon per day water treatment plant in northern New Castle County.
  • Installed an ultraviolet advanced oxidation treatment process at our Llangollen facility in New Castle County.
  • Enrolled more than 19,000 customers to date, about 23% of our base, in our free and secure e-billing service that enables our customers to conveniently view, print and pay their bills on-line.

About Artesian Resources

Artesian Resources Corporation operates as the holding company of wholly-owned subsidiaries offering water, wastewater services and related services on the Delmarva Peninsula. Artesian Water Company, the principal subsidiary, is the oldest and largest investor-owned public water utility on the Delmarva Peninsula and has been providing water service since 1905. Artesian supplies 7.6 billion gallons of water per year through 1,201 miles of water main to about 301,000 people.

Artesian Resources Corporation
Condensed Consolidated Statements of Operations
(In thousands, except per share amounts)
(Unaudited)
Three months ended Year ended
December 31, December 31,
2014 2013 2014 2013
Operating Revenues
Water sales $15,987 $14,845 $64,667 $61,846
Other utility operating revenue 1,057 1,033 3,648 3,253
Non-utility operating revenue 1,035 1,015 4,150 3,974
18,079 16,893 72,465 69,073
Operating Expenses
Utility operating expenses 9,044 8,893 34,893 34,509
Non-utility operating expenses 495 524 2,193 2,121
Depreciation and amortization 2,121 2,086 8,673 8,251
State and federal income taxes 1,442 1,047 6,375 5,588
Property and other taxes 1,057 1,066 4,285 4,120
14,159 13,616 56,419 54,589
Operating Income 3,920 3,277 16,046 14,484
Allowance for funds used during construction 24 80 329 324
Miscellaneous (23) (46) 524 548
Income Before Interest Charges 3,921 3,311 16,899 15,356
Interest Charges 1,777 1,764 7,393 7,055
Net Income $2,144 $1,547 $9,506 $8,301
Weighted Average Common Shares Outstanding - Basic 8,907 8,818 8,884 8,774
Net Income per Common Share - Basic $0.24 $0.18 $1.07 $0.95
Weighted Average Common Shares Outstanding - Diluted 8,945 8,878 8,926 8,836
Net Income per Common Share - Diluted $0.24 $0.17 $1.07 $0.94
Artesian Resources Corporation
Condensed Consolidated Balance Sheet
(In thousands)
(Unaudited)
December 31, December 31,
2014 2013
Assets
Utility Plant, at original cost less accumulated depreciation $393,793 $378,960
Current Assets 16,648 13,254
Regulatory and Other Assets 11,772 11,618
$422,213 $403,832
Capitalization and Liabilities
Stockholders' Equity $125,605 $121,836
Long Term Debt, Net of Current Portion 104,954 105,510
Current Liabilities 30,192 25,563
Net Advances for Construction 10,228 11,427
Contributions in Aid of Construction 92,429 87,865
Other Liabilities 58,805 51,631
$422,213 $403,832

CONTACT: Nicholle Taylor Investor Relations (302) 453-6900 ntaylor@artesianwater.com

Source:Artesian Resources Corporation