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Artesian Resources Corporation Reports First Quarter 2016 Results

NEWARK, Del., May 04, 2016 (GLOBE NEWSWIRE) -- Artesian Resources Corporation (NASDAQ:ARTNA), a leading provider of water, wastewater services and related services on the Delmarva Peninsula, today announced that net income for the first quarter of 2016 was $2.8 million, a $0.3 million or 11.5% increase compared to net income recorded during the first quarter of 2015. Diluted net income per share increased 10.7% to $0.31 compared to $0.28 for the first quarter of 2015.

Revenues for the first quarter of 2016 were $18.4 million, a 2.7% increase from the $18.0 million in revenues recorded for the same three-month period of 2015. Water sales revenue increased by $0.4 million, or 2.5%, for the first quarter of 2016. The growth in water sales revenue was due to an increase in the number of customers served and the Distribution System Improvement Charge applied to customer bills, as well as the effect of the final rate adjustment as approved by the Delaware Public Service Commission upon conclusion of Artesian’s April 11, 2014 request for new rates to recover $47 million invested in utility plant. This increase was slightly offset by a decrease in water consumption.

The Distribution System Improvement Charge allows Delaware water utilities to place into effect interim rate increases for timely recovery of investments made in certain infrastructure improvements. “The Distribution System Improvement Charge has allowed Artesian to invest $7 million in the course of a year to replace and repair ageing infrastructure to ensure proper water quality and service reliability for our customers,” said Dian C. Taylor, Chair, President and CEO.

Non-utility operating revenues for the first quarter of 2016 were $1.1 million, a $0.1 million or 8.1% increase from the same period in 2015, reflecting an increase in the number of customers enrolled in Service Line Protection Plans. “Late in 2015 we introduced a third service line protection plan that covers a customer’s internal plumbing. This new plan offering along with an increase in participation in our existing water and sewer service line protection plan offerings accounted for the increase in non-utility operating revenue. Our customers can now obtain protection against the costs for repair or replacement of pipe within the home as well as for the service lines from the house to the street,” said Taylor.

Excluding depreciation and income taxes, operating expenses increased 0.1% for the three months ended March 31, 2016 compared to the same period in 2015. The ratio of operating expense, excluding depreciation and income taxes, to total revenue decreased by 2.4% the first quarter of 2016 compared to the same period in 2015.

Depreciation and amortization expense increased by $0.1 million, or 4.8%, to $2.3 million as a result of continued investment in utility plant providing supply, treatment, storage and distribution of water to customers. “In the past 12 months, Artesian has invested about $21 million in supply, treatment, storage and distribution infrastructure to continue to ensure a reliable and safe water supply for our customers,” said Taylor. Federal and state income tax expense increased $0.2 million, or 10.7%, to $2.0 million due to higher pre-tax income for the three months ended March 31, 2016, compared to the same three month period in 2015.

About Artesian Resources
Artesian Resources Corporation operates as a 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 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 1,218 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
March 31,
2016 2015
Operating Revenues
Water sales$16,436 $16,038
Other utility operating revenue 865 862
Non-utility revenue 1,148 1,062
18,449 17,962
Operating Expenses
Utility operating expenses 8,546 8,661
Non-utility operating expenses 635 521
Depreciation and amortization 2,315 2,209
State and federal income taxes 1,952 1,764
Property and other taxes 1,148 1,135
14,596 14,290
Operating Income 3,853 3,672
Allowance for funds used during construction 24 24
Miscellaneous 656 590
Income Before Interest Charges 4,533 4,286
Interest Charges 1,703 1,748
Net Income $2,830 $2,538
Weighted Average Common Shares Outstanding - Basic 9,066 8,917
Net Income per Common Share - Basic$0.31 $0.28
Weighted Average Common Shares Outstanding - Diluted 9,130 8,955
Net Income per Common Share - Diluted$0.31 $0.28
Artesian Resources Corporation
Condensed Consolidated Balance Sheet
(In thousands)
(Unaudited)
March 31, December 31,
2016 2015 .
Assets
Utility Plant, at original cost less
accumulated depreciation$407,173 $405,606
Current Assets 12,090 14,444
Regulatory and Other Assets 11,543 11,576
$430,806 $431,626
Capitalization and Liabilities
Stockholders' Equity$133,537 $132,331
Long Term Debt, Net of Current Portion 103,259 103,647
Current Liabilities 17,438 22,403
Advances for Construction 8,522 8,752
Contributions in Aid of Construction 102,842 99,847
Other Liabilities 65,208 64,646
$430,806 $431,626

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

Source:Artesian Resources Corporation