Artesian Resources (ARTNA) Q3 2024 earnings summary

Executive summary

• Operating revenues for Q3 2024 increased 9.7% year-over-year to $29.1 million, driven by higher water sales and customer growth.

• Net income for Q3 2024 rose 34.4% to $6.8 million, with EPS of $0.66, compared to $5.1 million and $0.49 in Q3 2023.

• Year-to-date net income increased 25.2% to $16.5 million; diluted EPS reached $1.61.

• Final approved water rates effective June 12, 2024, replaced temporary rates, resulting in a 15.2% annualized increase in water sales revenue.

• Regulated utility segment contributed 93.6% of total operating revenues for the nine months ended September 30, 2024.

Financial highlights

• Q3 2024 operating revenues: $29.1M (+$2.6M YoY); nine months: $81.1M (+$6.8M YoY).

• Water sales revenue for Q3 increased 11.3% due to a 14.6% temporary rate hike and higher consumption; year-to-date water sales rose 10.2%.

• Operating expenses (excl. depreciation & taxes) up 4.9% YoY in Q3 and nine months.

• Depreciation expense decreased 4.5% in Q3, increased 3.0% for nine months.

• Interest charges for nine months decreased $0.4M due to lower short-term debt interest.

Outlook and guidance

• Company expects continued growth in regulated water and wastewater services, with expansion in Delaware and Maryland.

• Capital improvements planned over the next three years for water and wastewater infrastructure expansion.

• Anticipates continued growth in non-utility subsidiaries, especially SLP Plans.

• Sufficient liquidity expected from operations, credit lines, and capital markets to fund short- and long-term needs.

• Management expects continued growth in business and customer base, with proactive investment in water quality and regulatory compliance.