NEWARK, Del., March 09, 2022 (GLOBE NEWSWIRE) -- Artesian Resources Corporation (Nasdaq: ARTNA), a leading provider of water and wastewater services, and a number of other related core business services, on the Delmarva Peninsula, today announced earnings results for the fourth quarter and year ended December 31, 2021.
- Increased revenues by 3.1% in 2021 and 3.8% in the fourth quarter
- Increased shareholder dividends by 4% in 2021
- Paid dividends to shareholders for 117 consecutive quarters and increased dividends for the 25th consecutive year
- Invested $40.8 million in 2021 in water and wastewater infrastructure
- Completed construction of the Dagsboro Water Treatment Plant, located in Sussex County, and installed 8.5 miles of main and 45 fire hydrants to connect the new plant to the existing South Bethany water system
- Began operations at our Sussex Regional Recharge Facility, designed to accept over 3 million gallons per day of treated wastewater in Sussex County, Delaware
- Acquired Middlesex Water Company’s wholly-owned subsidiary, Tidewater Environmental Services, Inc., a regulated wastewater company, in January 2022, which more than doubled the number of wastewater customers served in Delaware
- Entered into an agreement in February 2022 to purchase water operating assets from the Town of Clayton, a Delaware municipality
Year End Results
Net income remained the same at $16.8 million for both 2021 and 2020. Diluted earnings per share also remained the same at $1.79 in 2021 and 2020.
Revenues totaled $90.9 million for the year ended December 31, 2021, $2.7 million, or 3.1%, more than revenues recorded for the same period in 2020.
Water sales revenue increased $1.3 million, or 1.8%, primarily due to an increase in fixed fee revenue related to customer growth and an increase in non-residential consumption revenue.
Other utility operating revenue, predominately consisting of wastewater revenues, increased $0.7 million, or 10.3%. This increase is mainly due to an increase in wastewater revenue related to residential customer growth and housing development in Sussex County, Delaware, offset by a decrease in industrial wastewater service revenue resulting from adjustments related to the amounts recorded for the minimum required volume of wastewater under contract, pursuant to a settlement agreement.
Non-utility operating revenue increased $0.7 million, or 13.7%, primarily due to an increase in contract service revenue related to a contract for the design and construction of wastewater infrastructure in New Castle County, Delaware for a third party and an increase in Service Line Protection Plan revenue that covers the cost of materials and labor to repair or replace participants’ leaking water services or clogged sewer lines.
“We have continued growth in our customer base, most notably in Sussex County, Delaware, through sustainable business practices, operational efficiencies, acquisitions and investments in infrastructure,” said Dian C. Taylor, Chair, President and CEO. “The successful execution of our business strategies supports our commitment to ensure customers continue to have safe, reliable water and wastewater service. We are confident in our ability to promote growth in earnings and deliver long-term value for our shareholders,” said Taylor.
Operating expenses, excluding depreciation and income taxes, increased $1.9 million, or 4.0%, primarily related to increases in water and wastewater treatment facilities and equipment maintenance costs, and overall compensation and employee benefit costs, partially offset by a decrease in bad debt reserve related to non-payment of water customer receivable balances resulting from the COVID-19 pandemic. In addition, there was an increase in contract service fees related to a wastewater infrastructure design and construction contract and an increase in Service Line Protection Plan plumbing repair fees.
Depreciation and amortization expense increased $0.7 million, or 6.7%, primarily due to continued investment in utility plant providing supply, treatment, storage and distribution of water to customers and service to our wastewater customers.
Miscellaneous income increased $0.3 million, primarily due to an increase in patronage from CoBank, -ACB.
Allowance for funds used during construction, or AFUDC, decreased $0.3 million as a result of lower long-term construction activity subject to AFUDC.
Recent Acquisitions
Continuing our efforts to expand integrated water and wastewater systems throughout the state of Delaware, in 2022, the Company completed one acquisition of a regulated wastewater company and signed another agreement to purchase water operating assets from a municipality. The acquisition of Middlesex Water Company’s wholly-owned subsidiary, Tidewater Environmental Services, Inc., in January 2022 added seven wastewater facilities, 13,000 acres of exclusive franchise territory, and more than doubled the number of wastewater customers served in Sussex County, Delaware. The acquisition of the Town of Clayton’s water system, which is expected to close in the second quarter of 2022, will integrate approximately 4,000 residents through 23 miles of main, and includes a treatment station, three wells and two elevated water storage tanks. The system will be integrated with Artesian’s existing regional water system in northern Kent County, Delaware. “These transactions are the result of our established relationships with municipalities and other water and wastewater utility providers, in addition to our proven ability to deliver exceptional, safe, and reliable water and wastewater service to our existing and future customers in fast-growing areas in Delaware,” said Taylor.
Capital Expenditures
As part of Artesian’s on-going effort to ensure high quality reliable service to customers, $40.8 million was invested in 2021, compared to $40.0 million in 2020, in water and wastewater infrastructure projects including installation of transmission and distribution facilities, replacement of aging mains, rehabilitation of treatment facilities, and redevelopment of wells and pumping equipment. “Our investments continue to advance our water and wastewater service reliability and support growth in the communities we serve,” said Taylor.
Fourth Quarter Results
Net income remained the same at $3.1 million for both the fourth quarter of 2021 and 2020. Diluted earnings per share were $0.32 for the fourth quarter of 2021 compared to $0.33 for the same quarter in 2020.
Revenues totaled $22.6 million, an increase of $0.8 million, or 3.8%.
Water sales revenue increased $0.3 million, or 1.8%, primarily due to an increase in non-residential consumption revenue.
Other utility operating revenue increased $0.3 million, or 12.7%, primarily due to an increase in wastewater revenue related to customer growth.
Non-utility operating revenue increased $0.2 million, or 16.4%, primarily due to an increase in contract service revenue related to a contract for the design and construction of wastewater infrastructure for a third party and an increase in Service Line Protection Plan revenue.
Operating expenses, excluding depreciation and income taxes, increased $0.7 million, or 5.2%, primarily related to increases in overall compensation and employee benefits costs, and water and computer equipment maintenance costs, partially offset by a decrease in bad debt reserve and purchased water costs. In addition, there was an increase in contract service fees related to a wastewater infrastructure design and construction contract and an increase in Service Line Protection Plan plumbing repair fees.
AFUDC decreased $0.2 million as a result of lower long-term construction activity subject to AFUDC.
About Artesian Resources
Artesian Resources Corporation operates as a holding company of wholly-owned subsidiaries offering water and wastewater services, and a number of other related core business services, on the Delmarva Peninsula. Artesian Water Company, the principal subsidiary, is the oldest and largest regulated water utility on the Delmarva Peninsula and has been providing water service since 1905. Artesian supplies 8.3 billion gallons of water per year through 1,398 miles of main to over a third of Delawareans.
Forward Looking Statements
This release contains forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding, among other things, our growth strategy, our expectations regarding the closing of our transaction to acquire a municipal water system, expectations regarding infrastructure investments, and the continued growth in our business and the number of customers served. These statements involve risks and uncertainties that could cause actual results to differ materially from those expressed or implied by such forward-looking statements including: changes in weather, changes in our contractual obligations, changes in government policies, the timing and results of our rate requests, failure to receive regulatory approval, changes in economic and market conditions generally, including inflationary pressures, and other matters discussed in our filings with the Securities and Exchange Commission. While the Company may elect to update forward-looking statements, we specifically disclaim any obligation to do so and you should not rely on any forward-looking statement as representation of the Company’s views as of any date subsequent to the date of this release.
Contact:
Nicki Taylor
Investor Relations
(302) 453-6900
ntaylor@artesianwater.com
| Artesian Resources Corporation | ||||||||||||
| Condensed Consolidated Statement of Operations | ||||||||||||
| (In thousands, except per share amounts) | ||||||||||||
| (Unaudited) | ||||||||||||
| Three months ended | Twelve months ended | |||||||||||
| December 31, | December 31, | |||||||||||
| 2021 | 2020 | 2021 | 2020 | |||||||||
| Operating Revenues | ||||||||||||
| Water sales | $ | 18,634 | $ | 18,299 | $ | 77,821 | $ | 76,476 | ||||
| Other utility operating revenue | 2,377 | 2,108 | 7,195 | 6,525 | ||||||||
| Non-utility operating revenue | 1,564 | 1,344 | 5,843 | 5,140 | ||||||||
| 22,575 | 21,751 | 90,859 | 88,141 | |||||||||
| Operating Expenses | ||||||||||||
| Utility operating expenses | 11,108 | 10,797 | 41,414 | 40,338 | ||||||||
| Non-utility operating expenses | 1,186 | 890 | 3,942 | 3,277 | ||||||||
| Depreciation and amortization | 2,927 | 2,863 | 11,885 | 11,143 | ||||||||
| State and federal income taxes | 1,060 | 1,004 | 5,737 | 5,684 | ||||||||
| Property and other taxes | 1,426 | 1,357 | 5,587 | 5,404 | ||||||||
| 17,707 | 16,911 | 68,565 | 65,846 | |||||||||
| Operating Income | 4,868 | 4,840 | 22,294 | 22,295 | ||||||||
| Allowance for funds used during construction | 95 | 253 | 823 | 1,170 | ||||||||
| Miscellaneous | 4 | (51 | ) | 1,302 | 971 | |||||||
| Income Before Interest Charges | 4,967 | 5,042 | 24,419 | 24,436 | ||||||||
| Interest Charges | 1,907 | 1,928 | 7,592 | 7,619 | ||||||||
| Net Income | $ | 3,060 | $ | 3,114 | $ | 16,827 | $ | 16,817 | ||||
| Weighted Average Common Shares Outstanding - Basic | 9,410 | 9,347 | 9,394 | 9,327 | ||||||||
| Net Income per Common Share - Basic | $ | 0.33 | $ | 0.33 | $ | 1.79 | $ | 1.80 | ||||
| Weighted Average Common Shares Outstanding - Diluted | 9,441 | 9,388 | 9,426 | 9,369 | ||||||||
| Net Income per Common Share - Diluted | $ | 0.32 | $ | 0.33 | $ | 1.79 | $ | 1.79 | ||||
| Artesian Resources Corporation | ||||||||||||
| Condensed Consolidated Balance Sheets | ||||||||||||
| (In thousands) | ||||||||||||
| (Unaudited) | ||||||||||||
| December 31, | December 31, | |||||||||||
| 2021 | 2020 | |||||||||||
| Assets | ||||||||||||
| Utility Plant, at original cost less | ||||||||||||
| accumulated depreciation | $ | 590,431 | $ | 559,561 | ||||||||
| Current Assets | 19,160 | 17,619 | ||||||||||
| Regulatory and Other Assets | 15,620 | 16,038 | ||||||||||
| $ | 625,211 | $ | 593,218 | |||||||||
| Capitalization and Liabilities | ||||||||||||
| Stockholders' Equity | $ | 178,010 | $ | 169,426 | ||||||||
| Long Term Debt, Net of Current Portion | 143,259 | 142,333 | ||||||||||
| Current Liabilities | 47,702 | 43,724 | ||||||||||
| Net Advances for Construction | 4,295 | 4,578 | ||||||||||
| Contributions in Aid of Construction | 176,656 | 160,258 | ||||||||||
| Other Liabilities | 75,289 | 72,899 | ||||||||||
| $ | 625,211 | $ | 593,218 | |||||||||
