Artesian Resources Corporation Reports 4th Quarter and 2012 Year End Earnings

13 Mar, 2013, 16:45 ET from Artesian Resources Corporation

NEWARK, Del., March 13, 2013 /PRNewswire/ -- Artesian Resources Corporation (Artesian) (NASDAQ: ARTNA), a leading provider of water, wastewater and related services on the Delmarva Peninsula, today announced record revenue and income for 2012.  Revenues were $70.6 million, up 8.4% from $65.1 million in 2011. Net income grew 46.0% to $9.8 million, compared to $6.7 million from last year. Diluted net income per common share was up 36.1% at $1.13 compared to $0.83. Higher water sales revenue and improved operating margins drove the record results.

"We are pleased with our 2012 performance, as we delivered sound results for our customers and shareholders," said Dian C. Taylor, Chair, President & CEO.  "Our 2012 results were positively impacted by our fiscal discipline and operational management.  In addition, we continued our commitment to providing the best possible service to our customers.  We launched a free and secure e-Billing service and converted to a monthly billing cycle at the request of our customers.  We will remain focused on operating as efficiently as possible in 2013 and will continue our efforts to provide superior service to our customers." 

Water sales revenues were up 10.5%, to $63.6 million in 2012 from $57.6 million in 2011. The increase in water sales is primarily attributable to the addition of new customers, including those from acquisitions of water systems in Cecil County, Maryland over the past 15 months, and increased rates in Delaware. Artesian was granted rate relief in late 2011 to allow for the recovery of over $40 million in infrastructure improvements made in prior years. The new rates were fully implemented in January 2012.

Non-utility revenue was $3.8 million, down from $4.2 million in 2011, a 9.9% drop. The decrease was due to a decline in design and permitting work and a decrease in contract services performed in Maryland following the acquisition of the Cecil County water assets in December 2011. The decrease was partially offset by the growth in revenues generated by Artesian's water and wastewater Service Line Protection Plans, which continue to be popular with customers. 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 2.3% to $40.2 million in 2012 as compared to $39.3 million in 2011. The major components of the increase were higher payroll and related benefits costs, and increased purchased water expenses. These increases were partially offset by a decrease in non-utility expenses resulting from less non-regulated project activity in 2012. The ratio of operating expenses, excluding depreciation and income taxes, to total revenues was 56.9% for 2012 compared to 60.4% for 2011.

Depreciation and amortization expense increased by $0.5 million, or 7.0%, due to continued investment in utility plant, providing supply, treatment and distribution of water.  Income tax expense increased by $2.0 million as a result of improved profitability.

For the three months ended December 31, 2012, revenues were $17.0 million, an increase of 5.5% from $16.1 million for the same period in 2011.  Net income and diluted net income per common share for the three months ended December 31, 2012 were flat at $1.7 million and $0.20, respectively, compared to the same period in 2011. 

Other Artesian highlights include the following:

  • Enrolled more than 10,000 customers, about 13% 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.
  • Continued growth in Cecil County, Maryland with the acquisition of CECO Utilities, Inc.
  • Expanded water systems in Cecil County with the installation of 7.6 miles of new water main.
  • Extended water mains from our Delaware water system into the Town of Chesapeake City, Maryland making Artesian the sole water supplier for the Town and surrounding areas.
  • Artesian's Beth Hamilton was honored in 2012 as the first woman recipient of the Operator of the Year Award by the American Water Works Association Chesapeake Section.

About Artesian Resources Artesian Resources Corporation operates as the holding company of eight wholly-owned subsidiaries offering water, wastewater 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 Resources Corporation

Condensed Consolidated Statement of Operations

(In thousands, except per share amounts)

(Unaudited)

Three months ended

Year ended

December 31,

December 31,

2012

2011

2012

2011

Operating Revenues

Water sales

$

15,010

$

14,045

$

63,607

$

57,564

Other utility operating revenue

1,003

1,094

3,169

3,302

Non-utility operating revenue

939

934

3,787

4,204

16,952

16,073

70,563

65,070

Operating Expenses

Utility operating expenses

8,725

7,770

34,117

32,300

Non-utility operating expenses

538

724

2,100

3,148

Depreciation and amortization

2,050

1,880

7,930

7,410

State and federal income taxes

1,180

1,197

6,616

4,654

Property and other taxes

980

940

3,945

3,822

13,473

12,511

54,708

51,334

Operating Income

3,479

3,562

15,855

13,736

Allowance for funds used during construction 

70

22

323

163

Miscellaneous

(35)

(49)

713

136

Income Before Interest Charges

3,514

3,535

16,891

14,035

Interest Charges

1,766

1,789

7,045

7,289

Net Income 

$

1,748

$

1,746

$

9,846

$

6,746

Weighted Average Common Shares Outstanding - Basic

8,705

8,601

8,666

8,122

Net Income per Common Share - Basic

$

0.20

$

0.20

$

1.14

$

0.83

Weighted Average Common Shares Outstanding - Diluted

8,773

8,634

8,717

8,160

Net Income per Common Share - Diluted

$

0.20

$

0.20

$

1.13

$

0.83

Artesian Resources Corporation

Condensed Consolidated Balance Sheet

(In thousands)

(Unaudited)

December 31,

December 31,

2012

2011

Assets

Utility Plant, at original cost less 

accumulated depreciation

$

366,563

$

353,397

Current Assets

13,480

13,250

Regulatory and Other Assets

11,671

12,090

$

391,714

$

378,737

Capitalization and Liabilities

Stockholders' Equity

$

118,180

$

112,997

Long Term Debt, Net of Current Portion

106,257

106,539

Current Liabilities

24,939

24,660

Net Advances for Construction

13,023

14,405

Contributions in Aid of Construction

81,348

77,306

Other Liabilities

47,967

42,830

$

391,714

$

378,737

 

SOURCE Artesian Resources Corporation



RELATED LINKS

http://www.artesianwater.com