Artesian Resources Corporation Reports First Quarter 2013 Results

May 07, 2013, 16:01 ET from Artesian Resources Corporation

NEWARK, Del., May 7, 2013 /PRNewswire/ -- Artesian Resources Corporation, (NASDAQ: ARTNA), a leading provider of water, wastewater services and other related services on the Delmarva Peninsula, today announced that net income for the first quarter of 2013 was $1.6 million, a $0.9 million decrease compared to $2.5 million in net income recorded during the first quarter of 2012.  Diluted net income per share decreased to $0.19 compared to $0.29 for the first quarter of 2012.

Revenues for the first quarter of 2013 were $16.3 million, a 2.2% decrease from the $16.7 million in revenues recorded for the same three-month period of 2012.  Water sales revenue decreased $0.5 million, or 3.2%, to $14.6 million for the first quarter of 2013, compared to $15.0 million for the same period in 2012, as a result of a decline in water consumption.  Non-utility operating revenues for the first quarter of 2013 were $1.0 million, a $0.1 million, or 6.0%, increase from the $0.9 million recorded for the same period in 2012 reflecting increased enrollment in water and wastewater Service Line Protection Plans that provide coverage for material and labor to repair or replace participants' leaking water service or clogged sewer lines.

Excluding depreciation and income taxes, operating expenses increased $1.0 million, or 10.3%, to $10.4 million for the first quarter of 2013, compared to $9.5 million for the same period in 2012.  Utility operating expenses for the first quarter of 2013 were $8.8 million, a $0.9 million, or 11.4%, increase from the $7.9 million recorded for the same period in 2012.  The increase was primarily due to increased legal costs associated with litigation against the Chester Water Authority in regard to the proper determination of the rate charged for water purchased under contract from the Chester Water Authority and increased payroll and employee benefit costs.  The ratio of operating expense, excluding depreciation and income taxes, to total revenue rose to 63.9% for the first quarter of 2013, compared to 56.7% for the same period in 2012.

"In addition to the reduction in water sales revenue during the first quarter, we were faced with increased legal expenses.  The litigation with the Chester Water Authority is an unfortunate circumstance that was necessary for us to take in order to protect the long-term interests of our customers.  We are disappointed that it has taken such effort and expense but we are driven by the fact that we know it is the right course of action," said Dian C. Taylor, Chair, President and CEO.

About Artesian Resources

Artesian Resources Corporation operates as the holding company of eight wholly-owned subsidiaries offering water, wastewater services and other 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 Statements of Operations

(In thousands, except per share amounts)

(Unaudited)

Three months ended

March 31,

2013

2012

Operating Revenues

Water sales

$

14,567

$

15,044

Other utility operating revenue

786

735

Non-utility revenue

974

919

16,327

16,698

Operating Expenses

Utility operating expenses

8,831

7,929

Non-utility operating expenses

539

498

Depreciation and amortization

2,041

1,960

State and federal income taxes

1,111

1,688

Property and other taxes

1,067

1,033

13,589

13,108

Operating Income

2,738

3,590

Allowance for funds used during construction 

67

34

Miscellaneous

582

653

Income Before Interest Charges

3,387

4,277

Interest Charges

1,747

1,772

Net Income 

$

1,640

$

2,505

    Weighted Average Common Shares Outstanding - Basic

8,725

8,626

    Net Income per Common Share - Basic

$

0.19

$

0.29

    Weighted Average Common Shares Outstanding - Diluted

8,794

8,663

    Net Income per Common Share - Diluted

$

0.19

$

0.29

Artesian Resources Corporation

Condensed Consolidated Balance Sheet

(In thousands)

(Unaudited)

March 31,

December 31,

2013

2012

Assets

Utility Plant, at original cost less 

accumulated depreciation

$

368,340

$

366,563

Current Assets

13,028

13,480

Regulatory and Other Assets

11,778

11,671

$

393,146

$

391,714

Capitalization and Liabilities

Stockholder's Equity

$

118,665

$

118,180

Long Term Debt, Net of Current Portion

106,022

106,257

Current Liabilities

24,482

24,939

Advances for Construction

12,732

13,023

Contributions in Aid of Construction

82,684

81,348

Other Liabilities

48,561

47,967

$

393,146

$

391,714

 

SOURCE Artesian Resources Corporation