2014

Artesian Resources Corporation Reports Second Quarter Results

NEWARK, Del., Aug. 5, 2011 /PRNewswire/ -- Artesian Resources Corporation (Nasdaq: ARTNA), a leading provider of water, wastewater and engineering services on the Delmarva Peninsula, today announced that revenues for the second quarter of 2011 were $16.5 million, a 3.2% increase from the $16.0 million in revenues recorded for the second quarter of 2010.

Net income for the quarter was $1.8 million, while diluted net income per share was $0.23.

On July 20, Artesian raised $15 million from a public offering of 804,290 shares of the Company's Class A Non-Voting Common Stock. Artesian used the proceeds to repay short term borrowings previously incurred primarily to finance its water utility plant and equipment construction program.

"Our investors continue to show great confidence in the future of Artesian and our ability to generate sound returns," said Artesian President and CEO Dian C. Taylor. "Maintaining a safe, reliable water system requires significant and continuous investment in our infrastructure. We believe our ability to attract investors and raise money through capital markets enables us to maintain our systems at the lowest possible cost to our customers."

In the first six months of 2011, Artesian invested $6.6 million in capital expenditures to enhance or improve existing treatment facilities, upgrade meter reading equipment and replace aging mains, among other projects.

"We installed additional treatment for water systems in Hockessin, Delaware, and other areas as part of our ongoing commitment to stay ahead of increasingly stringent water quality standards," Taylor said.

The increase in operating revenues during the second quarter was driven by strong water sales, including sales to neighboring water utilities. Water sales rose by 5.6% compared to the same period of 2010, representing 88.9% of revenues. Operating expenses, excluding depreciation and income taxes, grew 4.1% to $9.8 million, compared to the second quarter of 2010, primarily as a result of increased payroll and benefits costs.

During the quarter, Cecil County, Maryland, received a favorable ruling from the Maryland Court of Appeals allowing the county to proceed with the sale of its water and wastewater facilities to Artesian. Artesian is now progressing towards closing on the agreements by year end, subject to approval by the Maryland Public Service Commission. Artesian has made a significant investment in Cecil County over the last several years to provide water and wastewater infrastructure in the county's designated growth area.

About Artesian Resources

Artesian Resources Corporation operates as the holding company of eight wholly-owned subsidiaries offering water, wastewater and engineering 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 Water distributes and sells water to residential, commercial, industrial, governmental, municipal and utility customers. Other subsidiaries include Artesian Water Maryland, Inc., Artesian Water Pennsylvania, Inc., Artesian Wastewater Management, Inc., Artesian Wastewater Maryland, Inc., Artesian Utility Development, Inc., Artesian Consulting Engineers, Inc., and Artesian Development Company.

Artesian Resources Corporation

Condensed Consolidated Statement of Operations

(In thousands, except per share amounts)

(Unaudited)















Three months ended



Six months ended



June 30,



June 30,



2011



2010



2011



2010

Operating Revenues












    Water sales

$

14,683


$

13,909


$

27,598


$

26,804

    Other utility operating revenue


711



714



1,458



1,333

    Non-utility revenue


1,116



1,380



2,211



2,850



16,510



16,003



31,267



30,987













Operating Expenses












    Utility operating expenses


8,136



7,466



16,214



14,834

    Non-utility operating expenses


775



958



1,715



1,976

    Depreciation and amortization


1,823



1,723



3,633



3,454

    State and federal income taxes


1,260



1,209



1,954



2,326

    Property and other taxes


928



1,027



1,944



1,990



12,922



12,383



25,460



24,580













Operating Income


3,588



3,620



5,807



6,407













    Allowance for funds used during construction


38



24



73



67

    Miscellaneous


(25)



(44)



572



567













Income Before Interest Charges


3,601



3,600



6,452



7,041













Interest Charges


1,848



1,802



3,690



3,597













Net Income

$

1,753


$

1,798


$

2,762


$

3,444













  Weighted Average Common Shares Outstanding - Basic


7,672



7,539



7,662



7,526

  Net Income per Common Share - Basic

$

0.23


$

0.24


$

0.36


$

0.46













  Weighted Average Common Shares Outstanding - Diluted


7,714



7,607



7,706



7,595

  Net Income per Common Share - Diluted

$

0.23


$

0.24


$

0.36


$

0.45



Artesian Resources Corporation

Condensed Consolidated Balance Sheet

(In thousands)

(Unaudited)








June 30,


December 31,


2011


2010

Assets






    Utility Plant, at original cost less






       accumulated depreciation

$

348,251


$

345,383

    Current Assets


11,339



14,033

    Regulatory and Other Assets


12,223



12,113


$

371,813


$

371,529







Capitalization and Liabilities












    Stockholder’s Equity

$

95,705


$

95,146

    Long Term Debt, Net of Current Portion


106,729



105,061

    Current Liabilities


38,253



41,885

    Advances for Construction


15,832



16,159

    Contributions in Aid of Construction


74,962



74,531

    Other Liabilities


40,332



38,747


$

371,813


$

371,529



SOURCE Artesian Resources Corporation




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