Artesian Resources Corporation Reports Third Quarter Results

Nov 03, 2011, 16:00 ET from Artesian Resources Corporation

NEWARK, Del., Nov. 3, 2011 /PRNewswire/ -- Artesian Resources Corporation (NASDAQ: ARTNA) today announced that revenues for the third quarter of 2011 were $17.7 million, down slightly from $18.0 million in revenues recorded for the third quarter in 2010. Revenues were impacted by near-record rainfall on the Delmarva Peninsula during the quarter, which lowered water consumption and offset an increase in water sales revenue resulting from a temporary rate increase in Delaware.

"We continue to diversify our business to increase our revenues from sources other than water sales," said Artesian President and CEO, Dian C. Taylor. "But, the reality is that water sales are still core to our business and when we have historically bad weather, water sales will be adversely affected."

During the third quarter, the Maryland Public Service Commission issued an order authorizing Artesian Water Maryland's exercise of its water service franchise area in the eastern part of Cecil County. Artesian is now well-positioned to provide reliable water service throughout Cecil County's growth area. Artesian already provides water service to the Town of Port Deposit through a Susquehanna River water appropriation, has a water interconnection with the Town of Elkton and provides water service in the Mountain Hill area in the western part of the county that includes the Principio Business Park and communities of Carpenters Point and Whitaker Woods.

Artesian mutually agreed with Cecil County during the third quarter to terminate agreements to purchase wastewater facilities from the county and recorded a one-time charge against income of $349,000.

Net income decreased by $659,000, to $2.24 million for the third quarter.  Diluted net income per common share was $0.26, down $0.12 from the same period last year. Earnings per share was impacted by the one-time charge as well as this year's late summer near-record rainfall and the effect of an 888,290 common stock share offering in the third quarter of 2011.

Operating expenses, excluding depreciation and income taxes, for the third quarter of, 2011, increased by 3.9% to $10.0 million, compared to $9.6 million for the same period in 2010. The increase was primarily due to higher water treatment equipment maintenance costs, meter maintenance costs, fuel and personnel expenses.

"Despite the bad weather, we had many positives," Taylor said. "Our profitable Water and Sewer Service Line Protection plans continued to grow and we moved one step closer to providing end-to-end water service in Cecil County's growth area. We are committed to driving this business forward by providing safe, reliable water and superior customer service; continuously improving our efficiency and performance; and delivering sound returns for our investors."

About Artesian

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 Resources Corporation

Condensed Consolidated Statement of Operations

(In thousands, except per share amounts)

(Unaudited)

Three months ended

Nine months ended

September 30,

September 30,

2011

2010

2011

2010

Operating Revenues

Water sales

$

15,921

$

16,097

$

43,520

$

42,901

Other utility operating revenue

751

657

2,208

1,990

Non-utility revenue

1,058

1,209

3,269

4,059

17,730

17,963

48,997

48,950

Operating Expenses

Utility operating expenses

8,313

7,697

24,527

22,531

Non-utility operating expenses

709

946

2,424

2,923

Depreciation and amortization

1,897

1,750

5,530

5,204

State and federal income taxes

1,505

1,922

3,459

4,248

Property and other taxes

939

942

2,882

2,931

13,363

13,257

38,822

37,837

Operating Income

4,367

4,706

10,175

11,113

Allowance for funds used during construction

67

73

140

140

Miscellaneous

(387)

(47)

185

520

Income Before Interest Charges

4,047

4,732

10,500

11,773

Interest Charges

1,809

1,835

5,500

5,432

Net Income

$

2,238

$

2,897

$

5,000

$

6,341

Weighted Average Common Shares Outstanding - Basic

8,547

7,562

7,960

7,538

Net Income per Common Share - Basic

$

0.26

$

0.38

$

0.63

$

0.84

Weighted Average Common Shares Outstanding - Diluted

8,579

7,623

8,000

7,601

Net Income per Common Share - Diluted

$

0.26

$

0.38

$

0.63

$

0.83

Artesian Resources Corporation

Condensed Consolidated Balance Sheet

(In thousands)

(Unaudited)

September 30,

December 31,

2011

2010

Assets

Utility Plant, at original cost less

accumulated depreciation

$

350,504

$

345,383

Current Assets

13,647

14,033

Regulatory and Other Assets

11,689

12,113

$

375,840

$

371,529

Capitalization and Liabilities

Stockholder’s Equity

$

110,787

$

95,146

Long Term Debt, Net of Current Portion

105,955

105,061

Current Liabilities

26,808

41,885

Advances for Construction

15,410

16,159

Contributions in Aid of Construction

75,321

74,531

Other Liabilities

41,559

38,747

$

375,840

$

371,529

SOURCE Artesian Resources Corporation



RELATED LINKS

http://www.artesianwater.com