American Water Works Company Inc.
) reported second quarter earnings per share of 57 cents, lagging
the Zacks Consensus Estimate of 60 cents by 5%.
Earnings were also 13.6% lower than the year-ago figure of 66
cents. The decline in earnings was attributable to above-average
rainfall and cooler temperatures in its service territories,
resulting in lower consumer demand.
Second quarter total revenue of $724.2 million declined 2.9% year
over year from $745.6 million and also lagged the Zacks Consensus
Estimate of $762.0 million by 4.96%.
The contribution from the company's regulated business declined
by 3% from the comparable year-ago period, primarily due to
Highlights of the Release
Total operating expenses in the reported quarter increased 1.6%
to $482.4 million, primarily due to a 9.8% increase in
depreciation and amortization expenses.
Interest expenses decreased 2.5% to $77.6 million from $79.6
million in the year-ago quarter due to a decline in debt.
Long-term debt of the company as of Jun 30, 2013 was $5.19
billion, marginally lower than $5.20 billion as of Dec 31, 2012.
During the quarter, the company announced the intended
acquisition of Dale Service Corp., a wastewater utility company
in Virginia and another company in Beaver County, Pa. Both these
acquisitions are expected to close before the end of the year. It
will expand market reach and add to the customer base.
American Water Works reaffirmed its 2013 earnings per share
guidance in the range of $2.15 to $2.25 per share.
American Water Works has already made capital investment of
$429.8 million in the first half of 2013 and intends to invest
$950 million in 2013 in various projects to ensure the safety and
reliability of its water operations.
Other Company Releases
Aqua America, Inc.
) announced second-quarter 2013 operating earnings of 38 cents
per share, 5.5% above the Zacks Consensus Estimate of 36 cents.
California Water Service Group
) announced second-quarter 2013 operating earnings of 28 cents
per share, in line with the Zacks Consensus Estimate.
Middlesex Water Company
) reported second-quarter 2013 earnings per share of 28 cents,
beating the Zacks Consensus Estimate by a penny.
Demand for water utility services fluctuates with weather.
American Water Works' performance in the quarter missed our
estimates primarily due to weather variation.
American Water Works continues to make investments to maintain
and upgrade its water and wastewater infrastructure. The
company is presently waiting for rate case decisions in five
states in which it operates. A favorable decision will definitely
help American Water Works to carry out the maintenance of its
Voorhees, N.J.-based American Water Works Company was founded in
1886. This water and wastewater utility caters to approximately
14 million residents across the country and parts of Canada.
American Water Works Company currently has a Zacks Rank #4
AMER WATER WORK (AWK): Free Stock Analysis
CALIF WATER SVC (CWT): Free Stock Analysis
MIDDLESEX WATER (MSEX): Free Stock Analysis
AQUA AMER INC (WTR): Free Stock Analysis
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