American Water Works Company, Inc. · NYSE:AWK
American Water Works — Q1 2025 Earnings Presentation
32 slides from American Water Works's earnings presentation, May 1, 2025
Slide 1: 2025 First Quarter Earnings Conference Call
2025 First Quarter Earnings Conference Call May 1, 2025
Slide 2: Aaron Musgrave, Vice President, Investor Relations
Aaron Musgrave Vice President, Investor Relations 2
Slide 3: Forward-Looking Statements
FORWARD-LOOKING STATEMENTS Safe Harbor This presentation includes forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Litigation Reform Act of 1995 and the Federal securities laws. They are not guarantees or assurances of any outcomes, financial resu
Slide 4: John Griffith, President
4 AMERICAN WATER John Griffith President
Slide 5: First Quarter 2025 Results On Track
First Quarter 2025 Results On Track Earnings Per Share Q1/YTD Highlights 2025 Q1 EPS of $1.05 driven by higher revenue on increased rate base and 2024 rate case outcomes $1.05 $0.95 $0.03 Continued success in regulatory execution $0.02 • New rates effective in IL, TN, VA and CA; Constructive set
Slide 6: Long-Term Targets Affirmed
Long-Term Targets Affirmed Low Risk Capital Plan, Leading Earnings & Dividend Growth Outlook 2025 EPS Guidance Affirming 2025 Guidance of $5.65-5.75* 8% EPS Growth Higher revenues from investments at midpoint over weather-normalized in rate base while proactively 2024 EPS of $5.27 managing operating
Slide 7: Top Tier Dividend Growth Continues in 2025
Top Tier Dividend Growth Continues in 2025 8.2% Increase Aligns with Long-Term Target AWK’s Strong and Consistent Total Dividend Payout Ratio Dividend Growth* Projected as of Long-Term December 31, 2025* Target 58% 55-60% $3.2475 $3.0025 * Annual projected 2025 cash dividends per share of $3.2475 ov
Slide 8: David Bowler, Executive Vice President & Chief Financial Officer
David Bowler Executive Vice President & Chief Financial Officer 8
Slide 9: Details of First Quarter 2025 EPS
Details of First Quarter 2025 EPS 0.44 (0.15) (0.02) (0.11) 0.04 $1.05 $0.03* $0.95 (0.10) $0.02* Q1 2024 Revenue O&M General Taxes Depreciation Financing Other, net Q1 2025 * Results for the three months ended March 31, 2025 and 2024 include incremental interest income of $0.03 and $0.02 per share,
Slide 10: General Rate Case Updates
General Rate Case Updates Rate Cases in Progress 2025 Completed Rate Cases State Filed Capital Rates Expected State Additional Authorized Subsidiary Investment Effective Date Subsidiary Type Revenue Rates Effective Date Missouri 7/1/24 $1.1 billion May 31, 2025 Tennessee General $1 million January 2
Slide 11: 2025 YTD Legislative Updates
2025 YTD Legislative Updates Missouri - Future Test Year (SB4) • Water and wastewater utilities may request the use of a Future Test Year in a general rate case beginning July 1, 2026 • Passed on March 13, 2025 – signed by the Governor on April 9, 2025 • Legislation becomes effective on August 28, 2
Slide 12: Affirming 2025 EPS Guidance
Affirming 2025 EPS Guidance of $5.65 to $5.75** 2025 Growth Drivers 2025 Debt Financing Update 8% EPS growth in 2025 (at midpoint) vs. 2024 on a weather-normalized basis Successfully executed $800 million long-term note offering in February • Revenue growth in base rates and in infrastructure me
Slide 13: Cheryl Norton, Executive Vice President & Chief Operating Officer
Cheryl Norton Executive Vice President & Chief Operating Officer 13
Slide 14: Investments Drive Continued Rate Base Growth
Investments Drive Continued Rate Base Growth Minimal Impact Expected on CapEx and O&M from Tariffs Investments to Support System Needs Investments Drive Continued Rate Base Growth Regulated Capital Investments Estimated Rate Base** ~8-9% (Includes Acquisitions) (Includes Acquisitions) CAGR 2025E $ i
Slide 15: Acquisition Outlook
Acquisition Outlook Deals Under Agreement and in Pipeline Signify Strength in Many States Under Agreement South Orange Village, NJ Closed As of April 30, 2025 Water As of April 30, 2025 6 ~37,400 Customer Connections IL 3 4 ~2,150 Customer Connections 18 Acquisitions in 6 States, $162M $20 million p
Slide 16: ASCE 2025 Infrastructure Report Card
ASCE 2025 Infrastructure Report Card (March 2025) American Society of Civil Engineers’ Latest Study Highlights Investment Needs The U.S. AWK Drinking Water: C- United States’ Vast Aging Pipes, Meters, Acquisition Wastewater: D+ Infrastructure Needs and Service Lines Opportunities Plentiful Report Ca
Slide 17: Q&A Session
Q&A Session 17
Slide 18: Investor Relations Contacts
INVESTOR RELATIONS CONTACTS Aaron Musgrave, CPA Jack Quinn, CPA Vice President, Investor Relations Senior Manager, Investor Relations aaron.musgrave@amwater.com jack.quinn@amwater.com Janelle McNally Kelley Uyeda Director, Sustainability Analyst, Investor Relations & ESG janelle.mcnally@amwater.com
Slide 19: Appendix
Appendix 19
Slide 20: Forward Looking Statements
Forward Looking Statements Certain statements made, referred to or relied upon in this presentation including, without limitation, 2025 earnings guidance, the Company’s long-term financial, growth and dividend targets, the ability to achieve the Company’s strategies and goals, customer affordability
Slide 21: 2025 Earnings Guidance (Non-GAAP)
2025 Earnings and 2025 Earnings Guidance (Non-GAAP) This presentation includes a description of American Water’s 2025 earnings per share guidance range, and its 2025 dividend payout ratio, excluding the incremental interest from the amendment in early 2024 of the HOS seller note. This information wo
Slide 22: Successfully Executed $800M Note Offering
Successfully Executed $800M Note Offering Closed this offering on February 27, 2025 2025 financing plan includes $1.5- 2.0B of long-term debt financing Successfully Executed $800 Million Senior Note Offering Issuer American Water Capital Corp. Pricing Date February 24, 2025 Tenor 10yr Senior Unsec
Slide 23: State Legislation & Regulation Enable Growth
State Legislation & Regulation Enable Growth Fair Consolidated Future Hybrid Infrastructure Affordability Value Tariff Test Year Test Year Mechanism Tariffs/Programs CA MO CA MO CA MO MD IA NJ CA MO IA NJ IA NJ HI KY NJ IL PA IA NJ IL PA IL PA IA PA WV IN TN IL PA IN VA IN VA IL TN KY VA IN TN KY WV
Slide 24: Five- and Ten-Year Capital Plans
Five- and Ten-Year Capital Plans: Investments to Support System Needs Capital Plan ($ in billions) Capital Recovery Outlook $40 - $42 ~70% $4 - $5 Regulated Acquisitions Infrastructure Surcharge Mechanisms ~45% $17 - $18* $1.5 - $2.0 $3.3 $36 - $37 Regulated System Years ~30% Future TestTraditional
Slide 25: Reconciliation of Estimated Rate Base
Reconciliation of Estimated Rate Base Estimated Rate Base* As of 3/31/2025 Net Utility Plant $28.3 Less Advances for Construction $0.4 CIAC – Contributions in Aid of Construction $1.6 Net Deferred Income Taxes $3.9 $5.9 Total Estimated Rate Base $22.4 * An approximation of rate base, which includes
Slide 26: Continued Strong Balance Sheet & Credit Ratings
Continued Strong Balance Sheet & Credit Ratings AWK Long-Term Senior Unsecured Ratings Total Debt to Total Capital S&P Moody’s A Baa1 As of Long-Term (Stable Outlook) (Stable Outlook) March 31, 2025 Target Ratings and Stable Outlook Low risk business profile 58% <60% Strong regulatory affirmed a
Slide 27: Closed Acquisitions
Closed Acquisitions April 30, 2025 NUMBER WATER CUSTOMER CONNECTIONS WASTEWATER CUSTOMER CONNECTIONS STATE TOTAL CUSTOMER CONNECTIONS OF SYSTEMS Pennsylvania 1 1,600 - 1,600 California 1 300 - 300 New Jersey 1 250 - 250 Total 3 2,150 - 2,150 27
Slide 28: Acquisitions Under Agreement
Acquisitions Under Agreement April 30, 2025 NUMBER STATE WATER CUSTOMER CONNECTIONS WASTEWATER CUSTOMER CONNECTIONS TOTAL CUSTOMER CONNECTIONS OF SYSTEMS West Virginia 3 2,500 12,300 14,800 Pennsylvania 8 6,100 8,400 14,500 New Jersey 1 5,000 - 5,000 Illinois 1 - 1,500 1,500 California 3 1,300 - 1,3
Slide 29: Annualized Revenue from Rate Proceedings
Annualized Revenue from Rate Proceedings ($ in millions) Rate Filings Completed* Requested Revenue in Pending Rate Proceedings Effective since January 1, 2025 $23 $161 $138 $15 $100 $85 Rate Cases Infrastructure Total Rate Cases Infrastructure Total (Includes Charges (Includes Charges Step Increases
Slide 30: Rates Effective Since January 1, 2025
Rates Effective Since… January 1, 2025 ($ in millions) Date Annualized Date Annualized Revenue Rate Cases & Step Increases Infrastructure Charges Effective Revenue Increases Effective Increases Illinois 1/1/2025 $105(a) Kentucky (QIP) 1/1/2025 $2 West Virginia (DSIC/WSIC) 1/1/2025 4 California, Step
Slide 31: Pending Rate Case Filings
Pending Rate Case Filings ($ in millions) Rate Cases Filed Docket/Case Number Date Filed Requested Revenue Increase ROE Requested Rate Base Iowa (a) Docket No. RPU-2024-0002 5/1/2024 $21 10.75% $258 $21 $258 Rate Cases Awaiting Regulatory Approval Missouri (b) Docket No. WR-2024-0320 7/1/2024 $63 Ha
Slide 32: Regulatory Information – Top States
Regulatory Information – Top 10 States CALIFORNIA ILLINOIS INDIANA KENTUCKY MISSOURI Authorized Rate Base* $882,554g) $2,185,956 $1,723,927 $489,426 $2,318,849(c) ROE 10.20%(a) 9.84% 9.65% 9.70% 9.75%(d) Equity 57.04%(a) 49.00% 56.15%(b) 52.22% 50.00%(e) Effective Date of Rate Case 1/1/2024(g) 1/1/2
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