California Water Service Group · NYSE:CWT
California Water Service — Q2 2024 Earnings Presentation
18 slides from California Water Service's earnings presentation, Aug 1, 2024
Slide 1: Second Quarter 2024 Earnings Presentation
Second Quarter 2024 Earnings Presentation August 1, 2024
Slide 2: Today’s Speakers
Today’s Speakers Marty Kropelnicki James Lynch Greg Milleman Chairman & CEO Sr. Vice President, CFO & Treasurer Vice President, Rates & Regulatory Affairs 2
Slide 3: Forward-Looking Statements and Other Important Information
Forward-Looking Statements and Other Important Information This presentation contains forward-looking statements within the meaning established by the Private Securities Litigation Reform Act of 1995 (“PSLRA”). The forward-looking statements are intended to qualify under provisions of the federal se
Slide 4: Highlights from the Period
Highlights from the Period 1 2 3 CA Supreme 4 5 Company 6 Court voided Hawaii Water continued to the portion of Newly Operating Company filed hosted pursue cost CPUC decision published results 2024 CA GRC / emergency recovery for related to 2023 ESG benefitted Infrastructure response treatment elimi
Slide 5: Second Quarter 2024 Financials
Second Quarter 2024 Financials (in millions except EPS amounts & %s) Q2 2024 Q2 2023 Variance Operating Revenue $244.3 $194.0 25.9% Operating Expenses $196.1 $178.1 10.1% Net Interest Expense $14.0 $12.7 10.2% Net Income Attributable to CWT $40.6 $9.6 322.9% Diluted Earnings per Share $0.70 $0.17 31
Slide 6: Diluted EPS Bridge Q2 2023 to Q2 2024
Diluted EPS Bridge Q2 2023 to Q2 2024 Reflects regulatory approval of Cal Water’s 2021 GRC in Q1 24 $0.90 $0.14 $0.80 $0.08 $0.70 $0.70 $0.26 -$0.09 -$0.03 $0.60 -$0.04 -$0.02 $0.50 $0.23 $0.40 $0.30 $0.17 $0.20 $0.10 $0.00 6
Slide 7: Second Quarter 2024 Financials
Second Quarter 2024 Financials (in millions except EPS amounts & %) YTD 2024 YTD 2023 Variance Operating Revenue $515.0 $325.1 58.4% Operating Expenses $389.0 $326.7 19.1% Net Interest Expense $29.1 $24.7 17.8% Net Income (loss) Attributable to CWT $110.5 ($12.7) 970% Diluted Earnings (Loss) per Sha
Slide 8: Diluted EPS Bridge YTD 2023 to YTD 2024
Diluted EPS Bridge YTD 2023 to YTD 2024 Reflects regulatory approval of Cal Water’s 2021 GRC in Q1 24 $2.30 $0.22 $0.44 $1.90 $2.00 -$0.13 $0.11 $1.70 $1.82 -$0.19 -$0.08 -$0.06 $1.40 $1.10 $0.80 $0.50 $0.20 -$0.10 -$0.40 -$0.23 8
Slide 9: Capital Investment & Depreciation
Capital Investment & Depreciation Growth in capital investment outpaces depreciation (in millions) $800 Capital Investment Depreciation $750 $700 $660 $655 $600 2015-2023 TOTAL CapEx $500 $384 $385 $400 3x $328 $299 $293 $300 $259 $272 $274 $229 $200 $177 $263 $224 $233 DEPRECIATION $100 $115 $124 $
Slide 10: Regulated Rate Base Growth
Regulated Rate Base Growth Estimated to achieve over $3.3 billion by 2027 (in billions) $4.00 $3.50 $3.35 $2.93 $3.00 $2.58 $2.50 $2.36 $2.20 $2.01 $1.87 $2.00 $1.61 $1.50 $1.24 $1.26 $1.00 $0.50 $0.00 2018 2019 2020 2021 2022 2023 2024* 2025** 2026** 2027** *2024 rate base estimates include amounts
Slide 11: Capital Allocation | Balance Sheet
Capital Allocation | Balance Sheet Continued to maintain financial discipline with strong balance sheet, while allocating capital in efficient manner Strong capital structure Maintained Board- Declared 318th S&P affirmed a global of 59.5% equity and authorized equity ATM consecutive quarterly credit
Slide 12: Liquidity Profile
Liquidity Profile Group maintained strong liquidity profile to help execute capital plan and pursue strategic M&A investments (in millions) $450 $400 • Expect to have adequate cash to support capital investment and growth $350 $300 • Credit facility of $600 million that can be expanded up to $800 mi
Slide 13: 2024 California General Rate Case Filing
2024 California General Rate Case Filing LUWEP $1.6B Application proposes Low-Use Filing requests total revenue increases of: Water Equity Program that would decouple revenue from water sales • $140.6 million, or 17.1%, for 2026 to enhance affordability • $74.2 million, or 7.7%, for 2027 Investment
Slide 14: Group Hosts Emergency Exercises, Responds to Wildfires
Group Hosts Emergency Exercises, Responds to Wildfires Hawaii Emergency Exercises Thompson, Park & Borel Fires • Hawaii Water hosted emergency response and regulatory • Cal Water activated EOC in early July when Thompson Fire agencies, elected and State offices, utilities, contractors, threatened Or
Slide 15: Group Executing Plan to Meet New PFAS Standards and Continues to Pursue Cost Recovery
Group Executing Plan to Meet New PFAS Standards and Continues to Pursue Cost Recovery Group leading water EPA also designated Group has been preparing industry efforts on EPA adopted new 2 PFAS as hazardous for new regulation and treatment cost recovery National Primary substances under believes wel
Slide 16: Acquisitions
Acquisitions Group continues to pursue diversification into compelling states including HI, WA, NM & TX 36,000+ Total connections added through acquisitions • Completed acquisition of Kings Mountain Park Mutual Water Company in Q2; although small, enhances water supply reliability and system resilie
Slide 17: 2023 ESG Report Published
2023 ESG Report Published Highlighting environmental, social, and governance efforts and strategic initiatives for 2024 Report highlights ongoing efforts to support Group's ESG strategy and In May, Company released 2023 objectives along with significant achievements in 2023, including: ESG Report an
Slide 18: Questions?
Questions?
California Water Service Group — Q2 2024 Earnings Presentation on 6ix