California Water Service Group · NYSE:CWT
California Water Service — Q3 2024 Earnings Presentation
17 slides from California Water Service's earnings presentation, Oct 31, 2024
Slide 1: Third Quarter 2024 Earnings Presentation
Third Quarter 2024 Earnings Presentation October 31, 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 secu
Slide 4: Highlights from the Period
Highlights from the Period 1 2 3 Approved 4 Made critical 5 Filed 2024 CA GRC / advice letters infrastructure relating to investments Received Results reflect Infrastructure totaling awards for continued regulatory Improvement mechanisms to $332.2M to conservation, benefit from Plans for 2025- suppo
Slide 5: Third Quarter 2024 Financials
Third Quarter 2024 Financials (in millions except EPS amounts and %s) Q3 2024 Q3 2023 $ Variance % Change Operating Revenue $299.6 $255.0 $44.6 17.5% Operating Expenses $232.8 $211.5 $21.3 10.1% Net Interest Expense $13.6 $12.8 $0.8 6.2% Net Income Attributable to CWT $60.7 $34.4 $26.3 76.5% Diluted
Slide 6: Diluted EPS Bridge Q3 2023 to Q3 2024
Diluted EPS Bridge Q3 2023 to Q3 2024 $1.40 $0.10 $0.09 $0.56 $1.20 -$0.12 -$0.04 $1.03 -$0.04 $1.00 -$0.10 $0.80 $0.60 $0.60 $0.40 $0.20 $0.00 6
Slide 7: Year-to-Date 2024 Financials
Year-to-Date 2024 Financials (in millions except EPS amounts and %s) YTD 2024 YTD 2023 $ Variance % Change Operating Revenue $814.6 $580.1 $234.5 40.4% Operating Expenses $621.8 $538.2 $83.6 15.5% Net Interest Expense $42.7 $37.5 $5.2 13.9% Net Income Attributable to CWT $171.1 $21.8 $149.3 684.9% D
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 $3.60 $0.09 $0.17 $0.12 $3.20 $0.21 $1.19 -$0.25 $0.04 $2.93 $2.80 -$0.18 -$0.13 $2.40 $2.00 $1.29 $1.60 $1.20 $0.80 $0.38 $0.40 $0.00 8
Slide 9: Capital Investment & Depreciation
Capital Investment & Depreciation Growth in capital investment outpaces depreciation (in millions) 2015-2024* TOTAL $800 Capital Investment Depreciation $750 CapEx $700 $600 $660 $655 3x DEPRECIATION $500 $400 $299 $293 $328 $384 $385 $259 $272 $274 $300 $229 $177 $200 CapEx 2025-2027** >4x $100 $64
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 $2.36 $2.50 $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 Continue to maintain financial discipline with strong balance sheet, while allocating capital in efficient manner Declared 319th Company capital Maintain Board- Cal Water issued $125M consecutive quarterly structure of 60.8% authorized at-the-market of its 5.22% Fi
Slide 12: Liquidity Profile
Liquidity Profile Group maintains strong liquidity profile to execute capital plan and strategic M&A investments (in millions) $450 • Expect to have adequate cash to support capital $400 investment and growth $350 $300 • Credit facilities of $600M that can be expanded up to $340.0 $800M; facilities
Slide 13: 2024 California General Rate Case
2024 California General Rate Case LUWEP Key updates since filing: $1.6B • Pre-hearing conference has been completed Application proposes Low-Use • A judge and commissioner have been assigned to Water Equity Program that would the rate case decouple revenue from water sales to enhance affordability •
Slide 14: Water Cost of Capital Mechanism
Water Cost of Capital Mechanism No change triggered for California Return on Equity (ROE) in 2025 • Cal Water’s current Cost of Capital decision, as extended through 12/31/25, includes Water Cost of Capital Mechanism (WCCM) WCCM features: Is triggered by positive or Is measured during period from ne
Slide 15: Other Regulatory Mechanisms & Filings
Other Regulatory Mechanisms & Filings Received approval for advice letters seeking recovery of $94.2 million to be recognized as cash over next three years • Received approval for advice letters relating to Interim Rates Memorandum Account (IRMA), 2023 Monterey Water Rate Adjustment Mechanism (MWRAM
Slide 16: Recognized Leader
Recognized Leader Newsweek names National Association EPA names Cal San Francisco Group one of Great Place to of Water Companies Water 2024 Chronicle names World’s Most Work® Institute awards Maui WaterSense® Company a Top Bay Trustworthy names Company a Operations Manager Excellence Award Area Work
Slide 17: Conclusion
Conclusion
California Water Service Group — Q3 2024 Earnings Presentation on 6ix