Earnings Total $1.14 per Share
Regulated Water Activities Income Increases 10.7%
CLINTON, Conn., March 14, 2011 (GLOBE NEWSWIRE) -- Connecticut Water Service, Inc. (Nasdaq:CTWS) announced net income of $9.8 million and earnings per basic average share (EPS) of $1.14 for 2010, compared to net income of $10.2 million and EPS of $1.20 for 2009. In 2009, the Company completed real estate transactions that generated revenues of $2.2 million and EPS of $0.17. No real estate transactions were completed in 2010.
In 2010, total revenue grew to $72.8 million from $67.5 million in 2009, an increase of $5.3 million, or 8%. Total revenue includes all revenues generated by the Company's three business segments: Water Activities, Services and Rentals, and Real Estate.
In 2010, income in the Water Activities segment, the Company's principal business, grew by approximately $840,000 to $8.7 million from $7.8 million in 2009, an increase of 10.7%. The gain was largely attributable to increased revenue through a rate increase of 13% that became effective in July 2010, and a 6% increase in water production due to hotter and drier weather in 2010 compared to 2009. The increased revenues were partially offset by a one-time pre-tax charge of approximately $790,000 associated with an organizational review principally at the Company's corporate headquarters in the third quarter.
Additionally, O&M costs increased less than 3%, or approximately $920,000, to $33.1 million in 2010 due in part to a $1.0 million increase in labor, pension and post-retirement medical costs compared to 2009. In 2009, employee focus on capital projects including the implementation of an Enterprise Resource Planning computer system resulted in a temporary increase in capitalized labor. In 2010, labor expense was $12.1 million and was more in line with the 2008 labor expense of $11.9 million. There was also a decrease of $506,000 in medical expense due to a reduction in claims and administrative expense.
The Services and Rentals segment contributed EPS of $0.10 in 2010, which is down slightly from the $0.11 reported in 2009. The Real Estate segment contributed EPS of $0.03 in 2010. In 2009, the segment produced an EPS of $0.17 due to the sale of a conservation easement on 200 acres of open space land to the Town of Windsor Locks, Connecticut, and the sale of a small residential property.
Eric W. Thornburg, Chairman, President and Chief Executive Officer, stated, "The Company's core business segment, the Water Activities segment, was strong in 2010. The segment produced income of $1.01 per share compared to $0.93 per share in the same period of 2009." Mr. Thornburg added, "We expect 2011 earnings in the Water Activities segment to be higher than in 2010, and we expect modest growth in the Services and Rentals segment as well."
In the fourth quarter of 2010, the Company reported net income of $1.8 million and basic EPS of $0.20. During the same period in 2009, the company reported net income of $1.0 million and basic EPS of $0.12. Total revenue increased $1.8 million to $17.4 million from $15.6 million for the same quarter of 2009.
Connecticut Water Service, Inc. is the largest publicly traded water company based in New England. Through its wholly-owned public water utility subsidiary, The Connecticut Water Company, the Company provides drinking water to nearly 90,000 customers, or about 300,000 people, in 55 towns throughout Connecticut.
The Connecticut Water Service, Inc. logo is available at http://www.globenewswire.com/newsroom/prs/?pkgid=2893
| Connecticut Water Service, Inc. & Subsidiaries | ||
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Condensed Consolidated Statements of Income (unaudited) |
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| (In thousands except per share amounts) | December 31, 2010 | December 31, 2009 |
| Operating Revenues | $66,408 | $59,391 |
| Other Water Activities Revenues | 1,345 | 1,257 |
| Real Estate Revenues | -- | 2,160 |
| Service and Rentals Revenues | 5,074 | 4,735 |
| Total Revenues | $72,827 | $67,543 |
| Organizational Review | $786 | $-- |
| Total Operating Expenses | $52,573 | $47,003 |
| Other Utility Income, Net of Taxes | $742 | $704 |
| Total Utility Operating Income | $14,577 | $13,092 |
| Gain on Property Transactions, Net of Taxes | $230 | $1,449 |
| Non-Water Sales Earnings (Services and Rentals), Net of Taxes | $899 | $929 |
| Net Income | $9,798 | $10,209 |
| Net Income Applicable to Common Shareholders | $9,760 | $10,171 |
| Basic Earnings Per Average Common Share | $1.14 | $1.20 |
| Diluted Earnings Per Average Common Share | $1.13 | $1.19 |
| Basic Weighted Average Common Shares Outstanding | 8,532 | 8,448 |
| Diluted Weighted Average Common Shares Outstanding | 8,633 | 8,523 |
| Book Value Per Share | $13.05 | $12.66 |
| Condensed Consolidated Balance Sheets (unaudited) | ||
| (In thousands) | December 31, 2010 | December 31, 2009 |
| ASSETS | ||
| Net Utility Plant | $344,219 | $325,202 |
| Current Assets | 20,428 | 19,962 |
| Other Assets | 60,564 | 70,112 |
| Total Assets | $425,211 | $415,276 |
| CAPITALIZATION AND LIABILITIES | ||
| Shareholders' Equity | $113,191 | $108,569 |
| Preferred Stock | 772 | 772 |
| Long-Term Debt | 111,675 | 111,955 |
| Current Liabilities | 35,102 | 33,056 |
| Other Liabilities and Deferred Credits | 164,471 | 160,924 |
| Total Capitalization and Liabilities | $425,211 | $415,276 |
This news release may contain certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 regarding the Company's results of operations, financial position, and long-term strategy. These forward-looking statements are based on current information and expectations, and are subject to risks and uncertainties discussed in our filings with the Securities and Exchange Commission, which could cause the Company's actual results to differ materially from expected results. We undertake no obligation to update or revise forward-looking statements, whether as a result of new information, future events, or otherwise.