NEWARK, Del., Aug. 5 /PRNewswire-FirstCall/ -- Artesian Resources Corporation, , a leading provider of water, wastewater and engineering services on the Delmarva Peninsula, today announced that revenues for the second quarter of 2010 were $16.0 million, a 4.1% increase from the $15.4 million in revenues recorded for the same three-month period of 2009.
Net income for the quarter was $1.8 million, while basic and diluted net income per share were $0.24 and $0.24. Net income decreased by $199,000 compared to the same period a year ago primarily due to a decrease in construction activity and lower utility operating income margins.
Water sales, which accounted for 86.9% of revenues, increased to $13.9 million, a 1.4% increase over the second quarter of 2009.
"Water sales increased in June due to the extremely hot weather in our service areas, but that was nearly offset by the very wet beginning to the quarter when water consumption was down," said Artesian President and CEO Dian C. Taylor.
During the second quarter, non-utility revenues grew by $269,000 to $1.4 million, a 24.2% increase over the same period a year ago. The increase was primarily attributable to additional contract revenue for design and permitting services for a project in Middletown, Delaware, and for increased contract services for municipalities in Maryland. Non-utility revenues made up 8.6% of Artesian's total revenue for the quarter.
"We are focused on diversifying our Company to grow our service area and product offering, in order to expand into a total water resource company that includes less weather-dependent, non-utility businesses," Taylor said. "We made significant progress during the quarter."
Artesian received Maryland Public Service Commission (PSC) approval for our agreement to acquire the water assets of the Town of Port Deposit in Cecil County. The acquisition, which was announced in December 2009, includes a water treatment facility with a capacity of up to 500,000 gallons per day, a Susquehanna River water appropriation permit, a 500,000 gallon ground storage tank, water mains and water service rights to significant growth areas.
In Delaware, Artesian expanded its wastewater management capabilities with the launch of the Artesian Water Resource Management Partnership. Through the Partnership, Artesian is encouraging and supporting the use of reclaimed water for agricultural irrigation and other needs by providing planning, engineering, and technical expertise and bringing together various state, local and private partners needed for water resource management project approvals. The Artesian Water Resource Management Partnership's project with the town of Middletown, completed with the assistance of Delaware's Governor, Secretary of the Department of Natural Resources and Environmental Control and Secretary of Agriculture, has saved nearly 150 million gallons of ground water so far this year.
Operating expenses for the second quarter grew 5.9% to $12.4 million, primarily due to increases in payroll and employee benefit costs, purchased water expenses and increases in property and other taxes. Our increased purchased water expenses included an intentional acceleration of takes from the Chester Water Authority in advance of an increase in their rates effective July 1, 2010.
As always, Artesian focused its operations, as well as its infrastructure investments, on continuing to ensure the safety, reliability and quality of its water system. Even though Artesian's network of deep wells provides some of the cleanest supplies of water found in the region, the Company tests and treats its water to ensure quality at the tap. The company continues to meet all federal Safe Drinking Water Act requirements.
About Artesian Resources
Artesian Resources Corporation operates as the holding company of eight wholly-owned subsidiaries offering water, wastewater and engineering services on the Delmarva Peninsula. Artesian Water Company, the principal subsidiary, is the oldest and largest investor-owned public water utility on the Delmarva Peninsula, and has been providing water service since 1905.
Artesian Resources Corporation Condensed Consolidated Statement of Operations (In thousands, except per share amounts) (Unaudited) Three months ended Six months ended June 30, June 30, 2010 2009 2010 2009 ---- ---- ---- ---- Operating Revenues Water sales $13,909 $13,717 $26,804 $26,217 Other utility operating revenue 714 542 1,333 1,010 Non-utility revenue 1,380 1,111 2,850 2,019 ----- ----- ----- ----- 16,003 15,370 30,987 29,246 ------ ------ ------ ------ Operating Expenses Utility operating expenses 7,466 7,146 14,834 13,990 Non-utility operating expenses 958 790 1,976 1,460 Depreciation and amortization 1,723 1,601 3,454 3,199 State and federal income taxes 1,209 1,304 2,326 2,387 Property and other taxes 1,027 853 1,990 1,706 ----- --- ----- ----- 12,383 11,694 24,580 22,742 ------ ------ ------ ------ Operating Income 3,620 3,676 6,407 6,504 Allowance for funds used during construction 24 115 67 224 Miscellaneous (44) 19 567 487 Income Before Interest Charges 3,600 3,810 7,041 7,215 Interest Charges 1,802 1,813 3,597 3,611 Net Income $1,798 $1,997 $3,444 $3,604 ====== ====== ====== ====== Weighted Average Common Shares Outstanding - Basic 7,539 7,427 7,526 7,426 Net Income per Common Share - Basic $0.24 $0.27 $0.46 $0.49 Weighted Average Common Shares Outstanding - Diluted 7,607 7,479 7,595 7,481 Net Income per Common Share - Diluted $0.24 $0.27 $0.45 $0.48 Artesian Resources Corporation Condensed Consolidated Balance Sheet (In thousands) (Unaudited) December June 30, 31, 2010 2009 ---- ---- Assets Utility Plant, at original cost less accumulated depreciation $329,059 $326,899 Current Assets 11,328 13,243 Regulatory and Other Assets 19,137 18,753 ------ ------ $359,524 $358,895 ======== ======== Capitalization and Liabilities Stockholder's Equity $92,518 $91,174 Long Term Debt, Net of Current Portion 105,545 106,025 Current Liabilities 34,164 36,521 Advances for Construction 17,677 18,433 Contributions in Aid of Construction 72,702 71,243 Other Liabilities 36,918 35,499 ------ ------ $359,524 $358,895 ======== ========
Artesian Resources Corporation
CONTACT: Nicki Taylor, Investor Relations, +1-302-453-6900,
ntaylor@artesianwater.com
Web Site: http://www.artesianwater.com/
