Summary
American Water Works Company, Inc. (AWK) reported solid financial results for the nine months ended September 30, 2019, demonstrating consistent growth and strategic execution. The company's net income attributable to common shareholders increased by 14.9% year-over-year to $523 million, with diluted EPS rising to $2.89 from $2.53 in the prior year period. This growth was driven by continued investment in regulated infrastructure, strategic acquisitions in its regulated water and wastewater systems, and expansion of its market-based businesses, notably through the Military Services Group (MSG). Financially, the company strengthened its balance sheet by issuing $1.1 billion in long-term debt, which was used to fund growth initiatives and refinance existing obligations. Cash flow from operations remained robust, although slightly lower than the prior year due to a one-time settlement of cash flow hedges. Capital expenditures were significant, totaling $1.115 billion for infrastructure improvements and acquisitions, underscoring the company's commitment to long-term asset enhancement and service expansion. Despite facing some regulatory and legal matters, AWK appears well-positioned to navigate these challenges and continue its growth trajectory in the essential water utility sector.
Financial Highlights
49 data points| Revenue | $1.01B |
| Operating Expenses | $607.00M |
| Operating Income | $406.00M |
| Net Income | $240.00M |
| EPS (Basic) | $1.33 |
| EPS (Diluted) | $1.33 |
| Shares Outstanding (Basic) | 181.00M |
| Shares Outstanding (Diluted) | 181.00M |
Key Highlights
- 1Net income attributable to common shareholders increased to $523 million for the first nine months of 2019, up from $455 million in the same period of 2018.
- 2Diluted earnings per share (EPS) rose to $2.89 for the nine months ended September 30, 2019, compared to $2.53 in the prior year.
- 3The company invested approximately $1.25 billion in capital expenditures during the first nine months of 2019, focused on infrastructure improvements ($1.17 billion) and regulated business acquisitions ($85 million).
- 4AWK secured significant new contracts for its Military Services Group (MSG), including operation and maintenance of water and wastewater systems at Joint Base San Antonio and the U.S. Military Academy at West Point, with estimated aggregate revenues of $967 million over 50 years.
- 5The company successfully issued $1.1 billion in long-term debt in May 2019 to support growth initiatives, including lending to its parent company and regulated subsidiaries, and to repay maturing debt.
- 6Operating revenues increased by $118 million (4.6%) to $2.708 billion for the first nine months of 2019, driven by rate increases in regulated businesses and growth in market-based segments.
- 7The company's adjusted O&M efficiency ratio for the Regulated Businesses improved to 35.0% for the twelve months ended September 30, 2019, from 35.7% in the prior year period, indicating operational improvements.