The York Water Co (YORW) Announces Increased Earnings and Revenue in 2023
Operating Revenues: $71,031,000 in 2023, up by $10,970,000 from 2022.
Net Income: Increased to $23,757,000, a $4,177,000 rise from the previous year.
Earnings Per Share: $1.66 in 2023, marking a $0.26 increase compared to 2022.
Dividends: Rose by 4% from 2022, with dividends declared per common share at $0.8189.
Infrastructure Investment: $64.6 million in construction expenditures for system improvements.
On March 5, 2024, The York Water Co (NASDAQ:YORW) released its 8-K filing, detailing its financial results for the year ended December 31, 2023. The investor-owned water utility company, which impounds, purifies, and distributes water within a franchised territory covering over 54 municipalities in York County, Pennsylvania, reported a notable increase in operating revenues and net income for both the annual and fourth quarter periods.
2023 Financial Highlights
The York Water Co's operating revenues for 2023 stood at $71,031,000, a significant increase of $10,970,000 from the previous year. This growth was primarily attributed to a rate increase effective March 1, 2023, and an expansion in the customer base. However, the reset to zero of the Distribution System Improvement Charge (DSIC) partially offset these gains. The DSIC is a charge permitted by the Pennsylvania Public Utility Commission, allowing water utilities to collect funds from customers for the replacement of aging infrastructure.
Net income for the year rose to $23,757,000, up by $4,177,000 compared to 2022. Basic and Diluted Earnings per share also saw an increase, reaching $1.66 for 2023, which is $0.26 higher than the previous year. The company's dividends per share grew by 4%, with $0.8189 declared per common share.
Operational and Strategic Developments
Throughout 2023, The York Water Co invested heavily in its infrastructure, with construction expenditures totaling $64.6 million. These investments were directed towards the armoring and replacement of the Lake Williams dam spillway, wastewater treatment plant construction, and routine infrastructure improvements. Approximately 50,200 feet of pipe were replaced to enhance the distribution system, reduce expenses, and improve customer service. The company also spent $625,000 on acquiring a water and wastewater system.
For the fourth quarter of 2023, The York Water Co reported an increase in operating revenues of $2,985,000 and a net income increase of $1,001,000 compared to the same period in 2022. Basic and Diluted Earnings per share for the quarter were $0.42, up by $0.07 from the fourth quarter of the previous year.
Future Investments and Outlook
Looking ahead, President Hand indicated that The York Water Co plans to invest approximately $42.2 million in 2024 and $46.1 million in 2025, excluding acquisitions. These funds will be allocated to main extensions, completion of the Lake Williams dam spillway, wastewater treatment plant construction, an upgrade to the enterprise software system, and further improvements to the company's infrastructure.
The company's commitment to ensuring a safe, adequate, and reliable supply of drinking water, alongside proper wastewater management, is expected to support its growing customer base and contribute to its operational success.
The York Water Co's financial performance in 2023 demonstrates its ability to effectively manage rate adjustments and infrastructure investments to deliver value to shareholders and customers alike. With strategic investments planned for the coming years, the company is poised to maintain its positive trajectory in the regulated utilities industry.
Explore the complete 8-K earnings release (here) from The York Water Co for further details.
This article first appeared on GuruFocus.
