Attached files
Exhibit 99.1
SJW CORP. ANNOUNCES
THIRD QUARTER FINANCIAL RESULTS
Board Declares Quarterly Dividend on Common Stock
SAN JOSE, CA, October 26, 2011 - SJW Corp. (NYSE: SJW) today reported
financial results for the third quarter ended September 30, 2011. Operating
revenue was $73.9 million in the quarter compared to $70.3 million in 2010.
The $3.6 million increase in revenue reflects cumulative rate increases of
$4.4 million, $221,000 in new customers, partially offset by lower customer
usage (a $1.4 million impact), and $353,000 in higher revenue from real
estate operations.
Net income was $8.2 million and diluted earnings per common share were
$0.44, compared to $10.8 million and $0.58 per share, respectively, in the
third quarter of 2010.
Water production costs for the quarter ended September 30, 2011 were
$32.0 million compared to $30.2 million in 2010, an increase of $1.8
million. The increase in water production costs is primarily attributable
to $2.2 million in a higher per unit cost for purchased water and
groundwater extraction charges, partially offset by $266,000 in lower
costs caused by reduced customer water usage and an $82,000 reduction in
costs due to an increase in use of available surface water supply.
Operating expenses, excluding water production costs, for the third
quarter were $23.4 million compared to $22.3 million in 2010. The increase
of $1.1 million reflects an additional $721,000 of depreciation expense,
$436,000 of maintenance expenses and $341,000 more in taxes other than
income tax, partially offset by a decrease of $352,000 in administrative
and general expenses.
In addition, 2010 income before taxes included $4.5 million gain on
the sale of California Water Service group shares which did not recur in
2011. Income tax expense for the third quarter decreased to $5.4 million
in 2011 from $7.3 million in 2010.
Year-to-date operating revenue increased by $11.7 million to $176.6
million from $164.9 million in the first nine months of 2011. The increase
was attributable to $8.9 million in cumulative rate increases, higher
customer water usage (a $1.4 million impact), $544,000 in revenue from new
customers and $910,000 in higher revenue from real estate operations.
Year-to-date net income was $14.3 million, compared to $16.3 million
in 2010. Diluted earnings per share were $0.76 in the first nine months
of 2011, compared to $0.87 per diluted share for the same period in 2010.
Year-to-date water production costs increased to $69.7 million from
$66.4 million in 2010. The $3.3 million increase was primarily
attributable to $2.4 million in a higher per unit cost for purchased water
and groundwater extraction charges, $492,000 in higher costs related to
customer water usage and $433,000 in increased costs due to decreased use
of surface water supply. Operating expenses, excluding water production
costs, increased $5.1 million to $69.0 million from $63.9 million. The
increase was due to an increase in depreciation expense of $2.1 million,
$1.3 million in administrative and general expenses, $895,000 in
maintenance expenses and $788,000 in taxes other than income taxes.
Income tax expense decreased by $1.5 million year-to-date due to lower
pre-tax income. Other (expense) income increased due to interest expense
on new senior note borrowings. In addition, the Company recorded a
pre-tax gain of $4.5 million in 2010 related to the sale of California
Water Service Group shares. No similar sale occurred in 2011.
The Directors of SJW Corp. today declared a quarterly dividend on
common stock of $0.1725 per share. The dividend is payable on December 1,
2011 to shareholders of record on November 7, 2011.
SJW Corp. is a publicly traded holding company headquartered in San
Jose, California. SJW Corp. is the parent company of San Jose Water
Company, SJWTX, Inc., Texas Water Alliance Limited, and SJW Land Company.
Together, San Jose Water Company and SJWTX, Inc. provide regulated and
nonregulated water service to more than one million people in San Jose,
California and nearby communities and in Canyon Lake, Texas and nearby
communities. SJW Land Company owns and operates commercial real estate
investments.
This press release may contain certain forward-looking statements
including but not limited to statements relating to SJW Corp.'s plans,
strategies, objectives, expectations and intentions, which are made
pursuant to the safe harbor provisions of the U.S. Private Securities
Litigation Reform Act of 1995. These forward-looking statements involve
known and unknown risks, uncertainties and other factors which may cause
the actual results, performance or achievements of SJW Corp. to be
materially different from any future results, performance or achievements
expressed or implied by such forward-looking statements. The results for
a quarter are not indicative of results for a full year due to seasonality
and other factors. Certain factors that may cause actual results,
performance or achievements to materially differ are described in SJW
Corp.'s most recent reports on Form 10-K, Form 10-Q and Form 8-K filed
with the Securities and Exchange Commission. SJW Corp. undertakes no
obligation to publicly update or revise any forward-looking statement,
whether as a result of new information, future events or otherwise.
SJW Corp.
Condensed Consolidated Statements of Income and Comprehensive Income
(Unaudited)
(in thousands, except per share data)
THREE MONTHS ENDED NINE MONTHS ENDED
SEPTEMBER 30 SEPTEMBER 30
2011 2010 2011 2010
-----------------------------------------
OPERATING REVENUE $ 73,914 70,347 176,617 164,886
OPERATING EXPENSE:
Production Costs:
Purchased water 19,182 16,574 39,279 33,728
Power 1,979 2,122 4,366 4,850
Groundwater extraction charge 7,824 8,736 17,632 19,969
Other production costs 3,030 2,726 8,442 7,832
-----------------------------------------
Total production costs 32,015 30,158 69,719 66,379
Administrative and general 9,882 10,234 29,176 27,861
Maintenance 3,331 2,895 9,855 8,960
Taxes other than income 2,397 2,056 6,607 5,819
Depreciation and amortization 7,803 7,082 23,389 21,263
-----------------------------------------
Total operating expense 55,428 52,425 138,746 130,282
-----------------------------------------
OPERATING INCOME 18,486 17,922 37,871 34,604
Gain on sale of California Water
Service stock - 4,466 - 4,466
Interest on long-term debt
and other (4,911) (4,268) (13,985) (11,666)
-----------------------------------------
Income before income taxes $ 13,575 18,120 23,886 27,404
Provision for income taxes 5,360 7,333 9,610 11,116
-----------------------------------------
NET INCOME $ 8,215 10,787 14,276 16,288
=========================================
Other comprehensive loss, net (227) (1,881) (210) (2,608)
-----------------------------------------
COMPREHENSIVE INCOME $ 7,988 8,906 14,066 13,680
=========================================
Earnings per share
-Basic $ 0.44 0.58 0.77 0.88
-Diluted $ 0.44 0.58 0.76 0.87
Dividend per share $ 0.17 0.17 0.52 0.51
Weighted average shares outstanding
-Basic 18,587 18,537 18,578 18,528
-Diluted 18,803 18,752 18,788 18,738
SJW Corp.
Condensed Consolidated Balance Sheets
(Unaudited)
(in thousands)
September 30 December 31
2011 2010
ASSETS -----------------------------
UTILITY PLANT:
Land $ 8,579 8,579
Depreciable plant and equipment 1,038,753 1,004,689
Construction in progress 24,684 10,103
Intangible assets 14,730 13,538
---------------------------
Total utility plant 1,086,746 1,036,909
Less accumulated depreciation and amortization 345,235 322,102
---------------------------
Net utility plant 741,511 714,807
---------------------------
Real estate investment 89,108 88,943
Less accumulated depreciation and amortization 10,122 8,854
---------------------------
Net real estate investment 78,986 80,089
---------------------------
CURRENT ASSETS:
Cash and equivalents 43,069 1,730
Accounts receivable and accrued
unbilled utility revenue 43,071 33,835
Prepaid expenses and other 3,055 2,462
---------------------------
Total current assets 89,195 38,027
---------------------------
OTHER ASSETS:
Investment in California Water Service Group 6,820 7,177
Debt issuance costs, net
of accumulated amortization 4,952 4,308
Regulatory assets 87,721 87,721
Other 4,058 3,233
---------------------------
103,551 102,439
---------------------------
$1,013,243 935,362
===========================
CAPITALIZATION AND LIABILITIES
CAPITALIZATION:
Common stock $ 9,683 9,662
Additional paid-in capital 24,404 23,443
Retained earnings 224,132 219,568
Accumulated other comprehensive income 2,149 2,359
---------------------------
Total shareholders' equity 260,368 255,032
Long-term debt, less current portion 344,502 295,704
---------------------------
Total capitalization 604,870 550,736
---------------------------
CURRENT LIABILITIES:
Line of credit 5,500 4,000
Current portion of long-term debt 1,154 1,133
Accrued groundwater extraction charge,
purchased water and purchased power 9,588 4,854
Accounts payable 6,687 5,487
Accrued interest 5,440 5,244
Other current liabilities 10,324 8,437
---------------------------
Total current liabilities 38,693 29,155
---------------------------
DEFERRED INCOME TAXES AND CREDITS 119,353 107,961
ADVANCES FOR CONSTRUCTION AND CONTRIBUTIONS
IN AID OF CONSTRUCTION 190,550 190,155
POSTRETIREMENT BENEFIT PLANS 52,634 50,213
OTHER NONCURRENT LIABILITIES 7,143 7,142
---------------------------
$1,013,243 935,362
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