Attached files
EXHIBIT 99.1
SJW CORP. ANNOUNCES 2011 ANNUAL AND
FOURTH QUARTER FINANCIAL RESULTS
SAN JOSE, CA, February 21, 2012 - SJW Corp. (NYSE: SJW) today reported
operating revenue for the year ended December 31, 2011 of $238.9 million
versus $215.6 million for the year ended December 31, 2010, an increase of
$23.3 million. The increase in revenue was primarily attributable to
cumulative rate increases of $12.4 million, the recovery of a Mandatory
Conservation Revenue Adjustment Memorandum account ("MCRAM") that was
authorized by the California Public Utilities Commission in December 2011 of
$5.7 million, higher customer usage of $3.4 million, $706,000 in new
customers, and $1.1 million in higher revenue from real estate operations.
Water production costs for the year ended December 31, 2011 were $92.1
million versus $87.3 million in 2010, an increase of $4.8 million. The
increase in water production costs is primarily attributable to $3.7 million
in higher per unit costs for purchased water and groundwater extraction
charges, $743,000 higher customer water usage and $265,000 increase in costs
due to a decrease in the use of available surface water supply.
Operating expenses, excluding water production costs, for the year ended
December 31, 2011 were $92.5 million versus $90.3 million for 2010, an
increase of $2.2 million. This increase was primarily attributable to $2.9
million higher depreciation and amortization, $1.0 million in maintenance
expenses, $1.0 million in taxes other than income tax and $952,000 in
administrative and general expenses. In 2010, $3.6 million in impairment
loss on a real estate investment was recognized. No impairment loss was
recognized in 2011.
Other (expense) income increased due to interest expense on new senior
note borrowings. In addition, the Company sold 907,392 shares of California
Water Service Group stock and recorded a gain of $19.0 million in 2010. No
similar sale occurred in 2011. Income taxes for the year ended December 31,
2011 were $14.6 million versus $16.7 million for 2010, a decrease of $2.1
million due to lower pre-tax income.
Net income was $20.9 million for the year ended December 31, 2011,
compared to $24.4 million for the year ended December 31, 2010. Diluted
earnings per common share for the year ended December 31, 2011 were $1.11,
compared to $1.30 per share in 2010. For the year ended December 31, 2011,
recognition of the MCRAM contributed $0.18 to diluted earnings per share.
For the year ended December 31, 2010, the sale of California Water Service
Group stock contributed $0.60 to diluted earnings per share, offset by the
impairment loss of $0.11 per diluted share.
Fourth Quarter Financial Results
--------------------------------
Operating revenue for the fourth quarter ended December 31, 2011 was
$62.3 million versus $50.7 million for the same period in 2010, an increase
of $11.6 million. The increase was attributable to $5.7 million due to the
recognition of the MCRAM, cumulative rate increases of $3.5 million, higher
customer usage of $2.1 million, $162,000 in new customers and $138,000 in
higher revenue from real estate operations.
Water production costs for the fourth quarter of 2011 were $22.3 million
versus $20.9 for the same period in 2010, an increase of $1.4 million. The
increase in water production costs is primarily attributable to $1.3 million
in higher per unit costs for purchased water and groundwater extraction
charges, $251,000 higher customer water usage, partially offset by $168,000
decrease in costs due to an increase in the use of available surface water
supply.
Operating expenses, excluding water production costs, for the fourth
quarter of 2011 were $23.4 million versus $26.4 million for the same period
in 2010, a decrease of $3.0 million. This was attributable to decreases of
$3.6 million in impairment loss on a real estate investment and $363,000 in
administrative and general expenses, partially offset by increases of
$736,000 in depreciation and amortization, $226,000 in taxes other than
income tax expense and $124,000 in maintenance expenses.
Other (expense) income increased due to interest expense on new senior
note borrowings. In addition, the Company sold 684,280 shares of California
Water Service Group stock and recorded a gain of $14.5 million in 2010. No
similar sale occurred in 2011. Income taxes for the fourth quarter of 2011
were $5.0 million versus $5.6 million for 2010, a decrease of $0.6 million
due to lower pre-tax income.
Net income was $6.6 million for the fourth quarter ended December 31,
2011, compared to $8.1 million for the same period in 2010. Diluted earnings
per common share were $0.35 for the quarter ended December 31, 2011, compared
to $0.43 per share for the same period in 2010. In the fourth quarter of
2011, the recognition of the MCRAM contributed $0.18 to diluted earnings per
share. In the fourth quarter of 2010, the sale of California Water Service
Group stock contributed $0.46 to diluted earnings per share, offset by the
impairment loss of $0.11 per diluted share.
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 (Loss)
(Unaudited)
(in thousands, except per share data)
THREE MONTHS ENDED TWELVE MONTHS ENDED
DECEMBER 31 DECEMBER 31
2011 2010 2011 2010
-------------------------------------------
OPERATING REVENUE $ 62,338 50,752 238,955 215,638
OPERATING EXPENSE:
Production Costs:
Purchased water 15,038 9,829 54,317 43,557
Power 1,028 1,579 5,394 6,429
Groundwater extraction charge 3,365 6,645 20,997 26,614
Other production costs 2,903 2,870 11,345 10,702
-------- -------- ------- -------
Total production costs 22,334 20,923 92,053 87,302
Administrative and general 9,960 10,323 39,136 38,184
Maintenance 3,406 3,282 13,261 12,242
Taxes other than income 2,314 2,088 8,921 7,907
Depreciation and amortization 7,804 7,068 31,193 28,331
Impairment on real estate
investment - 3,597 - 3,597
-------- -------- ------- -------
Total operating expense 45,818 47,281 184,564 177,563
-------- -------- ------- -------
OPERATING INCOME 16,520 3,471 54,391 38,075
Gain on sale of California Water
Service stock - 14,500 - 18,966
Interest on long-term debt
and other (4,962) (4,229) (18,947) (15,895)
-------- -------- ------- -------
Income before income taxes $ 11,558 13,742 35,444 41,146
Provision for income taxes 4,956 5,624 14,566 16,740
-------- -------- ------- -------
NET INCOME $ 6,602 8,118 20,878 24,406
======== ======== ======= ======
Other comprehensive
income (loss), net 125 (8,220) (85) (10,828)
-------- -------- ------- -------
COMPREHENSIVE INCOME (LOSS) $ 6,727 (102) 20,793 13,578
======== ======== ======= =======
Earnings per share
-Basic $ 0.36 0.45 1.12 1.32
-Diluted $ 0.35 0.43 1.11 1.30
Dividend per share $ 0.17 0.17 0.69 0.68
Weighted average shares outstanding
-Basic 18,592 18,541 18,582 18,531
-Diluted 18,813 18,755 18,794 18,742
SJW Corp.
Condensed Consolidated Balance Sheets
(Unaudited)
(in thousands)
December 31 December 31
2011 2010
ASSETS -----------------------------
UTILITY PLANT:
Land $ 8,852 8,579
Depreciable plant and equipment 1,070,016 1,004,689
Construction in progress 18,527 10,103
Intangible assets 14,732 13,538
---------- ---------
Total utility plant 1,112,127 1,036,909
Less accumulated depreciation and amortization 355,914 322,102
---------- ---------
Net utility plant 756,213 714,807
---------- ---------
Real estate investment 89,099 88,943
Less accumulated depreciation and amortization 10,557 8,854
---------- ---------
Net real estate investment 78,542 80,089
---------- ---------
CURRENT ASSETS:
Cash and equivalents 26,734 1,730
Accounts receivable and accrued
unbilled utility revenue 33,853 33,835
Prepaid expenses and other 8,328 2,462
---------- ---------
Total current assets 68,915 38,027
---------- ---------
OTHER ASSETS:
Investment in California Water Service Group 7,032 7,177
Debt issuance costs, net
of accumulated amortization 4,865 4,308
Regulatory assets, net 119,248 87,721
Other 3,995 3,233
---------- ---------
135,140 102,439
---------- ---------
$1,038,810 935,362
========== =========
CAPITALIZATION AND LIABILITIES
CAPITALIZATION:
Common stock $ 9,684 9,662
Additional paid-in capital 24,552 23,443
Retained earnings 227,494 219,568
Accumulated other comprehensive income 2,274 2,359
---------- ---------
Total shareholders' equity 264,004 255,032
Long-term debt, less current portion 343,848 295,704
---------- ---------
Total capitalization 607,852 550,736
---------- ---------
CURRENT LIABILITIES:
Line of credit - 4,000
Current portion of long-term debt 838 1,133
Accrued groundwater extraction charge,
purchased water and purchased power 6,212 4,854
Accounts payable 7,417 5,487
Accrued interest 5,376 5,244
Other current liabilities 8,445 8,437
---------- ---------
Total current liabilities 28,288 29,155
---------- ---------
DEFERRED INCOME TAXES AND CREDITS 135,036 107,961
ADVANCES FOR CONSTRUCTION AND CONTRIBUTIONS
IN AID OF CONSTRUCTION 190,668 190,155
POSTRETIREMENT BENEFIT PLANS 68,855 50,213
OTHER NONCURRENT LIABILITIES 8,111 7,142
---------- ---------
$1,038,810 935,362
========== =========
