2022 annual earnings per share guidance range
of $1.75 to $1.80
Infrastructure investments of $3 billion
through 2024
Reaffirms multiyear ESG commitments
Essential Utilities Inc. (NYSE: WTRG) today announces guidance,
including earnings expectations, 3-year infrastructure investment
plans, and reaffirmation of company’s ESG commitments.
2022 Essential Financial and Growth Guidance
Essential continues to monitor the effects of the COVID-19
pandemic on its customers, employees and the business and will
update guidance impacts from the pandemic in the future if needed.
This guidance is based on the inclusion of signed water and
wastewater acquisitions but does not factor in the impact of the
expected continuation of significant water and wastewater customer
growth from acquisitions.
The following is the company’s 2022 full-year guidance:
- Net income per diluted common share of $1.75 to $1.80
- Continuation of the company’s stated long-term earnings per
share growth CAGR of 5 to 7% for the three-year period through 2024
based off the midpoint of the company’s stated 2021 guidance range
of $1.64-1.69 earnings per share. The company expects to reaffirm
the long-term earnings per share growth guidance after the
completion of significant regulatory processes this spring
- Regulated infrastructure investments of approximately $1
billion annually through 2024, weighted towards the regulated water
segment
- Regulated water segment rate base compound annual growth rate
of 6 to 7% through 2024
- Regulated natural gas segment rate base compound annual growth
rate of 8 to 10% through 2024
- Average annual regulated water segment customer (or equivalent
dwelling units) growth of between 2 and 3% from acquisitions and
organic customer growth
- Gas customer count stable for 2022
ESG Guidance and Commitments
- Reduction of Scope 1 and Scope 2 greenhouse gas emissions by
60% by 2035 from our 2019 baseline
- Multiyear plan to increase diverse supplier spend to 15%
- Multiyear plan to reach 17% employees of color
- Multiyear plan to ensure that finished water does not exceed 13
parts per trillion (ppt) of PFOA, PFOS, and PFNA compounds
Essential is reaffirming its commitment to substantially reduce
Scope 1 and 2 greenhouse gas emissions by 2035. This is achievable
through extensive gas pipeline replacement, renewable energy
purchasing, accelerated methane leak detection and repair, and
various other currently planned initiatives. Essential also
reaffirms its commitment to diversity, equity, and inclusion
efforts to ensure the diversity of its employee base and suppliers
reflects the diversity of its customer population. Since making
these commitments, the company has already announced a 5% scope 1
and 2 emissions reduction towards our 60% reduction target, 14% of
employees are people of color towards our 17% target, and almost
10% supplier diversity towards our 15% target.
“Our premium water and natural gas platform gives us a unique
ability to deliver critical resources with a high degree of
reliability and resiliency to the communities we serve. The
long-term guidance we are issuing today reflects our confidence in
our ability to deliver on our mission of providing essential
natural resources to our water, wastewater, and natural gas
customers. We are dedicated to growing our customer base through
sustainable business practices, operational excellence, and
acquisitions and by investing in the replacement of aging
infrastructure, all while making significant reductions in
Essential’s overall environmental footprint,” said Essential
Chairman and Chief Executive Officer Christopher Franklin. “As we
capitalize on our core competencies, we are confident in our
ability to drive growth in earnings and deliver long-term value for
our stakeholders.”
Water Utility Acquisition Growth
Essential’s continued acquisition growth allows the company to
provide safe and reliable water and wastewater service to an even
larger customer base. In 2021, Essential acquired two water and
wastewater systems and added approximately $36.3 million in rate
base and approximately 7,500 new customers to the company’s
footprint.
The company previously announced seven signed pending purchase
agreements for additional water and wastewater systems that are
expected to serve approximately 234,000 equivalent retail customers
or equivalent dwelling units and total approximately $468 million
in purchase price in two of our existing states. This includes the
company’s agreement to acquire the Delaware County Regional Water
Quality Control Authority (DELCORA) for $276.5 million. DELCORA, a
Pennsylvania sewer authority, serves approximately 198,000
equivalent dwelling units in the Philadelphia suburbs. Also
included is the company’s agreement to acquire the wastewater
system from the City of Beaver Falls. This $41.25 million
acquisition of approximately 7,600 customer equivalents will be the
first acquisition in western Pennsylvania, near the company’s gas
operations. In Dec. 2021, the company’s regulated water subsidiary,
Aqua Texas signed an asset purchase agreement for its second fair
market value acquisition. The agreement to purchase The Southern
Oaks Water System will add approximately 740 additional customer
connections for a purchase price of for $3.33 million.
The guidance announced today is based on the inclusion of these
signed municipal water and wastewater acquisitions. The impact of
significant municipal acquisitions from our pipeline of potential
acquisitions, representing over 400,000 customer equivalents, is
not included in our stated earnings, rate base or infrastructure
investment guidance. Based on our proven acquisition track record
of adding over 94,000 customers and over $361 million in rate base
since 2015, our current backlog of over $471 million of signed
pending acquisitions resulting in approximately 235,000 equivalent
customers, and the current acquisition landscape, we are confident
in our ability to continue to grow our water and wastewater
customer base by 2-3% annually over the long-term, leading to
strong long-term future earnings growth.
Essential Reaffirms 2021 Earnings Guidance
The company expects to report earnings for the quarter and year
ended Dec. 31, 2021, following market close on Feb. 23, 2022. The
company also reaffirms 2021 earnings per share guidance of
$1.64-1.69.
Essential Utilities does not guarantee future results of any
kind. Guidance is subject to risks and uncertainties, including,
without limitation, those factors outlined in the “Forward Looking
Statements” of this release and the “Risk Factors” section of the
company’s annual and quarterly reports filed with the Securities
and Exchange Commission.
Earnings Call Information
Essential Utilities Inc. (NYSE: WTRG) expects to report earnings
for the quarter ended Dec. 31, 2021, and the full year 2021
following market close on Feb. 23, 2022. Management expects to
provide an update on the company's financial outlook, capital
investment, municipal acquisition program and ESG objectives.
Date: Feb. 24, 2022 Time: 11 a.m. EST (please dial in by 10:45
a.m.) Webcast and slide presentation link:
https://www.essential.co/events-and-presentations/events-calendar
Replay Dial-in #: 888.203.1112 (U.S.) & +1 719.457.0820
(International) Confirmation code: 7024618
The company’s conference call with financial analysts will take
place on Thursday, Feb. 24, 2022, at 11 a.m. Eastern Standard Time.
The call and presentation will be webcast live so interested
parties may listen over the internet by logging on to Essential.co
and following the link for Investors. The conference call will be
archived in the Investor Relations section of the company’s website
for 90 days following the call. Additionally, the call will be
recorded and made available for replay at 2 p.m. on Feb. 24, 2022,
for 10 business days following the call. To access the audio replay
in the U.S., dial 888.203.1112 (pass code 7024618). International
callers can dial +1 719.457.0820 (pass code 7024618).
About Essential
Essential is one of the largest publicly traded water,
wastewater, and natural gas providers in the U.S., serving
approximately 5 million people across 10 states under the Aqua and
Peoples brands. Essential is committed to excellence in proactive
infrastructure investment, regulatory expertise, operational
efficiency, and environmental stewardship. The company recognizes
the importance water and natural gas play in everyday life and is
proud to deliver safe, reliable services that contribute to the
quality of life in the communities it serves. For more information,
visit http://www.essential.co.
Forward-Looking Statements
This release contains forward-looking statements within the
meaning of the Private Securities Litigation Reform Act of 1995,
including, among others: the guidance range of net income per
diluted common share for the fiscal years ending in 2021 and 2022;
the continuation of the three-year period of earnings growth
through 2024; the anticipated amount of capital investment in 2022;
the anticipated amount of capital investment from 2022 through
2024; the reduction of Scope 1 and Scope 2 greenhouse gas emissions
by 60% by 2035; that the Company’s pipeline replacement program
will lead to significant methane reductions; that the Company’s
municipal growth pipeline is strong; that the Company will help
solve the nation’s infrastructure challenge; the company’s ability
to increase diverse supplier spend to 15%; the company’s ability to
achieve 17% employees of color; the company’s anticipated rate base
growth from 2022 through 2024; and, the company’s ability to
accelerate the replacement of aged gas pipes. There are important
factors that could cause actual results to differ materially from
those expressed or implied by such forward-looking statements
including: disruptions in the global economy; financial and
workforce impacts from the COVID-19 pandemic; potential disruptions
in the supply chain for raw and finished materials; the
continuation of the company's growth-through-acquisition program;
general economic business conditions; housing and customer growth
trends; unfavorable weather conditions; the success of certain
cost-containment initiatives; changes in regulations or regulatory
treatment; the company’s ability to successfully close municipally
owned systems presently under agreement; and other factors
discussed in our Annual Report on Form 10-K and our Quarterly
Reports on Form 10-Q, which are filed with the Securities and
Exchange Commission. For more information regarding risks and
uncertainties associated with Essential's business, please refer to
Essential's annual, quarterly, and other SEC filings. Essential is
not under any obligation - and expressly disclaims any such
obligation - to update or alter its forward-looking statements
whether as a result of new information, future events or
otherwise.
WTRGF
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version on businesswire.com: https://www.businesswire.com/news/home/20220203005932/en/
Brian Dingerdissen Essential Utilities Inc. Investor Relations
O: 610.645.1191 BJDingerdissen@Essential.co
Erin O’Donnell Communications and Marketing Media Hotline:
1-877-325-3477 Media@essential.co
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