American Water Works Announces Rate Adjustments And Strong Financial Performance
$AWK
American Water Works (NYSE:AWK), the largest regulated water and wastewater utility in the United States, has recently been granted approval for new water and wastewater rates by the Virginia State Corporation Commission. This decision comes as a result of the company’s substantial investment in infrastructure, totaling over $110 million. These enhancements, aimed at upgrading treatment systems and distribution networks, have led to a total annualized revenue increase of approximately $14.6 million.
The new rates, which are a reduction from the interim rates that became effective in May 2024, will decrease the average water bill for most customers using 4,000 gallons per month by about $2.00 and the average wastewater bill by approximately $1.50 per month. This adjustment reflects the company’s commitment to maintaining affordable and reliable service for the 350,000 people it serves. Additionally, the rates will be retroactive to May 1, 2024, with the company planning to issue credits for the difference between the interim and permanent rates, including interest, within 90 days of the final order.
In other financial news, American Water Works has reported the performance in the fourth quarter of 2024. The company posted operating earnings per share (EPS) of $1.22, surpassing the consensus estimate of $1.13 by 7.9%. This represents a 38.6% increase from the previous year’s EPS of 88 cents. Total quarterly revenues reached $1.2 billion, an 11.4% increase over the prior year and exceeding estimates by 11.4%.
The consensus estimate for 2025 stands at $5.71 per share, indicating a year-over-year growth rate of 5.94%. This forecast underscores the company’s robust financial health and its ability to sustain growth through strategic investments and effective capital management.
American Water Works, with a history dating back to 1886, continues to play a pivotal role in providing essential water and wastewater services across 14 states and 18 military installations. The company’s focus on substantial infrastructure investments not only supports regulatory compliance and service reliability but also ensures long-term sustainability for the communities it serves.
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