SYS-CON MEDIA Authors: Peter Silva, Kevin Jackson, Jessica Qiu, Dana Gardner, Dan Stolts

News Feed Item

California Water Service Group Announces Second Quarter 2014 Results

SAN JOSE, CA -- (Marketwired) -- 07/30/14 -- California Water Service Group (NYSE: CWT) today announced net income of $17.2 million or $0.36 per diluted common share for the second quarter of 2014, compared to net income of $13.5 million or $0.28 per diluted common share for the second quarter of 2013. Included in the second quarter of 2014 operating results is a $2.5 million (or $0.05 per diluted common share) non-recurring tax benefit.

Revenue for the second quarter of 2014 was $158.4 million, compared to revenue of $154.6 million in second quarter 2013, in part due to higher estimated unbilled revenue. The unbilled revenue increase resulted from higher consumption at the end of the quarter which is not included in the water revenue adjustment mechanism (WRAM).

Total operating expenses for the second quarter of 2014 increased $1.4 million, or 1%, to $135.1 million. Increases in water production costs, primarily purchased water cost increases, were partially offset by decreases in other operating expenses, income taxes, and property and other taxes. Maintenance expense increased $0.8 million, or 19%, to $5.0 million, while depreciation expense increased $1.6 million, or 11%, to $16.1 million due to 2014 capital additions.

Other income, net of income taxes, increased $0.7 million in the second quarter of 2014, primarily due to an increase in unrealized gains on our benefit plan insurance investments. Interest expense decreased $0.4 million, or 6%, to $6.9 million due to the Company's repayment of long-term debt in 2013.

A delay in the decision on the Company's largest subsidiary's General Rate Case, filed with the California Public Utilities Commission (CPUC) in 2012, continued to impact results for the quarter. On July 21, 2014, the CPUC issued a Proposed Decision on California Water Service Company's (Cal Water) General Rate Case. The Proposed Decision will not become effective until it has been reviewed and approved by the CPUC. The Commission may adopt the proposed decision, modify it, or reject it.

Until the Proposed Decision is adopted, Cal Water will continue to track the difference between approved interim rates and new rates that are eventually adopted in a memorandum account. After new rates are implemented, the memorandum account balance will be collected through customer surcharges over 12, 24, or 36 months. Had the Commission approved the settlement proposed by the parties effective January 1, 2014, the new rates would have increased pre-tax income $10.2 million for the six month period ended June 30, 2014. The proposed new rates would have added the following to the Company's results in 2014: $16.1 million of pre-tax income for service charges, flat rate, and fire protection rate increases, $1.6 million of pre-tax income from the proposed new health care balancing account, and a $7.5 million reduction to WRAM pre-tax income.

"We are pleased to have a Proposed Decision in Cal Water's General Rate Case. We are looking forward to receiving a final decision that will allow us to recover prudently incurred costs of providing a safe, reliable water supply and earn a reasonable return on critical infrastructure investments," said President and Chief Executive Officer Martin A. Kropelnicki.

"Having this lengthy proceeding behind us will enable us to focus all of our attention on meeting our customers' need for a reliable supply of high quality water in the midst of one of the most serious droughts in the state's history," he said.

All stockholders and interested investors are invited to listen to the teleconference. The 2014 second quarter conference call may be accessed by dialing 1-888-572-7033 or 1-719-325-2491 and keying in ID# 3765528. A replay of the call will be available from 2:00 p.m. ET on Thursday, July 31, 2014 through September 30, 2014, at 1-888-203-1112 or 1-719-457-0820, ID# 3765528. The call, which will be hosted by President and Chief Executive Officer Martin A. Kropelnicki and Vice President and Chief Financial Officer Thomas F. Smegal, will also be webcast under the investor relations tab at www.calwatergroup.com.

California Water Service Group is the parent company of California Water Service Company, Washington Water Service Company, New Mexico Water Service Company, Hawaii Water Service Company, Inc., CWS Utility Services, and HWS Utility Services. Together these companies provide regulated and non-regulated water service to approximately 2 million people in more than 100 California, Washington, New Mexico, and Hawaii communities. Group's common stock trades on the New York Stock Exchange under the symbol "CWT." Additional information is available at our web site at www.calwatergroup.com.

This news release contains forward-looking statements within the meaning established by the Private Securities Litigation Reform Act of 1995 ("Act"). The forward-looking statements are intended to qualify under provisions of the federal securities laws for "safe harbor" treatment established by the Act. Forward-looking statements are based on currently available information, expectations, estimates, assumptions and projections, and management's judgment about the Company, the water utility industry and general economic conditions. Such words as would, expects, intends, plans, believes, estimates, assumes, anticipates, projects, predicts, forecasts or variations of such words or similar expressions are intended to identify forward-looking statements. The forward-looking statements are not guarantees of future performance. They are subject to uncertainty and changes in circumstances. Actual results may vary materially from what is contained in a forward-looking statement. Factors that may cause a result different than expected or anticipated include, but are not limited to: governmental and regulatory commissions' decisions; changes in regulatory commissions' policies and procedures; the timeliness of regulatory commissions' actions concerning rate relief; changes in the capital markets and access to sufficient capital on satisfactory terms; new legislation; changes in California Department of Public Health water quality standards; changes in environmental compliance and water quality requirements; changes in accounting valuations and estimates; changes in accounting treatment for regulated companies, including adoption of International Financial Reporting Standards, if required; electric power interruptions; increases in suppliers' prices and the availability of supplies including water and power; fluctuations in interest rates; litigation that may result in damages or costs not recoverable from third parties; acquisitions and our ability to successfully integrate acquired companies; the ability to successfully implement business plans; civil disturbances or terrorist threats or acts, or apprehension about the possible future occurrences of acts of this type; the involvement of the United States in war or other hostilities; our ability to attract and retain qualified employees; labor relations matters as we negotiate with the unions; federal health care law changes that could result in increases to Company health care costs and additional income tax expenses in future years; changes in federal and state income tax regulations and treatment of such by regulatory commissions; implementation of new information technology systems; changes in operations that result in an impairment to acquisition goodwill; restrictive covenants in or changes to the credit ratings on current or future debt that could increase financing costs or affect the ability to borrow, make payments on debt, or pay dividends; general economic conditions, including changes in customer growth patterns and our ability to collect billed revenue from customers; changes in customer water use patterns and the effects of conservation; the impact of weather and climate on water availability, water sales and operating results; the ability to satisfy requirements related to the Sarbanes-Oxley and Dodd-Frank Acts and other regulations on internal controls; and, other risks and unforeseen events. When considering forward-looking statements, you should keep in mind the cautionary statements included in this paragraph, as well as the annual 10-K, Quarterly 10-Q, and other reports filed from time-to-time with the Securities and Exchange Commission (SEC). The Company assumes no obligation to provide public updates of forward-looking statements.



CALIFORNIA WATER SERVICE GROUP
CONDENSED CONSOLIDATED BALANCE SHEETS
Unaudited

(In thousands, except per share data)              June 30,    December 31,
                                                     2014          2013
                                                 ------------  ------------
ASSETS
Utility plant:
  Utility plant                                  $  2,269,779  $  2,213,328
  Less accumulated depreciation and amortization     (730,266)     (697,497)
                                                 ------------  ------------
    Net utility plant                               1,539,513     1,515,831
                                                 ------------  ------------

Current assets:
  Cash and cash equivalents                            29,706        27,506
  Receivables:
    Customers                                          34,278        31,468
    Regulatory balancing accounts                      26,978        30,887
    Other                                              13,825        18,700
  Unbilled revenue                                     28,055        17,034
  Materials and supplies at weighted average
   cost                                                 5,952         5,571
  Taxes, prepaid expenses and other assets             12,014         8,324
                                                 ------------  ------------
    Total current assets                              150,808       139,490
                                                 ------------  ------------

Other assets:
  Regulatory assets                                   264,245       251,681
  Goodwill                                              2,615         2,615
  Other assets                                         53,003        50,238
                                                 ------------  ------------
    Total other assets                                319,863       304,534
                                                 ------------  ------------
                                                 $  2,010,184  $  1,959,855
                                                 ============  ============

CAPITALIZATION AND LIABILITIES
Capitalization:
  Common stock, $.01 par value                   $        478  $        477
  Additional paid-in capital                          329,332       328,364
  Retained earnings                                   266,082       269,915
                                                 ------------  ------------
    Total common stockholders' equity                 595,892       598,756
  Long-term debt, less current maturities             423,334       426,142
                                                 ------------  ------------
    Total capitalization                            1,019,226     1,024,898
                                                 ------------  ------------

Current liabilities:
  Current maturities of long-term debt                  6,550         7,908
  Short-term borrowings                                81,215        46,815
  Accounts payable                                     70,906        55,087
  Regulatory balancing accounts                         6,603         1,827
  Accrued interest                                      4,240         4,245
  Accrued expenses and other liabilities               52,560        50,702
                                                 ------------  ------------
    Total current liabilities                         222,074       166,584

Unamortized investment tax credits                      2,106         2,106
Deferred income taxes, net                            180,956       183,245
Pension and postretirement benefits other than
 pensions                                             145,426       145,451
Regulatory and other liabilities                       90,134        86,455
Advances for construction                             181,443       183,393
Contributions in aid of construction                  168,819       167,723
                                                 ------------  ------------
                                                 $  2,010,184  $  1,959,855
                                                 ------------  ------------



CALIFORNIA WATER SERVICE GROUP
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Unaudited
(In thousands, except per share data)

For the Three-Months ended:
                                                   June 30,      June 30,
                                                     2014          2013
                                                 ------------  ------------

Operating revenue                                $    158,416  $    154,555
                                                 ------------  ------------
Operating expenses:
  Operations:
    Water production costs                             61,915        59,645
    Administrative and general                         23,796        23,155
    Other operations                                   16,004        17,030
  Maintenance                                           4,988         4,188
  Depreciation and amortization                        16,087        14,491
  Income taxes                                          7,190         9,548
  Property and other taxes                              5,144         5,715
                                                 ------------  ------------
    Total operating expenses                          135,124       133,772
                                                 ------------  ------------

    Net operating income                               23,292        20,783
                                                 ------------  ------------

Other income and expenses:
  Non-regulated revenue                                 3,474         3,215
  Non-regulated expenses, net                          (2,253)       (3,240)
  Income tax (expense) benefit on other income
   and expense                                           (481)           16
                                                 ------------  ------------
    Net other income (loss)                               740            (9)
                                                 ------------  ------------

Interest expense:
  Interest expense                                      7,077         7,803
  Less: capitalized interest                             (215)         (539)
                                                 ------------  ------------
    Net interest expense                                6,862         7,264
                                                 ------------  ------------

Net income                                       $     17,170  $     13,510
                                                 ============  ============

Earnings per share
  Basic                                          $       0.36  $       0.28
                                                 ============  ============
  Diluted                                        $       0.36  $       0.28
                                                 ============  ============
Weighted average shares outstanding
  Basic                                                47,804        47,729
                                                 ============  ============
  Diluted                                              47,837        47,760
                                                 ============  ============
Dividends declared per share of common stock     $     0.1625  $     0.1600
                                                 ------------  ------------



CALIFORNIA WATER SERVICE GROUP
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
Unaudited
(In thousands, except per share data)

For the Six-Months ended:
                                                   June 30,      June 30,
                                                     2014          2013
                                                 ------------  ------------

Operating revenue                                $    268,931  $    265,999
                                                 ------------  ------------
Operating expenses:
  Operations:
    Water production costs                            107,317       101,342
    Administrative and general                         48,937        48,436
    Other operations                                   32,380        32,675
  Maintenance                                           9,993         8,321
  Depreciation and amortization                        32,140        29,120
  Income taxes                                          3,351         8,402
  Property and other taxes                             10,369        11,150
                                                 ------------  ------------
    Total operating expenses                          244,487       239,446
                                                 ------------  ------------

    Net operating income                               24,444        26,553
                                                 ------------  ------------

Other income and expenses:
  Non-regulated revenue                                 7,754         6,737
  Non-regulated expenses, net                          (6,372)       (5,657)
  Income tax (expense) on other income and
   expense                                               (560)         (435)
                                                 ------------  ------------
    Net other income                                      822           645
                                                 ------------  ------------

Interest expense:
  Interest expense                                     14,152        15,840
  Less: capitalized interest                             (580)       (1,079)
                                                 ------------  ------------
    Net interest expense                               13,572        14,761
                                                 ------------  ------------

Net income                                       $     11,694  $     12,437
                                                 ============  ============

Earnings per share
  Basic                                          $       0.24  $       0.28
                                                 ============  ============
  Diluted                                        $       0.24  $       0.28
                                                 ============  ============
Weighted average shares outstanding
  Basic                                                47,780        45,004
                                                 ============  ============
  Diluted                                              47,818        45,034
                                                 ============  ============
Dividends declared per share of common stock     $     0.3250  $     0.3200
                                                 ------------  ------------

1720 North First Street
San Jose, CA 95112-4598

Contact:
Tom Smegal
(408) 367-8200 (analysts)

Shannon Dean
(310) 257-1435 (media)

More Stories By Marketwired .

Copyright © 2009 Marketwired. All rights reserved. All the news releases provided by Marketwired are copyrighted. Any forms of copying other than an individual user's personal reference without express written permission is prohibited. Further distribution of these materials is strictly forbidden, including but not limited to, posting, emailing, faxing, archiving in a public database, redistributing via a computer network or in a printed form.

@ThingsExpo Stories
Cultural, regulatory, environmental, political and economic (CREPE) conditions over the past decade are creating cross-industry solution spaces that require processes and technologies from both the Internet of Things (IoT), and Data Management and Analytics (DMA). These solution spaces are evolving into Sensor Analytics Ecosystems (SAE) that represent significant new opportunities for organizations of all types. Public Utilities throughout the world, providing electricity, natural gas and water, are pursuing SmartGrid initiatives that represent one of the more mature examples of SAE. We have spoken with, or attended presentations from, utilities in the United States, South America, Asia and Europe. This session will provide a look at the CREPE drivers for SmartGrids and the solution spaces used by SmartGrids today and planned for the near future. All organizations can learn from SmartGrid’s use of Predictive Maintenance, Demand Prediction, Cloud, Big Data and Customer-facing Dashboards...
The Internet of Things (IoT) is going to require a new way of thinking and of developing software for speed, security and innovation. This requires IT leaders to balance business as usual while anticipating for the next market and technology trends. Cloud provides the right IT asset portfolio to help today’s IT leaders manage the old and prepare for the new. Today the cloud conversation is evolving from private and public to hybrid. This session will provide use cases and insights to reinforce the value of the network in helping organizations to maximize their company’s cloud experience.
IoT is still a vague buzzword for many people. In his session at Internet of @ThingsExpo, Mike Kavis, Vice President & Principal Cloud Architect at Cloud Technology Partners, will discuss the business value of IoT that goes far beyond the general public's perception that IoT is all about wearables and home consumer services. The presentation will also discuss how IoT is perceived by investors and how venture capitalist access this space. Other topics to discuss are barriers to success, what is new, what is old, and what the future may hold.
Whether you're a startup or a 100 year old enterprise, the Internet of Things offers a variety of new capabilities for your business. IoT style solutions can help you get closer your customers, launch new product lines and take over an industry. Some companies are dipping their toes in, but many have already taken the plunge, all while dramatic new capabilities continue to emerge. In his session at Internet of @ThingsExpo, Reid Carlberg, Senior Director, Developer Evangelism at salesforce.com, to discuss real-world use cases, patterns and opportunities you can harness today.
All major researchers estimate there will be tens of billions devices – computers, smartphones, tablets, and sensors – connected to the Internet by 2020. This number will continue to grow at a rapid pace for the next several decades. With major technology companies and startups seriously embracing IoT strategies, now is the perfect time to attend @ThingsExpo in Silicon Valley. Learn what is going on, contribute to the discussions, and ensure that your enterprise is as "IoT-Ready" as it can be!
Noted IoT expert and researcher Joseph di Paolantonio (pictured below) has joined the @ThingsExpo faculty. Joseph, who describes himself as an “Independent Thinker” from DataArchon, will speak on the topic of “Smart Grids & Managing Big Utilities.” Over his career, Joseph di Paolantonio has worked in the energy, renewables, aerospace, telecommunications, and information technology industries. His expertise is in data analysis, system engineering, Bayesian statistics, data warehouses, business intelligence, data mining, predictive methods, and very large databases (VLDB). Prior to DataArchon, he served as a VP and Principal Analyst with Constellation Group. He is a member of the Boulder (Colo.) Brain Trust, an organization with a mission “to benefit the Business Intelligence and data management industry by providing pro bono exchange of information between vendors and independent analysts on new trends and technologies and to provide vendors with constructive feedback on their of...
Software AG helps organizations transform into Digital Enterprises, so they can differentiate from competitors and better engage customers, partners and employees. Using the Software AG Suite, companies can close the gap between business and IT to create digital systems of differentiation that drive front-line agility. We offer four on-ramps to the Digital Enterprise: alignment through collaborative process analysis; transformation through portfolio management; agility through process automation and integration; and visibility through intelligent business operations and big data.
There will be 50 billion Internet connected devices by 2020. Today, every manufacturer has a propriety protocol and an app. How do we securely integrate these "things" into our lives and businesses in a way that we can easily control and manage? Even better, how do we integrate these "things" so that they control and manage each other so our lives become more convenient or our businesses become more profitable and/or safe? We have heard that the best interface is no interface. In his session at Internet of @ThingsExpo, Chris Matthieu, Co-Founder & CTO at Octoblu, Inc., will discuss how these devices generate enough data to learn our behaviors and simplify/improve our lives. What if we could connect everything to everything? I'm not only talking about connecting things to things but also systems, cloud services, and people. Add in a little machine learning and artificial intelligence and now we have something interesting...
Last week, while in San Francisco, I used the Uber app and service four times. All four experiences were great, although one of the drivers stopped for 30 seconds and then left as I was walking up to the car. He must have realized I was a blogger. None the less, the next car was just a minute away and I suffered no pain. In this article, my colleague, Ved Sen, Global Head, Advisory Services Social, Mobile and Sensors at Cognizant shares his experiences and insights.
We are reaching the end of the beginning with WebRTC and real systems using this technology have begun to appear. One challenge that faces every WebRTC deployment (in some form or another) is identity management. For example, if you have an existing service – possibly built on a variety of different PaaS/SaaS offerings – and you want to add real-time communications you are faced with a challenge relating to user management, authentication, authorization, and validation. Service providers will want to use their existing identities, but these will have credentials already that are (hopefully) irreversibly encoded. In his session at Internet of @ThingsExpo, Peter Dunkley, Technical Director at Acision, will look at how this identity problem can be solved and discuss ways to use existing web identities for real-time communication.
Can call centers hang up the phones for good? Intuitive Solutions did. WebRTC enabled this contact center provider to eliminate antiquated telephony and desktop phone infrastructure with a pure web-based solution, allowing them to expand beyond brick-and-mortar confines to a home-based agent model. It also ensured scalability and better service for customers, including MUY! Companies, one of the country's largest franchise restaurant companies with 232 Pizza Hut locations. This is one example of WebRTC adoption today, but the potential is limitless when powered by IoT. Attendees will learn real-world benefits of WebRTC and explore future possibilities, as WebRTC and IoT intersect to improve customer service.
From telemedicine to smart cars, digital homes and industrial monitoring, the explosive growth of IoT has created exciting new business opportunities for real time calls and messaging. In his session at Internet of @ThingsExpo, Ivelin Ivanov, CEO and Co-Founder of Telestax, will share some of the new revenue sources that IoT created for Restcomm – the open source telephony platform from Telestax. Ivelin Ivanov is a technology entrepreneur who founded Mobicents, an Open Source VoIP Platform, to help create, deploy, and manage applications integrating voice, video and data. He is the co-founder of TeleStax, an Open Source Cloud Communications company that helps the shift from legacy IN/SS7 telco networks to IP-based cloud comms. An early investor in multiple start-ups, he still finds time to code for his companies and contribute to open source projects.
The Internet of Things (IoT) promises to create new business models as significant as those that were inspired by the Internet and the smartphone 20 and 10 years ago. What business, social and practical implications will this phenomenon bring? That's the subject of "Monetizing the Internet of Things: Perspectives from the Front Lines," an e-book released today and available free of charge from Aria Systems, the leading innovator in recurring revenue management.
The Internet of Things will put IT to its ultimate test by creating infinite new opportunities to digitize products and services, generate and analyze new data to improve customer satisfaction, and discover new ways to gain a competitive advantage across nearly every industry. In order to help corporate business units to capitalize on the rapidly evolving IoT opportunities, IT must stand up to a new set of challenges.
There’s Big Data, then there’s really Big Data from the Internet of Things. IoT is evolving to include many data possibilities like new types of event, log and network data. The volumes are enormous, generating tens of billions of logs per day, which raise data challenges. Early IoT deployments are relying heavily on both the cloud and managed service providers to navigate these challenges. In her session at 6th Big Data Expo®, Hannah Smalltree, Director at Treasure Data, to discuss how IoT, Big Data and deployments are processing massive data volumes from wearables, utilities and other machines.
P2P RTC will impact the landscape of communications, shifting from traditional telephony style communications models to OTT (Over-The-Top) cloud assisted & PaaS (Platform as a Service) communication services. The P2P shift will impact many areas of our lives, from mobile communication, human interactive web services, RTC and telephony infrastructure, user federation, security and privacy implications, business costs, and scalability. In his session at Internet of @ThingsExpo, Erik Lagerway, Co-founder of Hookflash, will walk through the shifting landscape of traditional telephone and voice services to the modern P2P RTC era of OTT cloud assisted services.
While great strides have been made relative to the video aspects of remote collaboration, audio technology has basically stagnated. Typically all audio is mixed to a single monaural stream and emanates from a single point, such as a speakerphone or a speaker associated with a video monitor. This leads to confusion and lack of understanding among participants especially regarding who is actually speaking. Spatial teleconferencing introduces the concept of acoustic spatial separation between conference participants in three dimensional space. This has been shown to significantly improve comprehension and conference efficiency.
The Internet of Things is tied together with a thin strand that is known as time. Coincidentally, at the core of nearly all data analytics is a timestamp. When working with time series data there are a few core principles that everyone should consider, especially across datasets where time is the common boundary. In his session at Internet of @ThingsExpo, Jim Scott, Director of Enterprise Strategy & Architecture at MapR Technologies, will discuss single-value, geo-spatial, and log time series data. By focusing on enterprise applications and the data center, he will use OpenTSDB as an example to explain some of these concepts including when to use different storage models.
SYS-CON Events announced today that Gridstore™, the leader in software-defined storage (SDS) purpose-built for Windows Servers and Hyper-V, will exhibit at SYS-CON's 15th International Cloud Expo®, which will take place on November 4–6, 2014, at the Santa Clara Convention Center in Santa Clara, CA. Gridstore™ is the leader in software-defined storage purpose built for virtualization that is designed to accelerate applications in virtualized environments. Using its patented Server-Side Virtual Controller™ Technology (SVCT) to eliminate the I/O blender effect and accelerate applications Gridstore delivers vmOptimized™ Storage that self-optimizes to each application or VM across both virtual and physical environments. Leveraging a grid architecture, Gridstore delivers the first end-to-end storage QoS to ensure the most important App or VM performance is never compromised. The storage grid, that uses Gridstore’s performance optimized nodes or capacity optimized nodes, starts with as few a...
The Transparent Cloud-computing Consortium (abbreviation: T-Cloud Consortium) will conduct research activities into changes in the computing model as a result of collaboration between "device" and "cloud" and the creation of new value and markets through organic data processing High speed and high quality networks, and dramatic improvements in computer processing capabilities, have greatly changed the nature of applications and made the storing and processing of data on the network commonplace. These technological reforms have not only changed computers and smartphones, but are also changing the data processing model for all information devices. In particular, in the area known as M2M (Machine-To-Machine), there are great expectations that information with a new type of value can be produced using a variety of devices and sensors saving/sharing data via the network and through large-scale cloud-type data processing. This consortium believes that attaching a huge number of devic...