Essential Utilities Inc. (WTRG Quick QuoteWTRG - Free Report) delivered second-quarter 2024 operating earnings per share (EPS) of 28 cents, which lagged the Zacks Consensus Estimate of 30 cents by 6.7%.

The bottom line also missed the year-ago quarter’s earnings of 34 cents by 17.6%. The year-over-year decline in earnings was due to the impact of weather, which was warmer than normal, lowering demand for utility services and increasing expenses.

Total Revenues

Operating revenues of $434.4 million lagged the Zacks Consensus Estimate of $437 million by 0.6%. Total revenues were down 0.5% year over year.

Highlights of the Release

Operation and maintenance expenses were $142.5 million, up 6.7% from the year-ago figure of $133.5 million.

Operating income was $145.3 million, up 6.4% year over year. Interest expenses increased 5.6% to $73.3 million from $69.2 million in the prior year quarter.

Essential Utilities signed six purchase agreements to acquire additional wastewater systems that will add 217,000 retail customers or equivalent dwelling units. In the quarter, the company closed on its acquisition of the Westfield Homeowners Association wastewater system located in Cook County, IL.

To date, in 2024, the company’s regulated water segment has received rate awards or infrastructure surcharges in Illinois, North Carolina, Ohio and Pennsylvania of $25.8 million. Its regulated natural gas segment has received infrastructure surcharges in Kentucky and Pennsylvania of $2.0 million.

Financial Highlights

Current assets were $362.7 million as of Jun 30, 2024, compared with $492 million as of Dec 31, 2023.

Long-term debt was $7.01 billion as of Jun 30, 2024, higher than $6.82 billion as of Dec 31, 2023.

The company invested $548.9 million in the first half of the year to improve its regulated water and natural gas infrastructure systems and to enhance its operations and customer service.

Guidance

Essential Utilities now expects to exceed its 2024 EPS guidance of $1.96-$2. The Zacks Consensus Estimate for EPS is pegged at $1.97, a tad lower than the midpoint of the company’s guided range.

Management anticipates its customer base in the water segment to expand by 2-3% through acquisitions and organic customer growth.

The company is on track to invest $1.3-$1.4 billion in its infrastructure in 2024. Essential Utilities also plans to invest $7.2 billion through 2024-2028 to improve the water and natural gas systems and better serve its customers using improved information technology.

WTRG projects compound annual growth rate of 8% and 10% through 2028 for its regulated water and natural gas segments, respectively.

Zacks Rank

Currently, Essential Utilities carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Releases

American Water Works Company (AWK Quick QuoteAWK - Free Report) posted second-quarter 2024 operating EPS of $1.42, which lagged the Zacks Consensus Estimate of $1.47 by 3.4%.

The Zacks Consensus Estimate for 2024 and 2025 earnings per share reflects year-over-year growth of 6.9% and 8.4%, respectively.

California Water Service Group (CWT Quick QuoteCWT - Free Report) recorded second-quarter 2024 adjusted earnings of 70 cents per share, which surpassed the Zacks Consensus Estimate of 39 cents by 79.5%.

The Zacks Consensus Estimate for 2024 earnings per share reflects year-over-year growth of 246.1%.

Middlesex Water (MSEX Quick QuoteMSEX - Free Report) came out with quarterly earnings of 59 cents per share, missing the Zacks Consensus Estimate of 64 cents by 7.8%.

The Zacks Consensus Estimate for 2024 and 2025 earnings per share reflects year-over -year growth of 25.6% and 6.8%, respectively.