Artesian Resources Corporation reported earnings in the first quarter.
Net income for the three months ended March 31, was $4.5 million, a $0.3 million, or 6.6% increase, compared to net income recorded during the first quarter of 2021. Artesian is headquartered near Newark.
Revenues totaled $22.2 million for the three months ended March 31, 2022, $1.5 million, or 7.5%, higher than revenues for the three months ended March 31 of last year Water sales revenue increased $300,000 or 1.8%, primarily due to continued growth in the customer base. Other utility operating revenue increased by approximately $1.1 million primarily due to an increase in wastewater revenue related to the acquisition of Tidewater Environmental Services (TESi) in January 2022, the continued growth of the residential customer base in existing wastewater territories, and industrial wastewater service revenue associated with process wastewater operations that started in June 2021.
“With the recent integration of TESI progressing smoothly, we remain on track to continue with our acquisition growth. We are expected to close on the acquisition of the Town of Clayton’s water system in the second quarter of 2022,” said Dian C. Taylor, CEO. “Purchasing both municipally-owned systems and regulated public systems is not only about growth; it allows us to do our part to strengthen water and wastewater infrastructure in the communities we serve, something that is crucial for the future,” said Taylor.
Operating expenses, excluding depreciation and income taxes, increased $1.1 million, or 9.3%, primarily related to an increase in utility operating expenses and property and other taxes. The majority of the utility operating expense increases are related to repair and maintenance costs, payroll and benefits costs, contractual service costs, and purchased power costs associated with both water and wastewater operations. The utility operating expense increases are partially offset by a decrease in purchased water under a new contract, effective January 2022, in which the minimum amount of water required to be purchased was reduced.
A total of $12.6 million was invested in the first three months of 2022 in water and wastewater infrastructure projects and acquisitions. These investments include the installation of transmission and distribution facilities, replacement of aging mains, rehabilitation of treatment facilities, and redevelopment of wells and pumping equipment. The company also acquired wastewater utility plant assets related to the acquisition of the Tidewater unit.
“For the remainder of 2022, we will continue to execute our strategic initiatives, which include consolidating and enhancing our water and wastewater systems, in addition to expanding our service territory. Furthermore, with the recent acquisition of TESI, we plan to utilize our larger regional wastewater facilities in order to gain additional efficiencies in the treatment and disposal of wastewater,” said Taylor.
Artesian Resources Corporation operates as a holding company of wholly-owned subsidiaries offering water and wastewater services, and a number of other related core business services, on the Delmarva Peninsula. Artesian Water Company, the principal subsidiary, is the oldest and largest regulated water utility on the Delmarva Peninsula and has been providing water service since 1905. Artesian supplies 8.4 billion gallons of water per year through 1,398 miles of main to over a third of Delawareans. The company also serves customers in neighboring Cecil County, MD.
Artesian announced on April 13, that its board approved a 2% increase in the company’s Class A and Class B Common Stock dividend, raising the annual dividend to $1.0916 per share. The quarterly dividend of $0.2729 is payable on May 23, 2022, to shareholders at the close of business on May 9, 2022. This marks Artesian’s 118th consecutive quarterly dividend paid to shareholders.-