CLINTON, Conn., Aug. 9, 2010 (GLOBE NEWSWIRE) -- Connecticut Water Service, Inc. (Nasdaq:CTWS) announced net income of $2.3 million and earnings per basic average share (EPS) of $0.28 for the second quarter of 2010, compared to net income of $2.3 million and EPS of $0.27 for the second quarter of 2009. Total revenue grew to $17.5 million from $16.7 million, an increase of $784,000, or 5%. Total revenue includes all revenues generated by the Company's three business segments: Water Activities, Services and Rentals, and Real Estate.
The increased revenues were partially offset by a $353,000, or 32%, increase in interest and debt expenses for the quarter related to a long-term financing completed at the end of 2009. Revenue growth was further offset by a $565,000, or 25%, increase in income tax and depreciation expenses for the quarter. The higher tax expense was due to a higher effective tax rate and increased pre-tax net income.
Second-quarter net income in the Water Activities segment, the Company's principal business, grew to $2.1 million from $2.0 million in 2009, an increase of 4.9%. The gain was largely attributable to increased revenue through implementation of the Water Infrastructure and Conservation Adjustment (WICA) surcharge that was added to customer bills in July of 2009. The WICA surcharge for the second quarter of 2010 was 2.1%.Operating and Maintenance (O&M) expenses declined by $399,000, or 4.8%, from the 2009 second quarter. The decline was largely due to cost containment efforts; reduced use of outside services; and lower administrative costs associated with property, liability and medical insurance costs. The Services and Rentals segment continued to perform consistently, producing EPS of slightly more than $0.02 in 2010. There was no activity in the Real Estate segment in the second quarter of either 2010 or 2009. Eric W. Thornburg, Chairman, President, and Chief Executive Officer, stated, "I am proud of Connecticut Water employees who, through their commitment to cost containment, have been able to hold O&M expense for the quarter at levels comparable to the second quarter of 2008 despite upward pressure on the cost of water treatment, electricity and employee wages and benefits over the past two years. I am especially pleased that they were able to do that while still delivering world-class customer service."