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Regulated Water Activities Income Increases 10.7%
CLINTON, Conn., March 14, 2011 (GLOBE NEWSWIRE) -- Connecticut Water Service, Inc. (Nasdaq:CTWS) announced net income of $9.8 million and earnings per basic average share (EPS) of $1.14 for 2010, compared to net income of $10.2 million and EPS of $1.20 for 2009. In 2009, the Company completed real estate transactions that generated revenues of $2.2 million and EPS of $0.17. No real estate transactions were completed in 2010.
In 2010, total revenue grew to $72.8 million from $67.5 million in 2009, an increase of $5.3 million, or 8%. Total revenue includes all revenues generated by the Company's three business segments: Water Activities, Services and Rentals, and Real Estate.
In 2010, income in the Water Activities segment, the Company's principal business, grew by approximately $840,000 to $8.7 million from $7.8 million in 2009, an increase of 10.7%. The gain was largely attributable to increased revenue through a rate increase of 13% that became effective in July 2010, and a 6% increase in water production due to hotter and drier weather in 2010 compared to 2009. The increased revenues were partially offset by a one-time pre-tax charge of approximately $790,000 associated with an organizational review principally at the Company's corporate headquarters in the third quarter.
Additionally, O&M costs increased less than 3%, or approximately $920,000, to $33.1 million in 2010 due in part to a $1.0 million increase in labor, pension and post-retirement medical costs compared to 2009. In 2009, employee focus on capital projects including the implementation of an Enterprise Resource Planning computer system resulted in a temporary increase in capitalized labor. In 2010, labor expense was $12.1 million and was more in line with the 2008 labor expense of $11.9 million. There was also a decrease of $506,000 in medical expense due to a reduction in claims and administrative expense.