SJW Corp. Announces First Quarter Financial Results

SJW Corp. (NYSE:SJW) today reported financial results for the first quarter ended March 31, 2011. Operating revenue was $43.7 million in the quarter compared to $40.4 million in 2010. The $3.3 million increase in revenue reflects cumulative rate increases of $2.4 million, $628,000 in higher customer water usage and new customers compared to a year ago and $300,000 in higher revenue from real estate operations.

Net income was $610,000 and diluted earnings per common share were $0.03, compared to $985,000 and $0.05 per share, respectively, in the first quarter of 2010.

Water production costs for the quarter ended March 31, 2011 were $15.5 million compared to $14.5 million in 2010, an increase of $1.0 million. The increase in water production cost is primarily attributable to a decrease in use of available surface water supply.

Operating expenses, excluding water production costs, for the first quarter were $22.6 million compared to $20.6 million in 2010. The increase of $2.0 million reflects an additional $683,000 of depreciation expense compared to last year, higher administrative and general expenses of $648,000, $384,000 more in taxes other than income tax and an increase of $272,000 in maintenance expenses. Income tax expense for the first quarter decreased to $433,000 in 2011 from $682,000 in 2010 as a result of lower pre-tax income.

The Directors of SJW Corp. today declared a quarterly dividend on common stock of $0.1725 per share. The dividend is payable on June 1, 2011 to shareholders of record on May 9, 2011.

SJW Corp. is a publicly traded holding company headquartered in San Jose, California. SJW Corp. is the parent company of San Jose Water Company, SJWTX, Inc., Texas Water Alliance Limited, and SJW Land Company. Together, San Jose Water Company and SJWTX, Inc. provide regulated and nonregulated water service to more than one million people in San Jose, California and nearby communities and in Canyon Lake, Texas and nearby communities. SJW Land Company owns and operates commercial real estate investments.

This press release may contain certain forward-looking statements including but not limited to statements relating to SJW Corp.'s plans, strategies, objectives, expectations and intentions, which are made pursuant to the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of SJW Corp. to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The results for a quarter are not indicative of results for a full year due to seasonality and other factors. Certain factors that may cause actual results, performance or achievements to materially differ are described in SJW Corp.'s most recent reports on Form 10-K, Form 10-Q and Form 8-K filed with the Securities and Exchange Commission. SJW Corp. undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

SJW Corp.

Condensed Consolidated Statements of Income and Comprehensive Income
(Unaudited)
(in thousands, except per share data)
 
  THREE MONTHS ENDED
MARCH 31
2011   2010
 
OPERATING REVENUE $ 43,696   40,411
OPERATING EXPENSE:
Operation:
Purchased water 7,416 5,819
Power 1,014 1,144
Groundwater extraction charge 4,508 4,995
Other production costs   2,592   2,538  
Total production costs 15,530 14,496
 
Administrative and general 9,636 8,988
Maintenance 3,048 2,776
Taxes other than income 2,087 1,703
Depreciation and amortization   7,794   7,111  
Total operating expense   38,095   35,074  
 
OPERATING INCOME 5,601 5,337
 

Interest on long-term debt and other
  (4,558 ) (3,670 )
 
Income before income taxes $ 1,043 1,667
 
Provision for income taxes   433   682  
 
NET INCOME $ 610   985  
 

Other comprehensive income (loss), net
  (11 ) 513  
 
COMPREHENSIVE INCOME $ 599   1,498  
 
 
Earnings per share
-Basic $ 0.03 0.05
-Diluted $ 0.03 0.05
 
Dividend per share $ 0.17 0.17
 
Weighted average shares outstanding
- Basic 18,570 18,519
- Diluted 18,775 18,721
 
SJW Corp.
Condensed Consolidated Balance Sheets
(Unaudited)
(in thousands)
 
  March 31   December 31
2011   2010
ASSETS
UTILITY PLANT:
Land $ 8,579 8,579
Depreciable plant and equipment 1,018,311 1,004,689
Construction in progress 14,501 10,103
Intangible assets   14,313 13,538
Total utility plant 1,055,704 1,036,909
Less accumulated depreciation and amortization   329,597 322,102
Net utility plant   726,107 714,807
 
REAL ESTATE INVESTMENT: 88,962 88,943
Less accumulated depreciation and amortization 9,273 8,854
Net real estate investment 79,689 80,089
CURRENT ASSETS:
Cash and equivalents 2,354 1,730

Accounts receivable and accrued unbilled utility revenue
34,572 33,835
Prepaid expenses and other 2,135 2,462
Total current assets 39,061 38,027
OTHER ASSETS:
Investment in California Water Service Group 7,158 7,177

Debt issuance costs, net of accumulated amortization
4,479 4,308
Regulatory assets 87,721 87,721
Other   3,463 3,233
  102,821 102,439
$ 947,678 935,362
CAPITALIZATION AND LIABILITIES
CAPITALIZATION:
Common stock $ 9,675 9,662
Additional paid-in capital 23,808 23,443
Retained earnings 216,942 219,568
Accumulated other comprehensive income   2,348 2,359
Total shareholders’ equity 252,773 255,032
Long-term debt, less current portion   295,059 295,704
Total capitalization   547,832 550,736
CURRENT LIABILITIES:
Line of credit 11,500 4,000
Current portion of long-term debt 1,149 1,133

Accrued groundwater extraction charge and purchased water
3,721 4,359
Purchased power 454 495
Accounts payable 10,609 5,487
Accrued interest 4,897 5,244
Other current liabilities   8,741 8,437
Total current liabilities   41,071 29,155
 
DEFERRED INCOME TAXES AND CREDITS 111,293 107,961

ADVANCES FOR CONSTRUCTION AND CONTRIBUTIONS IN AID OF CONSTRUCTION
189,092 190,155
POSTRETIREMENT BENEFIT PLANS 51,248 50,213
OTHER NONCURRENT LIABILITIES   7,142 7,142
$ 947,678 935,362

Copyright Business Wire 2010

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