SJW Corp. Announces 2012 Annual And Fourth Quarter Financial Results

SJW Corp. (NYSE: SJW) today reported operating revenue for the year ended December 31, 2012 of $261.5 million versus $238.9 million for the year ended December 31, 2011, an increase of $22.6 million. The increase in revenue was attributable to cumulative rate increases of $17.6 million, $5.5 million in higher customer water usage, the recognition of certain balancing and memorandum accounts of $3.6 million in December 2012, $1.3 million from new customers and $383,000 from real estate operations. These increases were partially offset by the Mandatory Conservation Revenue Adjustment Memorandum Account ("MCRAM") of $5.7 million that was recognized in December 2011.

Water production costs for the year ended December 31, 2012 were $107.3 million compared to $92.1 million in 2011, an increase of $15.2 million. The increase in water production costs is primarily attributable to $6.7 million in higher per unit costs for purchased water and groundwater extraction charges, $5.3 million in higher costs due to a decrease in available surface water supply and $3.2 million in higher customer water usage.

Operating expenses, excluding water production costs, for the year ended December 31, 2012 were $99.0 million compared to $92.5 million in 2011. The increase of $6.5 million reflects an additional $3.7 million of administrative and general expenses primarily due to higher payroll and benefit costs, $1.9 million of higher depreciation expense, $782,000 in higher property taxes and $89,000 in higher maintenance expenses. The effective consolidated income tax rate was 41% for the years ended December 31, 2012 and 2011.

Net income was $22.3 million and diluted earnings per common share were $1.18, compared to $20.9 million and $1.11 per share, respectively, for the year ended December 31, 2011.

Fourth Quarter Financial Results

Operating revenue for the fourth quarter ended December 31, 2012 was $62.4 million versus $62.3 million for the same period in 2011, an increase of $100,000. The change was primarily attributable to $4.0 million in cumulative rate increases, $3.6 million due to the recognition of balancing and memorandum accounts and $358,000 from new customers. These increases were partially offset by the recognition of the MCRAM of $5.7 million in December 2011 and $2.1 million due to lower customer usage.

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