American Water Works (AWK) 28 Jul 222022 Q2 Earnings call transcript

Good morning, and welcome to American Water's Second Quarter 2022 Earnings Conference Call.

As a reminder, this call is being recorded and is also being webcast with an accompanying slide presentation through the company's Investor Relations website. The audio webcast archive will be available for one year on American Water's Investor Relations website. I would now like to introduce your host for today's call, Aaron Musgrave, Vice President of Investor Relations. Mr. begin. may you Musgrave,

questions. Good today's and of call. will for remarks, Jordan. joining our you us we your call the for At open morning, you, thank everyone, for prepared Thank the end

we Let me first performance expectations making our over predictions some or our expectations, other statements represent and our These current will statements based language. that are safe forward-looking regarding be harbor go Today, assumptions. future future estimates events. on

subject with may by deal the known future to statements to these are and that numerous or such unknown they factors be since cause uncertainties risks, implied However, results indicated from and events, results statements. materially other different actual

guidance related and earnings XX-Q, each Additional our efficiency uncertainties as The ratio, a factors information Form more well be release June these financial the is XX can with yesterday O&M as President and and reconciliation risks, stories. progress over of provided year-to-date per American with release diluted found and Susan review in on our earnings and website. slide of acquisition important for and the several other and calculation President Norton, We'll milestones and highlights investments information measure our in been impact earnings the in detail, financial CFO, general detailed XXXX some activity. SEC. our with and inflationary the our regarding review will Vice financials update filed earnings in John we'll and a analysis earnings conclude will another our results has non-GAAP details share. of Water's quarter Executive our year-to-date which that, focus environment. We'll Investor the Griffith, and to Hardwick, accompanying share this appendix our of earnings questions. to I'll answering our President Hardwick. of by managing then Businesses. the and deck, an to and Executive during presentation page cases, the your statements will we'll Vice President for the costs our key second our on ESG and posted recent discuss today's targets, on Susan COO, our With Regulated in in All more share call then Relations our Cheryl CEO, active close close refer the the long-term affirmed of and cover to rate in turn per earnings CEO, and

Thanks, Aaron, and good morning, everyone.

we hear with to Let CFO, us John and Griffith shortly. our say are me have happy John how as you'll also more from

offset shortly. from completed were about several more and operating revenues and XXXX XXXX talk filings. first by I'll In drove Let's of XXXX. XXXX, of turn I'll case majority expectations covering These increase MSG our growth, same of in The same in be share half highlights in would the the results to with of period compared earnings the growth of to year the to Regulated Slide per year. due compared the share to XXXX. increases X, and the we as was as line of period the some $X.XX Business infrastructure $X.XX for accounting the general mechanism first which the six per higher in were rate half by revenue $X.XX and the months while for knew $X.XX early Results start from up were $X.XX costs, partially proceedings other regulated the of higher first strong

executing our investments. teams over responsible these invested capital $XXX projects work Regulated quarter the for and Our year-to-date, million reflecting great in acquisitions and billion for Business $X.XX by

Coupled on were for for year a to total acquisition York's of with in the and system million the first City that our start the recall, you we May. strong As results, to investment the wastewater off for our included capital are pace of investments to goal $XXX our will XXXX good billion meet plan year. capital the quarter close excited $X.X

focused stay time third affirmed we for call. cover detail yesterday, And as the saw in earnings John continue later now XXXX and have on guidance plan. We you our And little guidance. to a in results more the will XXXX the

how system Before to York's I the to me family. again and excited the customers let comment on, American employees wastewater move are welcome of about Water we

benefits history, community's acquisition are and largest objectives Water acquisitions it's underestimated, how As we've of jointly states we example understanding landscape opportunity in Pennsylvania where focus The for our acquisitions, leverage we be in water we said, can wastewater can't the great and competitive And think a to and this as stakeholders. on is advantage. growing municipal we the American all executed. that of an created competitive importance about the continue

in existing is mass the footprint cost state, This our efforts efficiencies. target As each mass. challenges regulatory greater and to solve as will a in we help in critical customer grow we many through XX,XXX to acquisitions we've and where Also, critical said voice of industry important before, and range have constructive legislative times we promote have policies. X,XXX an affordability customers, we environments, regulatory to

but affordable you in contract had cover there of are a I'll won't achieve end will awarded and enable Group communities XXX-plus of our pursuits. military reliable I'll the XX the need, delivering us believe of pursue, history we're proud very Mayport award safe, adds final at and year we that and while our the services And rate The another Services of win is clean, the to wastewater great details, know to first every So Cheryl other water plenty opportunity be second quarter. continue that serve. the to success high we at we Navy we Military in the here to highlight installations our let give that

the impacts Slide review to managing X. are few of the minutes here the provide company. how Turning take a and environment to we to macroeconomic I'll a

managed chart not the In X, to Slide much brought pressure see and Our you can as with pandemic. has of have bottom focus at the costs grow efficiency is operating far on us the focus disciplined on about increases of the new, our business. of the supply through This cost we the the on even effects result focus you well know. as of positioned managing so

as increases cost date we while and And are experiencing exercise midyear, in our extended Now energy, to scale. we what an by of inflationary the certain may pressure, to impacts be leveraging are supplies fairly modest. have through disciplined we cost in been continue approach to period our management

union regularly significant our is most to labor our operating far. with expense contract renewals. leadership secure of our terms biggest by costs, We In work

we achieve fair to far, able been outcomes. so And have very

power For usually our roles Chemical the cost. our practice biggest operating and focused of next we're workforce, non-union on compensation. and key purchase competitive costs filling are maintaining

costs chain do supply our and O&M expect to higher power to peers, prices. compared year our While higher have purchasing helped strategies as chemical we chemical due especially mitigate increases, this cost

through going about talk results. we managed I which our estimate cost has of XXXX of For XXXX, increases return been target operations a lot remeasurement we and this Overall, we cost-effective through year-end many done to and for equity will plan end market But volatility ability on in expected determination planned income. power you our also And secure that under types cost expense includes these partnering have as offset XX-XX contracts the assets power about much management solutions of final pension rising fleet team I'd expect there the XXXX XX% other cost reliable, to were the in forward. successful drive the been will be Missouri increases we with amortizing the about remind pursuing and These variability as method in years, at we've for gains that possible our weeks we've the fixed few fuel year-end per written of the trackers pension selected at to about across equity years plans a Later, now, expense overall with to earnings the has Certainly, ago methods and and includes levels environment. value are and and has favorable allocation updates we supply $X.XX only Though pension footprint. obligation regulatory the of I of pension fuel talk to production losses. funded chain for efforts, for year-to-date, The the and these generally rate share comment which we approach mention in in use I'd And modest midyear, the cases. because been over said, in markets and quarter an establish years cost the in confident our at $X.XX impact perhaps accounting impacts John always that And in last of to the place resulted simply assets. will expectations more such able using of as approach. over been expense. of fair just active accounting roughly the general part were on year. and both unfavorable year. many pension one used our our as solutions moderate we're before California, regulatory in pension hit have expense, This how XXXX.

the in pension case. received are request As regulatory to current requirement currently an point costs. approval this increased this requested case including costs Illinois and on in addressing around that slide we file, for increase requested example will on That to And an the week how in estimated revenue cases these considered update in goes of my we final costs be solutions. last

know we that variability mechanisms of and management all cost regulators earnings bills. over in, remain expense financing doubt are manage our aligned in and it operating John more to objectives to closely the with Our disciplined pursuing find no approach vital regulatory ability and execute current that, John? the we to but deferrals it a me such of as ability The cover interest regulatory turn to meeting teams is effectively our confident affordability our and in cost generally. limiting managing we solutions execution regulatory our company through the all to using environment. let results customers financial in challenging throughout on the and ourselves detail customer to our in with of recovery There’s plan and And environment cases are active our plans.

recall was quarter a morning, last first been her on the thrilled serve good as call everyone. role. CFO the where I it and privilege Thanks, earnings had to Susan one that in Susan, it was saying she

the team. So let join say Susan great results, this and take before I that I as Water with thrilled to from American baton CFO get at started am the me just

saw X, in share increase a $X.XX quarter results. $X.XX second to on more Slide So results from compared me with rates, We that, per prior let to revenues Regulated the new higher details increased a share acquisitions few to per turning growth. and year. related provide total organic

growth HOS $X.XX favourable Market-Based earnings $X.XX note per quarter the a share results O&M operating share of in wanted increased of share first $X.XX increased include XXXX quarter. in the XXXX second per prior from the $X.XX the Homeowner seller increased segment power increased Other costs. final share include quarter inflation second in reminder, recorded revenue share, half of the Related on which $X.XX and that results income year-over-year. reflect the financing Services to of XXXX share to year included note interest of estimated earnings long-term Business. fuel the second per year true-up the to These Regulated reflects Results expense the working as sale also expense results per for agreements an for Other I per in also of amounting some which on capital support effects interest Business HOS. XXXX entries chemical, of we has both and while of The debt weather share XXXX. from in of in and As the $X.XX earnings. in results per periods, to the compared from of on expense of Depreciation HOS, by $X.XX

New the of American first we York $X.XX we on quarter. a recorded As Water loss sale previously disclosed, in the

helped The organization As the mitigate inflationary case year sale-related contribution of often net these share we our have it size, two has earnings so number final far. a with per to is pluses an in from entries offset. of any and $X.XX pressures of common have generally the impact seen of minuses the given to is that

per the offset share year-to-date same increased per somewhat $X.XX Regulated same X. to Slide period for from Business share increased to year, increased other revenues, share half for the year-to-date period performance XX% Moving increases share Consolidated of year. generally first operating the $X.XX $X.XX share. last compared period results. in depreciation year-to-date as of with on Market-Based period. our higher expenses pleased share $X.XX results and the a the $X.XX Overall, The $X.XX mentioned per compared the results driven and to O&M per factors last the the year, many by and in second for over period -- Other drivers quarter the by of with second same we're the increase We Businesses financial as Results per quarter. per the same for the of saw

sets well plan. full our on up us deliver The first year to half financial performance

per solid to XX. we of XXXX Susan are Slide Speaking our start guidance our of share the earnings $X.XX to mentioned, After affirming turn per XXXX a $X.XX to as now share. year, plan, let's range

continue we years to half returns investments our from growth additional earn see and in second to on growth revenue year strong expect continue the the from acquisitions. prior as of infrastructure We

continued results Second as year. quarter of to interest year of business the when sale each working see this the its operations year, are our York chemicals will prior year, to And limit impacts historically and pressures be third by had related expense. we of half the biggest compared we primarily expect earnings rising American to half in the earlier while to contribution second the of which we New costs, the tempered in diligently the mentioned, to Water

New proceeds agreements contribution revenue but from earnings the annual previously, offset loss mentioned share HOS. HOS utility earnings in earnings will interest XXXX sale we've of of the not the revenue material redeployment nearly from and As York,; from from note for see expected on we the any in seller prior the the will

of As previously earnings ramp-up years shared, rolled The next investments has part our investment plan the out the will November. as up to from a over accelerated continue capital few team of we'll investment last ramp follow. that our

we growth. this our We financial have planning as in X% the reiterate and to that to Finally, those confident including we budgeting are in macroeconomic summer. and through long-term process factoring in the annual X% base I'll headwinds are progress and X% growth just place, rate targets we EPS acknowledge X% current

outlook expected, later term. XXXX we updated As will provide for this longer and year an the

Turning which in across the wastewater are we to purchase $XXX now piece the XX,XXX of exists million of a our was approximately pleased Pennsylvania's connections. May of in our of framework fair our This triangle. closing -- City now of we agreement customer to Slide under York's announce serving where the system of and executed growth market the is XX XX which acquisition purchase states We value that legislation, operate. were for of the

of to Act. is Harbor under review agreement in Turning Jersey is transaction close City the a connections June Protection Harbor Water Egg XXXX. under XX,XXX first the XX, half Infrastructure Egg the the customer as to expected of New second of nearly City

allows and legislation in partner by will benefit Importantly, swiftly to we challenges operating just Water American referendum Jefferson the their we Utilities Utilities like wastewater address And customer the with $XX communities a of opportunity The the a this transaction system that Pennsylvania. connections. to to future significant approximately assets quite us deals, of for to the provider closed, acquisition a footprint, purchase call expect potential including signed large pipeline The avoid and West other two public since many by almost Virginia systems West at last York municipalities with water believe issues. combined customer serve states million. removal emerged in still of additional now with as in of X,XXX across various X.X yesterday, announced represents Virginia strong our agreement well Jefferson and it this end million and multitude opportunities year. as connections a close have several is acquisitions The this another as pipeline our in

credit financing strong sheet of balance intend we finance discussed Let's XX of This previously and investment ratings. have and the have of billion profile. a long-term our Slide debt-to-capital that how of move level believe reminder target XX%. that current includes is the $X.X equity our achieving to I plan, we and we it, supportive on we to both our focus a as credit

We for credit our of maintaining at will continue benefit, industry-leading our ratings work ultimately, to hard the customers.

applied strong our appendix issuer slides. outcomes us in of also in Importantly, recent financing ratings enabling that's debt strong senior are summarized to these debt unsecured the offerings to today's like achieve our offering May,

in this a on debt rate our company the over a environment, point to taken the to that thing strategy I'll to slide the financings in In and I it Services rate left certainly I'll slide. other over maturity order is interest expect that has turn the laddered risk. continue cover bottom wise is to investments profile years more of it our debt approach Military agree rising The minimize to that, out Cheryl capital important long-term interest results on with Cheryl? detail. With approach. that and Group

morning, good Thanks, John, everyone. and

I start recent the results, streak covering I Slide ago. coming a ever weeks I'm privatization continues segment's While by of few our team's contract start military want announcement Navy contract. award XX so of reviewing the by This latest from on utility our Services years. Military at usually wins first Group the MSG's operating in regulated proud installations today to just

installations we and the contracts. With XX wastewater with contract XX Naval between are these the currently years addition of Station XX on serving with Mayport, remaining

can adding We projects partners optimizing missions. you we system have then identified new and services the or or military in the is to military work these new civilians of change other potential expected that ahead. construction vital proud opportunities XX of technologies additional we're to revenues Again, our may as see, our these extremely bids or around infrastructure A XXXX. business new their also through for identify military about in years improvements efficiency a which infrastructure needed be and the bases model projects. or two serve. installation's families to and personnel, one can support awarded sustainability. We lead mission on that portfolio improve the expand we military with have provide outstanding, to centers MSG's installations And be

for so rate changes activity charges key As here turn year-to-date. summary details let's we our our our also rate XXXX Slide of our each efforts XX, the we is the Shown in facts strategies. regulatory states. cover of completed on key to infrastructure These cases far in Susan's case filings to of in appendix, ability In share our our team's this some regulatory year. reflect comment execute and

in the be once of Public Board And decision January. we Utilities rate determination. judge. since issued, steady to a returned been progress by from matter New pending parties We're you has will base Jersey the our and can to in happening proceeding. really months. issues next the month, filed it's that order slide, final case the the XX, case administrative it's and February As for July for the our Office hearings our a parties settlement Law six report with all is law on filing. expect been last the Evidentiary resolving see along an the last on about constructive few case furthest the start discussions general Jersey initial of the will an In of the New years rate over to with are waiting Illinois, The Administrative case, since stipulation pleased

rate will also Pennsylvania, case in year is a order utilizes rising business. and evidentiary Pennsylvania in next case this recovery are investments. of period and year that In helpful for Importantly, of during in a forward ratemaking faced with $X purposes, by for proceeding expected The planned, including the which April general Illinois test occur September costs a test filed ratemaking late billion as uses seeking we over an also case is forward early of hearings year. purposes. this

on we progressing earlier month so we know, far. have that expected from were case California as Our another and are this filed in And as and cases in Virginia active finally, Missouri you XXXX The totaling just $X in of XXXX. cases thread over to all to conclusion in some bring these cases, recovery investments of the in infrastructure focus common extensive roll-in and billion the expect is acquisitions.

rates. few will recovery over continue we ramp capital take these investments to it up next time of in investments the years, to see As

to continue if states the to expect with are investment, the from two limiting efforts. our we our lag return. plans, or allowed regulatory see We in our excessive file ability lead success teams Clearly, to earn regulatory ability to our rate of lingering confident sooner to to cases inflationary three every critical our in larger general go in we very execution and years impacts that our is

remain we always, affordability. As customer very on focused

affordability. to with cost to on customer coupled and assistance have continued help efforts emphasis capital our customer Our growth our efficiencies and design programs customer

implement would our we Slide California. filings annualized our includes benefit or case the to being seek solutions million XXXX believe The a case front, used we currently increase bill completed as to the what utility the as challenges. three requested all We summarize amounts comply. revenue there more the $XXX in in and well cases, quarter in customers requires cases. so was each infrastructure Generally additional is lastly, granted X reflects of paid our to state And which local the rate total what the difference first in in revenue state or the go into set in the as Illinois, in well efforts bills any XX, water in to The since and in in one pending to requirement. in surcharge and an passed bill to options revenue with total are proceedings, to property legislative final we to positioned bill a give defer the effect legislation legislative active expect cybersecurity help in Tennessee of was plan, various call, Tennessee one one compared Missouri taxes On actually address XXXX utilities pieces one requires and far they in Illinois communities cases. On requested wastewater affordability certain were our customers. The Missouri. speaking, of of increases XXXX important

X. Turning to Slide

Our in nearly Business and in efficiently and did drove us Regulated job the of XXXX, the capital that year great the complete of regulated higher by same $XXX hundred result again hit goal improved significant It first plan. capital half effort took leaders increased safely triangle. spending teams and of to million to second on projects executing investment year. the several investment quarter systems compared a the last the earnings $X a to in keeps growth our our on approximately billion capital pace This period our foundation of our their

that project us collaborative customers. succeeding the American Moving Ventures. to growing our infrastructure continued Slide plant's investments, to regulated This, of NJR we on remain this of highlight provide annual projects creates on constructing and execution our XX. Water. efficiently capital solar are is win the ESG and to gas a want will have while megawatt XX% at systems just another to growth array Brook Upon of rate and impact Energy story course, from partnership year, on one will base. for power needs XX our on last Clean and our between with earnings financial, and of American I and operational focused close Like acquisitions lake benefit next another greenhouse of we help completion ESG this annual drives largest our our later customers. a U.S. our Water Slide I'll a New the in the This X.X a both safely that quarters, emissions. Treatment Plant. operating Jersey is in reduce installation project floating the Water been Canoe example The doing several comes This

So to with and over take that, you back any to may our have. operator turn I'll questions it begin Q&A

Instructions] from first Our Sunderland comes question JPMorgan. from Richard [Operator

inflation XH headwind of reaffirmation, how a X% offsets Maybe guess, the X% reason then in that could there inflation you could frame be relative XH year? the think over impact HOS I you of any particular, you balance about is in little guidance And risk starting your to the given and offset, to year-to-date? had the ratable? benefit the do the bit

couple me of here. in weigh make a and yes, Rich, comments let have certainly John

made that affirmed I in think we for of prepared year. guidance pretty first our we remarks, hopefully clear it all, the

think So 'XX. XXXX, We to headwinds as that quite around particularly to we costs did continue the expectations about in we've see ability confident we're hit some for indicate established for targets and costs. pressure our chemical we in energy

that we also addressed. diligently pointed on Cheryl do basis the environment test in that costs We our number highlighted have of regulatory a ensure And out, go-forward cases those to we're as have working a forward-looking years.

So hopeful we're that here XXXX. really limit to we exposure any can

last a I sold the was to some comment continue we our final. which focused exposure pointed made, the second half of other we have management, we transaction year. and more we related recorded, year we We And size that first working the you just activity sorts The HOS, don't the capital gain was HOS benefit obviously rightly that expect say final had focus again, levers a of that offset that half would to operate, that that to cost remarked John for offset see on That I'd pull throughout have to the to on But cost true-ups. how us of pluses also say when any the year in they're certainly not we And transaction. those you out transactions have our are of terribly course the size, may uncommon as efficiency, it's organization an helped our we increases. on not uncommon we'll of and focus are how can those minuses the of year. when of

say just And expect for guidance we fully I'll targets the it for again, year. XXXX, plan. our our we hit and that's So again, those to affirmed

pipe but CapEx. around the a I factors? on curious go I'm Got there. is guess, seeing the inflationary under replacement given dollar this spend color you're appreciate what other up Or commentary the macro topic, to for just it. either I I that to occur on budgeted less level hand, turning the guess on potential with current CapEx. front, the to there

Just into the curious that you're thinking update. budget how about

here we've have there? Cheryl supply amount our too we chain I can increases again, but again, availability of of to there and in operating on expect in would the you, increases pipe. really the our Yes. terms folks from any a may managing the all change work standpoint, been on to in And fairly those an some commodities. types our add at They job, plans in see supply done of anything any weigh But of don't tell cost tremendous don't doing. both Cheryl, And modest We change see we have cost invest. experienced. plans we're

Yes, just projects of I go we've hundreds our systems. say be always much that pretty need that ready know done to got to across we would

And that's to how so move through we've But delays coming. some continue in this increases prioritized been and forward. the quickly the think, have do years able any and been projects chain at cost point, any manage we we those and we that, flexibility work still get through supply to done

in those there, real concerns just being no projects. how approach we flexible So

'XX? a quantify Got able you potential about final query, talked makes the it. just That headwind you to in sense. Are And pension impacts.

those that all of the there, mentioned we're remarks, to currently focus there largest our all We've we this my remeasurement year, the get regulatory two already, are. regulatory at to on the would states, see in increases around file we to we to continuing not of we'll address it again, two have in to mitigate focus our use in specific will end types the Obviously, we No, states that on in said our we'll of manage so way. be tools of our disposal And in the at do by cost. time. do prepared need the I as and to cases trackers where got approaches. solutions But remarks

So we're optimistic there. manage we we'll or not may be see able whatever through increases to may

comes Our with Goldman Sachs. next question Insoo from Kim

back My the a the first guess, thinking about 'XX results. year-to-date little question given bit, guidance I going to,

kind to worth just 'XX would half 'XX it guess, I EPS, think be. to on lower if I XX, Slide four last I of where EPS the second of, that you XXXX. compared XH be midpoint If quarters the guidance said -- I gets of take of will

be that you're towards So the bottom in half the that range going the of range? XXXX XH the to then if lower, least implying at is is trending

headwinds don't simply earnings think reality out the didn't folks Slide is your I about we're for results then point those We're have expectations experience. that. want and assume of guidance talked inflation what year, just miss again, prior for you we profile. strategy to you of on hit quarters. to the we've confident that. impacts. very And try affirmed should we in our is may are -- and obviously What continued here had pointing What as XXXX, to our each to our two we in offset York. you out We our is to the New our remaining And that XX ability about that to the from have think we've say tried would

Got Okay. it.

guess, and I’ll commentary inflation, the So isolation. I too, should the more demand, I that in take to secure it in addition rates on other

Exactly.

a makes of That Okay. lot sense.

month, a more state-based. this put question, of I -- lot other the for chemicals. out advisories second new is PFAS The know last and it's EPA

the states it targets guys your is of as have recommendations have you own Some well. some their had mandates, had and okay,

advisories, any CapEx the chemical or whether on the on on that new based expenses? translates PFAS your operations other thoughts levels, opportunities and into Just other

question. Yes, good a it's

very I'm and see on, obviously, Cheryl it's to something this news. latest we let we're that focused on how going comment so And

us extremely PFAS What advisories compounds. test recently to for limit the for meet EPA any put below were to health opinion, certain health requirement no And advisories. detection Yes. methods to our with Thanks, test the of low, Susan. or there's were in those levels Those advisories. out regulatory

already projects far what we're regulations stand comes back we see and But at forward. anxiously out capital to will investments. other started And where looking today be going capital limit. in EPA we necessary states would than a future real at any regulatory we're have we as what have with footprint. mean as so across where We waiting all know And tested our

next with Our Storozynski from question comes Seaport. Angie

one comment XXXX. on Just

weather So swing can used for a or say I positive to past remember the have in $X.XX about the that you negative year.

earnings wondering I'm Jersey. if you're And wondering of water benefit. the parts in just I conservation that if at I'm it's calling And this that New cap just still least potentially could case. see for So

let what's I'll minute comment about Cheryl Angie, in New in a specifically happening Jersey.

of We're date this weather think, quarter. a impact. sweating I to June sort the seen much through all, really across of haven't country We

quarter. So this here to third results we've done away we'll moved see what in that from it think what does Yes, we've there. probably quantification, sort of I historically

do on does need wait in you have New quarter. what's So want specifically to And Jersey? about Cheryl, to on talk going impact in and demand we'll what this it just see

we to to rise two ask peak continuously in days, that serve kind feel got can to put level start on the Jersey those our dips and off in can that to customers important We've of usage place customers so peaks or or that without like shave conserve, we we it's Yes. kind we and we've pressure that. that of alternating water anything only where areas like New that our steps seen encourage any specifically

conservation usage through. So those you're and why that's we messages have seen spiking, come seeing

I And XX%, minimum well, projections, that tax impact seems topics. that Changing us overnight, new, right, might think proposed flows? if going effective we really know or how it's to tell Okay. your you least Could this -- your but rate, at anything pass. earnings see it cash else you it it's

And topic sure. Yes. And back impacts this been again. dust the past, primarily. we yes, has to this worked analysis done It's news. good through the think any a Ultimately, cash about gets the it in good -- And kind question. really our around sort talked as is flow to obviously, you customer an of of a on effective rates tax It's in it's off said, new impact bills. need as I probably we've that

say well, if did off we'll -- terribly see the to again, at report. anything cash there's I analysis So -- material, I dust it being I would there we need think probably recall but and our to it and to don't time. flow it's at look just need that just

it terms Aqua period Awesome. you what wins? because other And Or balance despite of I versus about just the more highest But competitor. your say mean, No my mean, some the any last winning have you do prepared question I little on to an have is one it's be such a to municipal award can as M&A. this we simple I competitive proposed went for big you took appreciate -- all But wouldn't the sheet? comments, into territory? insight share price negotiations, exclusivity as advantages? in an your that Susan, is is Pennsylvania. there not remarks. you no these location might it contracts... the service you I contracts What about Is it had

simply details on Well, to yes, I sure. never here. I'm obviously would that say simple. any not it's going comment

I We in think acquisition the that comments made yesterday. just back We the a important talked to remarks West prepared got X.X. to at pipeline Virginia it's New just announced in go his about John we've we that closed York.

We have plenty in is this do, plenty to to doing are we space. do lot. and There a

best we communities, be to take we on. and And have that opportunity can to approach say benefits the same got with great about Again, of the opportunities that's we move that. lots our I all metrics, every to we here. same foot we've put So approach seriously, provided one and and rigor, then same probably the forward every

Michael from Gaugler comes Montgomery question Janney with next Our Scott.

On plans XX, assistance low-income Illinois, you the in mentioned in Slide place. now Cheryl,

do you in? in all you wondering, or have them most Just operate states of the

Michael. Yes,

looking our be additional just struggle customers. expand assistance how to some to more accessible or going our but do there We are affordable we able also there that no how footprint, all how low-income customers programs at we make out those realize they're to have can can across We those we're to are, bills matter that.

assistance has across the popular level, much they've at helpful support hugely to for program as get where the working and customers that. also in federal been our we're So footprint the our trying states federal program, for implemented a

going try at some we're federal well to programs. or to to more continue So federal as the to as more get work level local utility-based of funding those

be the legislation this last one -- So Illinois in terms your clear, of to type the in of then adopting system? was was just Illinois

there's of -- wouldn't legislation. Well, Michael, every I state. separate a legislation It this is piece that in say

our of that all to We in our program Help Others have program, all participate our own states footprint. our across

assistance So our customers to some for have years now. had low-income access

question Greenwald next Our with America. from Bank comes Ryan of

It's John, new on congratulations role. a to connect. pleasure the

Thanks Ryan. very much,

appreciate I the update. Absolutely.

Just the and pension comments. a on follow-up brief

You XX? disclosed June the was through loss asset mid-May. previously What a guys had pension [XX%] performance through

that. I specifically. divine don't got that Ryan. on I I you something know, we I the there, Yes, out don't can know to fingertips. anything mean think what don't Ryan, answer have don't we it's have Q from at our

like the allocation? $X the PA Understood. for assuming balance from Is extrapolate rate million the it is company, case to a expense pension the PA fair XX% of

No.

kind think the color way that? Any on best to of about

a think that's set as difficult case. Well, we are for a approach. I analyses did the costs of Those estimated of rate

that we costs. And year, we answer going have is really are to be the think the to forward. just cases to said these what what address of I just to I prepared question really get the is to see would we many the really you the and these impact end reiterate until wait remarks in our working open we going diligently of in

in we proposals be costs don't or have these jurisdictions management Cheryl able focus hard And exposures. these to have we docket several we to continue estimates these enough to those costs to cases, either or on to rate costs As forward-looking in those through worked address ways those highlighted cases of have include to test of years. other cover we the things. timely go-forward efforts, on mitigate And the cost extent will other impacts rate

our market think seen to or even filings. what performance any terms you can date, own on you've don't in really conclusions broad draw based I either of in So

how just again, we've really you, you insight end remarks, more expectations got it. our of John the wait you his we I'd remind at commented into think about until here. think affirmed the I then guidance we tell that to tell long-term certainly year, also have you we'll in and But

to manage we in both as going cost, we're solutions. regulatory management our the confident and forward, think straight So about cost this from certainly standpoint just a ability

for potential this And initial could you corporate how PA Governor's Understood. on this then move the month to tax there impact guys play rate, just thoughts case any in Pennsylvania earlier maybe dynamics? reduce into and rate lastly, the the

about at case. current this types impacts say really we'd don't the that considering be I have those moment. to Again, anything of in

So there. nothing really on to comment

Orrill from with comes Gregg Our next UBS. question

pension. on one Another

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Right. single Yes, yes. just we plan, a have

has concluded. now The presentation. today's conference Thank for you attending

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