Essential Utilities (WTRG) 7 Aug 202020 Q2 Earnings call transcript

Good day and welcome to the Essential Utilities' Q2 2020 Earnings Conference Call. Today's conference is being recorded. At this time, I would like to turn the conference over to Mr. Brian Dingerdissen. Please go ahead, sir.

thank XXXX joining earnings and Utilities' for everyone quarter second call. morning, you us for Essential Good I am Brian Investor Relations Dingerdissen, Vice President, Communications. Chief and of Staff,

statement. If we Relations event found section the our website of copy find receive this The can by referencing of you there. slides and essential.co. our you webcast that it Investor be release, forward be There can of the visiting at did not will also looking press is a a

reminder, the that refer call risk, filings risks XX-Q, of recent that of a from may results or include results other uncertainties for and factors any a XX-K, description this As discussed during different expressed actual implied some matters other be our the forward-looking involve and such may SEC Please by to most uncertainties. materially future statements. to such statements cause and forward-looking

reference financial financial of made of call and During be the the to the may also course included posted is questions. presentation, measures non-GAAP for non-GAAP certain of these section the will the in we at this the the website. of Relations up end open presentation reconciliation A to call, Investor measures. After GAAP

Rhodes, by municipal an will people's Franklin, our for Dan of leadership will agenda an provide to team. acquisition Matthew followed CFO year today discuss For our highlights the on and then and start our with Schuller, we EVP be Corporate results. CEO Chris Chairman discuss from program. will financial provide who date update and our who will Strategy our on update will Development Dan

questions. that Chris open the will will the I Franklin conclude and call Chris the over call up then for With Finally to Franklin. turn call

have into just XXXX. It's through could Brian you morning continue none good the be amazed months by occurred in half COVID-XX we're that thank of by events I Hey, the first commitment now the of have the pandemic almost employees. us five predicted while that demonstrated hard to and navigating everyone. our believe to and

because dedication ever as strong as of remains our mission. to business their Our

achieving In get the on work agenda and important our remains with to focus pandemic before talked Brian touch that we customers the some want and issues addition of primary essential just are to primary the Essential. call. safety mission, employees as but we started through we believe our our this at health I on about

top to companies Long justice the the key be now is are issues This at social should diverse I'm focus continue before either the do been at gender. Essentials company. done that that a key and really a the First, this our have topic events we diverse primary this XX% you a or the the our where board ensure racially this of people. journey built and of and topic at good to more than began that inclusive of I we have by good summer or Aqua tell country focus will summer. of workforce that members we've work proud

the demographics resource supplemented others. reflect the our among average The this the Our of employee of to-date work example of creating or industry XX% versus We've black black workforce work and groups to is make we try continues by communities we brown our resources employee women's XX%. as serve. workforce groups

the people has hired color work are been this women several of also direct Today management key levels of my to the we've company our Our diverse and senior year key management of nearly at in a make focus. roles. reports just half team more

it's effort and a has network concede in services. to It's want program diverse including highlight events done that also strong because aspects In suppliers long been we to much professional network. we're in work addition, our believe before we our I that our diversify our bring continue summer and in this at into investors and of work to. potential. of the that work country to that to supplier work all this both company work all this got in to our you, to our that underway will area the more before there frankly be work I we well needs true committed is so We've realize

reading website the the want for between Ohio over about occurring I this pride that ourselves a sheets case about in in company you're and our interested. corporate state We officials. events has we our you giving made series processes with our months. full ESG utilities compliance with giving across posted buildings It's laws Illinois all and we ensure monitor last interactions all Also to some to our the we to I'm XX confident values important as across Essential in our issue in in do principle want we're work I place also compliance of to talk that the lobbying the investors frankly that second and and officials three that activities. We've remain and values central in political that you up and confident footprint. to the is of core team among foundation morning elected the and has have all law your our living for in review, appointed employees three regulations. and our The with to been integrity. know of elected approve charitable continuously in leadership posted governing giving, we've our pair policies on do reference with our

and second on a House before mention we summer issue the the we at importance do. the looked being any water water the in customers about way legislation the federal Congress the our were been quarter. work municipal package in that our government All monitoring U.S. I said objectives. industry the last benefit the agenda, anytime is regulated in it water early or Finally, that on That into elevates our with of right the focuses happy either that make that I'm to infrastructure pass because from to work wastewater same infrastructure progress to this report really good customers we've that to of closely the working the thing proactively we let's and jump want consider on states. our continued benefit would to that sure talk systems

our far of in of and So million serve first that in segment. water million $XXX.X $XXX was months we we've year. invested million million invested in the was infrastructure six Of segment natural our communities $XXX.X during $XXX.X the regulated gas in invested regulated it the

$XX.X was you million note by the peoples that invested in quarter pre-closing. Importantly should first

COVID back on remain track $XXX of capital record construction mid-March, in brief the despite million in this pause we for Now related spending year.

of the Our we're work an you during and gas system to there. I Goodwin our schedule will approval process regulatory on underway. recall say on important gathering well and was happy this Tombaugh topic know also we're many is

miles of we to effective the program improvement As as XXXX of gas also approximately to know you Public the which through a emissions reduce Commission's natural done long-term efforts LTIP. replace program have will infrastructure be in in very is methane reminder The Pennsylvania replacement environment. that our many pipe Utility the pipe

on We years. coming in and that will to the report begin months

paperwork we February implement filing that repair. quickly that the in with in elect we to our the report want tax we I closed soon once and elected March So tax we own by we IRS. after said peoples would repair

we repair. Pennsylvania today. with for would Utility of portion you tax as of told file also We the just Commission that has been Public the treatment accomplished summer catch-up this the That of

is of a share noticed [box] performance he On will on as detail well an net our $X.XX. our we give the over, in same on achieved to share going a the to to earnings range full and compared per year. you of the that quarter the of you Dan a strong lot as GAAP of annual overview we last income give increased XX% next basis per first $X.XX guidance Peoples more period ownership reaffirmation

acquisition our totaling rate million over and expected remains over signed XXX,XXX Now agreements in strong customers. municipal $XXX new base strategy with municipal

a X,XXX base. XX We Norriton Pennsylvania rate closing also almost the East announced adding and million of customers in in

for milestone included Finally in market acquisition quarter announcement fair the first of Texas. another the our value

that give XXXX. last moments. passed I few just the on in that think fair just a of market will details year you will some recall most Dan you value legislation

dividend this Finally approved marks the of week of board X% which the increase XXth a Tuesday increases. consecutive dividend year

at the slide announced the our XXth are proud here next we increase XXth X% increase quarterly the very on something can the years of see XX company. dividend dividend of payments; marks consecutive You and in year

value. dividend take pride great Following our rate delivering share. per long record of the over We annualized the will $X a just consistent increase, in shareholder be

have to not four at know confidence and will leadership with Joe X. since our well say of the want in and sorry work. and the effective that had team as the and you been years we outstanding This really We him career Gregorini made the of his Joe and Peoples to the to all would as happening we've of am tenure contributions the We that in over only financial to the action team his but I our is Joe's is one. strategy Joe's retires. take especially for a a onset policy deal of our our over in really on the retire with leadership months see wish all for President slide I is and to I'm I continue to make pandemic I management after believe announced while and saying I'm employees minutes Joe's of the closing speak has of family leadership our his is past his an XX best reflection I for retirement. July has of the I end what's understand sure Peoples their how proud also indicative to the when well-deserved there. company Peoples the couple board's community organization he long as important going been September in the integration throughout significant execution. well influence with his next that also dividend strength. thankful years

Huwar in and conducting at which proven so Mike, Gases a He we Utilities after on professional, at well as of gas after recently Operating comes the the known Colombia announced operator board Mike that most Peoples Mike President Mike national Chief time community very and Officer at Nisource. to is more and XX right PUC. the to years really Maryland and of company. We're and than respected a have a is our new be Columbia fortunate he's subsidiary leading will Joe's of well job. true is Pennsylvania recently served home long President. with Peoples is Pennsylvania resident Now a successor Pittsburgh search as

including elected experience. as to and HM before and Peoples President President prosecutor general for announced in will fit from Duke and Most lead June the also as strong background for the and of Mike in Peoples. industry our Throughout very Controller the brings creating more is for a holding level. finance Kim the he's a Turzai various for natural a last segment. Turzai take Pennsylvania. terms Health former the with had team was running XX finance counsel experience already he's house as to in legislature law jobs counsel Vice Edwardson the Mike gas across and years general XX we terms as help also and spent in of his Kim Vice extensive Now degree ground Solutions than Pennsylvania office of the the appointment auditor and of a next speaker general here make company native recently southwestern focused three Pennsylvania there a he across Pittsburgh Mike's industries on hit last great regulated Edwardson career and state the Kim of

forward they me for have dedication same you financial to safety, that our capital turn place as on employee solid results. customer Dan to focus plan full the in we continued team looking core the it let to and we're ramped up them Now our With supporting mission.

morning Good Chris. Thanks everyone.

XXX.X XX.X% Peoples of a operations The income we'll the largely further revenues due the of The increases growth remainder in $XXX.X XX.X%. the regulated discuss $XX.X million quarter was $XX.X volume ends to of segment. addition million million O&M up O&M and this with primarily to quarter million to$ while water from our second EPS the in year-over-year million contributed up $XXX.X was Peoples million rate $XX.X show This second and acquisition growth the waterfall. we expenses XX.X% GAAP when maintenance increased of up year. last revenue which from and was was XX% up Net $X.XX. result to

capital metrics presentation. Although some business impacts a monitor of there closely discuss impact O&M and of including has been we billing, continue considering our collections, consumption we'll number and little COVID-XX to later the financial on which the in expenditures,

the starting the in Let's with walk through details following slides revenue. waterfall

and go in March increase second million. the revenue we adding As notice closed was Peoples volume which offset main additional growth other less XXX the million quarter that Rates and XX.X% water increase was surcharges, regulated driver which million. $XX.X revenue almost of increased related segment our revenue $X.X slightly new than for the through an provided you'll items to from towards the by

provide increased detailed as by revenues the for consumption water more it Next at a to we'd the customer look to correlates class quarter. like directly

where usage from but was changed not nearly the classes. offset negative you consumption customers XX% experience favorable most slightly an to With occurred we working very from overall other last water COVID-XX. water over revenue in residential As saw waterfall and year Year-over-year strong many up the significant impact in up did which of weather customer home was conditions, dramatically. our declines usage revenue

While homes strong. are commercial appears both and suffering that industrial indoor it our outdoor and at usage customers are

previously enacted treatment discussed have see to COVID-XX. debt off we've in for a increases many linked March larger we're monitoring closely ones given emerged indicated including when incremental in moratorium states explore COVID-XX to incremental at our bad debt asset glad As regulatory that the our bad states willingness to We're expenses. shut

we precautionary million as the measure COVID-XX the weeks Lastly secured financial work was a to our did you'll our long-term of June billion as term loan home back pandemic report recall April in We're mid and performance that a a many the to from in the liquidity that we paid of of term subsequent $X.X of orders the increased XXX acquisition financing months quarter expenses costs and peers. of million loan main $XXX for The after growth in With pleased couple early to and $XX.X related maintenance Operations the million, will XXX. Peoples quarter that were of $XXX.X costs O&M. move million were employee the we driver $X.X second began. O&M million edition production and XXX,XXX the waterfall. contributing Other second of $XX.X to compared organic XXXX. drivers of of

a have is not our Excluding impacts Peoples’ O&M and as to up a X.X% both comparative year. O&M aid basis in the transactional growth been costs last impacting would O&M expenses well way. COVID-XX on as significant currently

personal in certain related such savings supplies. travel equipment, offset areas the seeing cleaning COVID-XX activities which are of We as some related protective expenses and like

expectations look benefit tax XXXX. second increased from us of brought expenses net Aqua a and to regulated as depreciation, $X.XX as new $X.XX a the slide many waterfall. segment XX% current other of $X.XX was pieces the volume investors QX mix. intent contributed forward. The to transaction historical the to and projections $X.XX Next next from increase. quarter surcharges due a and $X.XX slide added In income to strong effect amortization take and we'll GAAP just transaction this EPS moment in by to This the we XXXX. repair slide moving decreased constructing for of EPS interest back the the and offering volatility the costs items comparisons to earnings $X.XX presented lack by want it result discuss Pennsylvania of quarter utility The our and our such the well a given going a bring per we net and as quarterly of of Peoples take We assist in rates together dilutive the discuss almost quarter. as income decrease water GAAP investor that to by wanted the and in is our growth from contributed in $X.X February. increased of share equity to net day at the quarter performance the

of the of our we QX may seasonality income movement regulated terms only summer a pennies net and and a for saw strongest water few months of to results typically due you As recall utility limited there weather. was in historically provided as

a water This natural on regulated gas and impacts of of dramatic segment utilities measured course quarters a the and a including company the is segment a result of heating to natural combined regulated will fourth that first highest we forward. in gas during anticipate weather a shift earnings the results. As going days

a the at Let's bars on consumption. of slide. take reporting the degree below at quarter. as first the a $X.XX $X.XX just look slightly April second largely heating income high water the at range and bar. ranges the and reported the for basis days light on falls greater adjusted QX in QX we the range of blue the share We're specifically We quarter number non-GAAP expected result the were of the end a middle of or Thus for per favorable which on

As a we share for the we'd be falloff of light natural XX% middle look above of predict can weather XX% gas per fourth will we push result quarter illustrated no of the right we for while just on earnings suggests the like which will the what forward to one slide. QX range quarter the the blue QX lower the will the anticipate consumption be to in in end $X.XX to the us in third to range that and reiterate

pro and range results share per Given projections in forma on in basis. our we $X.XX first current $X.XX to achieving adjusted confident guidance our full half of remain earnings year an

gas so receive Pennsylvania far Illinois, and Indiana, annualized and Kentucky revenue water Virginia expect surcharges rates base in any Jersey, pending surcharge we've or segment water regulated have for Ohio, a completed new the the this or surcharges Carolina, rates $XX.X we and totaling on we've New Pennsylvania with point cases rate in filings $X do or Ohio natural million. in North revenues regulated and a natural In to North total In coming Virginia of for annualized segment. Moving In our months base regulated activity. segment of Carolina rate in and XXXX to gas a at segment regulated million. completed we for not year surcharges

case regulators limited due technology activity our relatively limited Fortunately, continual rate with remains track fortunately interactions relatively and during our rate on counterparties. COVID-XX our sorry and related virtual to

Peoples tax for we reported natural largest our previously with of this about subsidiary connections. in subsidiary accounting late the XXX,XXX elected repair the gas method As March change natural gas year

second its by $XXX the tax We're repair treatment million tax million. income of capital a impact the announce benefits for for of catch-up deduction approximately the the Peoples. for to ownership terms we quarter with this essentials reduced pleased requesting filed In petition prior accounting Pennsylvania PUC expense $X.X invested morning that to

includes proposal Our tax shareholders. catch-up of benefits our our a between customers and the sharing

it proposed base all As time the rate benefit by case. parties would the extending next until

our changing As annual we X% envision it such expected growth earnings of wouldn't to rate X%.

similar equity and discussed issue other we this terms of right capitalize $XXX year. to That on as of procedure regulatory from to the previous we've the finally time you investor necessary this appropriate to expect we pipeline. continue a that approximately and In over processed to acquisitions for recall rate in filing be million equity, may is calls day, as look of DELCORA to proceeding a timeline

development. Next update and call Matt? turn on I'd over Rhodes like to corporate Matthew strategy for to the an

we role during delivering essential leverages and reliable our this are differentiates mission which best believe an are and strongly to these this serve to today's Thank waste Many is challenging in times our water, core you, and gas the X that the million provide play this to continue during life. marketplace. slide people in infrastructure utilizing strategy safe able pandemic. natural continuous resources we you uncertain In remains to challenges everyday important COVID-XX solving and this competencies been positioned familiar has to at our with and and supporting service company Dan. water the environment of Essential Essential for of natural company

rate acquisition by proven about is program to through program think growth, grow water internal have The needs we of base. backfilled new As a a success. robust very capital has which continuously capital sizable track that we business has municipal our opportunities record CapEx

been for the last needed. year-over-year it and municipal primary Our customer engine focus capital to investments program growth has our over years our consistent rate-based growth are remain we expect as several and growth

why our to significant opportunities continue transaction We priority see initiative and municipal wastewater of for remains water wastewater our growth. and sizes water varying municipal top is which

LDC has As transaction it a Pennsylvania a we was opportunity infrastructure located it growth. gas have Peoples the investment unique because in said strategic needs is and organic pure drives which significant predominantly play and

As programs. identified we nearly replacement their many of the gas pipe already XXXX is replacement discussed completed unique quite considering previously LDCs have miles pipeline have

approximately rate and based are with utility platforms XX% at of mix existing XX% We our pleased the water gas.

would from see increase we water successful In our acquisition have program. municipal be in would that we because contribution fact, mean happy been to the

X% future final of continue two Well, will of product businesses. The which microgrids often contribute today is and We more I home and these will only warranty little to of businesses, as businesses in have acquisitions. in MBAs selective and the These projects strategic a Essential market-based discuss business in benefits. complementary about very are within later. of projects existing they include net consider non-utility are environmental there be combined to are others we these total utility few and or opportunities investments a growth which strategy detail and income. power heat our our

slide. the to Moving next

a we to to solution this legislation We were call On to importance we the is legislation of last happy fair report currently water states continue municipal now discuss segment. in eight as where in our our market position company our as serve available customers regulated leaders. all value we that

announced acquisitions value water for our will regulated on which in the next Texas I fair discuss recently our acquisition This represents slide. earlier call, As first the Chris mentioned in we segment. market slide

XXXX advance and Campbell The Norriton continued value fair value year water the Cummins market of first suburbs. in and the this Cummins of the it new utilities, far we Garden with Houston East customers have following consists system Ohio, approximately the Rockwell represents closed DELCORA to agreement Texas legislation market in in our transaction So water X,XXX and wastewater located system implementation transactions. water the Pennsylvania in fair signed

DELCORA continues regulatory move with our process. Pennsylvania Regarding approval forward the transaction to PUC

There media to milestone about contract PUC we accepting challenges our Just transaction believe last and DELCORA. the the in has an of some week legally the legal been fully we news continue with but local reached we the have enforceable binding application. to

We transaction XXXX. in expect the to early close

We approval COVID-XX have not any major the experienced monitor process to due closely in continue to and delays regulatory our regulatory proceedings.

During our we've communications together ramped this we regulatory can our crisis track. COVID-XX on up keep with to regulators work so activities

We partner these stand looking water community and programs they cities can wastewater towns to for focus to strong constraints. on ready acquisitions continues municipal crisis continue utilities passage the to and with with solutions more we'll pressures financial now other legislation so that value of especially fair see of a anticipating We as COVID-XX projects. we pipeline economic vital be given and municipalities their on the and are market municipal

pipeline municipal Moving acquisitions are have the deals our healthy to slide, with as means of to municipality. potential included pipeline that next to a signed be part in active ,we we municipal having the addition it discussions our of

and given majority actively customers. assets Again XXX,XXX on can opportunities illustrated than this our the as recent be additions operation municipalities way wastewater the which same are compliance water totaling water been acquisitions are the regulated systems. municipal have manage. to same pursuing acquisition see of effectively coming of assets We with of wastewater some slide, approximately wastewater rather As many potential more we customer pipeline the difficult systems our trend from for the in

for serve. the we we similar opportunities that look is in acquisition opportunities for Next important how we to partnership it communities look that

this produce but an first Pittsburgh emergency International grid reliability, Airport which emissions for will airport while the connected microgrid and savings microgrid than local electrical source. power build public partnerships the solar by is equivalent the Pittsburgh own generators natural would resilient the energy microgrid completely electricity to which community natural approximately on-site and natural solar main on use major like airport sustainable project Through on-site backup highlight The homes. the One Peoples of of needed airport will the the resources. Through tenants. for will efficient gas using powered independent is amount remain project supplied to project five use by XX,XXX maintain we environmentally gas X,XXX Peoples its cost electricity slide panels, in the a will more U.S. allow lower source operate. more the this which be increased for and its safety and of ensures both of will in an achieving airport to gas The use and

hospital. needs hospital is with We for for Chris. will it will back water has CHP the emissions. partnership also project build in the reduce meet In kind cooling be will over power and reduce to of hospital its addition a more costs first operate chilled believe and and and all Peoples health improve the efficient formed the hand and Allegheny the will the project provide of to a The And project with Wexford This also network a as heating water, importantly to power, heat I reliability that steam combined region. and maintain energy the known hospital. at and electricity, hot

Peoples the Thanks day would Appreciate accelerated on it. our that year focus focused Matt. continued plan of our said this we our and We during priorities. process. we DELCORA Earlier remain the the Peoples implement of including the repair. program to that on we committed investor acquisition operational would remain transaction municipal excellence, our election CapEx presented integration We would XXXX said

remain our priorities. on time to the agenda core committed work focused course pandemic we the but the facing of remain didn't overcome and Of all pandemic know we would a we on this to be delivering despite

every focused to ESG about. these on to of that's ESG, month filing overall hired on our we talk our continue a CDP team and continue be tell have this later thinks updated work ESG that the With the to ESG fall. Recently program next will we a story level. day I addition priorities, manager and believe work publishing our that ESG annual he report initiatives. ESG Catalano let's is John guidance. of this In our take to survey who we working we all anticipate are and also focus Later we to strong John and about

pandemic. our of are guidance reaffirming that we're completely recognizing out We XXXX the not

However, we that the providing do will deliver on important falls $X.XX work for of still especially $X.XX us allow time pro to think third forma for year. basis to company's projections. continue about be strong as is to position spent the a remainder XXXX. Adjusted results a insight where to to This into the is your believe for per the quarters. expected you income some share the Dan in quarter various current you,

So that chart helpful is to hopefully you.

Our billion $X.X rate-based anticipate approximately across track we growth XX%. driving gas on million on spending the side capital remain on of X% rate-based on water gas to platform driving natural growth to the up XXXX plans regulated through X% the on natural $XXX and the approximately X% $XXX regulated Essential million the segment investing We and segment. anticipate water as approximately segment

it up X% expect average water with open segment. And we customer X% questions. on to to regulated for about annual growth Lastly that be let's for our

Bank first of Greenwald And of go you. Thank from question Instructions] our [Operator to America. we'll Ryan

Good Ryan. morning,

just bit morning latest in in kind morning. the terms landscape? there platform the in your competitive and provide announcement, just and magnitude what state around acquisition following of of opportunity time underway this a guys. of Can seeing the the the you Good efforts Appreciate you're color more the Texas

take. Matt Sure. will

It on very utility fair in call We're Texas with investor-owned about talked was market sure. about now opportunities we opportunities We municipal as our optimistic it have just deal Yes announced Texas hope value there. value there in about the first an and see expect and we opens we up. really utility XXXX we and that fair that other market a opportunities, investor customers. other

So it's focus a big ours. of

have We working in people development state discussions. having of are actively business Texas the that

opportunity do we there there. think So is additional

because the that you around is Yes. interesting Houston area. have Texas utility an districts municipal particularly as well place

of different experienced bit So it [animal] makes it what some we a states. in a other than

more hard and FMV to increased and market will the we activity been with we've think the it the in working so state. Matt open legislation I'm I see And there

the rest it most particular across Got thinking it's kind standing more the and that just where out any states particular of or you're where your on are seeing most side, the then competitive? states broadly water opportunities jurisdictions of

Yes.

Illinois value in Virginia, in our now and part the we of North not reason Illinois lot continue of places coincidentally value of like we've all Pennsylvania that's in see as lot activity market see Carolina activity a additional like had see fair now a but in market and and Pennsylvania so We Ohio we Texas, given to and have also well. longest activity in we're starting there of continued to in in places states the fair

our So states seeing while our across well. still as busiest definitely Pennsylvania activity more probably other state is we're

trying needs available need the to Important, make for our we're to or more and trouble door solutions system a us the to tactics RFP. various add that offer for more to where an the offers at new and is when we just their in municipals strapped making know municipal wait are or approach we're we call as knock and get help opposed for on we'll this buy time that actually and so as municipals especially example we cash that think

move tactics on you'll this as to offer our a we think increase proactive see better I way. period sales So solutions into

it in to changing of on EPS but the then to not the Got this terms basis catch-up a you're are provide it there contribution filed bit of kind that? and out sounds more morning can materialize the longer-term guidance of granularity terms like just X% X% you lastly able in that of component

rate really and customers would absolutely to case say the what that to extend the some the next at this I It's when doing their shared a from look rate extend it benefit you between benefit is customers serve customers that would the shareholders getting benefits I can that well that a period ability concept then on of is and construct and time proposing do what bill say might you a imagine time and for catch-up of really of and hard right. until case too to where we'd and the time be Ryan over bring here, next bill to the reduce deduction until we're back their credit say to shareholders later you're like

it's It's of that's So newly a it's PUC. before we what matter now kind likely an filed. proposal and Pennsylvania it's have in on open an

more than can't really any on it color probably provide So we that.

the time. enough. Fair Appreciate

Yes. Thanks Ryan.

go Connors next from Scattergood. Ryan question we'll And & to our Boenning of

Ryan. Hey

question. for morning. my Thanks Good taking Yes.

morning but So I all. meeting on the split hear know issue back wonder had if I you the and of service give issue that it I public a us any in regulatory didn't this update on they up at come the moratoriums June Pennsylvania. disconnection PUC in

expect on it update extending one other back? might or on that the any that So when to rolling way or they move

Yes.

news form think good guess question. allow I COVID has relief I get before that good in the the even timing regulatory related debt the an the provided they'll for into it's assets is Pennsylvania I important some expense. news

standpoint be commission it two at the So knowledge necessarily we bills good still commission issue it's Ryan missing not still non-pay my retired able at split issue hopefully the pay an long good all we it issue frankly customers for it's from have in and shutoff has that of terms from a their don't enforce a to and but cash place in time flow commissioner. commissioner when won't QX. each brought term hope P&L up but being We're commissioner been has office a times and

in some estimate commission the water frame. the Halle faced name we'll the we're on December would that best water Now the the how over by related but certainly Remember to think that again they're call the is so gas just time sent and what governor fall on we into senate no with where September a the timeframe shutoffs develops and this see Bullock a action the see week often side. I that coming side later moratorium heat winter the in for

So be That's up debt the I some the timeframe best bad some the moratorium commission moratorium winter these clean period can to and and issues. allow the are I considerations between think the able that of to about of Ryan. September think would give you

it. Got

I that risk that but issues. somewhat flow issue bigger the question in my mean dovetails it's on picture it goes not I into nature. which of it then longer cash and you the becomes an earnings Okay issue the is mean in mentioned other earning kind and big

seems guess the to me other overall in like kind like with So been my in the I look it is of when regulatory you the a seems at middle question COVID dynamics caught it of here. sort water have caught utilities

hand On no pun at service the intended. one you're Essential

whether rate the any hand costs collections now. whether and of got on a third case which and operating sort money it's other kind monetization to So that's you've a keep right it's of then shutoffs rail

job this help sort and So your to tide compact that if back more? in done turn bring up regulatory on the market into of what's going some and does What's being the reaction out? of for fact some done that to impact the and terms end be year household what balance unemployment thing can of to kind of and in another or balance

with we focused Yes. customers. Well, our for on let me start saying always affordability are

So we'll with that. start

a collections so now lot going through understand during we are what American families eased right and time. of that we've So a lot around issues this of

customers. So we help can

the year million fact about LIHEAP gas on on Peoples and of programs. the other through a to side help In comes bills customer $XX

help it. of for we make lot a provide to try customers to So

that mean we advantage not customers moratorium handling is be it that issues listen important these a with you're that help on with need that surgically some and the more I discipline. think it give who isn't a said broad having probably off Now instrument who believe blunt better take to It's hand there needs by that what we of they the as need effective. other customers I

commission to where an more we a moratorium. continue approach advocate rather broad surgical it's so for by a And than commissioned approach

we state states, of West state the that way and knowledge. conversations lifting restrictions would like already in gone each have So But then our it would those four and Texas in all have I four the of who of reinstituted best can say looks be Virginia continue Ryan, two and their states and more to then now we're our and that states. the in by September we're in conversations sometime states are be collections those in XX August our remaining

Got it.

question prior municipal the to just or like the of very pipeline, back and of then going you're terms sort Okay more outpacing the at on definitely in your of pipeline sort punching and your industry. flow one deal there your weight it just acquisition much and above seems

is really Pennsylvania ahead market. You've a impressive in very pulled which like given especially it competitive pretty seems it's

indicate on there way more So and be look at might reports the there. the local press

edge about and time? What that'll enabling it you or what timing even that? and So out just you're are that that that factors think your all are you a is giving process on think that do you streak is the over that's hot

stay we reputation Yes. the management, It's have let's I of the but and we in Ryan. course kidding all listen at I'm too, it think pretty nice and face we offerings we have a hard it area we really, built about of currently transactions on the so is water serve. hard some and are reputation really our We we're right of work long customers these that and talking top so with communities have. right

know that another advantage So us one deals level but inherent political there is doing some our at and beyond you more that transactions and our various these gives of given as people and bit and opinions. all location an of little the a get now, larger municipal we're get opinions reputation they others larger the or have the are they than larger larger more

think oppose course and people so, stay interest allow some to nature as confident of nature they an close and file the participate legal all And things going regulators is but that's will as the for let I to just get in just we've to determine make have the of position that is we're sure them. fit these if and and cases but people it, we're DELCORA process to kind the they to the to done more we've as with they and we're necessary outcome need see we bigger documentation but commission and got the more see these a ultimately have continue of what judges in and take going things listen the

the detail your Great. and Well, for thanks thanks time. for all

Thank you Yes, Ryan. bet. you,

Evercore go ISI. from question Chopra, a on, moving Durgesh to we'll And

Durgesh. Hey

extent impacts quarter. question just, my impacts a they're and off taking for start to very industrial quarter from weather, I was that us and normalized terms you you of much and very your actually declines? Thank just earnings COVID. mentioned the can can morning. offset one you understand peers in commercial Good of you Can guys. Hey during credential with are maybe how help seeing the an Maybe what seeing COVID solid

Dan? Sure.

seen lawn. what yes. saw you've keep home you we weather's watering the and care their we it now is to about conducive been weather, that Absolutely. lawns I the and people taken would some for think if say and their have certainly up. mean watering weather of They're too helpful work with I this us in from think was of mid-Atlantic

showed are actual be of in couple us could they're the for that expenses that helpful I PPE we and here in as and impacts of but So pennies think much the is and relatively COVID earnings a numbers O&M as cleaning we that when waterfall things terms that identify and like incremental modest so earlier.

figures not, stopped there not put say travel. and because effectively into we've of they're big bit as then So we our there's a offset an did

XX to now. conferences. not going or not between We're you're our traveling states people seeing So X

know As Chris, myself you any at We've Matt investor conferences. stopped haven't Brian it. and or you seen

some there savings So there help to expenses that offset are those as well.

record. in residential the I alarming for But the terms mean -- MSU right, you're mean footprint far? anything, yes, seen haven't I nothing guessing in declines so there, demand I'm actual I what obviously And terms declines Understood. you guys of in largely of seeing

kind what we of gotten the basically just call, were in that's April. on then in our had think for on before our said and we budget said last call kind I coming right and we No, the we as going of data April numbers in expected last saw we

customer for this other classes. to that industrial see So by in making point commercial, other the we residential declines was up the started that segments and or the

wanted what's period put last will we you slide this quantitatively to on just we far compared here show is what exactly the period see on same year. the to so and during going let that So there

look as varies that to chain jurisdiction as it, had decline you last this businesses we probably our it some several to production to certainly cause there to decline as that but might that watched guess, many other would industrials concerns and of and into be bad the was months, going you going I to over area can to and company company obviously probably this as and as issues have company at said. company jurisdiction but them maybe doesn't therefore supply this jurisdiction imagine and least at as that's in Yes happened their and as it been issues consumption could appear I as have over vary or jurisdictions to such and

Understood. Very helpful.

it year In why deal the terms subsequently? it issuance DELCORA, do just for of on timing just not why this wait the are Any and equity that do thoughts on front?

think timing. A lot think on to right?. about about on A that, lot to

thinking to So go how about our through we're Dan it? want you

to raise point little really they don't Durgesh where say wait money Yes, to it. bit a and need the you

you too here that. closing out So right election it, if get that of to the start to the ready we picked and how want of as that it know to equity in that around kind DELCORA just equity of and far we're kind ahead we make year make happens that knows look market you as raise half perspective see you back the and for time about and you who from what an do this sure of think here sure

in what lot year, a right, if that's events the the think just continues happens of that cause I is with could there COVID this the next economy some economy volatility.

rates. be opportunistic the can of best we're terms and in do going look we we're to to for equity timing going think I So for

Understood. just contractor Matt. be you, that Matt, too? interesting how in be follow-up hopefully on for which on plan but going terms you one any quick very, Thank businesses very there like business to Just of are is to color front would be is great, balance a you has deploying and been going model MBAs or sheet this capital

doesn't a light. is business capital which have mix. it the If require and say home like but MBAs, Yes. very growing we warranty different would they a is it's Peoples a business business for capital. fast few instance I one It's much a

the capital, in CHP those other basically manage like more projects are hospitals little that more capital they're Pittsburgh spend definitely intensive. bit so they hand and airport doing and They and On the and capital intensive. a projects them are the likes those which projects develop

a it's bag mixed on bit Aqua. at So the of business little depending and a Peoples both

guys. Understood. thank much. safe you Appreciate the color Be and so

Thanks care. Durgesh. Take

to move we'll Global. Angie Storozynski, And Seaport

you. Thank

seeing far a being mostly consuming questions. the are basis the is related C&I impact One mix side. just on normal COVID have and customer customers offsets the two residential class on that so more clients a we're to weather I of your So that that

there on that the we side. should like of change hope residential sensitivity hope at the the I a COVID is this see just weather there would to but the Because would one, customer the side, mix is electric weather is your higher, side argue Now or customer right? reactive more in least to both make also seemingly gas water and

be I'm what both weather far guidance? the least so to benefit that scenario there not and side is where COVID water would trying which this have what additive So at summer a and assuming the only actually on to winter going given a offsetting seen that actually but your gas say could also be we side the normal we've is to

right. to God's [lips Well, from your ears],

more suppositions hard are think is people predict. accurate that I I I are couple think these to home. your mean of things are there at

people yard those I their and plantings think work, more than this before so have So things therefore probably done accurate. lawns all watering year are are

their As out they their get they my spouse at trimming and and looking bills at through way rate that's that move to I'm bill my so will a is work summer expenses. continue we're maybe I question. the of get Do of one

don't range. we've at point our that in estimate at but could point and just that described guidance know potentially best estimate guidance we upside, be So right this this we're is I we're within the think guess there our best Angie range I within

on to don't secondly repair we were long know and be XXXX expecting sharing there versus leaves and so you still filed I this for you should shareholders as but Okay mechanism sharing catch-up case through a and that I application that just side rate is that anything another if EPS have gas again think tax file the the the plan additive even original as no?

a proposal that in I be beyond way say what we've we this would I such guess the stretching a the expecting. were rate next until made case the way time is you

frankly period So have shortfall. and what of call by up out farther for later from some would requirement farther going that out in there make what benefit to planned using than we revenue that you'd a

Due to continued this heavy spend. capital

that Due of to continued period capital heavy spend time. over

extended between is this next which the really period the stakeholders. we rate it So see think for good we case all really rate case driving and last

expenses any earnings. COVID Okay year, this are assertion related assuming defer your impact you for nets the expensive you or asked, question already that debt? of and showing both and remainder of negative COVID that guys basically mean know impact I not allows that on was COVID to of and I estimate lastly In remaining year-to-date are you the Pennsylvania bad any

On debt commission assuming expense. get issued on a guidance bad treatment we're and bad some COVID a regulatory that. related That's already on debt that we asset has

the other not we COVID related So damage COVID on COVID, opportunities expenses. there's expenses. opportunity to related can think our from on for bad without numbers with with hit other with not those savings debt basically but offset We expense we COVID think associated associated

Okay. Thank you.

Sure.

Angie. Thanks,

Jonathan And we go Instructions] will Fargo. Reeder to of [Operator Wells

Jonathan. Hey

Good are all? you How morning.

Pretty well. How are you?

on too getting the the burning. Not towards bad tail

the end of at the So life tunnel.

Right.

what and impact? it or of repairs you shielded the the amount was can reiterate is tax that Dan, income is that size the the that catch-up finally of income net

million, is deduction. that So XXX approximately it's $XXX and the

rate that the So is by benefit tax a deduction. effectively multiplied

Got it.

Okay.

what then is benefit through income that And flows statement. the

Right.

Okay.

to as side? mean levels you then asking to it so the earned are done that sort period portion of water amortization the accrue with predetermined ROE sounds like request the opposed shareholders, to your to over some that you keep like the flexibility to a was on And multi-year allowed recognize I needed consistent as

here. Yes. will It's that of I predetermined tell bit think time but a

and earlier an adjudicated. respectful in open said want that the actually to process. just is matter It’s front be of I this of now PUC As

I in is could think bit say think I a Jonathan just bigger it put maybe it we to about way. little thinking right the box,

John about would you way. agree. thinking right I it Yes. are the

has the past they had is relevant over to presenting see that or interveners that's And you've first shaped like the with the any by just regulators request been it months few time for react? them discussions and key or purely how

Dan compliment for have Well, on they've there because team this and the I’d Kim and pre-meetings. work the been done

wouldn't communications unless I would the not characterize with they I or commissions been file, is say this done exposure by be how surprised or what that they they've we've So a say on and guided the wouldn't it staff's nice saw. so, that the how to not Is I correct? well OCA as regulator on very, that to they're the wouldn't this very first job by

Yes. That's correct Chris.

good very conversations parties have socialize in various with the this advance. We had concept and

benefits for as try a benefits is win some term customer really everybody portion shareholder the short where and create long well. something We and by that to term, Jonathan the

craft to So really we situation. try compromise a

too. It really helps

elevated the supports of deployment It well. Yes. level as capital

and system. to continued to So capital our it's replace reliability prior that plus longer deployment drive in stay really out safety

think replacement reliability environmental from we condition here time have the the we associated, strongest stay pipe longer we the and the at gas outcome. even utility the race of can same COVID you focus believe for recovery to reasons in we of that for the As think on and continue about out the economic that's

sense. that that appreciate No. makes all Yes color. I

a council it between whatever? it's or where city whole fight you're fight are really do like stand not you things I legal the Lastly, but know in DELCORA in interested the that in and

for I then and it it start me further. to will Let pass Matt

Matt have presentation they've accepted application. accepted as filed PUC filed in we So his they fully our said with

So that's good news.

through and winding PUC a time tough you the is process now the So that's formally period. defined

say so expenses that would they've proceeds is XXXX this county in trust. this largely the it stays this it's have they're of and one creative The to call at and to it that proceeds this so that had for think it a opposed to COVID or the on take a current least those they the DELCORA the to commissioners expanding public offset it's me have up from numbers proceeds like said I the impact the those county they in are very around think $XXX and and of and of the have somewhere that county know we're had if the at taxpayers trust has related redirecting about I came will about So to county to increases then remain track. as the COVID now early And them us knows the would concerned cases, million put what think from are entirety simply million going future to to day, the the and of rate payers. at the thought listen carefully some so watching I DELCORA of I take planning because you be flow. to proceeds, capital as going up we we've sale spend end $XXX very and with rate idea was communicated

sometimes early issues. ruling September, so heavy this those sometime I the thinks have So what but through to to county are that's year, they good would we the I again moments At what in pretty in over their so the politics and lens going about and point be said are we're through on years lift a ago people Matt? he it's few situation. judge things a own as thought and a going to solution [eight] the the to have mid-September next was see work we think expect

there I add is, ongoing. are we are legal Jonathan am to -- going proceedings

progress confident mind we're in too but we transaction early and to signed a so a can't and legally this we much continue hopefully in So do comment we will binding APA XXXX. and agreement closed place that with get have we that's in

it Okay. guess But transaction. whether you the determine have Chris and has county right to versus that is maybe said the there or I whatever proceeds more the any proceeds spell appeals the that actually mid-September they judge would then that right to ruling what about of in a it's out

whether the step I exists. stop to a and to transaction, in the has a more county it's county whether right the right think the that intervene about has in contract

in decision trust in the dissolve less September, So I judge important more the ability a and it's transaction. of to intervene a authority think about county's midst the by the pretty about and the

Okay. All right. Thanks, appreciate clarity. I that

You bet.

Thanks Jonathan.

no like to And questions remarks. further I'd Franklin closing any to with in the Chris queue for turn or the conference back additional

a you are follow-up we're us this for day. Brian and Great there are and Dan questions great Have I Thanks available obviously if available. Thank joining so and all all for morning. any. much.

the thank for again And participation. conclude to call. everyone that like does We'd your

disconnect. now You may