Exhibit 99.1
(CAL WATER LETTERHEAD)
         
 
  1720 North First Street    
 
  San Jose, CA 95112-4598   April 30, 2008
 
      For Immediate Release
Contact:
  Marty Kropelnicki (408) 367-8200    
 
  (analysts)    
 
  Shannon Dean (310) 257-1435 (media)    
CAL WATER ANNOUNCES FIRST QUARTER 2008 RESULTS
 
     SAN JOSE, CA — California Water Service Group (NYSE : CWT) today announced net income of $0.2 million and diluted earnings per common share of $0.01 for the first quarter of 2008, compared to net income of $1.6 million and diluted earnings per common share of $0.07 for the first quarter of 2007.
     Revenues increased by $1.4 million, or 2%, to $72.9 million, with rate increases adding $4.2 million and sales to new customers adding $0.4 million, partially offset by a decrease in sales to existing customers of $3.2 million.
     Total operating expenses for the first quarter of 2008 increased by $1.8 million. A decrease of $0.5 million in water production costs was partially offset by an increase of $1.8 million in administrative & general and other operations costs, primarily attributable to payroll increases effective at the beginning of 2008 and increases for employee benefit programs.
     Maintenance expense decreased by $0.4 million to $4.1 million for the quarter. Depreciation expense increased $0.8 million to $9.2 million as a result of increases in 2007 capital expenditures, while taxes other than income increased $0.3 million due to increases in payroll and property taxes.
     Other income, net of income taxes, reflected a loss of $0.1 million, compared to income of $0.8 million last year, due to a decline in investment income and a mark-to-market adjustment in investments associated with pension and deferred compensation plans.

 


 

     For the twelve months ended March 31, 2008, net income was $29.8 million and dilutive earnings per share were $1.43, compared to net income of $26.3 million and dilutive earnings per share of $1.34 for the same period in the prior year. Revenues for the trailing twelve months were $368.4 million, compared to $341.1 million for the same period last year.
     “In 2007, our first quarter results benefited from higher water sales resulting from above-average temperatures. In 2008, we were affected by cool, wet winter weather, with many of our districts getting more than twice the rainfall than they did in the same period last year. Our results were also impacted by increases in benefits costs and negative mark-to-market adjustments associated with our pension and deferred compensation plans,” said Peter C. Nelson, President and Chief Executive Officer.
     “However, during the quarter, we continued to make progress with the California Public Utilities Commission’s (CPUC) Water Action Plan. Our 2007 General Rate Case progressed, and we believe it will address many of the areas affected by regulatory lag. In addition, the CPUC issued Decision #08-02-036 in February authorizing the decoupling of sales and revenues (weather revenue adjustment mechanism), modified cost balancing accounts, and tiered rates, which are scheduled to go into effect later this year,” Nelson said.
     All stockholders and interested investors are invited to listen to the 2008 first quarter conference call on May 1, 2008, at 11:00 a.m. (EST), by dialing 1-866-814-1919 and keying in ID# 1226399. A replay of the call will be available from 2:00 p.m. (EST) Thursday, May 1, 2008, through June 30, 2008, at 888-266-2081, ID# 1226399. The call, which will be hosted by President and CEO Peter Nelson and Vice President and Chief Financial Officer Martin A. Kropelnicki will also be webcast under the investor relations tab at www.calwatergroup.com.
     California Water Service Group is the parent company of California Water Service Company, Washington Water Service Company, New Mexico Water Service Company, Hawaii Water Service Company, Inc., CWS Utility Services, and HWS Utility

 


 

Services. Together these companies provide regulated and non-regulated water service to nearly 2 million people in 100 California, Washington, New Mexico, and Hawaii communities. Group’s common stock trades on the New York Stock Exchange under the symbol “CWT”.
     This news release contains forward-looking statements within the meaning established by the Private Securities Litigation Reform Act of 1995 (“Act”). The forward-looking statements are intended to qualify under provisions of the federal securities laws for “safe harbor” treatment established by the Act. Forward-looking statements are based on currently available information, expectations, estimates, assumptions and projections, and management’s judgment about the Company, the water utility industry and general economic conditions. Such words as expects, intends, plans, believes, estimates, assumes, anticipates, projects, predicts, forecasts or variations of such words or similar expressions are intended to identify forward-looking statements. The forward-looking statements are not guarantees of future performance. They are subject to uncertainty and changes in circumstances. Actual results may vary materially from what is contained in a forward-looking statement. Factors that may cause a result different than expected or anticipated include, but are not limited to: governmental and regulatory commissions’ decisions including but not limited to rate case decisions and implementation of the CPUC Water Action Plan; changes in regulatory commissions’ policies and procedures; the timeliness of regulatory commissions’ actions concerning rate relief; new legislation; electric power interruptions; increases in suppliers’ prices and the availability of supplies including water and power; fluctuations in interest rates; changes in environmental compliance and water quality requirements; acquisitions and our ability to successfully integrate acquired companies; the ability to successfully implement business plans; changes in customer water use patterns; the impact of weather on water sales and operating results; access to sufficient capital on satisfactory terms; civil disturbances or terrorist threats or acts, or apprehension about the possible future occurrences of acts of this type; the involvement of the United States in war or other hostilities; restrictive covenants in or changes to the credit ratings on our current or future debt that could increase our financing costs or affect our ability to borrow, make payments on debt or pay dividends; and, other risks and unforeseen events. When considering forward-looking statements, you should keep in mind the cautionary statements included in this paragraph, as well as the annual 10-K, Quarterly 10-Q, and other reports filed from time-to-time with the Securities and Exchange Commission (SEC). The Company assumes no obligation to provide public updates of forward-looking statements.
     Additional information is available at our Web site at www.calwatergroup.com.
     Attachments (2).
###
Source: California Water Service Group

 


 

CALIFORNIA WATER SERVICE GROUP
CONDENSED CONSOLIDATED BALANCE SHEETS

Unaudited
                 
(In thousands, except per share data)   March 31     December 31  
    2008     2007  
ASSETS
               
Utility plant:
               
Utility plant
  $ 1,468,966     $ 1,447,047  
Less accumulated depreciation and amortization
    (446,637 )     (436,851 )
 
           
Net utility plant
    1,022,329       1,010,196  
 
           
 
               
Current assets:
               
Cash and cash equivalents
    2,967       6,734  
Receivables
               
Customers
    17,404       18,600  
Other
    5,357       8,617  
Unbilled revenue
    11,368       12,911  
Materials and supplies at average cost
    4,779       4,744  
Taxes, prepaid expense, and other assets
    9,244       8,369  
 
           
Total current assets
    51,119       59,975  
 
           
 
               
Other assets:
               
Regulatory assets
    90,999       90,908  
Other assets
    22,768       23,420  
 
           
Total other assets
    113,767       114,328  
 
           
 
  $ 1,187,215     $ 1,184,499  
 
           
 
               
CAPITALIZATION AND LIABILITIES
               
Capitalization:
               
Common stock, $.01 par value
  $ 207     $ 207  
Additional paid-in capital
    211,976       211,885  
Retained earnings
    167,710       173,617  
 
           
Total common stockholders’ equity
    379,893       385,709  
Preferred stock
    3,475       3,475  
Long-term debt, less current maturities
    288,495       289,220  
 
           
Total capitalization
    671,863       678,404  
 
           
 
               
Current liabilities:
               
Current maturities of long-term debt
    2,701       2,701  
Accounts payable
    26,653       36,694  
Notes payable
    14,000        
Accrued expenses and other liabilities
    35,318       30,258  
 
           
Total current liabilities
    78,672       69,653  
 
               
Unamortized investment tax credits
    2,467       2,467  
Deferred income taxes, net
    68,001       69,712  
Pension and postretirement benefits other than pensions
    39,444       39,444  
Regulatory and other liabilities
    40,113       38,783  
Advances for construction
    168,822       168,024  
Contributions in aid of construction
    117,833       118,012  
Commitments and contingencies
               
 
           
 
  $ 1,187,215     $ 1,184,499  
 
           

 


 

CALIFORNIA WATER SERVICE GROUP
CONDENSED CONSOLIDATED STATEMENTS OF INCOME

Unaudited
(In thousands, except per share data)
For the three months ended:
                 
    March 31,     March 31,  
    2008     2007  
Operating revenue
  $ 72,921     $ 71,570  
 
           
Operating expenses:
               
Water production costs
    25,358       25,814  
Administrative and General
    13,418       12,570  
Other operations
    12,065       11,085  
Maintenance
    4,114       4,509  
Depreciation and amortization
    9,222       8,401  
Income taxes
    174       543  
Property and other taxes
    3,739       3,406  
 
           
Total operating expenses
    68,090       66,328  
 
           
 
               
Net operating income
    4,831       5,242  
 
           
 
               
Other income and expenses:
               
Non-regulated revenue
    2,905       3,042  
Non-regulated expenses
    (3,036 )     (1,751 )
Less: income taxes on other income and expenses
    49       (526 )
 
           
 
    (82 )     765  
 
           
 
               
Interest expense:
               
Interest Expense
    5,014       4,926  
Less: capitalized interest
    (450 )     (500 )
 
           
Total interest expense
    4,564       4,426  
 
           
 
               
Net income
  $ 185     $ 1,581  
 
           
 
               
Earnings per share
               
Basic
  $ 0.01     $ 0.07  
 
           
Diluted
  $ 0.01     $ 0.07  
 
           
Weighted average shares outstanding
               
Basic
    20,688       20,659  
 
           
Diluted
    20,711       20,681  
 
           
Dividends per share of common stock
  $ 0.29250     $ 0.29000