Cuộc họp công bố kết quả kinh doanh quý 3/2026 của Essential Utilities (WTRG): EPS tăng 9%, thương vụ sáp nhập diễn ra đúng tiến độ

Điểm nhấn chính

• Essential Utilities báo cáo EPS theo GAAP quý 3/2026 đạt 0,36 USD, tăng 9% so với mức 0,33 USD của cùng kỳ năm trước. EPS non-GAAP điều chỉnh đạt 0,38 USD sau khi loại trừ các chi phí liên quan đến sáp nhập.
• Các khoản hoàn thu theo quy định và phụ phí đã đóng góp thêm 0,06 USD/cổ phiếu, trong đó khoảng 65% lợi ích đến từ mảng cấp nước. Sản lượng nước tăng đóng góp thêm 0,01 USD/cổ phiếu.
• Vốn đầu tư lũy kế từ đầu năm đến nay đạt khoảng 1,1 tỷ USD. Ban lãnh đạo cho biết công ty vẫn đang bám sát lộ trình để đạt mức chi tiêu kỷ lục 1,7 tỷ USD cho cơ sở hạ tầng trong năm 2026.
• Theo ban lãnh đạo, thương vụ sáp nhập đề xuất với American Water vẫn đang đi đúng tiến độ để hoàn tất vào cuối quý 1/2027. Thỏa thuận đã nhận được phê duyệt tại Kentucky, Ohio và Virginia, trong khi các thỏa thuận dàn xếp tại Pennsylvania, North Carolina và Texas đang chờ phê duyệt cuối cùng.
• Essential Utilities đã ký các thỏa thuận mua lại tài sản cấp thoát nước với tổng trị giá khoảng 290 triệu USD, bao gồm các hệ thống dự kiến sẽ phục vụ khoảng 208.000 khách hàng. Danh mục các thương vụ mua lại tiềm năng đang triển khai của công ty đại diện cho khoảng 400.000 khách hàng mới tiềm năng.
• Công ty không tái khẳng định dự báo EPS dài hạn, viện dẫn thương vụ sáp nhập đang chờ xử lý và sự thiếu chắc chắn về phương án tài trợ vốn cho công ty sau sáp nhập. Ban lãnh đạo vẫn duy trì kỳ vọng đầu tư vốn ít nhất 8,7 tỷ USD trong 5 năm tới.

Dữ liệu tài chính quan trọng

Kết quả kinh doanh và vận hành

Chi phí vận hành và bảo dưỡng thấp hơn đã hỗ trợ kết quả kinh doanh quý. Chi phí O&M giảm khoảng 0,6%, phản ánh các khoản bồi thường bảo hiểm và chi phí nợ xấu thấp hơn ở mảng khí đốt được quản lý theo biểu phí, bù trừ một phần bởi các chi phí liên quan đến sáp nhập.

Chi phí phúc lợi nhân viên, bao gồm khoản bồi hoàn từ bảo hiểm y tế stop-loss, đã giảm khoảng 3,5 triệu USD. Ban lãnh đạo cho biết phần lớn mức giảm đó đến từ khoản bồi hoàn bảo hiểm stop-loss này.

Hoạt động điều tiết theo quy định tiếp tục là động lực chính thúc đẩy lợi nhuận. Essential Utilities đã hoàn tất các đợt điều chỉnh biểu phí hoặc phụ phí tương đương 70,5 triệu USD doanh thu tăng thêm tính theo năm trong năm 2026, với khoảng 75% đến từ hoạt động cấp thoát nước.

Mảng cấp thoát nước đang có các hồ sơ biểu phí hoặc thủ tục phụ phí chờ xử lý tại 5 bang với đề xuất tăng hơn 78,5 triệu USD tính theo năm. Công ty con mảng khí thiên nhiên tại Pennsylvania đang đề xuất tăng biểu phí cơ sở 163,2 triệu USD; thẩm phán luật hành chính đã khuyến nghị mức tăng khoảng 105 triệu USD.

Hoạt động mua lại cũng đạt được tiến triển. Trong tháng 10, công ty đã hoàn tất hoặc công bố một số giao dịch cấp thoát nước quy mô nhỏ hơn tại Texas, North Carolina và Pennsylvania. Tổng giá trị các thỏa thuận đã ký đạt khoảng 290 triệu USD và dự kiến sẽ bổ sung các hệ thống phục vụ khoảng 208.000 khách hàng.

Định hướng của ban lãnh đạo

Ban lãnh đạo dự kiến thương vụ sáp nhập với American Water sẽ hoàn tất vào cuối quý 1/2027. Công ty kỳ vọng sẽ có quyết định cuối cùng tại North Carolina và Texas trước khi kết thúc năm 2026, dù chưa có lịch trình cố định nào được đưa ra.

Tại Pennsylvania, ban lãnh đạo kỳ vọng thẩm phán luật hành chính sẽ đưa ra khuyến nghị quyết định vào khoảng cuối tháng 11, sau đó Ủy ban Tiện ích Công cộng có khả năng sẽ có động thái ngay sau đầu năm 2027. Các cuộc đàm phán dàn xếp tại New Jersey được mô tả là mang tính xây dựng, trong khi lệnh của ủy ban bang Illinois dự kiến sẽ sớm được ban hành theo khung thời gian luật định của bang.

Essential Utilities vẫn đang bám sát kế hoạch đầu tư kỷ lục 1,7 tỷ USD vào cơ sở hạ tầng trong năm 2026. Ban lãnh đạo cũng tái khẳng định kỳ vọng đầu tư ít nhất 8,7 tỷ USD trong 5 năm tới.

Công ty không đưa ra dự báo EPS dài hạn. Ban lãnh đạo cho biết định hướng lợi nhuận và các quyết định tài trợ vốn trong tương lai sẽ được đội ngũ quản lý và hội đồng quản trị của công ty sau sáp nhập giải quyết thỏa đáng hơn.

Rủi ro và các yếu tố cần theo dõi

• Giao dịch với American Water vẫn cần sự phê duyệt theo quy định cuối cùng tại một số bang, bao gồm Pennsylvania, North Carolina và Texas.
• Hồ sơ biểu phí khí đốt tại Pennsylvania vẫn đang chờ quyết định cuối cùng từ ủy ban. Mức tăng 163,2 triệu USD theo yêu cầu cao hơn mức khuyến nghị khoảng 105 triệu USD của thẩm phán luật hành chính.
• Ban lãnh đạo nhấn mạnh sự cần thiết phải cân bằng giữa đầu tư cơ sở hạ tầng và tỷ suất sinh lời hợp lý với khả năng chi trả của khách hàng.
• Giao dịch DELCORA vẫn đang bị thẩm phán tòa án phá sản liên bang tạm đình chỉ do liên quan đến vụ phá sản của Thành phố Chester, dù ban lãnh đạo cho biết thỏa thuận mua bán có thể được American Water tiếp quản.
• Ban lãnh đạo cho biết vẫn đang đánh giá các biến động chính trị sau cuộc bầu cử và chưa đánh giá các tác động từ thỏa thuận dàn xếp bồi thường thiệt hại cá nhân liên quan đến chất PFAS mới được nhắc tới có liên quan đến 3M.

Điểm nhấn phiên hỏi đáp với chuyên gia phân tích

Các chuyên gia phân tích tập trung vào tiến trình phê duyệt sáp nhập, việc thiếu vắng dự báo dài hạn, xu hướng chi phí và lộ trình phê duyệt của các cơ quan quản lý.

Về thương vụ sáp nhập, ban lãnh đạo cho biết các thỏa thuận dàn xếp tại North Carolina và Texas có thể nhận được quyết định cuối cùng trước khi năm nay kết thúc. Quyết định xử lý tại Pennsylvania dự kiến diễn ra vào khoảng đầu năm 2027, trong khi các cuộc thảo luận tại New Jersey tiếp tục tiến tới một thỏa thuận dàn xếp tiềm năng.

Về dự báo, ban lãnh đạo giải thích rằng các dự phóng EPS độc lập không còn phù hợp nữa trong bối cảnh thương vụ sáp nhập dự kiến hoàn tất vào đầu năm 2027 và các quyết định tài trợ vốn trong tương lai của công ty hợp nhất sắp được đưa ra. Kế hoạch đầu tư vốn vẫn được duy trì.

Ban lãnh đạo cũng làm rõ rằng kết quả quý này được hưởng lợi từ khoản bồi hoàn bảo hiểm y tế stop-loss. Bất chấp khoảng 4,9 triệu USD chi phí liên quan đến sáp nhập, tổng chi phí O&M vẫn giảm khoảng 900.000 USD so với cùng kỳ năm trước.

Về các thương vụ mua lại cấp thành phố, ban lãnh đạo cho biết kết quả bầu cử không gây ra lo ngại trọng yếu nào đối với các giao dịch đang chờ xử lý hoặc tiềm năng, đặc biệt là tại Pennsylvania.

Toàn văn biên bản cuộc gọi công bố kết quả kinh doanh

Toàn văn cuộc gọi công bố kết quả kinh doanh

Phần trình bày của ban lãnh đạo

Operator

Hello, everyone. Thank you for joining us, and welcome to the Essential Third Quarter 2026 Earnings Call. [Operator Instructions]

I will now hand the conference over to Ed Vallejo, Director of Investor Relations. Ed, please go ahead.

Edward Vallejo

Thank you, and good morning, everybody. Thank you for joining us for our third quarter 2026 earnings call. If you did not receive a copy of our press release, you can find the release on our Investor Relations website. The earnings call slides will also be found there alongside a webcast of the event.

During this conference call, both in our prepared remarks and in answers to your questions, we may make forward-looking statements that represent our expectations regarding future events and our future financial performance. These statements are predictions based upon our expectations, estimates and assumptions. However, as these statements deal with future events, they are subject to numerous known and unknown risks and uncertainties as discussed in detail in our documents filed with the SEC, including our most recently filed Forms 10-K and 10-Q.

During this call and in our third quarter 2026 earnings press release, we refer to GAAP and non-GAAP financial measures. The non-GAAP financial measures are not prepared in accordance with U.S. generally accepted accounting principles and are in addition to and not a substitute for or superior to measures of financial performance prepared in accordance with GAAP. A reconciliation between the GAAP and non-GAAP financial measures is included in our third quarter 2026 earnings press release available on our Investor Relations website.

We will begin with Chris Franklin, our Chairman and CEO, who will provide an update on the company. Then Dan Schuller, our Chief Financial Officer, will provide an overview of the financial results.

And with that, I will turn it over to Chris.

Christopher Franklin

Thanks, Ed, and good morning, everyone. Let's start on Page 5 with a few corporate updates. We'll start with our pending merger with American Water. Our regulatory approval process continues to progress nicely. We've reached constructive settlement agreements in Pennsylvania, North Carolina and Texas, all of which remain subject to final approvals from the respective state public utility commissions. We've already secured regulatory approvals in Kentucky, Ohio and Virginia, which marked major milestones as we progress toward closing the merger. With all of these positive developments, we continue to expect the merger to close by the end of the first quarter in 2027.

At the same time, our integration planning is moving at a full speed. Our integration teams have been busy collaborating across everything from organizational design to operational and financial processes, to IT systems and branding. It's been incredibly gratifying to see the teams from both Essential and American Water working so collaboratively and side-by-side to shape our future of the company.

Turning now to the quarterly results. We reported GAAP earnings per share of $0.36, an increase of 9% over last year. These GAAP EPS results include about $0.02 of merger-related expenses, bringing our non-GAAP EPS to $0.38 for the quarter.

Overall, it was a solid quarter that underscores the steady, consistent growth we are driving across both our water and gas businesses, as well as responsible expense management. A key driver of that performance is our ongoing commitment to system reliability and customer service. Year-to-date, we've invested about $1.1 billion of capital, keeping us on track to invest a record $1.7 billion in needed infrastructure improvements and upgrades in 2026.

All right. Now, on the regulatory front, we currently have rate cases or infrastructure surcharges pending in Texas, Virginia, Illinois, Indiana and New Jersey, along with our natural gas rate case in Pennsylvania. We recently received a proposed decision from the ALJ in the natural gas case recommending a revenue increase of approximately $105 million.

Now we continue to engage constructively with the Pennsylvania Public Utility Commission, the Governor's office and the various stakeholders regarding the state's regulatory environment. Related to this, you may have seen that Chairman DeFrank recently established an ROE working group, and we will be meeting over the coming months to evaluate options for establishing the cost of capital used in rate cases and DSIC filings. We are optimistic that the process will yield some improvements in the regulatory process and, frankly, a greater understanding by all the parties of the capital needs and the overall focus on affordability.

And finally, reinforcing our long-standing commitment to shareholder value, on October 21, our Board of Directors declared a quarterly dividend payment on December 1, 2026, to shareholders of record on November 10, 2026. Essential Utilities has paid consecutive quarterly cash dividends for over 80 years and has increased the dividend 36x in the last 35 years, a record we are very proud of.

And, Dan, on that note, I'll hand it over to you for a deeper look at our quarterly numbers.

Daniel Schuller

Thanks, Chris, and good morning, everyone. Today, my remarks will focus on our strong financial performance and the primary drivers of our results. Let's turn to Slide 8 to review our year-over-year EPS bridge, beginning with our Q3 2025 earnings of $0.33 per share. In terms of positive drivers, earnings per share this quarter benefited from a $0.06 increase in regulatory recoveries and surcharges, with about 65% of this coming from our water segment, and $0.01 from higher water volumes. These gains were partially offset by $0.02 from increased depreciation and amortization and another $0.02 from higher interest and lower AFUDC. This brings us to GAAP earnings per share of $0.36 for the quarter.

Now you'll see the details of our operations and maintenance expenses when you see our 10-Q, but let me give you some color here. O&M decreased by approximately 0.6%, or about $900,000. This decrease was primarily driven by insurance recoveries, as well as a decrease in bad debt expense in our regulated gas segment, offset by merger-related expenses.

Coming back to earnings. If we adjust our GAAP earnings per share of $0.36 to exclude the nonrecurring merger-related costs, our adjusted non-GAAP earnings per share were $0.38. A full reconciliation is available in our earnings release and in the appendix to this presentation.

Turning to Slide 9, let me provide an update on our regulatory activity. Thus far in 2026, we have finalized rate cases or surcharges representing $70.5 million in incremental annualized revenue. Approximately 75% of this total is derived from our water and wastewater operations, with the remainder coming from our gas business.

Looking ahead, our regulatory pipeline remains on track. Our water and wastewater segment currently has cases or surcharge proceedings pending in 5 states representing over $78.5 million in requested annualized increases. Our natural gas subsidiary has a base rate case pending here in Pennsylvania for $163.2 million. And as Chris mentioned, the ALJ has recommended a revenue increase of approximately $105 million.

This rate case filing is essential to supporting our long-term infrastructure improvement plan, which enhances system safety and reliability while continuing to drive emissions reductions. We expect a final order in this case in December. And as always, we manage these filings carefully to ensure we continue delivering safe, reliable service and earn a fair return on our invested capital while remaining highly sensitive to customer affordability.

And with that, I'll turn the call over to Chris. Chris?

Christopher Franklin

Well, thanks, Dan. Let's move to Slide 11, and we'll summarize our acquisition activity. Here, we show a selection of our business development opportunities, and our business development group had a very busy October. We started the month by completing the $1.1 million acquisition of Dril-Quip, a small water and wastewater system in Harris County, Texas. We also entered into an asset purchase agreement to acquire the North Carolina water and wastewater assets of Central States Water Resources. These assets serve approximately 4,100 customers, and we paid about $3.5 million.

Then on October 28, we entered into an asset purchase agreement for the acquisition of the water and wastewater assets of the Buckingham Springs system in Pennsylvania. These systems serve 1,300 customers, and we are paying $2.8 million for that acquisition. Finally, on that same day, we entered into an asset purchase agreement for the acquisition of the wastewater assets of the Hempfield Township Municipal Authority in Pennsylvania, which serves about 1,200 customers, for $2.2 million.

The company has also signed purchase agreements for additional water and wastewater systems in North Carolina and Virginia. In total, we've signed asset purchase agreements totaling approximately $290 million in purchase price, which are expected to serve approximately 208,000 customers.

Now this includes our DELCORA transaction, which remains under a stay put in place by a federal bankruptcy judge related to the bankruptcy of the city of Chester. And I'll remind you that the fully enforceable agreement of sale with DELCORA is assumable by American Water. Our active pipeline of potential water and wastewater acquisitions represents approximately 400,000 potentially new customers to the company.

And with that, I'll wrap things up and hand it back to the operator so we can take your questions.

Operator

[Operator Instructions] Your first question comes from the line of Travis Miller with Morningstar Inc.

Phần hỏi đáp

Travis Miller

I'm going to intentionally leave this one a little open here, but thoughts on the election? You're obviously operating in some key states that were featured in the election yesterday. Affordability, also an issue. Municipal M&A, potentially an issue. So I would just leave this open for any of your thoughts there.

Christopher Franklin

Yes. I'll tell you, it's a lot to digest, Travis. As you might imagine, there's some pretty big changes in the states where we operate. I will say this, though, just for starters. We are a 140-year-old utility. I've been at this company for nearly 35 years. My team has been with me for over a decade plus. And we have relationships on both sides of the aisle in all of our states. We work very hard at that, not only on the regulatory side but also the legislative side.

And so we'll have to meet some new people, get to know them. We'll have to get to know what is important to them in terms of their issues and then assess our work from there. But I think we're -- like so many people today, we're just in a digestion period at the moment.

Travis Miller

Okay. That's fair. Just real quick, municipal M&A, anything you saw from the election locally that might impact that either way, either existing pending or potential?

Christopher Franklin

I don't think so. A lot of the municipal folks in Pennsylvania, where we sit today, were not up for election. So, not as much on the municipal side that we see in terms of change, positive or negative, for municipal M&A. I think the transactions we have in the works, there doesn't seem to be any particular concerns about those. So I feel like business as usual in the largest part on our relationships with potential deals.

Operator

Your next question comes from the line of Paul Zimbardo with Jefferies.

Paul Zimbardo

Just one first for me. Just on the -- I noticed that long-term guidance was not included in the new press release. Just -- is it a change in the outlook? Or just could you give any color on why not reaffirm the plan with the update today?

Christopher Franklin

I think as we look forward, the reality is that -- and I think we've communicated this as best we could over the last year here, that we -- to give earnings per share guidance just doesn't make a whole lot of sense. We feel very confident that the transaction will close early in the new year. And how the business is financed will be largely up to the combined team, the combined Board and management team. So I think we decided here that earnings guidance going forward is best described by our -- the successor team here.

I will say this, though, Paul. We continue to feel strongly that we're going to invest capital. We've said we're going to be over at least $8.7 billion over the next 5 years in capital spend invested in our systems. So I don't think you should expect a great variation from the work we've been doing over the last decade plus.

Paul Zimbardo

Okay. Understood. And then one small one. Could you quantify what that insurance recovery item was during the quarter?

Daniel Schuller

Yes, Paul, I think you'll see this in the 10-Q that comes out. The insurance recovery is really tied to stop-loss insurance. So you think about health insurance cases that are significant claims. Last quarter, we noted that those claims were high because we hadn't yet had the stop-loss reimbursement. But this quarter, we're seeing that reimbursement come back through the income statement and sort of bringing those employee-related costs down. So you'll see in the Q that employee benefits, including that medical claim stop-loss reimbursement, decreased thus by about $3.5 million, most of that really being driven by that stop-loss recovery.

Paul Zimbardo

Okay. Got it. So the $3.5 million is net of the recoveries. Got it.

Daniel Schuller

Yes. So I think it's important to say in terms of the quarter, we had the positive benefit there. We had the benefit in terms of lower bad debt. But we also had about $4.9 million of merger-related expenses. And you'll see in the Q that O&M is still down by about $900,000. So even with the merger-related expenses, other costs came in, in line or lower than sort of typical or lower than we had last year. So very strong quarter from an O&M perspective here at the company.

Operator

Your next question comes from the line of Gregg Orrill with UBS.

Gregg Orrill

Two questions there. First, what are your expectations around converting the Texas and North Carolina settlements to final approvals? When does that occur, and what's involved there?

And secondly, I guess there was a significant PFAS settlement yesterday around personal injury in 3M. And just wondering if there are any implications for the company?

Christopher Franklin

Yes. Let's take the first one. So North Carolina and Texas, we believe those are on track. As you know, we have settlements in each of our states. And although it's not a defined schedule, we would expect that we would see adjudication in both states before the end of the year. So I think we feel comfortable with that.

On the PFAS, listen, I'm happy to get back to you on that. I'm not sure we're -- we have any thoughts on any new news from yesterday yet, but happy to reconnect with you on that, Gregg.

Operator

Your next question comes from the line of Davis Sunderland with Baird.

Davis Sunderland

Congrats. I'm sure it's been a very long process getting to where you are in the merger, and 2027 is right around the corner. So congrats on everything you guys have accomplished so far.

Most of my questions have been taken. I guess maybe I'll just round out Gregg's question. Obviously, you touched, Chris, on North Carolina, on Texas. If you could also just address Pennsylvania and New Jersey and the time lines and what to expect before year-end? Or even if things, I guess, carry into Q1, what your guys' latest expectations are and how that may have accelerated or pushed out from what you guys thought a quarter ago?

Christopher Franklin

Sure, sure. Yes. So in Pennsylvania, we're waiting for the administrative law judge to come across with the recommended decision. We'd expect that could be before Thanksgiving, could be a little after, but that's a reasonable time frame. And then it would go to the Public Utility Commission for their action. And as we've said, I think, all along, we'd expect that sometime probably right after the first of the year.

New Jersey, always good discussions there. And I would hope we'd have some news there to share soon. But discussions toward a settlement are, I think, constructive and in a good place. So hopefully, we'll be able to share some news on that one soon. And as I said in my earlier comments, really feel good about a first quarter close here.

Daniel Schuller

And then maybe the one we didn't cover, Davis, was Illinois. And in Illinois, we have a statutory time frame there. So in that statutory time frame, we would expect to hear something quite soon in Illinois in terms of a commission order.

Operator

There are no further questions at this time. I will now turn the call back to Chris Franklin, CEO, for closing remarks.

Christopher Franklin

Thanks again, everyone, for joining us. As always, we stand ready to answer your questions. Feel free to follow up with Dan, myself or Ed, and you have a wonderful day. Thank you.

Operator

This concludes today's call. Thank you for attending. You may now disconnect.