The York Water 2025 Q1 Earnings Net Income Falls 15.9%

The York Water Company (YORW) reported its fiscal 2025 Q1 earnings on May 06th, 2025. The company’s earnings fell short of expectations as net income decreased significantly by 15.9% compared to the previous year. The fiscal outlook remains cautious, with anticipated pressures on net income and earnings per share for the upcoming quarter. Despite these challenges, York Water plans to continue investing heavily in infrastructure, with an estimated $36.7 million earmarked for 2025.

Revenue
The York Water Company saw a 4.7% rise in total revenue for Q1 2025, reaching $18.46 million, up from $17.63 million in Q1 2024. Residential revenue contributed $11.83 million, while the commercial and industrial sectors brought in $5.28 million. Fire protection services added $1.19 million, and billing and revenue collection services accounted for $26,000. Collection services generated $3,000, with other revenue at $10,000. Rents from regulated property provided $114,000, culminating in the total operating revenue of $18.46 million.

Earnings/Net Income
The York Water's earnings per share (EPS) dropped by 16.7%, landing at $0.25 for Q1 2025, down from $0.30 in Q1 2024. Correspondingly, net income declined to $3.64 million, marking a 15.9% decrease from $4.33 million the previous year. This performance reflects a challenging quarter, with a notable decrease in EPS.

Price Action
The stock price of The York Water has edged up 2.07% during the latest trading day, has edged down 0.93% during the most recent full trading week, and has edged down 0.62% month-to-date.

Post-Earnings Price Action Review
The strategy of purchasing York Water shares following a quarter of declining revenue and holding them for 30 days has demonstrated a total shareholder return (TSR) of 0.6% over the past five years. This approach has provided modest gains, though the performance is relatively subdued, indicating that the potential returns are somewhat counterbalanced by the risks associated with holding a stock after a revenue downturn. While the strategy has been effective in generating returns, the gains are modest and there is an inherent risk involved in maintaining such investments in the face of declining revenue figures.

CEO Commentary
JT Hand, President of The York Water Company, remarked that the company achieved operating revenues of $18.456 million for the first quarter, an increase attributed to growth in the customer base and revenues from the Distribution System Improvement Charge (DSIC). However, he acknowledged challenges, including a decrease in net income to $3.638 million due to higher operational costs and reduced allowances for funds used during construction (AFUDC). Hand emphasized the company's commitment to strategic investments, noting a $9.3 million expenditure on capital projects to enhance infrastructure and software systems, ensuring reliable service for its growing customer base.

Guidance
The York Water Company anticipates investing an additional $36.7 million in 2025 for infrastructure projects, including main extensions and wastewater treatment plant construction. The company expects to maintain revenue growth but acknowledges the pressure on net income and earnings per share, which for Q2 2025 is forecasted at $0.36, compared to $0.35 in the same quarter last year. The leadership remains focused on managing operational challenges while enhancing service quality.

Additional News
In recent developments, The York Water Company has named Paul R. Bonney as the new Board Chair, effective May 5, 2025, reflecting a strategic leadership shift. Additionally, Suzanne M. Becker was welcomed as Vice President of Customer Service on March 6, 2025. The company also celebrated National Drinking Water Week on May 5, 2025, underscoring its commitment to community engagement and environmental stewardship. These non-earnings related activities highlight the company’s focus on leadership restructuring and community involvement.