What is the revenue and EPS growth rate for Essential year over year?

Did Essential beat or miss consensus estimates last quarter?

What does Essential do and what are its main business segments?

What is Essential's latest dividend and current dividend yield?

What were the key takeaways from Essential’s earnings call?

What is the market's earnings forecast for Essential next quarter?

What guidance did Essential's management provide for the next earnings period?

What factors drove the changes in Essential's revenue and profit?

- **Merger Milestone**: $34B rate base utility with 7-9% EPS growth potential post-approval.
- **Q3 Strong Performance**: 32% EPS growth driven by rate increases, with full-year guidance raised.
- **Data Center Expansion**: $26M investment in PA data center with 2029 operational target, part of 5 GW pipeline.
- **Financial Discipline**: 5-7% EPS CAGR through 2027, 60-65% payout ratio maintained.

**【CEO Summary Section】**
- **Merger with American Water**: Creates a $34 billion rate base utility serving 5 million connections across 17 states. Expected to generate 7-9% EPS growth and provide a hedge against electric utility volatility tied to AI demand. Regulatory and shareholder approvals pending.
- **Q3 2025 Results**: GAAP EPS of $0.33 (32% YoY growth). Water and gas businesses performed in line with expectations. Full-year EPS expected above $2.07-$2.11 guidance due to nonrecurring benefits.
- **Data Center Investment**: $26 million convertible note investment in a 1,400-acre Pennsylvania data center. Option to build 18M gallon/day water treatment plant and gas power plant. Expected operational in 2029, outside current EPS guidance. In discussions for 5 GW of additional data center projects across Pennsylvania, Ohio, Indiana, and Virginia.
- **Long-Term Growth**: 8% CAGR rate base growth (6% water, 11% gas). 5-7% EPS CAGR through 2027. 2025 equity raises increased to $350 million to support data center and merger-related costs.

**【CFO Financial Commentary】**
- **Revenue Performance**: Q3 revenue $477 million (9.6% YoY growth). $34.2 million from rate increases ($27.9M water, $6.3M gas). Offset by $3.4M higher purchased gas costs.
- **Expense Breakdown**: O&M expenses up 6% ($8.7M YoY) due to employee costs (+$7.2M), bad debt (+$4.2M), and water production costs (+$2.4M). Partially offset by lower outside services (-$6.2M).
- **EPS Drivers**: $0.09 boost from rate increases, $0.02 drag from higher expenses. Tax expense decline partially offset depreciation/amortization growth.
- **Regulatory Activity**: Pending rate cases in NC, OH, TX, VA ($96.5M annualized revenue requests). Gas surcharge in KY ($2.9M request).

Essential Utilities, Inc.(WTRG)-20251105-2025 Q3 Earnings call transcript

- **Q2 EPS Surpass Expectations**: 35% YoY growth to $0.38, driven by strong Water and Gas divisions.
- **Infrastructure Investment**: $1.4B capital spend YTD, with $613M deployed; GAAP EPS to exceed $2.11.
- **Strategic Growth**: Hydrogen pilot project in Pennsylvania and hyperscaler discussions for data centers.
- **Community Engagement**: 23% employee survey participation increase, 6% satisfaction score improvement.
- **Financial Strength**: 2025 PFAS proceeds of $45M-$46M; Q3/Q4 EPS targeting 10%-20% and 20%-30% of annual guidance.
- **Regulatory Outlook**: Pennsylvania's RRR for acquisitions; constructive engagement with new consumer advocate.
- **Dividend Growth**: 5.25% increase, maintaining 30+ year streak.

**【CEO Summary Section】**
- Q2 2025 GAAP EPS of $0.38, up 35% YoY, driven by strong performance in both Water and Natural Gas divisions.
- Gas division net income of $17.5M; Water division updates to follow from Colleen Arnold.
- 2025 capital investment target of $1.4B, with $613M deployed YTD; expects GAAP EPS above guidance range ($2.07-$2.11) due to nonrecurring benefits.
- Highlighted hydrogen pilot project in Pennsylvania and discussions with hyperscalers for data center locations.
- 5.25% dividend increase approved, maintaining 30+ year dividend growth streak.
- Employee engagement survey shows 23% participation increase, 6% satisfaction score improvement.
- Community recognition for environmental stewardship, including Greater Philadelphia's Most Community-Minded Business award.

**【CFO Financial Commentary】**
- Q2 revenue up 18.5% YoY to $514.9M, driven by rate case wins in Pennsylvania, higher gas volumes, and purchased gas cost pass-through.
- O&M expenses increased 4.2% YoY, primarily due to employee-related costs and bad debt expenses.
- 2025 GAAP EPS expected above $2.11, with Q3/Q4 EPS targeting 10%-20% and 20%-30% of annual guidance, respectively.
- Regulatory activity includes $7.7M rate increase in Kentucky and pending cases in North Carolina, Ohio, Texas, and Virginia ($96.6M requested revenue increases).
- PFAS-related cash proceeds of $7.1M received YTD, with total 2025 proceeds expected at $45M-$46M.

**【Q&A Highlights】**
- **Earnings Timing**: GAAP EPS above guidance due to winter gas usage, tax benefits, and regulatory reserve reversals; wet weather and inflation pose risks.
- **Cash Flow**: FFO targeting 12.2% FCF margin to address Moody's negative outlook; PFAS proceeds to support cash flow.
- **Regulatory Environment**: Pennsylvania's new consumer advocate seen as constructive; small business advocate open to dialogue.
- **Acquisition Strategy**: Pennsylvania's RRR (Reasonable Review Ratio) for fair market value transactions remains target, but exceptions possible for high-growth opportunities.
- **Hyperscaler Opportunities**: Pennsylvania's low energy costs attract hyperscalers; potential for unregulated infrastructure projects.
- **Tax Rate**: 2025 tax rate expected low single-digit benefit; 2026 may shift to low single-digit expense.
- **PFAS Compliance**: Municipalities delaying compliance; Aqua's PFAS Guard solution generating interest for acquisitions.


Essential Utilities, Inc. (WTRG) Q2 2025 Earnings Call Transcript

- **EPS Growth**: Q1 2025 EPS of $3.00 (+6% YoY), reaffirming $2.07–$2.11 annual guidance.
- **Gas Innovation**: 700,000 Intelis meters to be deployed, targeting safer gas distribution.
- **Data Center Opportunity**: Engaged with 5 GW of potential projects, leveraging shale gas resources.
- **Regulatory Progress**: Texas Future Test Year bill passed; Ohio rate case deadlines legislation enacted.
- **PFAS Compliance**: $450 million budget on track, with $69 million in grants secured.
- **Equity Management**: 2/3 of 2025 $315 million equity target met via ATM program.


**【CEO Opening Remarks】**
- Q1 2025 EPS of $3.00, up 6% YoY, driven by strong performance in both water and gas segments.
- Reaffirmed 2025 EPS guidance of $2.07–$2.11 (non-GAAP) and infrastructure investment target of $1.4–$1.5 billion.
- Highlighted operational achievements: 99.8% water quality compliance, PFOS compliance on track for 2028, and $100 million in expected proceeds from pollution settlements.
- Noted regulatory progress in Texas (Future Test Year bill passed by House) and Ohio (rate case deadlines legislation).

**【Mike Huwar (Gas Segment President)】**
- Gas segment rate base reached $4 billion as of end-2024, with focus on safety and reliability.
- Rolled out Intelis solid-state meters to 30,000+ customers in Q1 2025, targeting full deployment across 700,000 accounts.
- Weather Normalization Adjustment (WNA) mechanism stabilized bills amid 17%–30% weather volatility in Q1.
- Engaged with 5 GW of potential data center projects in Pittsburgh, leveraging shale gas resources.

**【Dan Schuller (CFO)】**
- Q1 2025 GAAP EPS of $3.00, up 6.2% YoY, with 28% revenue growth driven by regulatory recoveries and higher gas volumes.
- O&M expenses flat YoY, benefiting from $8.5 million customer assistance surcharge offset and lower bad debt.
- 2025 equity issuance progress: ~$210 million raised via ATM (2/3 of $315 million target), with remaining issuance timed to market conditions.
- Q1 EPS at high end of 40%–50% annual guidance range, with Q4 expected to account for 20%–30% of full-year EPS.

**【Q&A Highlights】**
- **Equity Issuance**: CFO noted 2/3 of 2025 equity needs completed, with no plans to accelerate remaining $100 million issuance.
- **Texas Rate Case**: CEO emphasized reputation for operational excellence and collaboration with regulators; filing expected by end-May.
- **PFAS Mitigation**: Full-speed-ahead approach, with $450 million budget intact and $69 million in government grants secured.
- **Data Centers**: Gas segment exploring behind-the-meter generation and pipeline investments, with PJM grid shortfall creating opportunities.
- **O&M Growth**: CFO expects ~2.5%–3% O&M growth excluding one-time items, with lean initiatives targeting long-term efficiency.


Essential Utilities (WTRG)-12 May 25-2025 Q1 Earnings call transcript

- **Record Growth**: 2024 non-GAAP EPS of $1.97, within 5%-7% long-term target, driven by regulatory wins and cost control. 
- **Capital Expansion**: $7.8B five-year investment plan, including $450M for PFAS mitigation and data center opportunities. 
- **Regulatory Momentum**: Pennsylvania rate cases add $73M annualized revenue; weather normalization reduces earnings volatility. 
- **Strategic Acquisitions**: Six signed deals to add 210,000 customer equivalents, with pipeline for 400,000+ more. 
- **Risks & Rewards**: PFAS costs offset by grants and lawsuits; data center partnerships could unlock 5GW growth. 


**【CEO Summary Section】**
- **2024 Financial Highlights**: GAAP EPS of $2.17, non-GAAP EPS of $1.97, aligning with 5%-7% long-term growth guidance. 
- **Regulatory Wins**: Pennsylvania water and gas rate cases added $73 million in annualized revenue. 
- **Capital Investment**: $1.4B-$1.5B in 2025, $7.8B over five years, excluding unsigned acquisitions. 
- **PFAS Mitigation**: $450M capital plan with patent-pending technology; potential lawsuit recoveries to offset costs. 
- **Data Center Growth**: Discussions with developers for up to 5GW power needs in Pittsburgh, with potential capital investments and rate base growth. 

**【CFO Financial Commentary】**
- **2024 Financials**: Operating revenues grew due to rate increases and water volume, offset by lower gas prices and warmer weather. 
- **Cost Control**: O&M expenses rose 2% to $1.3B, driven by surcharges and employee costs, but offset by asset sales. 
- **EPS Breakdown**: GAAP EPS of $2.17 includes $0.25 gain on asset sales; non-GAAP EPS of $1.97 reflects weather-normalized results. 
- **2025 Guidance**: EPS of $2.07-$2.11, with 5%-7% CAGR through 2027. 

**【Q&A Key Themes】**
- **Regulatory Environment**: Pennsylvania's new Consumer Advocate may reduce litigation, aiding future rate cases. 
- **M&A Activity**: Six signed deals for $344M in rate base, with pipeline for 400,000+ customers. 
- **PFAS Risks**: $450M plan net of grants and loans; legal challenges ongoing. 
- **Equity Raises**: $315M ATM issuance in 2025 to fund growth, excluding DELCORA. 
- **Data Center Strategy**: Exploring throughput growth, infrastructure investments, and potential CHP projects. 


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