York Water Co 10-Q for FY2024 Q3

York Water Co (YORW)

10-Q 2024-11-07 For: 2024-09-30

Added on April 12, 2026

About this 10-Q

York Water Co filed this 10-Q on November 7, 2024, covering the quarter ended September 30, 2024 (FY2024 Q3).

Headline figures

Quarter ended September 30, 2024, as reported in this filing, compared with the same period a year earlier where the filing states it.

Revenue: $19.72M; up 5.1% from $18.77M a year earlier
Net income: $5.86M; down 22.5% from net income of $7.57M a year earlier
Diluted EPS: $0.41; down 22.6% from $0.53 a year earlier

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Pennsylvania	23-1242500
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

130 East Market Street, York, Pennsylvania	17401
(Address of principal executive offices)	(Zip Code)

Common Stock, No par value	YORW	The Nasdaq Global Select Market
(Title of Class)	(Trading Symbol)	(Name of Each Exchange on Which Registered)

Large accelerated filer ☐	Accelerated filer ☐		Non-accelerated filer ⌧

Smaller reporting company ☒		Emerging growth company ☐

☐ Yes		⌧ No
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
Common stock, No par value	14,374,163 Shares outstanding as of November 7, 2024

PART I	Financial Information

Item 1.	Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	26
Item 4.	Controls and Procedures	26

PART II	Other Information

Item 5.	Other Information	26
Item 6.	Exhibits	27

Signatures		28

	Sep. 30, 2024			Dec. 31, 2023
ASSETS
UTILITY PLANT, at original cost	$	653,263		$	620,201
Plant acquisition adjustments		(9,437	)		(9,384	)
Accumulated depreciation		(122,158	)		(117,113	)
Net utility plant		521,668			493,704

OTHER PHYSICAL PROPERTY, net of accumulated depreciation of $526 in 2024 and $501 in 2023		1,544			1,569

CURRENT ASSETS:
Cash and cash equivalents		1			1
Accounts receivable, net of reserves of $1,455 in 2024 and $1,005 in 2023		7,712			7,837
Unbilled revenues		3,490			3,484
Recoverable income taxes		–			332
Materials and supplies inventories, at cost		3,775			3,109
Prepaid expenses		1,776			821
Total current assets		16,754			15,584

OTHER LONG-TERM ASSETS:
Prepaid pension cost		24,006			23,380
Note receivable		255			255
Deferred regulatory assets		52,110			48,949
Other assets		5,083			4,764
Total other long-term assets		81,454			77,348

Total Assets	$	621,420		$	588,205

	Sep. 30, 2024		Dec. 31, 2023
STOCKHOLDERS’ EQUITY AND LIABILITIES
COMMON STOCKHOLDERS’ EQUITY:
Common stock, no par value, authorized 46,500,000 shares, issued and outstanding 14,371,929 shares in 2024 and 14,332,245 shares in 2023	$	137,576	$	136,174
Retained earnings		91,112		85,004
Total common stockholders’ equity		228,688		221,178

PREFERRED STOCK, authorized 500,000 shares, no shares issued		–		–

LONG-TERM DEBT		198,439		180,007

COMMITMENTS		–		–

CURRENT LIABILITIES:
Accounts payable		11,503		10,873
Dividends payable		2,780		2,754
Accrued compensation and benefits		1,744		1,629
Accrued income taxes		336		–
Accrued interest		1,326		1,741
Deferred regulatory liabilities		809		644
Other accrued expenses		511		502
Total current liabilities		19,009		18,143

DEFERRED CREDITS:
Customers’ advances for construction		20,939		18,853
Deferred income taxes		58,964		55,235
Deferred employee benefits		3,719		3,847
Deferred regulatory liabilities		43,124		42,989
Other deferred credits		650		632
Total deferred credits		127,396		121,556

Contributions in aid of construction		47,888		47,321

Total Stockholders’ Equity and Liabilities	$	621,420	$	588,205

	Three Months Ended September 30						Nine Months Ended September 30
	2024			2023			2024			2023

OPERATING REVENUES:	$	19,715		$	18,767		$	56,093		$	52,935

OPERATING EXPENSES:
Operation and maintenance		4,961			4,471			14,635			12,688
Administrative and general		3,013			2,605			9,244			8,028
Depreciation and amortization		3,297			2,944			9,647			8,777
Taxes other than income taxes		389			314			1,235			1,075
		11,660			10,334			34,761			30,568

Operating income		8,055			8,433			21,332			22,367

OTHER INCOME (EXPENSES):
Interest on debt		(2,243	)		(1,850	)		(6,549	)		(5,041	)
Allowance for funds used during construction		301			1,131			1,782			2,724
Other pension costs		159			(239	)		365			(842	)
Other income (expenses), net		(51	)		(68	)		(266	)		(368	)
		(1,834	)		(1,026	)		(4,668	)		(3,527	)

Income before income taxes		6,221			7,407			16,664			18,840

Income tax expense (benefit)		358			(161	)		1,481			1,095

Net Income	$	5,863		$	7,568		$	15,183		$	17,745

Basic Earnings Per Share	$	0.41		$	0.53		$	1.06		$	1.24

Diluted Earnings Per Share	$	0.41		$	0.53		$	1.06		$	1.24

	Common Stock Shares		Common Stock Amount		Retained Earnings			Total

Balance, June 30, 2024		14,361,225	$	137,138	$	88,277		$	225,415
Net income		–		–		5,863			5,863
Cash dividends declared, $0.2108 per share		–		–		(3,028	)		(3,028	)
Issuance of common stock under dividend reinvestment, direct stock and employee stock purchase plans		10,704		390		–			390
Stock-based compensation		–		48		–			48
Balance, September 30, 2024		14,371,929	$	137,576	$	91,112		$	228,688

Balance, December 31, 2023		14,332,245	$	136,174	$	85,004		$	221,178
Net income		–		–		15,183			15,183
Cash dividends declared, $0.6324 per share		–		–		(9,075	)		(9,075	)
Issuance of common stock under dividend reinvestment, direct stock and employee stock purchase plans		34,327		1,214		–			1,214
Stock-based compensation		5,357		188		–			188
Balance, September 30, 2024		14,371,929	$	137,576	$	91,112		$	228,688

	As of			As of
	Sep. 30, 2024			Dec. 31, 2023			Change

Accounts receivable – customers	$	8,677		$	8,250		$	427
Other receivables		490			592			(102	)
		9,167			8,842			325
Less: allowance for doubtful accounts		(1,455	)		(1,005	)		(450	)
Accounts receivable, net	$	7,712		$	7,837		$	(125	)

Unbilled revenue	$	3,490		$	3,484		$	6

	As of Sep. 30, 2024			As of Dec. 31, 2023

Variable Rate Pennsylvania Economic Development Financing Authority Exempt Facilities Revenue Refunding Bonds, Series 2008A, due 2029	$	12,000		$	12,000
3.00% Pennsylvania Economic Development Financing Authority Exempt Facilities Revenue Refunding Bonds, Series A of 2019, due 2036		10,500			10,500
3.10% Pennsylvania Economic Development Financing Authority Exempt Facilities Revenue Refunding Bonds, Series B of 2019, due 2038		14,870			14,870
3.23% Senior Notes, due 2040		15,000			15,000
4.00% - 4.50% York County Industrial Development Authority Exempt Facilities Revenue Bonds, Series 2015, due 2029 – 2045		10,000			10,000
4.54% Senior Notes, due 2049		20,000			20,000
3.24% Senior Notes, due 2050		30,000			30,000
5.50% Senior Notes, due 2053		40,000			40,000
5.67% Senior Notes, due 2054		40,000			–
Committed Line of Credit, due September 2026		8,732			30,273
Total long-term debt		201,102			182,643
Less discount on issuance of long-term debt		(138	)		(147	)
Less unamortized debt issuance costs		(2,525	)		(2,489	)
Long-term portion	$	198,439		$	180,007

Description		September 30, 2024		Fair Value Measurements at Reporting Date Using Significant Other Observable Inputs (Level 2)
Interest Rate Swap		$650		$650

Description		December 31, 2023		Fair Value Measurements at Reporting Date Using Significant Other Observable Inputs (Level 2)
Interest Rate Swap		$632		$632

	Number of Shares		Grant Date Weighted Average Fair Value

Nonvested at beginning of the period	8,944		$42.32
Granted	6,149		$36.76
Vested	(6,184	)	$41.67
Forfeited	(792	)	$42.20
Nonvested at end of the period	8,117		$38.62

•	the amount and timing of rate changes and other regulatory matters including the recovery of costs recorded as regulatory assets;
•	expected profitability and results of operations;
•	trends;
•	goals, priorities and plans for, and cost of, growth and expansion;
•	strategic initiatives;
•	availability of water supply;
•	water usage by customers; and
•	the ability to pay dividends on common stock and the rate of those dividends.

	Three Months Ended September 30				Nine Months Ended September 30
	2024		2023		2024		2023

Weighted average common shares, basic		14,354,021		14,300,995		14,339,876		14,288,580
Effect of dilutive securities:
Employee stock-based compensation		821		834		211		305
Weighted average common shares, diluted		14,354,842		14,301,829		14,340,087		14,288,885

	Three Months Ended September 30				Nine Months Ended September 30
	2024		2023		2024		2023
Water utility service:
Residential	$	10,887	$	10,505	$	31,153	$	30,033
Commercial and industrial		5,527		5,244		15,292		14,341
Fire protection		1,156		1,040		3,360		3,022
Wastewater utility service:
Residential		1,578		1,458		4,554		3,998
Commercial and industrial		301		255		969		743
Billing and revenue collection services		121		115		373		357
Collection services		25		12		28		28
Other revenue		6		14		22		38
Total Revenue from Contracts with Customers		19,601		18,643		55,751		52,560
Rents from regulated property		114		124		342		375
Total Operating Revenue	$	19,715	$	18,767	$	56,093	$	52,935

	Three Months Ended September 30						Nine Months Ended September 30
	2024			2023			2024			2023

Service cost	$	159		$	150		$	476		$	449
Interest cost		464			469			1,392			1,407
Expected return on plan assets		(791	)		(903	)		(2,374	)		(2,709	)
Amortization of prior service cost		(4	)		(4	)		(10	)		(10	)
Rate-regulated adjustment		172			677			627			2,154
Net periodic pension cost	$	–		$	389		$	111		$	1,291

•	changes in weather or climate, including drought conditions or extended periods of heavy precipitation;
•	natural disasters, including pandemics such as the outbreak of the novel strain of coronavirus known as “COVID-19” and its variants and the effectiveness of the Company’s pandemic plans;
•	levels of rate relief granted;
•	the level of commercial and industrial business activity within the Company’s service territory;
•	construction of new housing within the Company’s service territory and increases in population;
•	changes in government policies or regulations, including the tax code;
•	the ability to obtain permits for expansion projects;
•	material changes in demand from customers, including the impact of conservation efforts which may impact the demand of customers for water;
•	changes in economic and business conditions, including interest rates;
•	loss of customers;
•	changes in, or unanticipated, capital requirements;
•	the impact of acquisitions;
•	changes in accounting pronouncements;
•	changes in the Company’s credit rating or the market price of its common stock; and
•	the ability to obtain financing.

Exhibit No.		Description

3		Amended and Restated Articles of Incorporation. Incorporated herein by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 4, 2010.

3.1		Amended and Restated By-Laws. Incorporated herein by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on January 26, 2012.

31.1		Certification of Chief Executive Officer, pursuant to Rule 13a-14(a)/15d-14(a) under the Securities Exchange Act of 1934.

31.2		Certification of Chief Financial Officer, pursuant to Rule 13a-14(a)/15d-14(a) under the Securities Exchange Act of 1934.

32.1		Certification of Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification of Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS		Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).

101.SCH		Inline XBRL Taxonomy Extension Schema.

101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase.

101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase.

101.LAB		Inline XBRL Taxonomy Extension Label Linkbase.

101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase.

104		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).

	THE YORK WATER COMPANY


	/s/ Joseph T. Hand
Date: November 7, 2024	Joseph T. Hand Principal Executive Officer



	/s/ Matthew E. Poff
Date: November 7, 2024	Matthew E. Poff Principal Financial and Accounting Officer

I, Joseph T. Hand, certify that:
1.	I have reviewed this quarterly report on Form 10-Q of The York Water Company;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
	a)	designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b)	designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	c)	evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	d)	disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):
	a)	all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	b)	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 7, 2024	/s/ Joseph T. Hand
	Joseph T. Hand
	President and CEO

I, Matthew E. Poff, certify that:
1.	I have reviewed this quarterly report on Form 10-Q of The York Water Company;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
4.	The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:
	a)	designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
	b)	designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
	c)	evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
	d)	disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and
5.	The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent function):
	a)	all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and
	b)	any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 7, 2024	/s/ Matthew E. Poff
	Matthew E. Poff
	Chief Financial Officer

(1)	The Report fully complies with the requirements of Section 13(a) of the Securities Exchange Act of 1934 (15 U.S.C. 78m(a)); and

(2)	The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.