美國水務 (AWK) 2024 Q1 法說會逐字稿

Good morning, and welcome to American Water's First Quarter 2024 Earnings Conference Call. As a reminder, this call is being recorded and is also being live webcast with an accompanying slide presentation through the company's Investor Relations website. The audio webcast archive will be available for 1 year on American Water's Investor Relations website.

各位早安，歡迎參加美國水務（American Water）2024 年第一季財報電話會議。提醒各位，本次會議將進行錄音，並透過公司投資人關係網站以即時網路直播方式進行，同時提供投影片簡報。音訊網路直播存檔將於美國水務投資人關係網站保留 1 年。

I would now like to introduce your host for today's call, Aaron Musgrave, Vice President of Investor Relations. Mr. Musgrave, you may begin.

現在我想介紹今天會議的主持人：投資人關係副總裁 Aaron Musgrave。Musgrave 先生，您可以開始了。

Thank you, Betsy. Good morning, everyone, and thank you for joining us for today's call. At the end of our prepared remarks, we will open the call for your questions. Let me first go over some safe harbor language. Today, we will be making forward-looking statements that represent our expectations regarding our future performance or other future events. These statements are predictions based on our current expectations, estimates and assumptions. However, since these statements deal with future events, they are subject to numerous known and unknown risks, uncertainties and other factors that may cause actual results to be materially different from the results indicated or implied by such statements.

謝謝你，Betsy。各位早安，感謝各位參加今天的電話會議。在我們的預備發言結束後，我們將開放提問。首先我先說明一些「安全港」聲明。今天我們將發表前瞻性陳述，代表我們對未來績效或其他未來事件的預期。這些陳述是基於我們目前的預期、估計與假設所做出的預測。然而，由於這些陳述涉及未來事件，因此受到眾多已知與未知的風險、不確定性及其他因素影響，可能導致實際結果與這些陳述所指示或暗示的結果存在重大差異。

Additional information regarding these risks, uncertainties and factors as well as a more detailed analysis of our financials and other important information is provided in the first quarter earnings release and in our March 31 Form 10-Q, each filed yesterday with the SEC. And finally, all statements during this presentation related to earnings and earnings per share referred to diluted earnings and diluted earnings per share. After our prepared remarks, we'll then close by answering your questions.

關於上述風險、不確定性與因素的更多資訊，以及對我們財務狀況更詳細的分析與其他重要資訊，已載於第一季財報新聞稿及我們截至 3 月 31 日的 Form 10-Q（兩者皆於昨日向 SEC 申報）。最後，本次簡報中所有與盈餘及每股盈餘相關的陳述，均指稀釋後盈餘與稀釋後每股盈餘。在我們的預備發言之後，我們將以回答各位問題作結。

With that, I'll turn the call over to American Water's President and CEO, Susan Hardwick.

接下來，我把電話交給美國水務總裁暨執行長 Susan Hardwick。

Thanks, Aaron. Good morning, everyone. As we announced yesterday, we started 2024 with solid financial results. As shown on Slide 5, earnings were $0.95 per share for the quarter compared to $0.91 last year. The increased results were as we expected and put us on track to achieve our full year earnings guidance, which we are pleased to affirm. First quarter 2024 results included $0.02 per share of additional interest income from the February 2024 amendment of the seller note related to the sale of HOS, which reflected the higher interest rate and the successful earn-out of the $75 million contingent consideration as we detailed in our February call. Here, you can also see a recap of some of our other key accomplishments so far in 2024, and John and Cheryl will add to these in their remarks.

謝謝你，Aaron。各位早安。如同我們昨日宣布的，我們以穩健的財務表現展開 2024 年。如投影片第 5 頁所示，本季每股盈餘為 0.95 美元，去年同期為 0.91 美元。這項成長符合我們的預期，並使我們朝達成全年盈餘指引的目標邁進，我們也很高興再次確認該指引。2024 年第一季結果包含每股 0.02 美元的額外利息收入，來自 2024 年 2 月對與出售 HOS 相關之賣方票據（seller note）的修訂；該修訂反映較高的利率，以及如我們在 2 月電話會議中所詳述，成功達成 7,500 萬美元或有對價（contingent consideration）的績效條件（earn-out）。在此也可看到我們截至目前於 2024 年達成的其他關鍵成果摘要，John 與 Cheryl 也將在其發言中補充。

As we announced in late February, we completed a successful long-term debt issuance of $1.4 billion. This delivered on the highest priority in our 2024 financing plan. We also invested well over $600 million of capital in infrastructure this quarter. In addition, we completed a large acquisition and filed general rate cases in several states in accordance with the traditional process of earning a return on the capital investments we have made. We did all of this while keeping customer bills affordable and staying true to our high value for quality service and sustainable operations, which we highlighted in our disclosures we published in early April as noted on this slide.

如同我們在 2 月下旬宣布的，我們成功完成 14 億美元的長期債務發行，達成我們 2024 年融資計畫中最優先的目標。本季我們也在基礎設施方面投入超過 6 億美元的資本。此外，我們完成了一項大型併購，並依循傳統的程序，在多個州提出一般費率案件（general rate cases），以就我們已投入的資本投資取得合理報酬。我們在完成上述事項的同時，仍維持客戶帳單的可負擔性，並堅守我們對優質服務與永續營運的高度重視；這些重點已如本頁所示，反映在我們於 4 月上旬發布的揭露內容中。

The other significant news so far in 2024 for us and the water industry as a whole came on April 10 when the EPA announced the final national primary drinking water regulations for 6 PFAS chemicals. Cheryl will elaborate further on the PFAS water quality standards, but I want to reiterate that we fully support the EPA's efforts to protect drinking water quality. I want to again assure our customers, regulators, investors and other stakeholders that American Water has the expertise to tackle this issue head on. And in fact, we have demonstrated that in many locations for some time now.

截至目前 2024 年對我們以及整體水務產業而言，另一項重大消息發生在 4 月 10 日：EPA 宣布針對 6 種 PFAS 化學物質的最終《國家初級飲用水法規》。Cheryl 將進一步說明 PFAS 的水質標準，但我想重申，我們完全支持 EPA 為保護飲用水水質所做的努力。我也要再次向我們的客戶、監管機關、投資人及其他利害關係人保證，美國水務具備正面迎戰此議題的專業能力；事實上，我們在許多地點早已展現這項能力。

Turning to Slide 6. This quarter, we again -- we are, again, affirming our long-term targets for both earnings and dividend growth at 7% to 9%. This affirmation is based upon clear top-tier capital growth plan and our strong regulatory and operational execution that I believe is a positive differentiator from our peers. As we've done in the past, we expect to consistently deliver on our annual and long-term plans, growing earnings and dividends at an industry-leading pace over the next 5 years and beyond.

接著看投影片第 6 頁。本季我們再次確認長期目標：盈餘成長與股利成長皆為 7% 至 9%。此一確認係基於我們清晰、同業領先的資本成長計畫，以及我們在監管與營運執行上的強勁表現；我相信這是相較同業的正向差異化因素。如同過去，我們預期將持續達成年度與長期計畫，在未來 5 年及更長期間，以產業領先的速度成長盈餘與股利。

Moving on to Slide 7. As we announced yesterday, our Board of Directors approved an increase in the company's quarterly cash dividend from $0.7075 per share to $0.765 per share, an 8.1% increase. We have grown our dividend consistently over the last 5 years, significantly outpacing virtually all of our utility peers, while maintaining a consistent payout ratio of less than 60%. Looking ahead, we continue to expect to grow our dividend at 7% to 9% per year on average, which is in line with our compelling 7% to 9% EPS growth target. Our Board and management team understand and appreciate how important the dividend component of our total shareholder return is to our investors.

接著看投影片第 7 頁。如同我們昨日宣布的，董事會核准將公司季度現金股利由每股 0.7075 美元提高至每股 0.765 美元，增幅 8.1%。過去 5 年我們持續穩定提高股利，成長幅度明顯超越幾乎所有公用事業同業，同時維持低於 60% 的穩定配息率。展望未來，我們仍預期股利平均每年成長 7% 至 9%，與我們具吸引力的每股盈餘（EPS）7% 至 9% 成長目標一致。我們的董事會與管理團隊理解並重視，股利在投資人總股東報酬中所扮演的重要角色。

And with that, let me turn it over to Cheryl to talk more about PFAS, recent regulatory updates, affordability and rate base growth. Cheryl?

接下來，我把時間交給 Cheryl，請她進一步談 PFAS、近期監管更新、可負擔性以及費率基礎（rate base）成長。Cheryl？

Thanks, Susan, and good morning, everyone. Let me start by turning to Slide 9 and reviewing the U.S. EPA's drinking water rule on PFAS published in April. As Susan stated, we fully support the EPA's efforts to protect drinking water quality. These contaminants are among the multiple challenges that the water industry faces regarding water quality, quantity and reliability. We remain steadfast in our commitment to be a leader in the U.S. water and wastewater industry and a provider of solutions to these challenges. EPA's final rule was unchanged in terms of the drinking water limit of 4 parts per trillion for PFOA and PFOS. However, the federal timeline to comply was extended from 3 years to 5 years in the final rule. The federal compliance window now includes the 2-year extension that states would have been allowed to grant the water systems for capital improvements.

謝謝你，Susan，各位早安。我先看投影片第 9 頁，回顧美國 EPA 於 4 月發布的 PFAS 飲用水規則。如 Susan 所述，我們完全支持 EPA 保護飲用水水質的努力。就水質、水量與可靠性而言，這些污染物是水務產業面臨的多重挑戰之一。我們將持續堅定承諾，成為美國供水與污水處理產業的領導者，並提供解決這些挑戰的方案。EPA 的最終規則在 PFOA 與 PFOS 的飲用水限值方面維持不變，仍為每兆分之 4（4 parts per trillion）。然而，最終規則將聯邦合規期限由 3 年延長至 5 年。新的聯邦合規期間也納入原本各州可允許水務系統為資本改善而核准的 2 年延長。

As always, we will work with our state regulators to incorporate any additional state specific guidance related to implementing the new federal rule, including maximum contaminant level guidelines. Based upon our preliminary analysis of this new PFAS rule and assuming states don't adopt more stringent limits, we currently do not anticipate any change to our estimate of $1 billion of capital and our estimate of up to $50 million annually of operating expenses to comply with the rule. We also do not currently expect the new limits set by the EPA for 3 additional PFAS compounds to impact these estimates.

一如既往，我們將與各州監管機關合作，納入任何與落實新聯邦規則相關的額外州別指引，包括最大污染物濃度（maximum contaminant level）指引。根據我們對此新 PFAS 規則的初步分析，並假設各州未採用更嚴格的限值，我們目前預期不會調整我們為遵循該規則所估計的 10 億美元資本支出，以及每年最高 5,000 萬美元的營運費用估計。我們目前也不預期 EPA 對另外 3 種 PFAS 化合物所設定的新限值會影響上述估計。

Through a separate rule-making in April, U.S. EPA also designated PFOA and PFOS as hazardous substances under CERCLA. As a reminder, we continue to actively advocate and support bipartisan federal legislation that would provide PFAS liability protections under CERCLA for water and wastewater systems as passive receivers of PFAS. Previously, we've disclosed that we remained a party to 2 settlements so far with 3M and DuPont coming out of the multi-district litigation, or MDL lawsuit. As we shared, we believe this is the best path to recouping the most dollars possible from PFAS manufacturers in an expedient manner for our customers. The MDL Court issued its final approval of the DuPont and 3M settlements in February and March of this year, respectively. The amount of proceeds to be received from each settlement is still pending.

此外，透過 4 月的另一項獨立規則制定，美國 EPA 亦將 PFOA 與 PFOS 指定為 CERCLA 下的危險物質。提醒各位，我們持續積極倡議並支持跨黨派的聯邦立法，為供水與污水處理系統提供 CERCLA 下的 PFAS 責任保護，將其定位為 PFAS 的被動接收者（passive receivers）。先前我們已揭露，截至目前我們仍為兩項和解案的當事方，該等和解案涉及 3M 與 DuPont，源自多區域訴訟（multi-district litigation，或 MDL）案件。如我們所分享，我們相信這是為客戶以更迅速方式向 PFAS 製造商追償最多金額的最佳途徑。MDL 法院已分別於今年 2 月與 3 月對 DuPont 與 3M 的和解案作出最終核准。各和解案可取得的款項金額仍待確定。

Turning to Slide 10. I'll cover the latest regulatory activity in our states. In West Virginia, the Commission issued an order authorizing an additional $18 million in annualized revenues effective February 25. We also received an order for $7 million of additional revenue related to our DSIC request, effective March 1. In Indiana, the Commission issued an order authorizing an additional $66 million in annualized revenues effective over a phased 3-step process through May 2025. They also approved a new rate design that provides 1,500 gallons of water usage at no additional cost above the fixed monthly customer charge for all water customers. The change will allow Indiana American to provide low-cost basic water service for customers on fixed incomes that use a lower volume of water than the typical residential customer. With this change, the cost for the typical residential water customer using 1,500 gallons will be approximately $20 per month. This is just one example of the many innovative ways we are addressing customer affordability.

接著看投影片第 10 頁。我將說明我們各州最新的監管動態。在西維吉尼亞州，委員會發布命令，自 2 月 25 日起核准新增年化收入 1,800 萬美元。我們也收到一項與 DSIC 申請相關的命令，自 3 月 1 日起新增收入 700 萬美元。在印第安納州，委員會發布命令，核准透過分三階段、至 2025 年 5 月止的方式，新增年化收入 6,600 萬美元。他們也核准新的費率設計：對所有用水客戶而言，在固定的每月客戶費用之上，1,500 加侖的用水量不另行收費。此一變更將使 Indiana American 能為固定收入、且用水量低於一般住宅客戶的客戶提供低成本的基本用水服務。依此變更，典型住宅用水客戶若使用 1,500 加侖，每月費用約為 20 美元。這只是我們以多種創新方式因應客戶可負擔性的其中一個例子。

Turning to active cases. You can see we have general rate cases in progress in 8 jurisdictions. All of these cases are centered around the capital investments we've made and will continue to make in these states. Our cases in California, Virginia, New Jersey and Illinois are progressing well as expected. In Illinois, the next milestones in the case will be staff and intervenor testimony in May, followed by our rebuttal in June. In New Jersey, the next milestones in the case will be staff and intervenor testimony in July, followed by our rebuttal in September and evidentiary hearings in October. In Kentucky, we expect an order any day now as the story deadline for the Commission to act is May 7. Interim rates in Kentucky were implemented on February 6.

接著談正在進行中的案件。您可以看到，我們在 8 個司法管轄區有一般費率案件正在推進。所有這些案件都聚焦於我們已在這些州進行、並將持續進行的資本投資。我們在加州、維吉尼亞州、新澤西州與伊利諾州的案件，正如預期般進展順利。在伊利諾州，該案件的下一個里程碑將是 5 月的工作人員與介入方證詞，接著是我們在 6 月的反駁。在新澤西州，該案件的下一個里程碑將是 7 月的工作人員與介入方證詞，接著是我們在 9 月的反駁，以及 10 月的證據聽證會。在肯塔基州，由於委員會採取行動的法定期限為 5 月 7 日，我們預期隨時會收到命令。肯塔基州的臨時費率已於 2 月 6 日實施。

In Pennsylvania, we expect new rates to be effective in August for the case we filed last year that was driven by $1 billion of vital capital investment. The next milestones expected in the case are a proposed decision from the ALJ likely in May and a final order in July. We expect a constructive outcome that reflects the State of Pennsylvania's long-standing support for needed capital investment that improves infrastructure for the benefit of customers. And finally, on the rate case front, just yesterday, we filed general rate cases in Iowa and Tennessee. And last week, we filed notice with the Missouri Public Service Commission that we plan to file a case by midyear.

在賓夕法尼亞州，我們預期去年提交、由 10 億美元關鍵資本投資所驅動的案件，其新費率將於 8 月生效。該案件預期的下一個里程碑為：行政法官（ALJ）可能在 5 月提出擬議決定，以及 7 月的最終命令。我們預期將有建設性的結果，反映賓夕法尼亞州長期以來對必要資本投資的支持，這些投資可改善基礎設施並使客戶受益。最後，在費率案件方面，就在昨天，我們已在愛荷華州與田納西州提交一般費率案件。上週，我們也向密蘇里州公共服務委員會提交通知，表示我們計畫在年中前提交案件。

On the legislative front, 3 state bills were passed and signed that will incrementally help water utilities in those states in the areas of lead service line replacements, expediency of approval of smaller acquisitions and fire hydrant maintenance. To show the magnitude of our regulatory execution efforts, you can see on Slide 11 that we have $98 million in annualized new revenues in rates since January. This includes $43 million from general rate cases and step increases and $55 million from infrastructure surcharges. In total, we have $636 million of total annualized revenue request pending.

在立法方面，有 3 項州法案已通過並簽署，將在更換含鉛服務管線、加速核准較小型收購，以及消防栓維護等領域，逐步協助這些州的自來水公用事業。為了展現我們在監管執行上的努力規模，您可以在投影片 11 看到，自 1 月以來，我們在費率中新增的年化收入為 9,800 萬美元。其中包括來自一般費率案件與階梯式調升的 4,300 萬美元，以及來自基礎設施附加費的 5,500 萬美元。合計而言，我們目前仍有 6.36 億美元的年化收入申請總額待審。

Moving to Slide 12 and a topic you've heard us cover just about every quarter, customer affordability. As we've said, we are very focused on balancing customer affordability and the magnitude of the system investments that are needed. Our industry and our company are in very good relative positions in terms of affordability or wallet share. Our system-wide average residential water customer bill is $55 to $65 per month. The investment plan we have in place will allow us to stay within our consolidated target for residential water bills of 1% or less of median household income. That analysis is supported by U.S. Census Bureau data specific to the geographies we serve that project rising levels of median household income in these communities.

接著看投影片 12，以及您幾乎每一季都聽我們談到的主題：客戶可負擔性。如同我們所說，我們非常專注於在客戶可負擔性與所需系統投資規模之間取得平衡。就可負擔性或「錢包占比」而言，我們的產業與公司都處於相對良好的位置。我們全系統平均住宅用水客戶帳單為每月 55 至 65 美元。我們現行的投資計畫將使我們能維持在合併口徑的目標之內，即住宅用水帳單占家庭收入中位數的 1% 或更低。此分析係以美國人口普查局針對我們服務地區的資料為依據，該資料預測這些社區的家庭收入中位數將持續上升。

At the same time, we realize we must continue to involve our strategies around rate design and programs to assist our customers who are challenged with affordability, as I described earlier, with what we're doing in Indiana as an example. As another example, just last month, California American Water announced an additional $8 million in bill relief for customers who faced financial hardship due to the COVID-19 pandemic. This funding comes through a California program that utilizes Federal American Rescue Plan Act funds. This brings the total benefit for challenged California American Water customers to $15 million under the program. We also continue to strongly advocate for a permanent federally funded low-income water assistance program, similar to what's been in place for many years for electric and gas utility customers. And we are continuing our focus on technology, efficiencies of scale and cost management to deliver on customer affordability especially as regulatory demand such as the final PFAS rule and the proposed lead and copper rule improvement increased capital needs.

同時，我們也了解必須持續完善我們在費率設計與協助可負擔性受挑戰客戶之方案上的策略，正如我先前以印第安納州的作法作為例子所說。再舉一例，就在上個月，加州 American Water 宣布額外提供 800 萬美元的帳單減免，協助因 COVID-19 疫情而面臨財務困難的客戶。此資金來自加州一項運用聯邦《美國救援計畫法》（American Rescue Plan Act）資金的計畫。這使得在該計畫下，面臨困難的加州 American Water 客戶所獲得的總福利提高至 1,500 萬美元。我們也持續強力倡議建立一項永久性的、由聯邦資助的低收入用水補助計畫，類似於多年來已為電力與天然氣公用事業客戶所設置的方案。此外，我們也持續聚焦於科技、規模效率與成本管理，以實現客戶可負擔性，特別是在監管要求（例如最終 PFAS 規則與擬議的鉛與銅規則改進）提高資本需求之際。

Lastly, Slide 13 shows that our state and corporate leaders and their teams did a great job in the first quarter, executing on our increased capital plan. It required significant effort to safely and efficiently deliver the hundreds of projects that improved our systems and drove capital investment higher by almost $200 million in the quarter, compared to the same period last year. This result keeps us on pace to hit our goal of approximately $3.1 billion of capital investment in 2024. The pie charts on the right side of the page speak to timely recovery and the nature of our investments across our footprint. As we share with regulators and legislators, our capital spending is driven by a risk-based strategy, balanced by a focus on affordability. For us, infrastructure renewal includes the basics of replacing older damaged pipe, but it also includes proactively meeting our standards related to lead service line replacements.

最後，投影片 13 顯示，我們的各州與公司領導團隊及其團隊在第一季表現出色，成功執行我們提高後的資本計畫。這需要付出相當大的努力，才能安全且有效率地交付數百個改善系統的專案，並使本季資本投資較去年同期增加近 2 億美元。此成果使我們維持在達成 2024 年約 31 億美元資本投資目標的進度上。頁面右側的圓餅圖說明了我們在各服務區域投資的及時回收情況與投資性質。正如我們與監管機關與立法者分享的，我們的資本支出係由風險導向策略所驅動，並以可負擔性為平衡考量。對我們而言，基礎設施更新不僅包含更換老舊受損管線等基本工作，也包含主動達成我們與含鉛服務管線更換相關的標準。

As we have said many times before, we firmly believe removing the risk of lead service lines over time is the right thing to do for the health and safety of our customers. Through capital recovery mechanisms and forward test years, we can reduce regulatory lag and lessen the reliance on general rate cases. This not only helps us to seek to earn our allowed return, but also to mitigate the size of general rate increases for our customers. We expect at least 75% of capital investments over the next 5 years to be recoverable through infrastructure mechanisms and through the use of forward test years, which is the key to driving modest bill increases and to unlocking a more consistent annual earnings growth pattern for the long term.

正如我們多次提到的，我們堅信，隨時間推進移除含鉛服務管線風險，對客戶的健康與安全而言是正確之舉。透過資本回收機制與前瞻測試年度（forward test years），我們可以降低監管時滯，並減少對一般費率案件的依賴。這不僅有助於我們爭取達成核准的允許報酬，也能降低客戶一般費率調升的幅度。我們預期未來 5 年至少 75% 的資本投資可透過基礎設施機制與前瞻測試年度予以回收；這是推動溫和帳單增幅、並在長期解鎖更一致的年度盈餘成長型態的關鍵。

With that, I'll hand it over to John to cover our financial results and plans in further detail. John?

接下來，我把時間交給 John，請他更進一步說明我們的財務結果與計畫。John？

Thank you, Cheryl, and good morning, everyone. Turning to Slide 15, I'll provide some further insights into our financial results for the quarter. Earnings were $0.95 per share for the quarter, up $0.04 per share versus the same period in 2023. As Cheryl mentioned, we have completed rate cases recently in Indiana and West Virginia in addition to rate outcomes achieved last year and we are seeing increased revenues as a result. And looking at O&M, production costs from increased fuel, power and chemicals as well as increased employee-related costs caused O&M to increase $0.07 per share.

謝謝你，Cheryl，各位早安。接著看投影片 15，我將就本季的財務結果提供一些進一步的洞見。本季每股盈餘為 0.95 美元，較 2023 年同期增加 0.04 美元。如 Cheryl 所提，我們近期已完成印第安納州與西維吉尼亞州的費率案件，此外也包括去年取得的費率結果，因此我們正看到收入隨之增加。再看營運與維護（O&M），由於燃料、電力與化學品成本上升所帶來的生產成本增加，以及員工相關成本上升，使 O&M 增加每股 0.07 美元。

Next, depreciation increased $0.06 per share and long-term financing costs increased $0.11 per share, both as expected in support of our investment growth. Long-term financing costs include interest on the $1 billion convertible note we issued last June and the $1.4 billion long-term senior note issued in February along with $0.04 of dilution related to the $1.7 billion of equity we issued last March. Short-term financing provided a benefit of $0.07 per share, primarily from interest earned on the cash reserves we held during the quarter. Other net consists of net unfavorable onetime nonoperating items year-over-year. And finally, as Susan mentioned, we had $0.02 per share of additional interest income from the February 2024 amendment of the seller note related to the sale of HOS.

接著，折舊增加每股 0.06 美元，長期融資成本增加每股 0.11 美元，兩者皆如預期，係為支持我們投資成長。長期融資成本包含我們去年 6 月發行的 10 億美元可轉換票據利息，以及 2 月發行的 14 億美元長期優先票據利息，並包含與我們去年 3 月發行 17 億美元股權相關的每股 0.04 美元稀釋。短期融資帶來每股 0.07 美元的利益，主要來自我們本季持有的現金準備所賺取的利息。其他淨額（Other net）包含年對年一次性非營運項目的不利淨影響。最後，如 Susan 所提，我們因 2024 年 2 月對與 HOS 出售相關之賣方票據（seller note）修訂而新增每股 0.02 美元的利息收入。

We will continue to break this out quarterly, so our investors will be able to track the ongoing growth of American Water from our core regulated strategy without this additional interest income.

我們將持續按季拆分揭露，讓投資人能夠追蹤 American Water 在核心受監管策略下的持續成長，而不包含這筆額外利息收入。

On Slide 16, you'll see that we successfully closed on the Granite City, Illinois Wastewater Treatment Plant acquisition in the first quarter. This acquisition will help ensure we can provide high-quality service to the customers in Granite City we already serve. We continue to be set up for strong growth through acquisitions with over 60,000 customer connections and over $500 million under agreement as of quarter end. Many states in our footprint are contributing to this total, which mirrors the broad-based pipeline of opportunities we have in progress across the country. Of the over 60,000 customers represented by signed agreements, nearly 20,000 have already been approved by the State Public Utility Commission. This includes the 15,000 customers in the Butler Area Sewer Authority, or BASA Wastewater System acquisition in Pennsylvania. We continue to expect BASA to close in the near future. This also includes the water and wastewater systems in Cape Charles, Virginia, which we closed just last week and marked the second acquisition completed under Virginia's fair market value law enacted in 2020. We look forward to serving our new Cape Charles customers.

在投影片 16，您會看到我們已於第一季成功完成伊利諾州 Granite City 污水處理廠的收購。此收購將有助於確保我們能為我們已在 Granite City 服務的客戶提供高品質服務。截至季末，我們在收購方面仍具備強勁成長動能，已簽約的客戶連接數超過 60,000，且協議金額超過 5 億美元。我們服務版圖中的許多州都對此總數有所貢獻，這也反映我們在全國各地推進中的廣泛機會管線。在已簽署協議所代表的逾 60,000 名客戶中，近 20,000 名已獲州公共事業委員會核准。其中包括賓夕法尼亞州 Butler Area Sewer Authority（或稱 BASA）污水系統收購案的 15,000 名客戶。我們仍預期 BASA 將在不久的將來完成交割。這也包括維吉尼亞州 Cape Charles 的供水與污水系統，我們就在上週完成交割，並成為維吉尼亞州於 2020 年制定的公平市價法（fair market value law）下完成的第二起收購案。我們期待為 Cape Charles 的新客戶提供服務。

As we've discussed before and as we lay out on this slide, the environment in Pennsylvania related to acquisitions is undergoing change, which we think is ultimately necessary and positive. We are very confident that the core principles of the original Act 12, fair market value law, will remain in place and continue to have good support since so much consolidation is still needed in Pennsylvania to address the underinvestment in infrastructure. In the meantime, closing of current pending transactions will likely take more time than usual, but to be clear, we are confident in our Pennsylvania acquisition pipeline. We are continuing to invest in regulated acquisition opportunities in Pennsylvania driven by the need for system consolidation and upgrading all for the benefit of communities who deserve safe and reliable water and wastewater service.

如同我們先前討論過的，以及我們在本張投影片所說明的，賓夕法尼亞州與併購相關的環境正在發生變化，而我們認為這種變化最終是必要且正面的。我們非常有信心，原始《第12號法案》（Act 12）之公平市價（fair market value）法律的核心原則將會維持不變，並將持續獲得良好支持，因為賓夕法尼亞州仍需要大量整併，以解決基礎設施投資不足的問題。與此同時，現有待完成交易的結案時間可能會比以往更久；但需要明確的是，我們對賓夕法尼亞州的收購案源（pipeline）充滿信心。我們將持續投資於賓夕法尼亞州受監管的收購機會，這些機會係由系統整併與升級的需求所驅動，目的在於讓社區居民能夠享有安全且可靠的供水與污水服務。

Slide 17 summarizes our successful long-term debt financing completed in February. The offering was for $1.4 billion and included $700 million of 10-year notes at 5.15% and $700 million of 30-year notes at 5.45%. Our treasury team did a very nice job proactively executing on our main financing plan objective for the year amidst a challenging interest rate environment. These proceeds will fund our regulated businesses' growth and were used to pay off a maturing senior note and outstanding commercial paper of which we had a zero balance at quarter end. Though the current higher interest rate environment is challenging, we are in a position of strength on a number of fronts in dealing with the challenge. Our strategy of issuing debt at the holding company level allows us to take advantage of our scale and pricing debt issuances, and we will remain proactive in managing risk and achieving a low cost of capital to the benefit of our customers and shareholders.

第17張投影片總結了我們於2月完成的成功長期債務融資。本次發行規模為14億美元，包括7億美元、10年期票據，利率5.15%，以及7億美元、30年期票據，利率5.45%。在充滿挑戰的利率環境下，我們的財務團隊非常出色地提前主動執行了我們今年主要融資計畫目標。這些資金將用於支持我們受監管業務的成長，並用於償還一筆到期的優先票據以及未償還的商業本票；截至季度末，我們的商業本票餘額為零。儘管目前較高的利率環境帶來挑戰，我們在多個面向具備優勢以因應此挑戰。我們在控股公司層級發行債務的策略，使我們能夠利用規模優勢並在債務發行定價上取得更佳條件；我們也將持續主動管理風險並達成較低的資本成本，以造福我們的客戶與股東。

And finally, Slide 18 is a summary of our continued strong financial condition. In March, S&P affirmed our solid single A investment-grade credit rating and stable outlook and noted our improved FFO to debt ratio, which followed Moody's affirmation of its rating and outlook for us in January. We are confident our FFO to debt ratio will continue to support our current credit ratings. Our total debt-to-capital ratio as of March 31 net of our $584 million of cash on hand is 56%, which is comfortably within our long-term target of less than 60%.

最後，第18張投影片總結了我們持續強勁的財務狀況。3月，標普（S&P）確認我們穩健的A級（single A）投資等級信用評等與穩定展望，並指出我們的FFO（營運資金流量）對債務比率有所改善；此前，穆迪（Moody's）也於1月確認了對我們的評等與展望。我們有信心，我們的FFO對債務比率將持續支持目前的信用評等。截至3月31日，在扣除我們手上5.84億美元現金後，我們的總債務對資本比率為56%，舒適地落在我們長期目標（低於60%）之內。

In closing, what you've heard today should sound very familiar. Our focus is on execution at every level. We believe our industry-leading EPS and dividend growth and ESG leadership will continue to be highly valued and rewarded by investors. We believe these aspects of our business and strategy separate us from all other utilities. And our execution includes the outstanding efforts by our Military Services Group to proudly serve the 18 military installations in our footprint.

總結而言，您今天聽到的內容應該非常熟悉。我們的重點是在各個層級落實執行。我們相信，我們在同業領先的每股盈餘（EPS）與股利成長，以及ESG領導地位，將持續受到投資人高度重視並獲得回報。我們相信，這些業務與策略面向使我們有別於其他所有公用事業公司。而我們的執行也包含我們軍事服務事業群（Military Services Group）的傑出努力，驕傲地為我們服務範圍內的18個軍事設施提供服務。

With that, I'll turn it back over to our operator and take any questions you may have.

接下來，我把時間交還給主持人，並回答各位可能有的問題。

(Operator Instructions) The first question today comes from Richard Sunderland with JPMorgan.

（接線員指示）今天的第一個問題來自摩根大通（JPMorgan）的Richard Sunderland。

Can you hear me?

你們聽得到我嗎？

Yes, we can.

是的，我們聽得到。

Great. First, I want to start on the Pennsylvania front. With the rate case, curious about the path forward and if settlement is still an option or if litigating is just the path to close out? And then separately, on Pennsylvania, the fair market value revisions, do you see that 1.68 cap limiting willingness to sell at all?

很好。首先我想從賓夕法尼亞州談起。關於費率案件（rate case），想請教後續的推進路徑，以及和解是否仍是選項，或是訴訟就是結案的途徑？另外，關於賓夕法尼亞州的公平市價修訂，你們是否認為1.68的上限會限制社區出售的意願？

Yes. Good questions, Rich. I think first on the rate case, I would say probably just where we are in the process. I'd say settlement is probably unlikely at this stage. And as Cheryl, I think, outlined, we would expect some activity by the Commission here in the next probably several weeks, and then we'll wrap that case up later in the summer. So I don't expect to settle at this point. And again, we're pleased with where we are in the process related to that case.

是的。很好的問題，Rich。我想先談費率案件，我會說大概就是我們目前在流程中的位置。我認為在這個階段和解可能性不大。正如我想Cheryl已概述的，我們預期委員會在接下來大概幾週內會有一些動作，然後我們會在夏末把這個案件收尾。因此我不預期此時會和解。再說一次，我們對於此案件目前的進展感到滿意。

On fair market value, lots going on, obviously there, and we'll continue to watch those activities. And obviously, we're involved in discussions around any potential changes that may get made. I think in terms of what impact some of those changes may have on community's interest in selling, I think it's just wait and see. I think so many of these communities need the help, and we're quite confident in our ability to help them. And I think our focus always is on coming up with the right solution for these communities, and we'll continue to do that. So we'll certainly work with whatever framework that is provided to us by regulators and legislators in this respect.

至於公平市價，顯然那邊有很多事情在進行，我們也會持續關注相關動態。而且很明顯地，我們也參與了任何可能變更的討論。我認為就某些變更可能對社區出售意願造成的影響而言，現在只能拭目以待。我認為很多社區都需要協助，而我們對自己能夠幫助他們非常有信心。我們的重點一向是為這些社區提出正確的解決方案，我們也會持續這麼做。因此，在這方面，我們當然會在監管機關與立法機關所提供的任何框架下配合推進。

Got it. Appreciate the commentary there. And then separately, on Slide 9, the latest around these new circular designations, curious how you view litigation risk under these new classifications or anything we should be thinking about on the litigation front, given the commentary around the liability protections that you also referenced?

了解。感謝你們的說明。另外，關於第9張投影片，這些新的循環（circular）指定的最新情況，想請教你們如何看待在這些新分類下的訴訟風險，或在訴訟面還有什麼是我們應該留意的？尤其你們也提到與責任保護相關的評論。

Yes. And Cheryl certainly can weigh in here too. I think our view is we'll continue to be proactive here in trying to get resolution to a CERCLA designation. But we're also just confident in our ability to execute our plan here to be compliant with the rules. We've been doing it for some time in many of our jurisdictions already. So we're quite confident in our plans and don't expect this to be a huge risk for us. Cheryl, anything you want to add?

是的。Cheryl也可以補充。我想我們的看法是，我們會持續主動推動，以期就CERCLA指定取得解決方案。但我們也對自己執行計畫、遵循規則的能力有信心。我們在許多司法管轄區其實已經做了一段時間。因此我們對我們的計畫相當有信心，也不預期這會對我們構成很大的風險。Cheryl，你有什麼要補充的嗎？

Yes, I would just add that we're working really hard on the legislative front to get the language fixed so that we are protected from those CERCLA rules, and we'll continue down that path. We've had lots of conversations with EPA around this, and their intent is not for us to be impacted by that, but those conversations will continue until we get to a solution that we're all really comfortable with.

是的，我只想補充，我們在立法面非常努力，想把相關文字修正到位，以確保我們能受到保護、不會受到那些CERCLA規則影響，我們也會持續沿著這條路走。我們已經就此與EPA進行了很多對話，他們的意圖並不是要讓我們受到影響，但這些對話會持續進行，直到我們找到一個大家都真正感到安心的解決方案。

The next question comes from Angie Storozynski with Seaport.

下一個問題來自Seaport的Angie Storozynski。

I do want to go back to Pennsylvania rate case. I understand the sensitivity around it, but there are just a number of issues raised in it by I mean many intervenors, the commission itself about how often you file rate cases, the allowed ROE? I mean you guys mentioned a number of other rate cases that seem to be going smoothly, but I'm just wondering if there's -- if there are any thoughts about a change in the strategy of still how often you file rate cases, any impact of these comments that you're seeing on the level of capital investments, especially in Pennsylvania. Again, I don't think that we've ever seen filings like these in Pennsylvania.

我確實想回到賓夕法尼亞州的費率案件。我理解這件事的敏感性，但其中提出了不少議題——我是說，很多介入方（intervenors）、甚至委員會本身都提到你們提出費率案件的頻率、核准的ROE（股東權益報酬率）等。我是說，你們提到其他一些費率案件似乎進展順利，但我想知道，是否有——是否有任何想法要改變策略，例如你們未來提出費率案件的頻率？以及你們看到這些評論後，對資本投資水準是否會有任何影響，特別是在賓夕法尼亞州。再說一次，我想我們以前從未在賓夕法尼亞州看到這樣的申請文件。

Yes, Angie, it's a good question. And again, we remain very confident in our plans, both in terms of how we execute them and the regulatory process that supports the work that we're doing in the State of Pennsylvania. There's just tremendous need in the State of Pennsylvania as there is in many of the jurisdictions that we operate in. So our focus on investment is really around the need for infrastructure improvement and we'll continue to do that work. I think the Pennsylvania case is a great example of that. We spent over $1 billion or will have spent over $1 billion in that case, and it's all focused on rate base growth. It is all focused on infrastructure renewal and replacement and the necessary work to be done in the State of Pennsylvania to bring these systems up to appropriate standards so that we can consistently provide safe and reliable water service.

是的，Angie，這是個好問題。再說一次，我們對我們的計畫仍然非常有信心，無論是在執行方式上，或是在支持我們於賓夕法尼亞州所做工作的監管流程上。賓夕法尼亞州有非常龐大的需求，就像我們營運的許多司法管轄區一樣。因此，我們投資的重點確實是基礎設施改善的需求，我們也會持續進行這些工作。我認為賓夕法尼亞州的案件就是一個很好的例子。我們在該案件中已投入超過10億美元，或將投入超過10億美元，而這些投入都聚焦於費率基礎（rate base）成長，聚焦於基礎設施更新、汰換，以及在賓夕法尼亞州必須完成的必要工作，以使這些系統提升到適當標準，讓我們能夠持續提供安全且可靠的供水服務。

So we're -- again, we remain very confident in our plan and our ability to navigate the regulatory arena. And there is, of course, some observation around the speed with which we're filing these cases, and I think it is directly tied to the pace of our spend. We've really increased the level of spend, again, driven by the need. And when you really look at the time line of this case, it's really not much different than other water peers in the state of Pennsylvania. We may be ahead just a bit by than our nearest competitor in the state, but not by much in terms of pace. And so I don't think it's that unusual. And again, it's all driven by the need for investment and the work that we're doing to improve the quality of service in the State of Pennsylvania.

因此我們——再說一次，我們對我們的計畫以及在監管環境中推進的能力仍然非常有信心。當然，外界確實對我們提出這些案件的速度有所觀察，而我認為這與我們支出速度直接相關。我們確實提高了支出水準，同樣是由需求所驅動。而當你真正檢視這個案件的時間軸，其實與賓夕法尼亞州其他同業水務公司並沒有太大不同。我們可能比州內最接近的競爭對手快一點點，但在節奏上差距不大。因此我不認為這有多不尋常。再說一次，這一切都是由投資需求以及我們為提升賓夕法尼亞州服務品質所做的工作所驅動。

Okay. And then just one other point, which is being mentioned is the inclusion of a pending acquisition in that rate case. I thought that, that's happened in the past. So I'm a little bit surprised that this is a point that is being raised. And I'm wondering if this has anything to do with the changes that are happening to Act 12. You guys referenced that it could take longer for to get regulatory approvals for some of these pending acquisitions. And I'm assuming that, that is in response to those questions being raised in this rate case. But I'm just wondering, again, going forward, how do you expect actually these many deals to be approved or reflected in rates?

好的。然後還有另一點被提到，就是在該費率案件中納入一項尚待完成的收購。我原本以為這在過去曾發生過，所以我對這次被提出作為問題有點意外。我想知道這是否與《法案12》（Act 12）正在發生的變更有關。你們提到，某些尚待完成的收購可能需要更長時間才能取得監管核准。我猜這是針對在這次費率案件中被提出的那些問題所做的回應。但我想再問一次，展望未來，你們預期這麼多交易實際上會如何獲得核准，或如何反映在費率中？

Yes. I think it's probably a fair assumption to say that all of this is getting a bit tied together. The landscape around the potential legislative changes in fair market value, I think, do sort of spill over into the rate case analysis a bit. And to be clear, we included in this case, acquisitions that we have approved and expected to close during this period of time. And so as the commission sorts through that, obviously, they've got to take into consideration the status of those acquisitions and their findings in the case, which we would fully expect them to do.

是的。我想可以合理地假設，這些事情確實有點被綁在一起。圍繞公平市價（fair market value）可能出現的立法變更之環境，我認為確實在某種程度上也會外溢到費率案件的分析中。需要澄清的是，我們在本案中納入的是：已獲核准且預期會在這段期間內完成交割的收購。因此，當委員會在審理時，顯然必須在其裁定與認定中考量這些收購的狀態，而我們也完全預期他們會這麼做。

I think on a go-forward basis, we wouldn't expect there to be really any change in how we consider acquisitions in future rate cases.

我認為就未來而言，我們不預期在未來的費率案件中，對於如何考量收購會有任何實質改變。

The next question comes from Gregg Orrill with UBS.

下一個問題來自 UBS 的 Gregg Orrill。

More of a general question just in might have covered this before, but on sort of the impact of with so many discussions are around these days, just data center presence and how that impacts your growth and any constraints that, that has on your business?

這是一個比較一般性的問題，可能你們之前已經談過，但就目前大家討論很多的議題而言，關於資料中心的進駐，以及它如何影響你們的成長，還有它對你們業務造成的任何限制？

Yes, it's a good question. Cheryl, you want to talk about any preliminary thoughts we have about potential water usage in some of these large data center moves.

是的，這是個好問題。Cheryl，你要不要談談我們對於一些大型資料中心遷入可能帶來的用水量之初步看法？

Yes, Gregg, we haven't seen a big uptake in the amount of water that our customers are asking for related to the data center moves at all. So we're thinking that's a minimal impact for us unlike our electric utility peers.

好的，Gregg，我們目前完全沒有看到，客戶因資料中心遷入而向我們要求的用水量有明顯增加。所以我們認為，這對我們的影響很小，不像我們的電力公用事業同業那樣。

(Operator Instructions) The next question comes from Aditya Gandhi with Wolfe Research.

（接線員指示）下一個問題來自 Wolfe Research 的 Aditya Gandhi。

Can you hear me?

你們聽得到我嗎？

We can.

聽得到。

Just on the PFAS legislation that you're advocating for, could you give us some color on whether it's attached to other related bills? And if there's any sort of milestones we should be watching for there? And then could you also just explain what steps you're taking to sort of secure support on both sides of the aisle as it relates to legislation.

關於你們正在倡議的 PFAS 立法，你們能否說明一下它是否附屬於其他相關法案？以及是否有任何我們應該關注的里程碑？另外，你們也能否說明，為了推動立法，你們正在採取哪些步驟來爭取兩黨的支持？

Sure. Yes. Cheryl, do you want to take that?

當然可以。是的。Cheryl，你要不要回答這題？

Yes, sure. So there has been legislation filed both on the Senate and the House side that it's the Water Systems PFAS Liability Act. On the house side, it's 7944 and I'm trying to see -- I don't have the Senate number, but this act would help protect us along with some other industries as a passive receiver and so we work really hard on both sides of the aisle all the time to connect with our legislators and also educate them on the real issues at hand. We've had some really great conversations on the Hill and are hopeful that this still will continue to move forward both in the House and the Senate, so that we can push this forward. And I think you would just watch for the key things like getting out of committee, getting a floor vote. And so we'll continue to push that forward and update you in these calls as things unfold there.

好的，當然。所以參議院與眾議院兩邊都已提出法案，也就是《水系統 PFAS 責任法》（Water Systems PFAS Liability Act）。在眾議院端，法案編號是 7944；我正在看——我手邊沒有參議院的編號。不過，這項法案將有助於保護我們以及其他一些產業，使我們作為被動接收者（passive receiver）免於承擔責任。因此，我們一直在兩黨之間非常努力地與立法者建立連結，並就當前真正的議題向他們進行說明。我們在國會山莊進行了一些非常好的對話，也希望這項法案能在眾議院與參議院持續推進，讓我們能把它往前推。我認為你們可以關注的關鍵節點包括：是否能從委員會送出、是否進入院會表決。因此我們會持續推動，並在後續電話會議中隨進展向各位更新。

And Cheryl, it is stand-alone, right? There's nothing else defined.

而且 Cheryl，它是獨立法案，對吧？沒有另外綁定其他內容。

Yes. It's not tied to anything else except to try to protect passive users or passive receivers from this liability.

是的。它沒有綁定任何其他法案，目的只是要保護被動使用者或被動接收者免於承擔這項責任。

Right. That's helpful. And maybe just 1 follow-up there. Is there a particular timeline by which you're expecting this legislation to either pass or by when -- by when should we know whether this thing is going to pass or not?

了解，這很有幫助。那我再追問一個問題：你們是否有一個特定的時間點，預期這項立法要嘛通過、要嘛——我們應該在什麼時候知道它是否會通過？

Yes. I think it's impossible to anticipate the timeline. We would love to say it will be all completed by the next couple of months, but it could take much longer. The political process is really challenging at times. So we think we've got good support, and we'll continue to push on it as fast as we can, but there's just no timeline for it.

是的。我認為很難預測時間表。我們當然希望能在接下來幾個月內完成，但也可能需要更久。政治程序有時確實非常具挑戰性。所以我們認為已獲得不錯的支持，也會盡可能快速推進，但目前沒有明確的時間表。

We do think it probably helps a bit that we now have the final rules out. We've been working on this particular angle for quite some time even before the final rule was published. So now that the final rule is here, that sort of eliminates one reason why legislators didn't want to take this issue up. If they were waiting to see what the final rule was, and that was sort of an excuse to not address this issue, I think that's been removed from their list of reasons not to move. So hopefully, that helps, and we'll see continued movement here.

我們也認為，現在最終規則已經發布，可能會有一些幫助。我們在這個切入點上已經努力了一段時間，甚至在最終規則公布之前就開始了。現在最終規則已出爐，這就消除了一個立法者不願處理此議題的理由。如果他們之前是在等最終規則、並把這當作不處理此議題的藉口，我認為這個理由已經從他們「不推動」的清單中移除了。所以希望這能有所幫助，我們也會看看後續是否能持續推進。

Yes. And in addition, the EPA said that they want to be able to use discretion. So part of this is some discretionary flexibility for them because they did not intend by designating these compounds as hazardous substances that it would apply to water and wastewater utilities. So they're planning to use discretion, but we think it's a much tighter protection to have this legislation. So we'll continue to pursue that in addition to working with EPA.

是的。此外，EPA 表示他們希望能運用裁量權。因此其中一部分也涉及他們的裁量彈性，因為他們在將這些化合物指定為有害物質時，並非有意要讓其適用於供水與污水處理公用事業。他們計畫運用裁量權，但我們認為，透過這項立法取得的保護會更為周延。因此，除了與 EPA 合作之外，我們也會持續推動這項立法。

This concludes our question-and-answer session. That concludes our conference call today. Thank you for attending today's presentation. You may now disconnect.

我們的問答環節到此結束。今天的電話會議也到此結束。感謝各位參加今天的簡報。各位現在可以掛線。