American States Water Co (AWR) 2023 Q1 法說會逐字稿

Ladies and gentlemen, thank you for standing by. Welcome to the American States Water Company conference call discussing the company's First Quarter 2023 Results. The call is being recorded. If you want to listen to a of this call, it will begin this afternoon at 5:00 p.m. Eastern Time and run through Thursday, May 18, 2023, on the company's website, www.aswater.com. The slides that the company will be referring to are also available on the website. (Operator Instructions) This call will be limited to an hour.

女士們，先生們，謝謝你們的支持。歡迎參加 American States Water Company 電話會議，討論公司 2023 年第一季度的業績。通話正在錄音中。如果您想收聽此電話會議的一部分，將於今天下午 5:00 開始。東部時間並持續到 2023 年 5 月 18 日星期四，在公司網站 www.aswater.com 上。該公司將參考的幻燈片也可以在網站上找到。 （操作員說明）此通話將限制在一個小時內。

Presenting today from American States Water Company are Bob Sprowls, President and Chief Executive Officer; and Eva Tang, Senior Vice President of Finance and Chief Financial Officer. As a reminder, certain matters discussed during this conference call may be forward-looking statements intended to qualify for the safe harbor from liability established by the Private Securities Litigation Reform Act of 1995.

今天來自 American States Water Company 的是 Bob Sprowls，總裁兼首席執行官；財務高級副總裁兼首席財務官 Eva Tang。提醒一下，本次電話會議期間討論的某些事項可能是前瞻性陳述，旨在符合 1995 年《私人證券訴訟改革法案》規定的安全港免責條款。

Please review a description of the company's risks and uncertainties in our most recent Form 10-K and Form 10-Q on file with the Securities and Exchange Commission. In addition, this conference call will include a discussion of certain measures that are not prepared in accordance with generally accepted accounting principles or GAAP in the United States and constitute non-GAAP financial measures under SEC rules. These non-GAAP financial measures are derived from consolidated financial information but are not presented in our financial statements that are prepared in accordance with GAAP. For more details, please refer to the press release.

請查看我們最近提交給美國證券交易委員會的 10-K 表格和 10-Q 表格中對公司風險和不確定性的描述。此外，本次電話會議還將討論某些未按照美國公認會計原則或公認會計原則編制的、構成美國證券交易委員會規則下的非公認會計原則財務措施的措施。這些非 GAAP 財務措施來自綜合財務信息，但未在我們根據 GAAP 編制的財務報表中列報。更多詳情，請參閱新聞稿。

At this time, I will turn the call over to Bob Sprowls, President and Chief Executive Officer of American States Water Company.

此時，我將把電話轉給美國各州水務公司總裁兼首席執行官 Bob Sprowls。

Thank you, Gary. Welcome, everyone, and thank you for joining us today. I'll begin with some brief comments on the quarter. Eva will then discuss some financial details, and then I'll wrap it up with updates on regulatory activity, ASUS, dividends, and then we'll take your questions.

謝謝你，加里。歡迎大家，感謝您今天加入我們。我將從本季度的一些簡短評論開始。然後 Eva 將討論一些財務細節，然後我會用監管活動、華碩、股息的最新情況來總結，然後我們會回答你的問題。

I'm pleased to report that our adjusted earnings for the first quarter of 2023 were $0.13 per share higher than adjusted earnings for the first quarter of 2022. The higher earnings performance in 2023 was aided by the receipt of a proposed decision in Golden State Water Company's water General Rate Case or GRC, from the California Public Utilities Commission or CPUC, during April and strong earnings at our contracted services business, American States Utility Services or ASUS. The proposed decision allows us to continue investing in the utility infrastructure to provide safe and reliable water services for the communities we serve.

我很高興地報告，我們 2023 年第一季度的調整後每股收益比 2022 年第一季度的調整後收益高 0.13 美元。2023 年更高的收益表現得益於收到 Golden State Water 的擬議決定4 月份來自加州公用事業委員會或 CPUC 的公司水一般費率案例或 GRC，以及我們的承包服務業務 American States Utility Services 或 ASUS 的強勁收益。擬議的決定使我們能夠繼續投資公用事業基礎設施，為我們所服務的社區提供安全可靠的供水服務。

It sets new water rates for the years 2022 through 2024 and is retroactive to January 1, 2022. We remain committed to spending $140 million to $160 million this year in infrastructure investments at our regulated utilities, fortifying our water and electric systems to serve our customers for generations to come. ASUS also performed $18.9 million of construction work during the quarter and is on pace to meet its targeted earnings contribution of $0.45 to $0.49 per share for 2023.

它設定了 2022 年至 2024 年的新水價，並追溯至 2022 年 1 月 1 日。我們仍然致力於今年在我們受監管的公用事業的基礎設施投資上花費 1.4 億至 1.6 億美元，加強我們的供水和電力系統，為我們的客戶提供服務世代相傳。華碩在本季度還進行了 1,890 萬美元的建築工程，並有望實現其 2023 年每股收益貢獻 0.45 美元至 0.49 美元的目標。

Eva will discuss the quarterly earnings and liquidity and I'll turn the call over to her.

伊娃將討論季度收益和流動性，我會把電話轉給她。

Thank you, Bob. Hello, everyone. Let me start with our first quarter results. Consolidated earnings as recorded were $0.93 per share as compared to $0.38 per share for the first quarter of 2022, an increase of $0.55 per share. Included in the results of the first quarter was $0.36 per share related to the impact of retroactive rates from the proposed decision in the water General Rate Case for the full year of 2022 of which $0.08 per share related to the first quarter of 2022. The $0.55 per share increase also included a favorable variance of $0.06 per share from investment held to fund a retirement plan. We recorded gains on the investments of $1.6 million for the quarter as compared to losses of $1.7 million in 2022. Excluding these 2 items, adjusted consolidated earnings for the quarter were $0.54 per share as compared to adjusted earnings of $0.41 per share for the first quarter of last year, an increase of $0.13 per share.

謝謝你，鮑勃。大家好。讓我從第一季度的業績開始。記錄的合併收益為每股 0.93 美元，而 2022 年第一季度為每股 0.38 美元，增加了 0.55 美元。第一季度的業績中包括每股 0.36 美元，與 2022 年全年水一般費率案例中擬議決定的追溯費率的影響有關，其中每股 0.08 美元與 2022 年第一季度有關。0.55 美元每股增長還包括為退休計劃提供資金而持有的每股 0.06 美元的有利差異。我們在本季度錄得 160 萬美元的投資收益，而 2022 年為虧損 170 萬美元。排除這兩項後，本季度調整後的綜合收益為每股 0.54 美元，而第一季度調整後的每股收益為 0.41 美元與去年同期相比，每股增長 0.13 美元。

For our water utility subsidiaries, Golden State Water Company, reported earnings were $0.74 per share as compared to $0.23 per share for the first quarter of 2022, a $0.51 increase. Both items as discussed affected earnings at the Water segment. So factoring the same effect from the 2 items, adjusted earnings for the first quarter at Water segment or $0.35 per share, which was an increase of $0.09 per share as compared to adjusted earnings of $0.26 per share for the same period in 2022.

對於我們的水務子公司 Golden State Water Company，報告的每股收益為 0.74 美元，而 2022 年第一季度為每股 0.23 美元，增加了 0.51 美元。所討論的這兩個項目都影響了水部門的收益。因此，考慮到這兩個項目的相同影響，水部門第一季度調整後收益或每股 0.35 美元，與 2022 年同期調整後每股收益 0.26 美元相比增加了 0.09 美元。

Since 2023 is the second year of the GRC, as estimated second year rate increases effective January this year has been accounted for in the quarter. The $0.09 per share increase in 2023, adjusted earnings largely represent the difference from the 2021 adopted rate end of 2023 estimated second year increases for the first quarter, partially offset by increases in operating and interest and other expenses.

由於 2023 年是 GRC 的第二年，據估計，今年 1 月生效的第二年利率增長已計入本季度。調整後收益在 2023 年每股增加 0.09 美元，這在很大程度上代表了與 2023 年底採用率估計第一季度第二年增加的差異，部分被運營和利息及其他費用的增加所抵消。

Our Electric segment earnings were $0.06 per share for the first quarter as compared to $0.07 per share for the same period last year. The decrease primarily related to not having new rates in effect yet for 2023 as we await the pending electric GRC that will set new rates for 2023 to 2026, while also experiencing continued increases in overall operating expenses and interest costs.

我們的電氣部門第一季度每股收益為 0.06 美元，而去年同期為每股 0.07 美元。這一下降主要與 2023 年新利率尚未生效有關，因為我們正在等待即將製定的 2023 年至 2026 年新利率的電動 GRC，同時整體運營費用和利息成本也在持續增加。

One of the decision is issued in the electric GRC new rates are expected to be retroactive to January 1, 2023, and cumulative adjustments will be recorded at that time. Earnings from our contracted services segment increased $0.07 per share for the quarter, which Bob will discuss later. Consolidated revenue for the first quarter increased by $52.8 million as compared to the same period last year.

其中一項決定是發布的電動GRC新費率預計將追溯至2023年1月1日，屆時將記錄累計調整。本季度我們的合同服務部門的收益增加了 0.07 美元，Bob 將在稍後討論。與去年同期相比，第一季度的綜合收入增加了 5280 萬美元。

Revenue for the water segment increased by $38.8 million, which includes the impact of retroactive new rate for the full year of 2022 of $30.3 million and estimated 2023 revenue increases of $8.7 million for the 3 months ended March 31 this year. The increase in electric revenue was partly attributed to advice letter filing and an expense allocation true-up as a result of the proposed water GRC decision. The increase in the general office expenses allocated to the Electric segment also included a corresponding offsetting increase in adopted electric revenues, resulting in no impact to earnings. In addition, there was an increase in revenue of $13 million from our contracted services.

水務部門的收入增加了 3880 萬美元，其中包括 2022 年全年 3030 萬美元的追溯新費率的影響，以及截至今年 3 月 31 日的三個月預計 2023 年收入增加 870 萬美元。電力收入的增加部分歸因於建議書的提交和由於擬議的水 GRC 決定而調整的費用分配。分配給電力部門的一般辦公費用的增加還包括相應的電力收入的抵消增長，因此對收益沒有影響。此外，我們的合同服務收入增加了 1300 萬美元。

Turning to Slide 9. Looking at total operating expenses other than supply costs, consolidated expenses increased $12.2 million as compared to the first quarter of 2022. The increase was largely due to an increase in construction costs at our Contracted Services segment resulting from higher construction activity due to timing difference of the wins construction work was performed in 2023 as compared to the first quarter last year and higher operations, administrative in general and depreciation expenses. The proposed decision in the water GRC issued in April also approved overall higher composite depreciation rates based on a revised depreciation study. The increase in composite depreciation rates increases to adopt the water revenue requirements with a corresponding increase in adopted depreciation expense, resulting in no impact to net earnings.

轉到幻燈片 9。從供應成本以外的總運營費用來看，與 2022 年第一季度相比，綜合費用增加了 1220 萬美元。增加的主要原因是建築活動增加導致我們的合同服務部門的建築成本增加由於 wins 建設工作與去年第一季度相比在 2023 年進行的時間差異以及更高的運營、一般行政和折舊費用。 4 月份發布的水 GRC 中的擬議決定還批准了基於修訂後的折舊研究的整體更高的綜合折舊率。綜合折舊率的增加增加了採納水收入要求，相應地增加了採納的折舊費用，對淨收益沒有影響。

Interest expense net of interest income increased by $2.3 million due to higher average interest rates during the quarter and increases in overall borrowing level. Other income net of other expenses increased by $2 million due primarily to gains on investments held for retirement benefit plans partially offset by increase in the nonservice cost component for Golden State Water's benefit plan.

扣除利息收入後的利息支出增加了 230 萬美元，原因是本季度平均利率上升以及整體借貸水平上升。扣除其他費用後的其他收入增加了 200 萬美元，這主要是由於為退休福利計劃持有的投資收益部分被 Golden State Water 福利計劃的非服務成本部分的增加所抵消。

Slide 10 shows the adjusted EPS bridge comparing the first quarter of 2023 and 2022.

幻燈片 10 顯示了 2023 年第一季度和 2022 年第一季度的調整後 EPS 橋樑。

Turning to liquidity on Slide 11. Net cash provided by operating activities was $7 million as compared to $38 million for the first quarter of 2022. During the first quarter of last year, our regulated utility received $9.8 million in COVID-19 relief funds from the state of California to provide assistance to customers for delinquent water and electric customer sales incurred during the pandemic. There were no relief funds received this year. The decrease in operating cash flow was also due to a 17% decrease in build-water consumption as well as the continued delay in receiving the water GRC finance decision. Once the final decision is received Golden State Water will request recovery through a surcharge of our retroactive revenue accumulated since January 2022. In addition, we will also file for the second year rate increases for 2023.

轉向幻燈片 11 的流動性。經營活動提供的淨現金為 700 萬美元，而 2022 年第一季度為 3800 萬美元。去年第一季度，我們受監管的公用事業公司從 COVID-19 救助基金中獲得了 980 萬美元加利福尼亞州為客戶在大流行期間拖欠的水電客戶銷售提供幫助。今年沒有收到救濟金。經營現金流量的減少也是由於建築用水量減少了 17% 以及繼續延遲接收水 GRC 融資決定。收到最終決定後，Golden State Water 將要求對我們自 2022 年 1 月以來累積的追溯收入收取附加費來追回。此外，我們還將申請 2023 年的第二年費率上調。

In January 2023, Golden State Water received $130 million of proceeds from the issuance of unsecured private placement notes. The proceeds were ultimately used to partially pay down AWR's credit facility and further support Golden State Water's capital program. AWR's credit facility with a borrowing capacity of $280 million expires in July 2023 as a result of an amendment that extended the maturity day by 2 months. We requested the extension to provide us adequate time to possibly put in place 2 new credit agreements. S&P provides the same credit rating for both consolidated AWR and Golden State Water.

2023 年 1 月，Golden State Water 通過發行無擔保私募票據獲得了 1.3 億美元的收益。所得款項最終用於部分償還 AWR 的信貸額度並進一步支持 Golden State Water 的資本計劃。由於修正案將到期日延長了 2 個月，AWR 的借貸能力為 2.8 億美元的信貸額度將於 2023 年 7 月到期。我們要求延期，以便為我們提供足夠的時間來製定 2 份新的信貸協議。標準普爾為合併後的 AWR 和 Golden State Water 提供相同的信用評級。

We are considering a separate credit facility for Golden State Water to allow for a separate credit rating and possibly improve the rating outlook for our flagship water utility. While lining up 2 credit facilities instead of 1 takes a little longer time. We believe that the company's sound capital structure and the A+ credit ratings for American States and Golden State Water combined with its financial discipline and history and relationship with lenders will enable us to access the market and put in place a new credit facility with reasonable terms. We anticipate the existing credit agreement will be terminated at an earlier date when it's superseded by the new agreement.

我們正在考慮為 Golden State Water 提供單獨的信用額度，以允許單獨的信用評級，並可能改善我們旗艦水務公司的評級前景。雖然排列 2 個信貸設施而不是 1 個需要更長的時間。我們相信，公司良好的資本結構和 American States 和 Golden State Water 的 A+ 信用評級，再加上其財務紀律和歷史以及與貸方的關係，將使我們能夠進入市場並以合理的條款實施新的信貸安排。我們預計現有信貸協議將在被新協議取代時提前終止。

At this time, we do not expect American States Water to issue additional equity for at least the next 18 to 24 months to fund its current businesses. We will continue to assess the need for equity issuance and if and when a decision is made to issue equity we plan to raise capital over time. We will consider doing an added market offering that enables AWR to control the timing and size of each sales of its common share over several years.

目前，我們預計 American States Water 至少在未來 18 至 24 個月內不會發行額外股本為其現有業務提供資金。我們將繼續評估發行股票的必要性，如果決定發行股票，我們計劃在一段時間內籌集資金。我們將考慮進行額外的市場發售，使 AWR 能夠控制幾年內每次出售其普通股的時間和規模。

With that, I'll turn the call back to Bob.

有了這個，我會把電話轉回給鮑勃。

Thank you, Eva. I will discuss a few key regulatory matters. Earlier, I discussed the proposed decision we received in the water general rate case. Among other items, the proposed decision through to adopt in its entirety, the settlement agreement between Golden State Water and the Public Advocates Office at the CPUC that had been filed with the CPUC in November 2021 and resolved all issues related to the 2022 annual revenue requirement in the rate case application, retroactive to January 1, 2022.

謝謝你，伊娃。我將討論一些關鍵的監管問題。早些時候，我討論了我們在水總費率案中收到的擬議決定。除其他事項外，擬議決定通過整體採納 Golden State Water 與 CPUC 公共辯護辦公室之間的和解協議，該協議已於 2021 年 11 月提交給 CPUC，並解決了與 2022 年收入要求相關的所有問題在費率案例申請中，追溯至 2022 年 1 月 1 日。

Furthermore, the proposed decision to address the 3 remaining unresolved issues related to Golden State Water's request for a medical insurance balancing account, a general liability insurance cost balancing account and consolidation of 2 of Golden State Water's customer service areas. The proposed decision to approve both balancing accounts and denied Golden State Water's request to consolidate the 2 customer service areas. The settlement agreement approved in the proposed decision authorized Golden State Water to invest $404.8 million in capital infrastructure over the 3-year cycle plus $9.4 million of capital projects that have been completed and filed as advice letter projects, the revenue for which was in effect in February of 2022.

此外，解決 3 個剩餘未決問題的擬議決定涉及 Golden State Water 要求的醫療保險平衡賬戶、一般責任保險成本平衡賬戶以及合併 Golden State Water 的 2 個客戶服務區域。提議的決定批准兩個平衡賬戶並拒絕 Golden State Water 合併 2 個客戶服務區域的請求。擬議決定中批准的和解協議授權 Golden State Water 在 3 年周期內投資 4.048 億美元用於資本基礎設施，外加 940 萬美元已完成並作為建議書項目備案的資本項目，其收入於2022 年 2 月。

It increases Golden State Water's adopted operating revenues for 2022 by $30.3 million, which includes an increase for higher adopted supply costs of $9.6 million and compared to the 2021 adopted revenues, excluding the advice letter project revenues -- sorry, as compared to the 2021 adopted revenues, excluding the advice letter project revenues. It adopts new operating expense levels for 2022, including higher depreciation expense, resulting from overall higher composite depreciation rates based on a new depreciation study adopted in the proposed decision and it allows for potential additional increases in adopted revenues for 2023 and 2024, subject to an earnings test and changes to the forecasted inflationary index values.

它使 Golden State Water 2022 年採用的營業收入增加 3030 萬美元，其中包括更高的採用供應成本增加 960 萬美元，與 2021 年採用的收入相比，不包括建議函項目收入——抱歉，與採用的 2021 年相比收入，不包括建議書項目收入。它採用了 2022 年的新運營費用水平，包括更高的折舊費用，這是根據擬議決定中採用的新折舊研究得出的總體較高的綜合折舊率造成的，並且它允許 2023 年和 2024 年採用的收入可能額外增加，但前提是收益測試和預測通貨膨脹指數值的變化。

We're now in the process of preparing our next water general rate case for the years 2025 through 2027 to be filed in the third quarter of this year. As you may have seen, Golden State Water received a proposed decision on Tuesday of this week on the cost of capital proceeding. The proposed decision adopts the requested capital structure and cost of debt filed in the application, it adopts a return on equity of 8.85%. It allows for the continuation of the water cost of capital mechanism and adopts the new cost of capital from January 1, 2022 through December 31, 2024.

我們現在正在準備下一個 2025 年至 2027 年的水綜合費率案例，該案例將於今年第三季度提交。您可能已經看到，Golden State Water 在本週二收到了一項關於資本運作成本的擬議決定。擬議決定採用申請中要求的資本結構和債務成本，採用 8.85% 的股本回報率。它允許延續水資源成本機制，並在 2022 年 1 月 1 日至 2024 年 12 月 31 日期間採用新的資本成本。

As discussed on prior calls, we have continued to record in the first quarter a reduction to water revenues, which decreased the first quarter earnings by $0.03 per share to reflect the estimated revenue impact of a lower cost of debt of 5.1% as requested in our cost of capital application as compared to 6.6% included in 2021 rates currently being billed to water customers. A similar adjustment based on the 2021 adopted rates was made throughout 2022. Also, an additional reduction to revenues of $1.1 million or $0.02 per share was included in the impact of retroactive new rates for the full year of 2022 and arriving at the $0.36 per share adjustment. That represents the incremental impact of revenues subject to refund related to the cost of capital proceeding.

正如之前的電話會議所討論的那樣，我們在第一季度繼續記錄水務收入的減少，這使第一季度每股收益減少了 0.03 美元，以反映我們按照我們的要求將債務成本降低 5.1% 對收入的估計影響。與目前向水客戶收取的 2021 年費率中包含的 6.6% 相比，資本應用成本。整個 2022 年都根據 2021 年採用的利率進行了類似的調整。此外，2022 年全年追溯新利率的影響還包括收入額外減少 110 萬美元或每股 0.02 美元，達到每股 0.36 美元調整。這代表了與資本運作成本相關的退還收入的增量影響。

As previously mentioned, the proposed decision allows for the continuation of the water cost of capital mechanism. For the period from October 1, 2021, through September 30, 2022, the Moody's AA utility bond rate increased by more than 100 basis points from the benchmark. As you may know, if there is a positive or negative change of more than 100 basis points, return on equity is adjusted by 1/2 of the difference. As a result, of the proposed decision, the water cost of capital mechanism will continue through 2024.

如前所述，擬議的決定允許繼續使用水成本資本機制。從 2021 年 10 月 1 日到 2022 年 9 月 30 日，穆迪 AA 級公用事業債券利率較基准上升了 100 多個基點。如您所知，如果出現超過 100 個基點的正向或負向變化，股本回報率將按差值的 1/2 進行調整。因此，根據擬議的決定，資本機制的水成本將持續到 2024 年。

Moving on to Slide 14. Our electric utility subsidiary filed its general rate case on August 30, 2022 for new rates for the period 2023 through 2026. In addition to new rates, there are a number of items that are requested such as additional capital expenditures as part of the 4-year rate cycle and a new capital structure. In addition, we have requested recovery of more than $22 million in capital already spent related to the wildfire mitigation plans. The CPUC has approved a decision for a general rate case memorandum account that will make new rates once approved in a CPUC final decision effective January 1, 2023.

轉到幻燈片 14。我們的電力子公司於 2022 年 8 月 30 日提交了 2023 年至 2026 年期間新費率的一般費率案例。除了新費率外，還有許多項目需要，例如額外的資本支出作為 4 年利率週期和新資本結構的一部分。此外，我們已要求收回超過 2200 萬美元的與野火緩解計劃相關的已支出資金。 CPUC 已批准一項關於一般費率案例備忘賬戶的決定，一旦在 2023 年 1 月 1 日生效的 CPUC 最終決定中獲得批准，該賬戶將製定新的費率。

Turning our attention to Slide 15. We present the growth in Golden State Water's average rate base as authorized by the CPUC for 2018 through 2021. Weighted average water rate base has grown from $752.2 million in 2018 to $980.4 million in 2021. Based on the general rate case settlement agreement as approved and adopted by the proposed decision, the 2022 rate base amount is $1,152.3 million, which, if approved, would result in a compound annual growth rate of 11.3% since 2018. The rate base amounts shown for 2021 and 2022 do not include any rate recovery for advice letter projects.

將注意力轉向幻燈片 15。我們介紹了 CPUC 授權的 2018 年至 2021 年 Golden State Water 平均費率基數的增長情況。加權平均水費基數已從 2018 年的 7.522 億美元增長到 2021 年的 9.804 億美元。基於一般情況根據擬議決定批准和通過的費率案件和解協議，2022 年費率基數為 11.523 億美元，如果獲得批准，自 2018 年以來的複合年增長率將達到 11.3%。顯示的費率基數為 2021 年和 2022 年不包括建議書項目的任何費率回收。

Let's move on to ASUS. I'm pleased to announce that ASUS contributed earnings of $0.15 per share for the first quarter as compared to $0.08 per share for the same period last year, an increase of $0.07 per share. The increase was largely due to an increase in construction activity in the first quarter of 2023 as compared to the same period last year due to timing differences of when construction work was performed and an increase in management fee revenue resulting from the resolution of various economic price adjustments, partially offset by higher overall operating expenses and interest costs as compared to the same period of 2022.

讓我們繼續華碩。我很高興地宣布，華碩第一季度每股收益為 0.15 美元，而去年同期為每股 0.08 美元，增加了 0.07 美元。增加的主要原因是 2023 年第一季度的建築活動與去年同期相比有所增加，原因是施工時間的差異以及各種經濟價格的解決導致管理費收入增加與 2022 年同期相比，總體運營費用和利息成本有所增加，部分抵消了這些調整。

As mentioned earlier, ASUS is on target to contribute $0.45 to $0.49 per share for the year. The completion of filings for economic price adjustments, requests for equitable adjustment, asset transfers and contract modifications awarded for new projects provide ASUS with additional revenues and dollar margin. We remain confident that we can effectively compete for new military-based contract awards based on our proven track record of managing water and wastewater related services for a military basis since 2004.

如前所述，華碩今年的目標是每股貢獻 0.45 美元至 0.49 美元。經濟價格調整、公平調整請求、資產轉讓和新項目合同修改申請的完成為華碩提供了額外的收入和美元利潤。基於我們自 2004 年以來在軍事基礎上管理水和廢水相關服務的可靠記錄，我們仍然相信我們能夠有效地競爭新的軍事合同授予。

I'd like to turn our attention to dividends, which remain a compelling part of our investment story. The company has achieved a compound annual growth rate of 9.2% in our calendar year dividend payments to shareholders over the last 10 years. These increases are consistent with our policy to achieve a compound annual growth rate in the dividend of more than 7% over the long term.

我想把我們的注意力轉移到股息上，這仍然是我們投資故事中引人注目的一部分。在過去 10 年中，公司向股東支付的歷年股息實現了 9.2% 的複合年增長率。這些增長符合我們的政策，即長期實現超過 7% 的股息複合年增長率。

I'd like to conclude our prepared remarks by thanking you for your interest in American States Water, and we'll now turn the call over to the operator for questions.

我想通過感謝您對 American States Water 的關注來結束我們準備好的發言，現在我們將把電話轉給接線員提問。

(Operator Instructions) The first question is from Angie Storozynski with Seaport.

（操作員說明）第一個問題來自 Seaport 的 Angie Storozynski。

So first, with the proposed decision and the cost of capital, it's interesting because I don't even know when it really applies. So your best guess, is it truly retroactive to January 1 of 2022, i.e., this provision that you guys have been booking for the lower cost of debt would basically stick based on it?

因此，首先，根據提議的決定和資本成本，這很有趣，因為我什至不知道它何時真正適用。所以你最好的猜測是，它真的可以追溯到 2022 年 1 月 1 日，也就是說，你們為降低債務成本而預訂的這項規定基本上會基於它堅持下去嗎？

Yes. So it's not entirely clear to us, Angie. One interesting item to note in the proposed decision is it does not expressly state that the lower cost of debt. For 2022 and 2023 and the lower cost of equity for 2022, partially offset by the higher return on equity for 2023, all of which are set forth in the proposed decision doesn't really state that they should be retroactive to the beginning of 2022. Since the ordering paragraph solely focused on future rate changes, it could be interpreted that it was the ALJ's intent to make all these changes so a perspective. And we don't know what the ALJ's intent is. So more to come on that.

是的。所以我們並不完全清楚，安吉。擬議決定中需要注意的一個有趣項目是它沒有明確說明較低的債務成本。對於 2022 年和 2023 年以及 2022 年較低的股本成本，部分被 2023 年較高的股本回報率所抵消，所有這些都在擬議決定中提出並沒有真正說明它們應該追溯至 2022 年初。由於命令段落只關注未來的利率變化，因此可以解釋為 ALJ 打算將所有這些變化都作為一個觀點。我們不知道 ALJ 的意圖是什麼。所以還有更多的事情要做。

Okay. But if -- under the assumption that those are prospective changes, meaning the rates would be adjusted starting on the -- basically midyear, right, after the commission signs off on it. What would be -- if I were to reverse the provisions associated with the lower cost of debt, what would be the add back to 2023 from an EPS perspective?

好的。但是，如果——假設這些是預期的變化，這意味著利率將從——基本上是年中開始調整，正確的，在委員會簽署之後。會是什麼——如果我要撤銷與較低債務成本相關的規定，從每股收益的角度來看，到 2023 年會增加多少？

Yes. So we have the add back for 2022 to start with. That was roughly $0.15.

是的。因此，我們從 2022 年開始重新添加。那大約是 0.15 美元。

$0.15.

0.15 美元。

Yes.

是的。

And it will book additional $0.03 for the first quarter of this year. So Angie, in total, up to March 31, that will be $0.18 that we'll be adding back.

並將在今年第一季度額外預訂 0.03 美元。因此，截至 3 月 31 日，Angie 總共將增加 0.18 美元。

It's possible -- it's possible we won't get a final in the second quarter, but we think we will -- if we don't, hopefully, we'll have a little more clarity as where they're headed on this so that we can deal with it appropriately in the second quarter.

有可能——我們有可能不會在第二節進入決賽，但我們認為我們會——如果我們不這樣做，希望我們能更清楚地了解他們的前進方向，所以我們可以在第二季度適當地處理它。

Okay. Well, that's just the first half of the question, right? The second one is when would the cost of capital adjustment mechanism kick in, right? So would it be -- I mean there are really only 2 options, right? Either coincidental with the new rates, so I mean you have middle of the year? Or actually, no, there would be 3. I mean there could be 1/1/23, could be mid 2023? Or you need to file and request that increase and only then it would kick in. So there is a third option, meaning it could get delayed until I don't know, like a September time frame.

好的。嗯，這只是問題的前半部分，對吧？第二個是資本成本調整機制什麼時候開始，對吧？那麼會是——我的意思是真的只有兩個選項，對吧？要么與新利率巧合，那麼我的意思是你有年中？或者實際上，不，會有 3 個。我的意思是可能有 1/1/23，可能是 2023 年年中？或者你需要提交並請求增加，然後它才會開始。所以還有第三種選擇，這意味著它可能會延遲到我不知道的時候，比如 9 月的時間範圍。

Right. And we...

正確的。和我們...

So that would be fair.

這樣才公平。

Yes. There's also that...

是的。還有那個...

So that would be fair.

這樣才公平。

There's also that 2022 adjustment, although it's very small for 5 basis points, but...

還有 2022 年的調整，雖然對於 5 個基點來說非常小，但是......

So your current guess would be that it happens, that it coincides with the reduction in the cost of debt, meaning roughly mid year.

所以你目前的猜測是它會發生，它與債務成本的減少同時發生，這意味著大約在年中。

Yes. I mean, to be fair, we've had this for 1.5 days. But yes, we think that you would be sort of move in lockstep although we may know more as we move through time here, probably will.

是的。我的意思是，公平地說，我們已經有 1.5 天了。但是，是的，我們認為你會步調一致，儘管隨著時間的推移我們可能會知道更多，很可能會。

And so now the last one, that's what I promise. So now assuming that we are doing it starting midyear, so the cost of debt down, cost of equity up well, whatever, by that 51 bps, minus the 5 bps, right? So right, I mean, if I get it right, 46 bps increase in the ROE starting midyear. So how big an increase does that have been an impact on an annualized basis? Does it have from an EPS perspective?

所以現在是最後一個，這就是我的承諾。所以現在假設我們從年中開始這樣做，那麼債務成本下降，股本成本上升，無論如何，51 個基點減去 5 個基點，對嗎？所以，我的意思是，如果我做對了，從年中開始，股本回報率將增加 46 個基點。那麼，這對年化的影響有多大？它有從 EPS 的角度來看嗎？

Okay. I'll take that one, Angie. Well, you booked through the 5.1% debt, right? So that's reflecting our recording number. So will be the upside from the 8.9% to the 9.36%, 46 basis points. 46 basis points on our $1.2 billion rate base, I think it translates about $0.08 to $0.09 for the full year. So it depends on this to be for the full year perspective. So you have to count that into your increase.

好的。我要那個，安吉。嗯，你是通過 5.1% 的債務預定的，對吧？所以這反映了我們的記錄數。所以將從 8.9% 上升到 9.36%，46 個基點。在我們 12 億美元的利率基礎上有 46 個基點，我認為這相當於全年約 0.08 美元至 0.09 美元。因此，這取決於全年的前景。所以你必須把它計入你的增長。

Okay. Okay. Well, I mean, it's complicated, but frankly, we're just so much further in this whole process than we were on the fourth quarter call that it's -- again, that's just frankly remarkable that now both the GRC and this issue have been almost resolved, well, almost. So moving on to the electric GRC, just looking at the schedule. So we're still I mean we're still expecting a decision in that proceeding to be issued only next year, right? I mean, again, realistically speaking.

好的。好的。好吧，我的意思是，這很複雜，但坦率地說，我們在整個過程中比我們在第四季度電話會議上走得更遠——再一次，坦率地說，現在 GRC 和這個問題都已經很了不起了幾乎解決了，嗯，差不多了。所以轉向電動 GRC，只看時間表。所以我們仍然是，我的意思是我們仍然期待在明年才發布該程序的決定，對嗎？我的意思是，再一次，現實地說。

Yes. So it's possible that we could get something in 2023, but I would say unlikely.

是的。所以我們有可能在 2023 年得到一些東西，但我認為不太可能。

Okay. And my last question, this $0.02 drag at the corporate level I mean, yes, we did expect an increase in the interest expense there. But now that you will have a true-up in revenues, should I assume that this quarterly drag is actually slightly slower because I get actually cash recognition of some of the deferred revenues?

好的。我的最後一個問題，這 0.02 美元在公司層面的拖累，我的意思是，是的，我們確實預計那裡的利息支出會增加。但是現在你將獲得收入的調整，我是否應該假設這個季度拖累實際上稍微慢一些，因為我實際上得到了一些遞延收入的現金確認？

You're talking about the unfavorable variance of $0.02 at the parent?

您是在談論父級 0.02 美元的不利差異？

Yes. Yes. So I'm basically asking is it a recurring $0.02 per quarter or now that...

是的。是的。所以我基本上是問這是每季度 0.02 美元的經常性費用還是現在...

It is. Because it really is -- it is a function of the borrowings we have at the parent that are not tied to borrowings at the utility.

這是。因為它確實是 - 它是我們在母公司擁有的借款的函數，與公用事業的借款無關。

Your next question is from Jonathan Reeder with Wells Fargo.

你的下一個問題來自富國銀行的 Jonathan Reeder。

Congrats on getting the 2 PDs long awaited, but I guess when it rains, it pours in California, right?

恭喜獲得期待已久的 2 個 PD，但我想下雨的時候，加利福尼亞會傾盆大雨，對吧？

That is true in a lot of different for us.

這對我們來說有很多不同之處。

So just wanted to keep going on the cost of capital proposed decision a little bit. So obviously, it took a lot of time to get this proposed decision don't know if you have any sense how much maybe influence the commission might have had on this proposed decision and kind of like what the thoughts are on the likelihood of the commission adopting the proposed decision as it is or whether like some past cost of capital proceedings on the water side, whether they modify the PD before adopting something.

所以只是想繼續對資本成本提議的決定進行一點。很明顯，這個提議的決定花了很多時間不知道你是否知道委員會可能對這個提議的決定產生了多大的影響，有點像對委員會的可能性有什麼想法按原樣採用擬議的決定，或者是否像過去在水方面進行的一些資本成本訴訟一樣，他們是否在採用某些東西之前修改了效績數據。

Yes. So I mean the utilities -- our company is analyzing the proposed decision and determining whether we like it or not. And so I'm sure the other 3 utilities are doing the same and then public advocates is doing the same. So then the question becomes, is anyone going to be lobbying the commission to get this changed. And I'd say it's too early to tell. I don't know that the other commissioners on their own would necessarily have an issue with this decision.

是的。所以我指的是公用事業——我們公司正在分析提議的決定並確定我們是否喜歡它。所以我確信其他 3 家公用事業公司也在做同樣的事情，然後公共倡導者也在做同樣的事情。那麼問題就變成了，是否有人會遊說委員會來改變這一點。我想說現在下結論還為時過早。我不知道其他委員是否一定會對這個決定有異議。

But they're just going to be a lot more on this here. We're just so early into the process. We don't completely understand what the decision says in terms of this retro activity to be honest. And so that will be something we'll have to get more clarity on. Sorry, I can't be more definitive than that. What's your view, Jonathan, I know you have a report out on it.

但他們只會在這裡做更多的事情。我們只是太早進入這個過程。老實說，我們並不完全理解該決定對這種複古活動的看法。因此，這將是我們必須更加清楚的事情。對不起，我不能比這更確定。 Jonathan，你有什麼看法，我知道你有一份關於它的報告。

Well, I don't know. History that he presented, then they'll modify it some, but no. I mean you certainly raise a good point. I mean, if you guys are , if they don't raise issues with it, then why wouldn't the commission, I guess, kind of adopt it. So I guess...

嗯，我不知道。他介紹的歷史，然後他們會對其進行一些修改，但沒有。我的意思是你肯定提出了一個很好的觀點。我的意思是，如果你們是，如果他們不提出問題，那麼我猜委員會為什麼不採納它。所以我猜...

I don't know where public advocates is on this, too. They -- I don't know how they feel about it. They were -- they had lower recommended adopted ROEs for 2022, but I mean that was back in 2021 when everybody filed. And we now know where interest rates were in 2022, usually, it's supposed to be -- you're supposed to try to predict where the interest rates are going. But we now know. So anyway, I'm sorry, I can't be more helpful than that. If this isn't like 2018, though, Jonathan, which I know you remember, which was just awful, the proposed decision was awful.

我也不知道公眾倡導者在哪裡。他們——我不知道他們對此有何感想。他們是——他們較低地推薦了 2022 年採用的 ROE，但我的意思是那是在 2021 年每個人都提交的時候。我們現在知道 2022 年的利率在哪裡，通常，它應該是——你應該試著預測利率的走向。但我們現在知道了。所以無論如何，對不起，我不能比這更有幫助了。不過，如果這不像 2018 年，喬納森，我知道你記得，那太糟糕了，擬議的決定太糟糕了。

Right, no, right. That one was very one-sided where your point I mean this one, the ROEs proposed seem to kind of in the middle to some degree and everything and then you have the cost of capital mechanism kind of resets and everything. So I just know if you have any thoughts or if there was any early onboarding or just because it did take so long if there was some sort of messaging that this is very much indicative of where the commission wants to come out, whereas past ones maybe that hasn't been the case.

對，不，對。那個是非常片面的，你的意思是這個，提議的 ROE 似乎在某種程度上處於中間位置，然後你有資本成本機制的重置和一切。所以我只知道你是否有任何想法，或者是否有任何早期入職，或者只是因為確實花了很長時間，如果有某種消息，這在很大程度上表明了委員會想要出來的地方，而過去的可能事實並非如此。

Right. Is it just the view of the ALJ and the assigned commissioner or are the other commissioners have they had a chance to weigh in at this point. I don't know the answer to that. I'm sorry. I always get nervous when these things come out, as you know, and this didn't -- well, I was here in 2018 and that just -- anything compared to that is you take a little bit of a sigh of relief.

正確的。這只是 ALJ 和指定專員的觀點，還是其他專員在這一點上有機會權衡。我不知道答案。對不起。正如你所知，當這些事情出現時我總是很緊張，而這並沒有——好吧，我在 2018 年來到這裡——與此相比，你會鬆一口氣。

Yes. No, I agree. I agree. So yes, we'll stay tuned and good luck on getting it across the finish line. The other topic I wanted to touch on and Eva, I know you discussed in your prepared remarks a bit, but the discussion in the queue around the credit facility and the need to do a 2-month extension, I mean, it just really struck me at that. I mean it seems like most companies extend or renew the facilities well in advance of the expiration date. So I mean I know you mentioned in the prepared remarks that it takes additional time to do the 2 credit facilities.

是的。不，我同意。我同意。所以是的，我們會繼續關注並祝它順利通過終點線。我想談的另一個話題是伊娃，我知道你在準備好的發言中討論了一點，但是關於信貸安排的討論以及延期 2 個月的必要性，我的意思是，它真的很震撼我在那個我的意思是，似乎大多數公司都在到期日之前很早就延長或更新了設施。所以我的意思是，我知道你在準備好的評論中提到，完成 2 個信用額度需要額外的時間。

But again, I would have thought that this could have been done well in advance of the current facility kind of expiring. So I guess the question is, do you think the 2-month extension, is that going to be enough time to get the new ones in place and have these efforts been impacted in any way by the upheaval in the banking industry the last few months.

但同樣，我本以為這可以在當前設施到期之前很好地完成。所以我想問題是，你認為 2 個月的延期是否有足夠的時間讓新的到位，這些努力是否受到過去幾個月銀行業動蕩的任何影響.

Yes, Jonathan, we extended 2 months, but we expect to get it done well ahead of that. So we just don't want to be hedged to the last day of the credit facility and doesn't allow anything. So it's really a more conservative approach. We expect to get it down much earlier than the 2 months extension deadline. We met -- this came about when Bob and I met with S&P in December and looking to how we can get a separate rating for Golden State Water and took a lot of the research and talking to S&P to come to this kind of intention that would try to get 2 facility. And the amount will be larger to on the credit facility, we had 280.

是的，Jonathan，我們延長了 2 個月，但我們希望在此之前完成它。所以我們只是不想被對沖到信貸安排的最後一天，不允許任何事情。所以這確實是一種更保守的方法。我們希望比 2 個月的延期截止日期早得多。我們認識了——當鮑勃和我在 12 月與標準普爾會面並尋找我們如何才能獲得 Golden State Water 的單獨評級並進行了大量研究並與標準普爾交談以達成這種意圖時，我們遇到了這種情況嘗試獲得2個設施。而且信貸額度的金額會更大，我們有 280。

This rate case, we got much higher capital expenditure in the last rate case. And we anticipate that rate base will grow when we file the rate case in August. So to support the next few years, CapEx with uncertainty of PFAS, and we are asking for a much bigger credit line amount if I would take a syndicated effort to put this together for 2 credit facilities. That's why it take it longer when we start this process.

在這個利率案例中，我們在最後一個利率案例中獲得了更高的資本支出。我們預計，當我們在 8 月份提交費率案例時，費率基礎將會增長。因此，為了支持未來幾年的 CapEx 和 PFAS 的不確定性，如果我願意聯合努力將其放在一起以獲得 2 個信貸額度，我們要求更大的信貸額度。這就是為什麼我們開始這個過程需要更長的時間。

So just to add in there, I mean, we are a bigger company than we were 5 years ago, and we now have to have larger financing capabilities because of that and because of our CapEx program, and I do think the upheaval in the banking industry probably didn't help us at all here. So just a number of things.

所以補充一下，我的意思是，我們是一家比 5 年前更大的公司，因此我們現在必須擁有更大的融資能力，因為我們的資本支出計劃，我確實認為銀行業的劇變行業可能在這裡根本沒有幫助我們。所以只有一些事情。

But splitting the credit facility into 2 pieces, I think long term, that's going to be a real advantage to the company. And it takes more time to do that. And should we have started earlier? Maybe. But I don't think this is anything people should be worried about on the facility. All it is, is a function of the size and we did increase the complexity a bit, I would say.

但將信貸額度分成兩部分，我認為從長遠來看，這對公司來說將是一個真正的優勢。這樣做需要更多時間。我們應該早點開始嗎？或許。但我認為這不是人們應該在設施上擔心的任何事情。我想說的是，它只是大小的函數，我們確實增加了一點複雜性。

Okay. Yes, no, I mean -- and that's the thing. And obviously, the credit rating is extremely strong where it is. So if you wouldn't have thought like getting a new facility would be an issue. So I appreciate be a different -- or the additional comments as to what was kind of going on with it. It sounds like maybe in the weeks ahead, should have something new in place if I'm reading the tea leaves correctly, so that's good. Last comment just on PFAS. I know the other companies have been addressing it based on your service territory, like how big of an issue is that? And how would that potentially impact the CapEx budget or the upcoming rate filing and stuff?

好的。是的，不，我的意思是——就是這樣。顯然，這裡的信用評級非常高。因此，如果您不認為獲得新設施將是一個問題。所以我很欣賞與眾不同——或者關於它發生了什麼的額外評論。聽起來可能在接下來的幾週內，如果我正確地閱讀了茶葉，應該會有一些新的東西，所以這很好。最後評論僅針對 PFAS。我知道其他公司一直在根據您的服務領域解決這個問題，比如這個問題有多大？這將如何潛在地影響資本支出預算或即將到來的利率申報等？

Yes. I can give you a little bit of detail on that. So at this point, we've tested 78 wells at the company, basically at the state's direction, they identify sort of what areas you need to be doing these tests on. And then we have found 25 of the 78 that are over the state's notification levels and 9 over the state's response levels. Now these notification and response levels are actually higher than what the EPA of 4 parts per trillion is.

是的。我可以給你一些細節。所以在這一點上，我們已經在公司測試了 78 口井，基本上是在國家的指導下，他們確定了你需要在哪些領域進行這些測試。然後我們發現 78 個中有 25 個超過了州的通知級別，9 個超過了州的響應級別。現在，這些通知和響應水平實際上高於 EPA 的萬億分之四。

And so we're going through the process. So we've got 34 wells of the 78 to have issues and cost between $2 million and $5 million per well to retrofit them for this issue. We also have more wells than the 78. We've got a total of 170. So we don't -- we can't really estimate at this point what the cost of getting everything sort of up to where the standards are for the 4 parts per trillion. But it's going to be a sizable CapEx. I don't know, Jonathan, whether the first -- the 4 parts per trillion is going to stick or not. I know it came in a bit lower than what the industry was expecting.

所以我們正在經歷這個過程。因此，我們有 78 口井中的 34 口井存在問題，每口井的成本在 200 萬到 500 萬美元之間，以針對這個問題進行改造。我們的油井也比 78 口多。我們總共有 170 口。所以我們現在不能真正估計將所有東西都達到標準的成本是多少萬億分之 4。但這將是一筆可觀的資本支出。我不知道，喬納森，第一個——萬億分之四是否會堅持下去。我知道它比行業預期的要低一些。

Yes. How does the -- I guess, the 4 parts per trillion compared to that might -- like the state levels? Because I mean, I guess, the $2 million to $5 million cost you kind of through out there, that's just to retrofit them in accordance with the state standards? Or would that also...

是的。與州水平相比，我猜，萬億分之四如何？因為我的意思是，我猜，200 萬到 500 萬美元的成本是你在那里花費的，這只是為了按照州標準對它們進行改造？或者那也...

It is, but it doesn't jump considerably when you reduce down to the 4 parts per trillion. Not a big jump there because you're kind of putting in the materials at that point.

確實如此，但是當您減少到萬億分之四時，它並沒有大幅增加。那裡不是很大的跳躍，因為你在那個時候有點放入材料。

Okay. And so out of those 78 that you test, I know the 34 have issues with the state standards. Do you know how many of those would have issues with the 4 parts per trillion standard?

好的。因此，在您測試的 78 個中，我知道有 34 個不符合州標準。您知道其中有多少人對萬億分之四的標準有疑問嗎？

Yes, all of them.

是的，所有這些。

So it could extend beyond those 78 even, and that's why you threw out the 170, I guess.

所以它甚至可以延伸到 78 之外，這就是你扔掉 170 的原因，我猜。

It is possible, yes, because the state -- the current state standard is lower or is higher than what the federal is.

是的，這是可能的，因為州——當前的州標準低於或高於聯邦標準。

Okay. All right. Are you going to try to encapsulate this at all in the upcoming rate case filing? Or would this be potentially something separate until you see what the EPA settles on if it is 4 parts per trillion and kind of what the compliance time frame is and everything.

好的。好的。您是否打算在即將提交的費率案件備案中嘗試將其完全封裝？或者這可能是獨立的東西，直到你看到 EPA 的決定是什麼，如果它是萬億分之 4 以及合規時間框架是什麼等等。

So we're still working on the rate case at this point, Jonathan, we're looking at the possibility, putting a strong testimony on additional CapEx and the water supply mix impact, et cetera. So we don't have a number at this point, but what is goes back really let it file, we filed the decision, I think, by all the folks.

因此，喬納森，我們目前仍在研究利率案例，我們正在研究這種可能性，為額外的資本支出和供水組合影響等提供強有力的證據。所以我們目前沒有數字，但真正返回的是什麼讓它提交，我認為我們提交了所有人的決定。

This concludes our question-and-answer session. I would like to turn the conference back over to Bob Sprowls for any closing remarks.

我們的問答環節到此結束。我想將會議轉回 Bob Sprowls 的閉幕詞。

Thank you, Gary. So I just want to wrap it up today by thanking you all for your participation, and we look forward to speaking with you next quarter. So have a good rest of your week, and good start to your summer. Thank you.

謝謝你，加里。因此，今天我只想通過感謝大家的參與來結束它，我們期待著下個季度與您交談。所以，好好休息一周，好好開始你的夏天。謝謝。

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.

會議現已結束。感謝您參加今天的演講。您現在可以斷開連接。