Nov 4, 2026, 9:37 AM ETUtilities

Essential Utilities — Q3 2026 Earnings Summary

WTRGESSENTIAL UTILITIES INC

Financial Performance

Reported GAAP net income of $103.8 million ($0.36 per share) for Q3 2026, compared to $92.1 million ($0.33 per share) in Q3 2025.
Non-GAAP diluted EPS for Q3 2026 was $0.38, excluding merger-related expenses.
Total revenues for Q3 2026 were $508.3 million, a 6.6% increase from $477.0 million in Q3 2025.
Revenue growth drivers included regulatory recoveries and increased purchased gas costs.
Operations and maintenance (O&M) expenses for Q3 2026 were $152.2 million, a 0.6% decrease from $153.1 million in Q3 2025; excluding merger costs, O&M decreased by $5.9 million.
For the first nine months of 2026, revenues were $1,900.9 million, a 7.1% increase from $1,775.5 million in the same period of 2025.
Nine-month 2026 O&M expenses totaled $481.6 million, compared to $439.4 million in 2025, including $22.5 million in merger-related expenses.
Nine-month 2026 GAAP net income was $434.0 million ($1.53 per share), compared to $483.7 million ($1.73 per share) in 2025.
Nine-month 2026 non-GAAP diluted EPS was $1.58.
As of September 30, 2026, long-term debt was $8.03 billion, with a weighted average cost of fixed-rate long-term debt at 4.14%.
The company had $759 million available on credit lines as of September 30, 2026.
Total equity was $7.13 billion as of September 30, 2026, up from $6.86 billion as of December 31, 2025.

The company is on track to invest $1.7 billion in infrastructure investments in 2026, having invested $1.1 billion in the first nine months.
Management expects operations and maintenance expenses for the full year to be in line with historic norms, excluding one-time items and abnormal weather.
The merger with American Water is expected to close in the first quarter of 2027.
Pending rate cases and infrastructure surcharges could add an estimated $78.5 million in incremental annual revenues for the regulated water segment and a requested $163.2 million increase for the natural gas segment in Pennsylvania.

Regulated water segment revenues were $380.6 million in Q3 2026, a 4.5% increase from $364.1 million in Q3 2025, driven by regulatory recoveries and a larger customer base.
Regulated water segment O&M expenses decreased to $104.8 million in Q3 2026 from $105.7 million in Q3 2025, due to lower employee benefits from insurance recoveries, partially offset by costs from recently acquired systems.
Regulated natural gas segment revenues were $122.6 million in Q3 2026, up from $108.5 million in Q3 2025, driven by higher rates, surcharges, purchased gas costs, and favorable customer usage volumes.
Regulated natural gas segment O&M expenses decreased to $43.0 million in Q3 2026 from $47.5 million in Q3 2025, due to lower bad debt expenses and insurance recoveries.
The company serves approximately 5.5 million people across nine states under the Aqua and Peoples brands.

The company received rate awards or infrastructure surcharges in 2026 increasing annual revenues by $53.6 million in Pennsylvania, Indiana, Illinois, Ohio, North Carolina, and New Jersey for the water segment.
The natural gas segment received rate awards or surcharges in Pennsylvania and Kentucky increasing annual revenues by $16.9 million.
The company is a leader in the U.S. for replacing miles of aged underground utility pipes.
The company has a pipeline of potential municipal water and wastewater acquisitions representing approximately 400,000 total customers.

Forward-looking statements note risks including the timing and likelihood of completing the merger with American Water.
Potential risks include changes in EPA regulations, U.S. governmental policies, global economic disruptions, and supply chain disruptions.
Risks also include housing and customer growth trends, unfavorable weather conditions, and the ability to successfully execute cost-containment initiatives.
Uncertainty exists regarding the company's ability to close municipally owned systems under agreement and complete other acquisitions.

Chairman and CEO Christopher Franklin stated that strong performance highlights consistent earnings growth from both water and natural gas divisions.
Franklin emphasized the team's dedication to operational excellence and strategic infrastructure investment.
Management remains focused on the benefits of the combined organization for communities and shareholders as they work toward closing the American Water merger.

The board declared a quarterly dividend of $0.3606 per share on October 21, 2026, payable December 1, 2026, to shareholders of record on November 10, 2026.
Essential Utilities has paid consecutive quarterly cash dividends for over 80 years and increased the dividend 36 times in the last 35 years.
In October 2026, the company completed the acquisition of Dril-Quip, Inc. (Texas) for approximately $1.1 million.
On October 19, 2026, the company agreed to acquire Central States Water Resources assets in North Carolina for approximately $3.5 million.
On October 28, 2026, the company agreed to acquire the Village of Buckingham Springs water assets ($2.8 million) and Hempfield Township wastewater assets ($2.2 million) in Pennsylvania.
The company has signed asset purchase agreements totaling approximately $290 million to serve over 208,000 customers, including a $276.5 million agreement to acquire the Delaware County Regional Water Quality Control Authority (DELCORA) in Pennsylvania.
Since 2015, the company has acquired approximately $570 million in rate base and added more than 138,000 new customers.
The merger with American Water has received approval from regulatory commissions in Kentucky, Ohio, and Virginia, with settlement agreements reached in Pennsylvania, North Carolina, and Texas pending final commission approval.