California Water Service Group Q4 FY2025 earnings call

• Announced two deals: purchasing Nevada and Oregon operations from Nexus Water and the remaining minority interest in the Texas joint venture BBRT Holdings. - In Q4 2025, results were negatively impacted by strong statewide weather in California. - Invested a record $517 million in infrastructure in 2025, including $52.3 million in Q4. - Increased annual dividend by 10.7% in 2025 and intended 8% increase in 2026. - Received extension for cost of capital in California allowing 10.27 ROE until Jan 2028 and approved interim rate increase of 3% in California. - Maintained A-plus stable credit rating from S&P. - Talked about rate cases in California, Texas, and Washington, with expectations of decisions soon. - Discussed the strategic rationalization of the Nexus acquisition, including adding rate base, growth platforms, and regulatory benefits. - Shilin talked about acquiring the remaining interest in BBRT in Texas and the growth potential there. - Greg provided updates on California general rate case, regulatory activities in Hawaii, Texas, and Washington.

In Q4 2025, revenue was $220 million (vs $222 million in Q4 2024), net income was $11.5 million or 19 cents per diluted share (vs $19.7 million or 33 cents per diluted share in prior year). For 2025, operating revenue was $1 billion (vs $1.37 billion in 2024), net income attributed to group was $128.2 million (vs $190.8 million in 2024), diluted earnings per share was $2.15 (vs $3.25 in 2024). Capital investments in 2025 were a record $517 million, with $152.3 million in the fourth quarter alone. The company has announced acquisitions of Nevada and Oregon operations from Nexus Water and the remaining minority interest in the Texas joint venture BBRT Holdings.

• Committed to timely completion of Nexus Water acquisitions for Nevada and Oregon. - Planning for 2027 general rate case in California after 2024 rate case is done. - Continuing to pursue growth opportunities in high-growth areas and strategic acquisitions meeting investment criteria. - Expecting to continue reinvesting capital into rate base with a focus on 10% year-over-year CapEx increase, excluding PFAS and acquisition investments. - Will continue disciplined regulatory strategy, balancing affordability, public health, sustainability, and reliability.

• Forward-looking statements are subject to various risks and uncertainties, actual results could differ materially from current expectations. - Weather events can impact financial results, such as the strong statewide weather in California in December 2025 affecting consumption and earnings. - Regulatory approvals for acquisitions and rate cases are uncertain and can impact the company's plans. - PFAS project expenditures and associated permitting processes can introduce uncertainties and impact capital investment plans.

Q: About the delay of the California GRC case, what gives confidence in future cases staying on track?

A: California Water Association has been educating commissioners, Commissioner Matt Baker is focused on timely decisions, and water division staff has been asking for information similar to previous cases. Also, affordability is a big issue now, and the commissioner assigned to the case has been setting a different tone than before.

Q: About regulatory mechanisms in Oregon and Nevada, any key ones?

A: Nevada has a reasonable commission, hybrid rate environment, DSIC, and rates phased in over six years for water systems. Oregon has a hybrid system allowing construction work in progress in rate base, interim rate memorandum account if case is late, adjustments for water production cost changes from wholesalers, and cases taking about six months.

Q: About PFAS, update on funds and plans?

A: Spent about $20 million on PFAS programs in 2025. Expect to spend between $50 - $70 million in 2026. Net recoveries so far are slightly below $40 million after attorneys' share. Treatment is anticipated to be in place by end of 2027, with wells taking longer depending on permitting.