H2O America Q3 FY2025 earnings call

• Welcomed Jonathan Reeder as Senior Director of Treasury and Investor Relations. • Strong third quarter financial results: adjusted net income $1.27 per share, an 8% increase over Q3 2024; year-to-date adjusted EPS $2.53, a 14% increase. • Infrastructure surcharges: Connecticut Water's Infrastructure and Conservation Adjustment approved, Texas Water filed third System Improvement Charge. • CapEx: Trending ahead of plan, invested $358 million in water and wastewater utility infrastructure by September 30th, 74% of revised $486 million budget. • M&A: Announced transformational Quadvest deal and tuck-in acquisition of Cibolo Valley wastewater treatment plant in Texas. • Sustainability: Selected as one of America's greenest companies for second year, achieved 43% reduction in Scope 1 and 2 emissions from 2019 baseline, increased solar generation by 73%, and had 85.2% customer satisfaction. • New commissioners: Governor Lamont appointed 4 new commissioners to Connecticut Public Utility Regulatory Authority.

No detailed product segment financial performance breakdown provided in the transcript.

• Narrowed 2025 guidance range for adjusted diluted earnings per share to $2.95 to $3, representing the upper half of the original range. • Reaffirmed 5% to 7% EPS CAGR through 2029, excluding impact of pending Quadvest acquisition which is expected to be accretive in 2028. • Will refresh 2026 and beyond CapEx budget in February 2026 when rolling forward the 5-year plan.

Q: Angie Storozynski asked about the delay in disclosing FMV for the Quadvest deal, American Water's merger in Texas, and appetite for Aquarion if the PURA rejects the sale process.

A: Bruce Hauk stated the FMV appraisals are on schedule with results expected in December, American Water's merger doesn't change H2O America's growth focus, and Aquarion's acquisition would need to meet strategic and financing criteria. Andrew Walters added H2O America's growth forecast doesn't rely on acquisitions and remains focused on balance sheet protection.

Q: Ian Rapp asked about refreshing EPS guidance through 2029 in relation to CapEx refresh and fair market value process.

A: Andrew Walters said long-term growth guidance will be impacted by CapEx and Quadvest acquisition, and the fair market value process is about asset valuation including construction work in progress up to July 1, 2026, and equity raise timing is linked to transaction approval and offering documentation.