EDMONTON, Alberta, July 25, 2019 (GLOBE NEWSWIRE) -- EPCOR Utilities Inc. (EPCOR) today filed its quarterly results for the three months and year-to-date period ended June 30, 2019.
“EPCOR’s net income in the second quarter of 2019 was below our expectations primarily due to recording the non-cash impact of the recently reduced Alberta corporate income tax rates. In addition, we provided a bill credit to our U.S. customers related to U.S. tax reform and weather conditions resulted in lower water demand-related revenues in our Canadian and U.S. operations. Second quarter net income was $40 million in 2019 compared to $68 million in 2018,” said Stuart Lee, EPCOR President & CEO.
“EPCOR’s people continue to be recognized for their operational expertise and commitment to customers,” continued Mr. Lee. “EPCOR was again named one of Canada’s Best 50 Corporate Citizens by Corporate Knights magazine, and EPCOR USA received 25 safety and operational excellence awards from the Arizona Water Association. In early June, Edmonton’s drinking water won a Best Water Award from the American Water Works Association, a follow-up to winning the Best of the West Canadian water taste test competition.”
Highlights of EPCOR’s financial performance are as follows:
- Net income was $40 million and $96 million for the three and six months ended June 30, 2019, respectively, compared with net income of $68 million and $133 million for the comparative periods in 2018, respectively. The decrease of $28 million for the three months ended June 30, 2019, was primarily due to higher income tax and depreciation expenses, and unfavorable fair value adjustments related to financial electricity purchase contracts, partially offset by higher transmission system access service charge net collections. The decrease of $37 million for the six months ended June 30, 2019, was primarily due to lower Adjusted EBITDA, as described below, and higher income tax and depreciation expenses, partially offset by favorable fair value adjustments related to financial electricity purchase contracts and higher transmission system access service charge net collections.
- Adjusted EBITDA was $178 million and $335 million for the three and six months ended June 30, 2019, respectively, compared with $178 million and $342 million for the comparative periods in 2018, respectively. Adjusted EBITDA for the three months ended June 30, 2019, had no change compared to comparative period in 2018, primarily due to lower water consumption per customer resulting from lower temperature and higher precipitation, lower water revenues in Arizona due to a tax reform adjustment credit on customer bills and lower Adjusted EBITDA related to street lighting, traffic signals and light rail transit electrical services for the City of Edmonton (the City), which were fully offset by higher water and wastewater rates and higher electricity distribution and transmission rates. The decrease of $7 million for the six months ended June 30, 2019, was primarily due to lower water consumption per customer resulting from lower temperatures and higher precipitation, lower water revenues in Arizona due to a tax reform adjustment credit on customer bills, higher water treatment costs due to poor water quality conditions of the North Saskatchewan River and lower Adjusted EBITDA related to street lighting, traffic signals and light rail transit electrical services for the City, partially offset by higher electricity distribution and transmission rates, higher Energy Price Setting Plan margins and Encor customer growth.
- Investment in capital projects was $290 million for the six months ended June 30, 2019, compared with $234 million for the corresponding period in the 2018. The increase of $56 million was primarily due to the acquisition of Rio Verde in Arizona, with no corresponding acquisition in 2018, higher spending in the Distribution and Transmission segment including a new substation in Southwest Edmonton, as well as, higher spending on our new customer billing system.
Interim management’s discussion and analysis and the unaudited condensed consolidated interim financial statements are available on EPCOR’s website (www.epcor.com) and SEDAR (www.sedar.com).
EPCOR, through its wholly owned subsidiaries, builds, owns and operates electrical, natural gas and water transmission and distribution networks, water and wastewater treatment facilities, sanitary and stormwater systems, and infrastructure in Canada and the United States. The Company also provides electricity, natural gas and water products and services to residential and commercial customers. EPCOR, headquartered in Edmonton, is an Alberta Top 70 employer. EPCOR’s website address is www.epcor.com.
For more information, contact:
Media Relations:
Kelly Struski (780) 969-8238
kstruski@epcor.com
Corporate Relations:
Matt Lemay (780) 412-3711 or toll free (877) 969-8280
mlemay@epcor.com
Management’s Discussion and Analysis can be viewed at http://ml.globenewswire.com/Resource/Download/e5aa767f-c3a2-4cf9-abdd-a5701f2adb93