Document and Entity Information
Document and Entity Information | 6 Months Ended |
Jun. 30, 2017shares | |
Document and Entity Information | |
Entity Registrant Name | CALIFORNIA WATER SERVICE GROUP |
Entity Central Index Key | 1,035,201 |
Document Type | 10-Q |
Document Period End Date | Jun. 30, 2017 |
Amendment Flag | false |
Current Fiscal Year End Date | --12-31 |
Entity Current Reporting Status | Yes |
Entity Filer Category | Large Accelerated Filer |
Entity Common Stock, Shares Outstanding | 48,018,420 |
Document Fiscal Year Focus | 2,017 |
Document Fiscal Period Focus | Q2 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS Unaudited - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Utility plant: | ||
Utility plant | $ 2,826,187 | $ 2,717,339 |
Less accumulated depreciation and amortization | (897,575) | (858,062) |
Net utility plant | 1,928,612 | 1,859,277 |
Current assets: | ||
Cash and cash equivalents | 29,103 | 25,492 |
Receivables: | ||
Customers | 39,027 | 30,305 |
Regulatory balancing accounts | 29,071 | 30,332 |
Other | 17,322 | 17,158 |
Unbilled revenue | 34,857 | 25,228 |
Materials and supplies at weighted average cost | 6,518 | 6,292 |
Taxes, prepaid expenses, and other assets | 14,682 | 7,262 |
Total current assets | 170,580 | 142,069 |
Other assets: | ||
Regulatory assets | 375,868 | 355,930 |
Goodwill | 2,615 | 2,615 |
Other assets | 55,351 | 51,854 |
Total other assets | 433,834 | 410,399 |
TOTAL ASSETS | 2,533,026 | 2,411,745 |
Capitalization: | ||
Common stock, $0.01 par value; 68,000 shares authorized, 48,018 and 47,965 outstanding in 2017 and 2016, respectively | 480 | 480 |
Additional paid-in capital | 334,834 | 334,856 |
Retained earnings | 326,520 | 324,135 |
Total common stockholders’ equity | 661,834 | 659,471 |
Long-term debt, less current maturities | 519,875 | 531,745 |
Total capitalization | 1,181,709 | 1,191,216 |
Current liabilities: | ||
Current maturities of long-term debt | 36,110 | 26,208 |
Short-term borrowings | 190,100 | 97,100 |
Accounts payable | 84,222 | 77,813 |
Regulatory balancing accounts | 6,743 | 4,759 |
Accrued interest | 5,842 | 5,661 |
Accrued expenses and other liabilities | 38,010 | 38,689 |
Total current liabilities | 361,027 | 250,230 |
Unamortized investment tax credits | 1,798 | 1,798 |
Deferred income taxes | 310,936 | 298,924 |
Pension and postretirement benefits other than pensions | 227,186 | 222,691 |
Regulatory liabilities and other | 86,821 | 83,648 |
Advances for construction | 182,394 | 182,448 |
Contributions in aid of construction | 181,155 | 180,790 |
Commitments and contingencies (Note 10) | ||
TOTAL CAPITALIZATION AND LIABILITIES | $ 2,533,026 | $ 2,411,745 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS Unaudited Unaudited (Parenthetical) - $ / shares | Jun. 30, 2017 | Dec. 31, 2016 |
Statement of Financial Position [Abstract] | ||
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 68,000,000 | 68,000,000 |
Common stock, shares outstanding (in shares) | 48,018,000 | 47,965,000 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME Unaudited - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Income Statement [Abstract] | ||||
Operating revenue | $ 171,132 | $ 152,445 | $ 293,168 | $ 274,172 |
Operations: | ||||
Water production costs | 64,131 | 57,589 | 106,199 | 98,658 |
Administrative and general | 23,796 | 23,366 | 49,045 | 51,193 |
Other operations | 18,328 | 18,903 | 34,452 | 38,205 |
Maintenance | 4,708 | 5,934 | 10,820 | 11,997 |
Depreciation and amortization | 19,218 | 15,842 | 38,419 | 31,888 |
Income taxes | 9,635 | 6,870 | 8,751 | 5,945 |
Property and other taxes | 6,057 | 5,407 | 12,173 | 11,482 |
Total operating (income) expense | 145,873 | 133,911 | 259,859 | 249,368 |
Net operating income (loss) | 25,259 | 18,534 | 33,309 | 24,804 |
Other income and expenses: | ||||
Non-regulated revenue | 3,739 | 3,764 | 7,201 | 7,192 |
Non-regulated expenses | (1,614) | (2,809) | (3,668) | (5,789) |
Allowance for equity funds used during construction | 879 | 0 | 1,658 | 0 |
Income tax expense on other income and expenses | (1,217) | (384) | (2,106) | (565) |
Net other income | 1,787 | 571 | 3,085 | 838 |
Interest expense: | ||||
Interest expense | 9,079 | 8,434 | 17,789 | 16,499 |
Allowance for borrowed funds used during construction | (564) | (837) | (1,058) | (1,567) |
Net interest expense | 8,515 | 7,597 | 16,731 | 14,932 |
Net income | $ 18,531 | $ 11,508 | $ 19,663 | $ 10,710 |
Earnings per share: | ||||
Basic (in dollars per share) | $ 0.39 | $ 0.24 | $ 0.41 | $ 0.22 |
Diluted (in dollars per share) | $ 0.39 | $ 0.24 | $ 0.41 | $ 0.22 |
Weighted average shares outstanding: | ||||
Basic (in shares) | 48,020 | 47,972 | 48,002 | 47,938 |
Diluted (in shares) | 48,020 | 47,972 | 48,002 | 47,943 |
Dividends declared per share of common stock (in dollars per share) | $ 0.18 | $ 0.1725 | $ 0.3600 | $ 0.3450 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS Unaudited - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Operating activities: | ||
Net income | $ 19,663 | $ 10,710 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 39,328 | 32,701 |
Change in value of life insurance contracts | (1,208) | (336) |
Allowance for equity funds used during construction | (1,658) | 0 |
Changes in operating assets and liabilities: | ||
Receivables and unbilled revenue | (35,533) | (561) |
Accounts payable | 3,242 | 4,745 |
Other current assets | (7,048) | (4,760) |
Other current liabilities | (747) | 355 |
Other changes in noncurrent assets and liabilities | 19,687 | 16,757 |
Net cash provided by operating activities | 35,726 | 59,611 |
Investing activities: | ||
Utility plant expenditures | (108,712) | (116,155) |
Life insurance proceeds | 450 | 495 |
Purchase of life insurance contracts | (1,216) | (1,065) |
Change in restricted cash | (598) | (653) |
Net cash used in investing activities | (110,076) | (117,378) |
Financing activities: | ||
Short-term borrowings | 140,000 | 103,100 |
Repayment of short-term borrowings | (47,000) | (61,615) |
Proceeds from long-term debt, net of issuance costs of $0 for 2017 and $177 for 2016 | 0 | 49,823 |
Repayment of long-term debt | (2,407) | (2,463) |
Advances and contributions in aid of construction | 10,312 | 11,463 |
Refunds of advances for construction | (4,430) | (3,472) |
Repurchase of common stock | (1,236) | (548) |
Dividends paid | (17,278) | (16,532) |
Net cash provided by financing activities | 77,961 | 79,756 |
Change in cash and cash equivalents | 3,611 | 21,989 |
Cash and cash equivalents at beginning of period | 25,492 | 8,837 |
Cash and cash equivalents at end of period | 29,103 | 30,826 |
Supplemental information: | ||
Cash paid for interest (net of amounts capitalized) | 15,932 | 13,572 |
Income tax refund | (1,697) | 0 |
Supplemental disclosure of non-cash activities: | ||
Accrued payables for investments in utility plant | 28,494 | 25,397 |
Utility plant contribution by developers | $ 7,212 | $ 7,198 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS Unaudited Unaudited (Parenthetical) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Jun. 30, 2016 | |
Statement of Cash Flows [Abstract] | ||
Payments of debt issuance expense | $ 0 | $ 177 |
Organization and Operations and
Organization and Operations and Basis of Presentation | 6 Months Ended |
Jun. 30, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization and Operations and Basis of Presentation | Organization and Operations and Basis of Presentation California Water Service Group (the Company) is a holding company that provides water utility and other related services in California, Washington, New Mexico and Hawaii through its wholly-owned subsidiaries. California Water Service Company (Cal Water), Washington Water Service Company (Washington Water), New Mexico Water Service Company (New Mexico Water), and Hawaii Water Service Company, Inc. (Hawaii Water) provide regulated utility services under the rules and regulations of their respective state’s regulatory commissions (jointly referred to herein as the Commissions). CWS Utility Services and HWS Utility Services LLC provide non-regulated water utility and utility-related services. The Company operates in one reportable segment, providing water and related utility services. Basis of Presentation The unaudited condensed consolidated interim financial information has been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) for interim financial information and in accordance with the instructions to Form 10-Q and Rule 10-01 of Regulation S-X promulgated by the Securities and Exchange Commission (SEC) and therefore do not contain all of the information and footnotes required by GAAP and the SEC for annual financial statements. The unaudited condensed consolidated financial statements should be read in conjunction with the Company’s consolidated financial statements for the year ended December 31, 2016 , included in its annual report on Form 10-K as filed with the SEC on February 23, 2017. The preparation of the Company’s unaudited condensed consolidated interim financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the balance sheet dates and the reported amounts of revenues and expenses for the periods presented. These include, but are not limited to, estimates and assumptions used in determining the Company’s regulatory asset and liability balances based upon probability assessments of regulatory recovery, revenues earned but not yet billed, asset retirement obligations, allowance for doubtful accounts, pension and other employee benefit plan liabilities, and income tax-related assets and liabilities. Actual results could differ from these estimates. In the opinion of management, the accompanying unaudited condensed consolidated interim financial statements reflect all adjustments, consisting of normal recurring transactions that are necessary to provide a fair presentation of the results for the periods covered. The results for interim periods are not necessarily indicative of the results for any future period. Due to the seasonal nature of the water business, the results for interim periods are not indicative of the results for a 12-month period. Revenue and income are generally higher in the warm, dry summer months when water usage and sales are greater. Revenue and income are generally lower in the winter months when cooler temperatures and rainfall curtail water usage and sales. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Summary of Significant Accounting Policies Revenue Revenue generally includes monthly cycle customer billings for regulated water and wastewater services at rates authorized by the Commissions (plus an estimate for water used between the customer's last meter reading and the end of the accounting period) and billings to certain non-regulated customers at rates authorized by contract with government agencies. The Company’s regulated water and wastewater revenue requirements are authorized by the Commissions in the states in which they operate. The revenue requirements are intended to provide the Company a reasonable opportunity to recover its operating costs and earn a return on investments. For metered customers, Cal Water recognizes revenue from rates which are designed and authorized by the California Public Utilities Commission (CPUC). Under the Water Revenue Adjustment Mechanism (WRAM), Cal Water records the adopted level of volumetric revenues, which would include recovery of cost of service and a return on investments, as established by the CPUC for metered accounts. The adopted volumetric revenue considers the seasonality of consumption of water based upon historical averages. The variance between adopted volumetric revenues and actual billed volumetric revenues for metered accounts is recorded as a component of revenue with an offsetting entry to a regulatory asset or liability balancing account (tracked individually for each Cal Water district) subject to certain criteria under the accounting guidance for regulated operations. The variance amount represents amounts that will be billed or refunded to customers in the future. In addition to volumetric revenues, the revenue requirements approved by the CPUC include service charges, flat rate charges, and other items not subject to the WRAM. Cost-recovery rates are designed to permit full recovery of certain costs allowed to be recovered by the Commissions. Cost-recovery rates such as the Modified Cost Balancing Account (MCBA) provide for recovery of adopted expense levels for purchased water, purchased power and pump taxes, as established by the CPUC. In addition, cost-recovery rates include recovery of costs related to water conservation programs and certain other operating expenses adopted by the CPUC. Variances (which include the effects of changes in both rates and volumes for the MCBA) between adopted and actual costs are recorded as a component of revenue, as the amount of such variances will be recovered from or refunded to customers in the future. Cost-recovery expenses are generally recognized when expenses are incurred with no markup for return on investments or profit. The balances in the WRAM and MCBA assets and liabilities accounts will fluctuate on a monthly basis depending upon the variance between adopted and actual results. The recovery or refund of the WRAM is netted against the MCBA over- or under-recovery for the corresponding district and the deferred net balances are interest bearing at the current 90 day commercial paper rate. Subsequent to calendar year-end, Cal Water files with the CPUC to refund or collect the balance in the accounts. The majority of under-collected net WRAM and MCBA receivable balances are collected over 12 or 18 months. Cal Water defers net WRAM and MCBA operating revenues and associated costs whenever the net receivable balances are estimated to be collected more than 24 months after the respective reporting period in which it was recorded. The deferred net WRAM and MCBA revenue and associated costs were determined using forecasts of customer consumption trends in future reporting periods and the estimated timing of when the CPUC will authorize Cal Water's filings to recover unbilled balances. Deferred revenues and associated costs are recorded in the periods when the collection is within 24 months of the respective reporting period. Customers' meter reads occur on various business days throughout the month. As a result, there are unmetered or unbilled customer usage each month. The estimated unbilled revenue for monthly unmetered customer usage is recorded using the number of unbilled days for that month and average daily customer billing rate for the previous month. The average daily customer billing rate for the previous month fluctuates depending on customer usage. Estimated unbilled revenue is not included in the WRAM until it is billed. Flat rate customers are billed in advance at the beginning of the service period. The revenue is prorated so that the portion of revenue applicable to the current period is included in that period’s revenue, with the balance recorded as unearned revenue on the balance sheet and recognized as revenue when earned in the subsequent accounting period. The unearned revenue liability was $0.8 million as of June 30, 2017 and December 31, 2016 , respectively. This liability is included in “accrued expenses and other liabilities” on the condensed consolidated balance sheets. Allowance for Funds Used During Construction The allowance for funds used during construction (AFUDC) represents the capitalized cost of funds used to finance the construction of the utility plant. In general, AFUDC is applied to Cal Water construction projects requiring more than one month to complete. No AFUDC is applied to projects funded by customer advances for construction, contributions in aid of construction, or applicable state-revolving fund loans. AFUDC includes the net cost of borrowed funds and a rate of return on other funds when used, and is recovered through water rates as the utility plant is depreciated. Cal Water was authorized by the CPUC to record AFUDC on construction work in progress effective January 1, 2017. Prior to January 1, 2017, the CPUC authorized Cal Water to only record capitalized interest on borrowed funds. Cal Water previously reported the amounts authorized as capitalized interest and a reduction to interest expense. The amount of AFUDC related to equity funds and to borrowed funds for the three and six month periods ended June 30, 2017 and 2016 are shown in the tables below: Three Months Ended June 30 2017 2016 Change Allowance for equity funds used during construction $ 879 $ — $ 879 Allowance for borrowed funds used during construction 564 837 (273 ) Total $ 1,443 $ 837 $ 606 Six Months Ended June 30 2017 2016 Change Allowance for equity funds used during construction $ 1,658 $ — $ 1,658 Allowance for borrowed funds used during construction 1,058 1,567 (509 ) Total $ 2,716 $ 1,567 $ 1,149 Cash and Cash Equivalents Cash equivalents include highly liquid investments with maturities of three months or less. Cash and cash equivalents was $29.1 million and $25.5 million as of June 30, 2017 and December 31, 2016 , respectively. Restricted cash was presented on the condensed consolidated balance sheet in “taxes, prepaid expenses and other assets” and was $1.0 million and $0.4 million as of June 30, 2017 and December 31, 2016 , respectively. Adoption of New Accounting Standards In March 2016, the Financial Accounting Standards Board (FASB) issued updated accounting guidance on simplifying the accounting for share-based payments (ASU 2016-09), which includes the accounting for share-based payment transactions, the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The Company adopted and implemented the changes to accounting for share-based payments on January 1, 2017 and applied the requirements retrospectively on the statement of cash flows for all periods presented. The Company's forfeiture policy did not change and the Company continues to account for forfeitures when they occur. For the six month period ended June 30, 2016, the Company recorded $0.5 million of income tax benefits in excess of compensation costs for share-based compensation which reduced the effective tax rate. The tax-related cash flows resulting from share-based payments were reported as operating activities and the associated cash paid by the company for employee tax withholding transactions were reported as financing activities on the consolidated statement of cash flows. The following table shows the effect of the accounting change to the Condensed Consolidated Statements of Cash Flows for the six month period ended June 30, 2016: Six Months Ended June 30, 2016 Cash Flow Classification As Reported on Form 10-Q Adjusted Balance on Form 10-Q Increase (Decrease) from Retrospective Adoption Other changes in noncurrent assets and liabilities $ 16,209 $ 16,757 $ 548 Net cash provided by operating activities 59,063 59,611 548 Repurchase of common stock — (548 ) (548 ) Net cash provided by financing activities 80,304 79,756 (548 ) New Accounting Standards In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which amends the existing revenue recognition guidance. In August 2015, the FASB deferred the effective date of this amendment for public companies by one year to January 1, 2018, with early adoption permitted as of the original effective date of January 1, 2017. The Company expects to adopt the new revenue standard using the modified retrospective method and does not expect the ASU to materially impact the timing or recognition of revenue related to the sale and delivery of water to their customers, which is a significant percentage of the Company's revenue. The Company is still evaluating the impact the ASU has on the related revenue disclosures. In February 2016, the FASB issued ASU 2016-02, Leases . This update changes the accounting treatment of operating leases for lessees and related disclosure requirements. ASU 2016-02 is effective for annual reporting periods beginning after December 15, 2018 and early adoption is permitted. The Company will adopt the standard using the modified retrospective method for its existing leases and is currently evaluating the impact of adopting the new lease standard on its consolidated financial statements and related disclosures. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230) - Classification of Certain Cash Receipts and Cash Payments . This update adds and clarifies guidance on the classification of certain cash receipts and payments in the statement of cash flows. ASU 2016-15 is effective for annual periods beginning after December 15, 2017 and early adoption is permitted. The Company is currently evaluating the impact on its consolidated financial statements and related disclosures. In March 2017, the FASB issued Accounting Standards Update No. 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (“ASU 2017-07”). The update requires employers to present the service cost component of the net periodic benefit cost in the same income statement line item as other employee compensation costs arising from services rendered during the period. The other components of net benefit cost, including interest cost, expected return on plan assets, amortization of prior service cost/credit and actuarial gain/loss, and settlement and curtailment effects, are to be presented as non-operating items. Employers will have to disclose the line(s) used to present the other components of net periodic benefit cost, if the components are not presented separately in the income statement . The standard only allows the service cost component to be eligible for capitalization. ASU 2017-07 is effective for annual periods after December 15, 2017, and early adoption is permitted. The Company is currently evaluating the impact on its consolidated financial statements and related disclosures. The adoption of this guidance will change the Company's financial statement presentation of net benefit costs. However, based on current regulatory authorization, the changes required by the standard are not expected to materially impact the results of operations. |
Stock-based Compensation
Stock-based Compensation | 6 Months Ended |
Jun. 30, 2017 | |
Disclosure of Compensation Related Costs, Share-based Payments [Abstract] | |
Stock-based Compensation | Stock-based Compensation Equity Incentive Plan During the six months ended June 30, 2017 and 2016, the Company granted annual Restricted Stock Awards (RSAs) of 48,717 and 72,317 , respectively, to officers and directors of the Company. During those same periods, 14,186 and 10,600 RSAs were canceled, respectively. During the three months ended June 30, 2017 and 2016, no RSAs were granted and 3,284 and 2,869 RSAs were canceled, respectively. Employee RSAs granted in 2017 and 2016 vest over 36 months. Director RSAs generally vest at the end of 12 months . During the first six months of 2017 and 2016, the RSAs granted were valued at $36.75 and $25.17 per share, respectively, based upon the fair market value of the Company’s common stock on the date of grant. During the six months ended June 30, 2017 and 2016, the Company granted 31,389 and 43,659 performance-based Restricted Stock Unit Awards (RSUs), respectively, to officers. During those same periods, the Company issued 38,709 and 28,424 RSUs, respectively, and canceled 19,735 and 6,602 RSUs, respectively. During the three months ended June 30, 2017 and 2016, the Company did not grant, issue or cancel any RSUs. Each RSU award reflects a target number of shares that may be issued to the award recipient. The 2017 and 2016 awards may be earned upon the completion of the three -year performance and are recognized as expense ratably over the three -year performance period using a fair market value of $36.75 per share and $25.17 per share, respectively, and an estimate of RSUs earned during the performance period. The Company has recorded compensation costs for the RSAs and RSUs in administrative and general operating expenses in the amount of $1.5 million and $1.4 million for the six months ended June 30, 2017 and June 30, 2016, respectively. |
Equity
Equity | 6 Months Ended |
Jun. 30, 2017 | |
Equity [Abstract] | |
Equity | Equity The Company’s changes in total common stockholders’ equity for the six months ended June 30, 2017 were as follows: Total Common Stockholders’ Equity Balance at December 31, 2016 $ 659,471 Common stock issued — Share-based compensation expense (22 ) Common stock dividends declared (17,278 ) Net income 19,663 Balance at June 30, 2017 $ 661,834 |
Earnings Per Share
Earnings Per Share | 6 Months Ended |
Jun. 30, 2017 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Earnings Per Share The computations of basic and diluted earnings per share are noted below. Basic earnings per share is computed by dividing the net income available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share reflects the potential dilution that could occur if securities or other contracts were exercised or converted into common stock. RSAs are included in the weighted average common shares outstanding because the shares have all the same voting and dividend rights as issued and unrestricted common stock. RSUs are not included in diluted shares for financial reporting until authorized by the Compensation & Organization Committee of the Board of Directors There were no shares of Stock Appreciation Rights (SARs) outstanding as of June 30, 2017 and as of June 30, 2016. All the SARs were dilutive when they were outstanding during the period, as shown in the tables below. Three Months Ended June 30 2017 2016 (In thousands, except per share data) Net income available to common stockholders $ 18,531 $ 11,508 Weighted average common shares outstanding, basic 48,020 47,972 Dilutive SARs (treasury method) — — Weighted average common shares outstanding, dilutive 48,020 47,972 Earnings per share - basic $ 0.39 $ 0.24 Earnings per share - diluted $ 0.39 $ 0.24 Six Months Ended June 30 2017 2016 (In thousands, except per share data) Net income available to common stockholders $ 19,663 $ 10,710 Weighted average common shares outstanding, basic 48,002 47,938 Dilutive SARs (treasury method) — 5 Weighted average common shares outstanding, dilutive 48,002 47,943 Earnings per share - basic $ 0.41 $ 0.22 Earnings per share - diluted $ 0.41 $ 0.22 |
Pension Plan and Other Postreti
Pension Plan and Other Postretirement Benefits | 6 Months Ended |
Jun. 30, 2017 | |
Retirement Benefits [Abstract] | |
Pension Plan and Other Postretirement Benefits | Pension Plan and Other Postretirement Benefits The Company provides a qualified, defined-benefit, non-contributory pension plan for substantially all employees. The Company makes annual contributions to fund the amounts accrued for in the qualified pension plan. The Company also maintains an unfunded, non-qualified, supplemental executive retirement plan. The costs of the plans are charged to expense or are capitalized in utility plant as appropriate. The Company offers medical, dental, vision, and life insurance benefits for retirees and their spouses and dependents. Participants are required to pay a premium, which offsets a portion of the cost. Cash contributions by the Company related to pension plans were $14.8 million and $14.0 million for the six months ended June 30, 2017 and June 30, 2016, respectively. There were no cash contributions by the Company to other postretirement benefit plans for the six months ended June 30, 2017 and $3.3 million of contributions for the six months ended June 30, 2016. The total 2017 estimated cash contribution to the pension plans is $29.5 million and to the other postretirement benefit plans is $9.3 million . The following table lists components of net periodic benefit costs for the pension plans and other postretirement benefits. The data listed under “pension plan” includes the qualified pension plan and the non-qualified supplemental executive retirement plan. The data listed under “other benefits” is for all other postretirement benefits. Three Months Ended June 30 Pension Plan Other Benefits 2017 2016 2017 2016 Service cost $ 5,865 $ 5,067 $ 2,019 $ 2,304 Interest cost 5,791 5,453 1,491 1,800 Expected return on plan assets (6,029 ) (5,454 ) (1,218 ) (1,046 ) Amortization of prior service cost 1,445 1,555 11 11 Recognized net actuarial loss 1,752 1,293 649 1,261 Net periodic benefit cost $ 8,824 $ 7,914 $ 2,952 $ 4,330 Six Months Ended June 30 Pension Plan Other Benefits 2017 2016 2017 2016 Service cost $ 11,730 $ 10,134 $ 4,038 $ 4,608 Interest cost 11,581 10,906 2,982 3,600 Expected return on plan assets (12,058 ) (10,908 ) (2,436 ) (2,092 ) Amortization of prior service cost 2,890 3,109 22 22 Recognized net actuarial loss 3,504 2,586 1,298 2,523 Net periodic benefit cost $ 17,647 $ 15,827 $ 5,904 $ 8,661 The decrease in other benefits was due to reductions in health care claim payments in 2016. |
Short-term and Long-term Borrow
Short-term and Long-term Borrowings | 6 Months Ended |
Jun. 30, 2017 | |
Debt Disclosure [Abstract] | |
Short-term and Long-term Borrowings | Short-term and Long-term Borrowings In March 2016, Cal Water issued the remaining $50.0 million of First Mortgage Bonds, consisting of $40.0 million of 4.41% series SSS maturing April 16, 2046 and $10.0 million of 4.61% series TTT maturing April 14, 2056. Cash proceeds of approximately $49.7 million , net of $0.3 million debt issuance costs, were received. Cal Water used a portion of the net proceeds from the offering to repay outstanding borrowings on the Company and Cal Water lines of credit of $48.6 million . Both short-term unsecured credit agreements contain affirmative and negative covenants and events of default customary for credit facilities of this type including, among other things, limitations and prohibitions relating to additional indebtedness, liens, mergers, and asset sales. Also, these unsecured credit agreements contain financial covenants governing the Company and its subsidiaries’ consolidated total capitalization ratio and interest coverage ratio. The outstanding borrowings on the Company lines of credit were $55.1 million and $57.1 million as of June 30, 2017 and December 31, 2016, respectively. There were $135.0 million and $40.0 million borrowings on the Cal Water lines of credit as of June 30, 2017 and December 31, 2016, respectively. The average borrowing rate for borrowings on the Company and Cal Water lines of credit during the six months ended June 30, 2017 was 1.82% compared to 1.30% for the same period last year. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes The Company accounts for income taxes under the provisions of ASC 740, Accounting for Income Taxes . The Company adjusts its effective tax rate each quarter to be consistent with the estimated annual effective tax rate. The Company also records the tax effect of unusual or infrequently occurring discrete items. The provision for income taxes consists of the following: Three Months Ended June 30 2017 2016 Income tax provision $ 10,852 $ 7,254 Six Months Ended June 30 2017 2016 Income tax provision $ 10,857 $ 6,510 The increase in the income tax provision for three months ended June 30, 2017 as compared to the three months ended June 30, 2016 was due primarily to an increase in the Company’s earnings in 2017 as compared to 2016, which was partially offset by a $0.1 million tax benefit associated with the settlement of equity awards in 2017. The increase in the income tax provision for six months ended June 30, 2017 as compared to the six months ended June 30, 2016 was due primarily to an increase in the Company’s earnings in 2017 as compared to 2016, which was partially offset by a $0.5 million tax benefit associated with the settlement of equity awards in 2017. The Company’s fiscal year 2017 effective tax rate is estimated to be 37% . As of June 30, 2017 and December 31, 2016, the Company had unrecognized tax benefits of approximately $10.2 million . Included in the balance of unrecognized tax benefits as of June 30, 2017 and December 31, 2016 is approximately $1.9 million of tax benefits that, if recognized, would result in an adjustment to the Company’s effective tax rate. The Company does not expect its unrecognized tax benefits to change significantly within the next 12 months. |
Regulatory Assets and Liabiliti
Regulatory Assets and Liabilities | 6 Months Ended |
Jun. 30, 2017 | |
Regulated Operations [Abstract] | |
Regulatory Assets and Liabilities | Regulatory Assets and Liabilities Regulatory assets and liabilities were comprised of the following as of June 30, 2017 and December 31, 2016 : June 30, 2017 December 31, 2016 Regulatory Assets Pension and retiree group health $ 188,550 $ 188,880 Property-related temporary differences (tax benefits flowed through to customers) 93,326 92,099 Other accrued benefits 26,663 27,503 Net WRAM and MCBA long-term accounts receivable 33,327 16,148 Asset retirement obligations, net 16,488 15,812 Interim rates long-term accounts receivable 4,634 4,605 Tank coating 9,501 8,452 Health care balancing account 227 1,000 Pension balancing account 910 — Other regulatory assets 2,242 1,431 Total Regulatory Assets $ 375,868 $ 355,930 Regulatory Liabilities Future tax benefits due to customers $ 33,317 $ 33,231 Health care balancing account 4,224 — Conservation program 1,358 584 Pension balancing account 146 695 Net WRAM and MCBA long-term payable 720 611 Other regulatory liabilities 804 3,614 Total Regulatory Liabilities $ 40,569 $ 38,735 Short-term regulatory assets and liabilities are excluded from the above table. The short-term regulatory assets were $29.1 million as of June 30, 2017 and $30.3 million as of December 31, 2016 . The short-term regulatory assets were primarily net WRAM and MCBA accounts receivable, 2012 General Rate Case (GRC) health cost balancing account receivable, 2014-2015 drought recovery, interim rate memorandum account receivable, and East LA memorandum accounts receivable as of June 30, 2017 and December 31, 2016 . The short-term portions of regulatory liabilities were $6.7 million as of June 30, 2017 and $4.8 million as of December 31, 2016 . As of June 30, 2017 , the short-term regulatory liabilities were primarily net WRAM and MCBA liability balances, refund balance from an interim rates true up authorized prior to the 2009 GRC, net refund balances to customers for the pension and conservation programs from the 2012 GRC. As of December 31, 2016 , the short-term regulatory liabilities were primarily net WRAM and MCBA liability balances and net refund balances to customers for the pension and conservation programs from the 2012 GRC. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Commitments and Contingencies Commitments The Company has significant commitments to lease certain office spaces and water systems and to purchase water from water wholesalers. These commitments are described in Form 10-K for the year ended December 31, 2016. As of June 30, 2017, there were no significant changes from December 31, 2016. Contingencies Groundwater Contamination The Company has undertaken litigation against third parties to recover past and anticipated costs related to groundwater contamination in our service areas. The cost of litigation is expensed as incurred and any settlement is first offset against such costs. The CPUC’s general policy requires all proceeds from groundwater contamination litigation to be used first to pay transactional expenses, then to make ratepayers whole for water treatment costs to comply with the CPUC’s water quality standards. The CPUC allows for a risk-based consideration of contamination proceeds which exceed the costs of the remediation described above and may result in some sharing of proceeds with the shareholder, determined on a case by case basis. The CPUC has authorized various memorandum accounts that allow the Company to track significant litigation costs to request recovery of these costs in future filings and uses of proceeds to comply with CPUC’s general policy. Other Legal Matters From time to time, the Company is involved in various disputes and litigation matters that arise in the ordinary course of business. The status of each significant matter is reviewed and assessed for potential financial exposure. If the potential loss from any claim or legal proceeding is considered probable and the amount of the range of loss can be estimated, a liability is accrued for the estimated loss in accordance with the accounting standards for contingencies. Legal proceedings are subject to uncertainties, and the outcomes are difficult to predict. Because of such uncertainties, accruals are based on the best information available at the time. While the outcome of these disputes and litigation matters cannot be predicted with any certainty, management does not believe when taking into account existing reserves the ultimate resolution of these matters will materially affect the Company’s financial position, results of operations, or cash flows. As of June 30, 2017 and December 31, 2016, the Company recognized a liability of $6.2 million and $6.0 million , respectively, for known legal matters. The cost of litigation is expensed as incurred and any settlement is first offset against such costs. Any settlement in excess of the cost to litigate is accounted for on a case by case basis, dependent on the nature of the settlement. |
Fair Value of Financial Assets
Fair Value of Financial Assets and Liabilities | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Fair Value of Financial Assets and Liabilities | Fair Value of Financial Assets and Liabilities The accounting guidance for fair value measurements and disclosures provides a single definition of fair value and requires certain disclosures about assets and liabilities measured at fair value. A hierarchical framework for disclosing the observability of the inputs utilized in measuring assets and liabilities at fair value is established by this guidance. The three levels in the hierarchy are as follows: Level 1 - Inputs to the valuation methodology are unadjusted quoted prices for identical assets or liabilities in active markets that the Plan has the ability to access. Level 2 - Inputs to the valuation methodology include: • Quoted market prices for similar assets or liabilities in active markets; • Quoted prices for identical or similar assets or liabilities in inactive markets; • Inputs other than quoted prices that are observable for the asset or liability; and • Inputs that are derived principally from or corroborated by observable market data by correlation or other means. If the asset or liability has a specified (contractual) term, the level 2 input must be observable for substantially the full term of the asset or liability. Level 3 - Inputs to the valuation methodology are unobservable and significant to the fair value measurement. Specific valuation methods include the following: Accounts receivable and accounts payable carrying amounts approximated the fair value because of the short-term maturity of the instruments. Long-term debt fair values were estimated using the published quoted market price, if available, or the discounted cash flow analysis, based on the current rates available using a risk-free rate (a U.S. Treasury securities yield curve) plus a risk premium of 1.70% . Advances for construction fair values were estimated using broker quotes from companies that frequently purchase these investments. June 30, 2017 Fair Value Cost Level 1 Level 2 Level 3 Total Long-term debt, including current maturities $ 555,985 — $ 630,712 — $ 630,712 Advances for construction 182,394 — 75,924 — 75,924 Total $ 738,379 $ — $ 706,636 $ — $ 706,636 December 31, 2016 Fair Value Cost Level 1 Level 2 Level 3 Total Long-term debt, including current maturities $ 557,953 $ — $ 630,510 $ — $ 630,510 Advances for construction 182,448 — 74,460 — 74,460 Total $ 740,401 — $ 704,970 $ — $ 704,970 |
Condensed Consolidating Financi
Condensed Consolidating Financial Statements | 6 Months Ended |
Jun. 30, 2017 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Condensed Consolidating Financial Statements | Condensed Consolidating Financial Statements On April 17, 2009, Cal Water issued $100.0 million aggregate principal amount of 5.875% First Mortgage Bonds due 2019, and on November 17, 2010, Cal Water issued $100.0 million aggregate principal amount of 5.500% First Mortgage Bonds due 2040, all of which are fully and unconditionally guaranteed by the Company. As a result of these guarantee arrangements, the Company is required to present the following condensed consolidating financial information. The investments in affiliates are accounted for and presented using the “equity method” of accounting. The following tables present the condensed consolidating balance sheets as of June 30, 2017 and December 31, 2016, the condensed consolidating statements of income for the three and six months ended June 30, 2017 and 2016, and the condensed consolidating statements of cash flows for the six months ended June 30, 2017 and 2016 of (i) California Water Service Group, the guarantor of the First Mortgage Bonds and the parent company; (ii) California Water Service Company, the issuer of the First Mortgage Bonds and a 100% owned consolidated subsidiary of California Water Service Group; and (iii) the other 100% owned non-guarantor consolidated subsidiaries of California Water Service Group. No other subsidiary of the Company guarantees the securities. The condensed consolidating statement of cash flows for the six months ended June 30, 2016 reflects the retrospective adoption of ASU 2016-09 (refer to Note 2 Summary of Significant Accounting Policies for more details). CALIFORNIA WATER SERVICE GROUP CONDENSED CONSOLIDATING BALANCE SHEET As of June 30, 2017 (In thousands) Parent Company Cal Water All Other Subsidiaries Consolidating Adjustments Consolidated ASSETS Utility plant: Utility plant $ 1,321 $ 2,625,435 $ 206,628 $ (7,197 ) $ 2,826,187 Less accumulated depreciation and amortization (872 ) (842,974 ) (55,694 ) 1,965 (897,575 ) Net utility plant 449 1,782,461 150,934 (5,232 ) 1,928,612 Current assets: Cash and cash equivalents 2,112 20,417 6,574 — 29,103 Receivables and unbilled revenue — 115,606 4,671 — 120,277 Receivables from affiliates 21,786 1,117 143 (23,046 ) — Other current assets 290 19,810 1,100 — 21,200 Total current assets 24,188 156,950 12,488 (23,046 ) 170,580 Other assets: Regulatory assets — 372,048 3,820 — 375,868 Investments in affiliates 668,660 — — (668,660 ) — Long-term affiliate notes receivable 25,037 — — (25,037 ) — Other assets 238 53,928 4,005 (205 ) 57,966 Total other assets 693,935 425,976 7,825 (693,902 ) 433,834 TOTAL ASSETS $ 718,572 $ 2,365,387 $ 171,247 $ (722,180 ) $ 2,533,026 CAPITALIZATION AND LIABILITIES Capitalization: Common stockholders’ equity $ 661,834 $ 597,262 $ 76,682 $ (673,944 ) $ 661,834 Affiliate long-term debt — — 25,037 (25,037 ) — Long-term debt, less current maturities — 518,839 1,036 — 519,875 Total capitalization 661,834 1,116,101 102,755 (698,981 ) 1,181,709 Current liabilities: Current maturities of long-term debt — 35,624 486 — 36,110 Short-term borrowings 55,100 135,000 — — 190,100 Payables to affiliates — 302 22,744 (23,046 ) — Accounts payable — 81,399 2,823 — 84,222 Accrued expenses and other liabilities 126 47,124 3,345 — 50,595 Total current liabilities 55,226 299,449 29,398 (23,046 ) 361,027 Unamortized investment tax credits — 1,798 — — 1,798 Deferred income taxes 1,512 308,164 1,413 (153 ) 310,936 Pension and postretirement benefits other than pensions — 227,186 — — 227,186 Regulatory liabilities and other — 83,579 3,242 — 86,821 Advances for construction — 181,832 562 — 182,394 Contributions in aid of construction — 147,278 33,877 — 181,155 TOTAL CAPITALIZATION AND LIABILITIES $ 718,572 $ 2,365,387 $ 171,247 $ (722,180 ) $ 2,533,026 CALIFORNIA WATER SERVICE GROUP CONDENSED CONSOLIDATING BALANCE SHEET As of December 31, 2016 (In thousands) Parent Company Cal Water All Other Subsidiaries Consolidating Adjustments Consolidated ASSETS Utility plant: Utility plant $ 1,318 $ 2,519,785 $ 203,433 $ (7,197 ) $ 2,717,339 Less accumulated depreciation and amortization (826 ) (805,992 ) (53,163 ) 1,919 (858,062 ) Net utility plant 492 1,713,793 150,270 (5,278 ) 1,859,277 Current assets: Cash and cash equivalents 5,216 13,215 7,061 — 25,492 Receivables and unbilled revenue — 98,850 4,173 — 103,023 Receivables from affiliates 19,566 3,608 8 (23,182 ) — Other current assets 80 12,442 1,032 — 13,554 Total current assets 24,862 128,115 12,274 (23,182 ) 142,069 Other assets: Regulatory assets — 352,139 3,791 — 355,930 Investments in affiliates 666,525 — — (666,525 ) — Long-term affiliate notes receivable 25,744 — — (25,744 ) — Other assets 376 50,361 3,765 (33 ) 54,469 Total other assets 692,645 402,500 7,556 (692,302 ) 410,399 TOTAL ASSETS $ 717,999 $ 2,244,408 $ 170,100 $ (720,762 ) $ 2,411,745 CAPITALIZATION AND LIABILITIES Capitalization: Common stockholders’ equity $ 659,471 $ 595,003 76,833 $ (671,836 ) $ 659,471 Affiliate long-term debt — — 25,744 (25,744 ) — Long-term debt, less current maturities — 530,850 895 — 531,745 Total capitalization 659,471 1,125,853 103,472 (697,580 ) 1,191,216 Current liabilities: Current maturities of long-term debt — 25,657 551 — 26,208 Short-term borrowings 57,100 40,000 — — 97,100 Payables to affiliates — 539 22,643 (23,182 ) — Accounts payable — 74,998 2,815 — 77,813 Accrued expenses and other liabilities 88 47,232 1,789 — 49,109 Total current liabilities 57,188 188,426 27,798 (23,182 ) 250,230 Unamortized investment tax credits — 1,798 — — 1,798 Deferred income taxes 1,340 296,781 803 — 298,924 Pension and postretirement benefits other than pensions — 222,691 — — 222,691 Regulatory and other liabilities — 80,518 3,130 — 83,648 Advances for construction — 181,907 541 — 182,448 Contributions in aid of construction — 146,434 34,356 — 180,790 TOTAL CAPITALIZATION AND LIABILITIES $ 717,999 $ 2,244,408 $ 170,100 $ (720,762 ) $ 2,411,745 CALIFORNIA WATER SERVICE GROUP CONDENSED CONSOLIDATING STATEMENT OF INCOME For the three months ended June 30, 2017 (In thousands) Parent Company Cal Water All Other Subsidiaries Consolidating Adjustments Consolidated Operating revenue $ — $ 161,174 $ 9,958 $ — $ 171,132 Operating expenses: Operations: Water production costs — 62,089 2,042 — 64,131 Administrative and general — 21,147 2,649 — 23,796 Other operations — 16,729 1,725 (126 ) 18,328 Maintenance — 4,509 199 — 4,708 Depreciation and amortization 26 18,102 1,113 (23 ) 19,218 Income tax (benefit) expense (123 ) 9,100 395 263 9,635 Property and other taxes — 5,315 742 — 6,057 Total operating (income) expenses (97 ) 136,991 8,865 114 145,873 Net operating income 97 24,183 1,093 (114 ) 25,259 Other income and expenses: Non-regulated revenue 496 3,469 396 (622 ) 3,739 Non-regulated expenses — (1,428 ) (186 ) — (1,614 ) Allowance for equity funds used during construction — 879 — — 879 Income tax expense on other income and expenses (202 ) (1,190 ) (78 ) 253 (1,217 ) Total other income 294 1,730 132 (369 ) 1,787 Interest: Interest expense 275 8,795 505 (496 ) 9,079 Allowance for borrowed funds used during construction — (542 ) (22 ) — (564 ) Net interest expense 275 8,253 483 (496 ) 8,515 Equity earnings of subsidiaries 18,415 — — (18,415 ) — Net income $ 18,531 $ 17,660 $ 742 $ (18,402 ) $ 18,531 CALIFORNIA WATER SERVICE GROUP CONDENSED CONSOLIDATING STATEMENT OF INCOME For the three months ended June 30, 2016 (In thousands) Parent Company Cal Water All Other Subsidiaries Consolidating Adjustments Consolidated Operating revenue $ — $ 142,342 $ 10,103 $ — $ 152,445 Operating expenses: Operations: Water production costs — 55,643 1,946 — 57,589 Administrative and general — 20,667 2,699 — 23,366 Other operations — 17,365 1,622 (84 ) 18,903 Maintenance — 5,692 242 — 5,934 Depreciation and amortization 57 14,735 1,074 (24 ) 15,842 Income tax (benefit) expense (93 ) 6,228 497 238 6,870 Property and other taxes — 4,669 738 — 5,407 Total operating (income) expenses (36 ) 124,999 8,818 130 133,911 Net operating income 36 17,343 1,285 (130 ) 18,534 Other income and expenses: Non-regulated revenue 462 3,439 423 (560 ) 3,764 Non-regulated expenses — (2,547 ) (262 ) — (2,809 ) Income tax expense on other income and expenses (188 ) (364 ) (60 ) 228 (384 ) Total other income 274 528 101 (332 ) 571 Interest: Interest expense 173 8,263 474 (476 ) 8,434 Less: capitalized interest — (820 ) (17 ) — (837 ) Net interest expense 173 7,443 457 (476 ) 7,597 Equity earnings of subsidiaries 11,371 — — (11,371 ) — Net income $ 11,508 $ 10,428 $ 929 $ (11,357 ) $ 11,508 CALIFORNIA WATER SERVICE GROUP CONDENSED CONSOLIDATING STATEMENT OF INCOME For the six months ended June 30, 2017 (In thousands) Parent Company Cal Water All Other Subsidiaries Consolidating Adjustments Consolidated Operating revenue $ — $ 274,516 $ 18,652 $ — $ 293,168 Operating expenses: Operations: Water production costs — 102,278 3,921 — 106,199 Administrative and general — 43,623 5,422 — 49,045 Other operations — 31,129 3,575 (252 ) 34,452 Maintenance — 10,415 405 — 10,820 Depreciation and amortization 49 36,213 2,203 (46 ) 38,419 Income tax (benefit) expense (226 ) 8,154 303 520 8,751 Property and other taxes (4 ) 10,727 1,450 — 12,173 Total operating (income) expenses (181 ) 242,539 17,279 222 259,859 Net operating income 181 31,977 1,373 (222 ) 33,309 Other income and expenses: Non-regulated revenue 977 6,604 850 (1,230 ) 7,201 Non-regulated expenses — (3,175 ) (493 ) — (3,668 ) Allowance for equity funds used during construction — 1,658 — — 1,658 Income tax expense on other income and expenses (398 ) (2,073 ) (136 ) 501 (2,106 ) Net other income 579 3,014 221 (729 ) 3,085 Interest: Interest expense 510 17,265 991 (977 ) 17,789 Allowance for borrowed funds used during construction — (1,018 ) (40 ) — (1,058 ) Net interest expense 510 16,247 951 (977 ) 16,731 Equity earnings of subsidiaries 19,413 — — (19,413 ) — Net income $ 19,663 $ 18,744 $ 643 $ (19,387 ) $ 19,663 CALIFORNIA WATER SERVICE GROUP CONDENSED CONSOLIDATING STATEMENT OF INCOME For the six months ended June 30, 2016 (In thousands) Parent Company Cal Water All Other Subsidiaries Consolidating Adjustments Consolidated Operating revenue $ — $ 255,369 $ 18,803 $ — $ 274,172 Operating expenses: Operations: Water production costs — 94,888 3,770 — 98,658 Administrative and general — 45,610 5,583 — 51,193 Other operations — 35,091 3,324 (210 ) 38,205 Maintenance — 11,532 465 — 11,997 Depreciation and amortization 114 29,650 2,172 (48 ) 31,888 Income tax (benefit) expense (187 ) 5,191 446 495 5,945 Property and other taxes — 10,059 1,423 — 11,482 Total operating (income) expenses (73 ) 232,021 17,183 237 249,368 Net operating income 73 23,348 1,620 (237 ) 24,804 Other income and expenses: Non-regulated revenue 926 6,635 797 (1,166 ) 7,192 Non-regulated expenses — (5,252 ) (537 ) — (5,789 ) Income tax expense on other income and expenses (377 ) (564 ) (99 ) 475 (565 ) Total other income 549 819 161 (691 ) 838 Interest: Interest expense 346 16,162 947 (956 ) 16,499 Less: capitalized interest — (1,534 ) (33 ) — (1,567 ) Net interest expense 346 14,628 914 (956 ) 14,932 Equity earnings of subsidiaries 10,434 — — (10,434 ) — Net income $ 10,710 $ 9,539 $ 867 $ (10,406 ) $ 10,710 CALIFORNIA WATER SERVICE GROUP CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS For the six months ended June 30, 2017 (In thousands) Parent Company Cal Water All Other Subsidiaries Consolidating Adjustments Consolidated Operating activities: Net income $ 19,663 $ 18,744 $ 643 $ (19,387 ) $ 19,663 Adjustments to reconcile net income to net cash provided by operating activities: Equity earnings of subsidiaries (19,413 ) — — 19,413 — Dividends received from affiliates 17,278 — — (17,278 ) — Depreciation and amortization 47 37,074 2,253 (46 ) 39,328 Changes in value of life insurance contracts — (1,208 ) — — (1,208 ) Allowance for equity funds used during construction — (1,658 ) — — (1,658 ) Changes in operating assets and liabilities (172 ) (40,755 ) 841 — (40,086 ) Other changes in noncurrent assets and liabilities 1,520 17,650 497 20 19,687 Net cash provided by operating activities 18,923 29,847 4,234 (17,278 ) 35,726 Investing activities: Utility plant expenditures — (105,684 ) (3,028 ) — (108,712 ) Changes in affiliate advances 429 2,491 (138 ) (2,782 ) — Issuance of affiliate short-term borrowings (2,610 ) — — 2,610 — Reduction of affiliates long-term debt 668 — — (668 ) — Life insurance proceeds — 450 — — 450 Purchase of life insurance contracts — (1,216 ) — — (1,216 ) Changes in restricted cash — (598 ) — — (598 ) Net cash used in investing activities (1,513 ) (104,557 ) (3,166 ) (840 ) (110,076 ) Financing Activities: Short-term borrowings — 140,000 — — 140,000 Repayment of short-term borrowings (2,000 ) (45,000 ) — — (47,000 ) Changes in affiliate advances — (238 ) (2,544 ) 2,782 — Proceeds from affiliate short-term borrowings — — 2,610 (2,610 ) — Repayment of affiliates long-term borrowings — — (668 ) 668 — Repayment of long-term debt — (2,161 ) (246 ) — (2,407 ) Advances and contributions in aid of construction — 10,225 87 — 10,312 Refunds of advances for construction — (4,430 ) — — (4,430 ) Repurchase of common stock (1,236 ) — — — (1,236 ) Dividends paid to non-affiliates (17,278 ) — — — (17,278 ) Dividends paid to affiliates — (16,484 ) (794 ) 17,278 — Net cash (used in) provided by financing activities (20,514 ) 81,912 (1,555 ) 18,118 77,961 Change in cash and cash equivalents (3,104 ) 7,202 (487 ) — 3,611 Cash and cash equivalents at beginning of period 5,216 13,215 7,061 — 25,492 Cash and cash equivalents at end of period $ 2,112 $ 20,417 $ 6,574 $ — $ 29,103 CALIFORNIA WATER SERVICE GROUP CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS For the six months ended June 30, 2016 (In thousands) Parent Company Cal Water All Other Subsidiaries Consolidating Adjustments Consolidated Operating activities: Net income $ 10,710 $ 9,539 $ 867 $ (10,406 ) $ 10,710 Adjustments to reconcile net income to net cash provided by operating activities: Equity earnings of subsidiaries (10,434 ) — — 10,434 — Dividends received from affiliates 16,532 — — (16,532 ) — Depreciation and amortization 114 30,372 2,263 (48 ) 32,701 Changes in value of life insurance contracts — (336 ) — — (336 ) Changes in operating assets and liabilities (218 ) (987 ) 984 — (221 ) Other changes in noncurrent assets and liabilities 1,440 14,567 730 20 16,757 Net cash provided by operating activities 18,144 53,155 4,844 (16,532 ) 59,611 Investing activities: Utility plant expenditures — (113,894 ) (2,261 ) — (116,155 ) Changes in affiliate advances (561 ) 787 (199 ) (27 ) — Reduction of affiliate short-term borrowings 2,000 42,100 — (44,100 ) — Issuance of affiliate short-term borrowings (2,615 ) (20,600 ) — 23,215 — Reduction of affiliates long-term debt 544 — — (544 ) — Life insurance proceeds — 495 — — 495 Purchase of life insurance contracts — (1,065 ) — — (1,065 ) Changes in restricted cash — (653 ) — — (653 ) Net cash used in investing activities (632 ) (92,830 ) (2,460 ) (21,456 ) (117,378 ) Financing Activities: Short-term borrowings 42,100 61,000 — — 103,100 Repayment of short-term borrowings (20,615 ) (41,000 ) — — (61,615 ) Changes in affiliate advances — 651 (678 ) 27 — Proceeds from affiliate short-term borrowings 20,600 — 2,615 (23,215 ) — Repayment of affiliate short-term borrowings (42,100 ) — (2,000 ) 44,100 — Repayment of affiliates long-term borrowings — — (544 ) 544 — Proceeds from long-term debt, net of issuance costs — 49,823 — — 49,823 Repayment of long-term debt — (2,287 ) (176 ) — (2,463 ) Advances and contributions in aid for construction — 11,413 50 — 11,463 Refunds of advances for construction — (3,454 ) (18 ) — (3,472 ) Repurchase of common stock (548 ) — — — (548 ) Dividends paid to non-affiliates — (16,135 ) (397 ) — (16,532 ) Dividends paid to affiliates (16,532 ) — — 16,532 — Net cash (used in) provided by financing activities (17,095 ) 60,011 (1,148 ) 37,988 79,756 Change in cash and cash equivalents 417 20,336 1,236 — 21,989 Cash and cash equivalents at beginning of period 582 4,270 3,985 — 8,837 Cash and cash equivalents at end of period $ 999 $ 24,606 $ 5,221 $ — $ 30,826 |
Summary of Significant Accoun19
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Revenue | Revenue Revenue generally includes monthly cycle customer billings for regulated water and wastewater services at rates authorized by the Commissions (plus an estimate for water used between the customer's last meter reading and the end of the accounting period) and billings to certain non-regulated customers at rates authorized by contract with government agencies. The Company’s regulated water and wastewater revenue requirements are authorized by the Commissions in the states in which they operate. The revenue requirements are intended to provide the Company a reasonable opportunity to recover its operating costs and earn a return on investments. For metered customers, Cal Water recognizes revenue from rates which are designed and authorized by the California Public Utilities Commission (CPUC). Under the Water Revenue Adjustment Mechanism (WRAM), Cal Water records the adopted level of volumetric revenues, which would include recovery of cost of service and a return on investments, as established by the CPUC for metered accounts. The adopted volumetric revenue considers the seasonality of consumption of water based upon historical averages. The variance between adopted volumetric revenues and actual billed volumetric revenues for metered accounts is recorded as a component of revenue with an offsetting entry to a regulatory asset or liability balancing account (tracked individually for each Cal Water district) subject to certain criteria under the accounting guidance for regulated operations. The variance amount represents amounts that will be billed or refunded to customers in the future. In addition to volumetric revenues, the revenue requirements approved by the CPUC include service charges, flat rate charges, and other items not subject to the WRAM. Cost-recovery rates are designed to permit full recovery of certain costs allowed to be recovered by the Commissions. Cost-recovery rates such as the Modified Cost Balancing Account (MCBA) provide for recovery of adopted expense levels for purchased water, purchased power and pump taxes, as established by the CPUC. In addition, cost-recovery rates include recovery of costs related to water conservation programs and certain other operating expenses adopted by the CPUC. Variances (which include the effects of changes in both rates and volumes for the MCBA) between adopted and actual costs are recorded as a component of revenue, as the amount of such variances will be recovered from or refunded to customers in the future. Cost-recovery expenses are generally recognized when expenses are incurred with no markup for return on investments or profit. The balances in the WRAM and MCBA assets and liabilities accounts will fluctuate on a monthly basis depending upon the variance between adopted and actual results. The recovery or refund of the WRAM is netted against the MCBA over- or under-recovery for the corresponding district and the deferred net balances are interest bearing at the current 90 day commercial paper rate. Subsequent to calendar year-end, Cal Water files with the CPUC to refund or collect the balance in the accounts. The majority of under-collected net WRAM and MCBA receivable balances are collected over 12 or 18 months. Cal Water defers net WRAM and MCBA operating revenues and associated costs whenever the net receivable balances are estimated to be collected more than 24 months after the respective reporting period in which it was recorded. The deferred net WRAM and MCBA revenue and associated costs were determined using forecasts of customer consumption trends in future reporting periods and the estimated timing of when the CPUC will authorize Cal Water's filings to recover unbilled balances. Deferred revenues and associated costs are recorded in the periods when the collection is within 24 months of the respective reporting period. Customers' meter reads occur on various business days throughout the month. As a result, there are unmetered or unbilled customer usage each month. The estimated unbilled revenue for monthly unmetered customer usage is recorded using the number of unbilled days for that month and average daily customer billing rate for the previous month. The average daily customer billing rate for the previous month fluctuates depending on customer usage. Estimated unbilled revenue is not included in the WRAM until it is billed. Flat rate customers are billed in advance at the beginning of the service period. The revenue is prorated so that the portion of revenue applicable to the current period is included in that period’s revenue, with the balance recorded as unearned revenue on the balance sheet and recognized as revenue when earned in the subsequent accounting period. The unearned revenue liability was $0.8 million as of June 30, 2017 and December 31, 2016 , respectively. This liability is included in “accrued expenses and other liabilities” on the condensed consolidated balance sheets. |
Allowance for Funds Used During Construction | Allowance for Funds Used During Construction The allowance for funds used during construction (AFUDC) represents the capitalized cost of funds used to finance the construction of the utility plant. In general, AFUDC is applied to Cal Water construction projects requiring more than one month to complete. No AFUDC is applied to projects funded by customer advances for construction, contributions in aid of construction, or applicable state-revolving fund loans. AFUDC includes the net cost of borrowed funds and a rate of return on other funds when used, and is recovered through water rates as the utility plant is depreciated. Cal Water was authorized by the CPUC to record AFUDC on construction work in progress effective January 1, 2017. Prior to January 1, 2017, the CPUC authorized Cal Water to only record capitalized interest on borrowed funds. Cal Water previously reported the amounts authorized as capitalized interest and a reduction to interest expense. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash equivalents include highly liquid investments with maturities of three months or less. Cash and cash equivalents was $29.1 million and $25.5 million as of June 30, 2017 and December 31, 2016 , respectively. Restricted cash was presented on the condensed consolidated balance sheet in “taxes, prepaid expenses and other assets” and was $1.0 million and $0.4 million as of June 30, 2017 and December 31, 2016 , respectively. |
Adoption of New Accounting Standards | Adoption of New Accounting Standards In March 2016, the Financial Accounting Standards Board (FASB) issued updated accounting guidance on simplifying the accounting for share-based payments (ASU 2016-09), which includes the accounting for share-based payment transactions, the income tax consequences, classification of awards as either equity or liabilities, and classification on the statement of cash flows. The Company adopted and implemented the changes to accounting for share-based payments on January 1, 2017 and applied the requirements retrospectively on the statement of cash flows for all periods presented. The Company's forfeiture policy did not change and the Company continues to account for forfeitures when they occur. For the six month period ended June 30, 2016, the Company recorded $0.5 million of income tax benefits in excess of compensation costs for share-based compensation which reduced the effective tax rate. The tax-related cash flows resulting from share-based payments were reported as operating activities and the associated cash paid by the company for employee tax withholding transactions were reported as financing activities on the consolidated statement of cash flows. The following table shows the effect of the accounting change to the Condensed Consolidated Statements of Cash Flows for the six month period ended June 30, 2016: Six Months Ended June 30, 2016 Cash Flow Classification As Reported on Form 10-Q Adjusted Balance on Form 10-Q Increase (Decrease) from Retrospective Adoption Other changes in noncurrent assets and liabilities $ 16,209 $ 16,757 $ 548 Net cash provided by operating activities 59,063 59,611 548 Repurchase of common stock — (548 ) (548 ) Net cash provided by financing activities 80,304 79,756 (548 ) New Accounting Standards In May 2014, the FASB issued ASU No. 2014-09, Revenue from Contracts with Customers, which amends the existing revenue recognition guidance. In August 2015, the FASB deferred the effective date of this amendment for public companies by one year to January 1, 2018, with early adoption permitted as of the original effective date of January 1, 2017. The Company expects to adopt the new revenue standard using the modified retrospective method and does not expect the ASU to materially impact the timing or recognition of revenue related to the sale and delivery of water to their customers, which is a significant percentage of the Company's revenue. The Company is still evaluating the impact the ASU has on the related revenue disclosures. In February 2016, the FASB issued ASU 2016-02, Leases . This update changes the accounting treatment of operating leases for lessees and related disclosure requirements. ASU 2016-02 is effective for annual reporting periods beginning after December 15, 2018 and early adoption is permitted. The Company will adopt the standard using the modified retrospective method for its existing leases and is currently evaluating the impact of adopting the new lease standard on its consolidated financial statements and related disclosures. In August 2016, the FASB issued ASU 2016-15, Statement of Cash Flows (Topic 230) - Classification of Certain Cash Receipts and Cash Payments . This update adds and clarifies guidance on the classification of certain cash receipts and payments in the statement of cash flows. ASU 2016-15 is effective for annual periods beginning after December 15, 2017 and early adoption is permitted. The Company is currently evaluating the impact on its consolidated financial statements and related disclosures. In March 2017, the FASB issued Accounting Standards Update No. 2017-07, Improving the Presentation of Net Periodic Pension Cost and Net Periodic Postretirement Benefit Cost (“ASU 2017-07”). The update requires employers to present the service cost component of the net periodic benefit cost in the same income statement line item as other employee compensation costs arising from services rendered during the period. The other components of net benefit cost, including interest cost, expected return on plan assets, amortization of prior service cost/credit and actuarial gain/loss, and settlement and curtailment effects, are to be presented as non-operating items. Employers will have to disclose the line(s) used to present the other components of net periodic benefit cost, if the components are not presented separately in the income statement . The standard only allows the service cost component to be eligible for capitalization. ASU 2017-07 is effective for annual periods after December 15, 2017, and early adoption is permitted. The Company is currently evaluating the impact on its consolidated financial statements and related disclosures. The adoption of this guidance will change the Company's financial statement presentation of net benefit costs. However, based on current regulatory authorization, the changes required by the standard are not expected to materially impact the results of operations. |
Summary of Significant Accoun20
Summary of Significant Accounting Policies (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Accounting Policies [Abstract] | |
Allowance for Funds Used During Construction | The amount of AFUDC related to equity funds and to borrowed funds for the three and six month periods ended June 30, 2017 and 2016 are shown in the tables below: Three Months Ended June 30 2017 2016 Change Allowance for equity funds used during construction $ 879 $ — $ 879 Allowance for borrowed funds used during construction 564 837 (273 ) Total $ 1,443 $ 837 $ 606 Six Months Ended June 30 2017 2016 Change Allowance for equity funds used during construction $ 1,658 $ — $ 1,658 Allowance for borrowed funds used during construction 1,058 1,567 (509 ) Total $ 2,716 $ 1,567 $ 1,149 |
Schedule of Effect of Accounting Changes | The following table shows the effect of the accounting change to the Condensed Consolidated Statements of Cash Flows for the six month period ended June 30, 2016: Six Months Ended June 30, 2016 Cash Flow Classification As Reported on Form 10-Q Adjusted Balance on Form 10-Q Increase (Decrease) from Retrospective Adoption Other changes in noncurrent assets and liabilities $ 16,209 $ 16,757 $ 548 Net cash provided by operating activities 59,063 59,611 548 Repurchase of common stock — (548 ) (548 ) Net cash provided by financing activities 80,304 79,756 (548 ) |
Equity (Tables)
Equity (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Equity [Abstract] | |
Schedule of changes in total common stockholders' equity | The Company’s changes in total common stockholders’ equity for the six months ended June 30, 2017 were as follows: Total Common Stockholders’ Equity Balance at December 31, 2016 $ 659,471 Common stock issued — Share-based compensation expense (22 ) Common stock dividends declared (17,278 ) Net income 19,663 Balance at June 30, 2017 $ 661,834 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Earnings Per Share [Abstract] | |
Schedule of SARs which were dilutive | All the SARs were dilutive when they were outstanding during the period, as shown in the tables below. Three Months Ended June 30 2017 2016 (In thousands, except per share data) Net income available to common stockholders $ 18,531 $ 11,508 Weighted average common shares outstanding, basic 48,020 47,972 Dilutive SARs (treasury method) — — Weighted average common shares outstanding, dilutive 48,020 47,972 Earnings per share - basic $ 0.39 $ 0.24 Earnings per share - diluted $ 0.39 $ 0.24 Six Months Ended June 30 2017 2016 (In thousands, except per share data) Net income available to common stockholders $ 19,663 $ 10,710 Weighted average common shares outstanding, basic 48,002 47,938 Dilutive SARs (treasury method) — 5 Weighted average common shares outstanding, dilutive 48,002 47,943 Earnings per share - basic $ 0.41 $ 0.22 Earnings per share - diluted $ 0.41 $ 0.22 |
Pension Plan and Other Postre23
Pension Plan and Other Postretirement Benefits (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Retirement Benefits [Abstract] | |
Schedule of components of net periodic benefit costs for the pension plans and other postretirement benefits | The following table lists components of net periodic benefit costs for the pension plans and other postretirement benefits. The data listed under “pension plan” includes the qualified pension plan and the non-qualified supplemental executive retirement plan. The data listed under “other benefits” is for all other postretirement benefits. Three Months Ended June 30 Pension Plan Other Benefits 2017 2016 2017 2016 Service cost $ 5,865 $ 5,067 $ 2,019 $ 2,304 Interest cost 5,791 5,453 1,491 1,800 Expected return on plan assets (6,029 ) (5,454 ) (1,218 ) (1,046 ) Amortization of prior service cost 1,445 1,555 11 11 Recognized net actuarial loss 1,752 1,293 649 1,261 Net periodic benefit cost $ 8,824 $ 7,914 $ 2,952 $ 4,330 Six Months Ended June 30 Pension Plan Other Benefits 2017 2016 2017 2016 Service cost $ 11,730 $ 10,134 $ 4,038 $ 4,608 Interest cost 11,581 10,906 2,982 3,600 Expected return on plan assets (12,058 ) (10,908 ) (2,436 ) (2,092 ) Amortization of prior service cost 2,890 3,109 22 22 Recognized net actuarial loss 3,504 2,586 1,298 2,523 Net periodic benefit cost $ 17,647 $ 15,827 $ 5,904 $ 8,661 |
Income Taxes (Tables)
Income Taxes (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Income Tax Disclosure [Abstract] | |
Schedule of Components of Income Tax Expense (Benefit) | The provision for income taxes consists of the following: Three Months Ended June 30 2017 2016 Income tax provision $ 10,852 $ 7,254 Six Months Ended June 30 2017 2016 Income tax provision $ 10,857 $ 6,510 |
Regulatory Assets and Liabili25
Regulatory Assets and Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Regulated Operations [Abstract] | |
Schedule of regulatory assets and liabilities | Regulatory assets and liabilities were comprised of the following as of June 30, 2017 and December 31, 2016 : June 30, 2017 December 31, 2016 Regulatory Assets Pension and retiree group health $ 188,550 $ 188,880 Property-related temporary differences (tax benefits flowed through to customers) 93,326 92,099 Other accrued benefits 26,663 27,503 Net WRAM and MCBA long-term accounts receivable 33,327 16,148 Asset retirement obligations, net 16,488 15,812 Interim rates long-term accounts receivable 4,634 4,605 Tank coating 9,501 8,452 Health care balancing account 227 1,000 Pension balancing account 910 — Other regulatory assets 2,242 1,431 Total Regulatory Assets $ 375,868 $ 355,930 Regulatory Liabilities Future tax benefits due to customers $ 33,317 $ 33,231 Health care balancing account 4,224 — Conservation program 1,358 584 Pension balancing account 146 695 Net WRAM and MCBA long-term payable 720 611 Other regulatory liabilities 804 3,614 Total Regulatory Liabilities $ 40,569 $ 38,735 |
Fair Value of Financial Asset26
Fair Value of Financial Assets and Liabilities (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value of long-term debt, including current maturities and advances for construction | Advances for construction fair values were estimated using broker quotes from companies that frequently purchase these investments. June 30, 2017 Fair Value Cost Level 1 Level 2 Level 3 Total Long-term debt, including current maturities $ 555,985 — $ 630,712 — $ 630,712 Advances for construction 182,394 — 75,924 — 75,924 Total $ 738,379 $ — $ 706,636 $ — $ 706,636 December 31, 2016 Fair Value Cost Level 1 Level 2 Level 3 Total Long-term debt, including current maturities $ 557,953 $ — $ 630,510 $ — $ 630,510 Advances for construction 182,448 — 74,460 — 74,460 Total $ 740,401 — $ 704,970 $ — $ 704,970 |
Condensed Consolidating Finan27
Condensed Consolidating Financial Statements (Tables) | 6 Months Ended |
Jun. 30, 2017 | |
Condensed Financial Information of Parent Company Only Disclosure [Abstract] | |
Schedule of Condensed Consolidating Balance Sheet | CALIFORNIA WATER SERVICE GROUP CONDENSED CONSOLIDATING BALANCE SHEET As of June 30, 2017 (In thousands) Parent Company Cal Water All Other Subsidiaries Consolidating Adjustments Consolidated ASSETS Utility plant: Utility plant $ 1,321 $ 2,625,435 $ 206,628 $ (7,197 ) $ 2,826,187 Less accumulated depreciation and amortization (872 ) (842,974 ) (55,694 ) 1,965 (897,575 ) Net utility plant 449 1,782,461 150,934 (5,232 ) 1,928,612 Current assets: Cash and cash equivalents 2,112 20,417 6,574 — 29,103 Receivables and unbilled revenue — 115,606 4,671 — 120,277 Receivables from affiliates 21,786 1,117 143 (23,046 ) — Other current assets 290 19,810 1,100 — 21,200 Total current assets 24,188 156,950 12,488 (23,046 ) 170,580 Other assets: Regulatory assets — 372,048 3,820 — 375,868 Investments in affiliates 668,660 — — (668,660 ) — Long-term affiliate notes receivable 25,037 — — (25,037 ) — Other assets 238 53,928 4,005 (205 ) 57,966 Total other assets 693,935 425,976 7,825 (693,902 ) 433,834 TOTAL ASSETS $ 718,572 $ 2,365,387 $ 171,247 $ (722,180 ) $ 2,533,026 CAPITALIZATION AND LIABILITIES Capitalization: Common stockholders’ equity $ 661,834 $ 597,262 $ 76,682 $ (673,944 ) $ 661,834 Affiliate long-term debt — — 25,037 (25,037 ) — Long-term debt, less current maturities — 518,839 1,036 — 519,875 Total capitalization 661,834 1,116,101 102,755 (698,981 ) 1,181,709 Current liabilities: Current maturities of long-term debt — 35,624 486 — 36,110 Short-term borrowings 55,100 135,000 — — 190,100 Payables to affiliates — 302 22,744 (23,046 ) — Accounts payable — 81,399 2,823 — 84,222 Accrued expenses and other liabilities 126 47,124 3,345 — 50,595 Total current liabilities 55,226 299,449 29,398 (23,046 ) 361,027 Unamortized investment tax credits — 1,798 — — 1,798 Deferred income taxes 1,512 308,164 1,413 (153 ) 310,936 Pension and postretirement benefits other than pensions — 227,186 — — 227,186 Regulatory liabilities and other — 83,579 3,242 — 86,821 Advances for construction — 181,832 562 — 182,394 Contributions in aid of construction — 147,278 33,877 — 181,155 TOTAL CAPITALIZATION AND LIABILITIES $ 718,572 $ 2,365,387 $ 171,247 $ (722,180 ) $ 2,533,026 CALIFORNIA WATER SERVICE GROUP CONDENSED CONSOLIDATING BALANCE SHEET As of December 31, 2016 (In thousands) Parent Company Cal Water All Other Subsidiaries Consolidating Adjustments Consolidated ASSETS Utility plant: Utility plant $ 1,318 $ 2,519,785 $ 203,433 $ (7,197 ) $ 2,717,339 Less accumulated depreciation and amortization (826 ) (805,992 ) (53,163 ) 1,919 (858,062 ) Net utility plant 492 1,713,793 150,270 (5,278 ) 1,859,277 Current assets: Cash and cash equivalents 5,216 13,215 7,061 — 25,492 Receivables and unbilled revenue — 98,850 4,173 — 103,023 Receivables from affiliates 19,566 3,608 8 (23,182 ) — Other current assets 80 12,442 1,032 — 13,554 Total current assets 24,862 128,115 12,274 (23,182 ) 142,069 Other assets: Regulatory assets — 352,139 3,791 — 355,930 Investments in affiliates 666,525 — — (666,525 ) — Long-term affiliate notes receivable 25,744 — — (25,744 ) — Other assets 376 50,361 3,765 (33 ) 54,469 Total other assets 692,645 402,500 7,556 (692,302 ) 410,399 TOTAL ASSETS $ 717,999 $ 2,244,408 $ 170,100 $ (720,762 ) $ 2,411,745 CAPITALIZATION AND LIABILITIES Capitalization: Common stockholders’ equity $ 659,471 $ 595,003 76,833 $ (671,836 ) $ 659,471 Affiliate long-term debt — — 25,744 (25,744 ) — Long-term debt, less current maturities — 530,850 895 — 531,745 Total capitalization 659,471 1,125,853 103,472 (697,580 ) 1,191,216 Current liabilities: Current maturities of long-term debt — 25,657 551 — 26,208 Short-term borrowings 57,100 40,000 — — 97,100 Payables to affiliates — 539 22,643 (23,182 ) — Accounts payable — 74,998 2,815 — 77,813 Accrued expenses and other liabilities 88 47,232 1,789 — 49,109 Total current liabilities 57,188 188,426 27,798 (23,182 ) 250,230 Unamortized investment tax credits — 1,798 — — 1,798 Deferred income taxes 1,340 296,781 803 — 298,924 Pension and postretirement benefits other than pensions — 222,691 — — 222,691 Regulatory and other liabilities — 80,518 3,130 — 83,648 Advances for construction — 181,907 541 — 182,448 Contributions in aid of construction — 146,434 34,356 — 180,790 TOTAL CAPITALIZATION AND LIABILITIES $ 717,999 $ 2,244,408 $ 170,100 $ (720,762 ) $ 2,411,745 |
Schedule of Condensed Consolidating Statement of Income | CALIFORNIA WATER SERVICE GROUP CONDENSED CONSOLIDATING STATEMENT OF INCOME For the three months ended June 30, 2017 (In thousands) Parent Company Cal Water All Other Subsidiaries Consolidating Adjustments Consolidated Operating revenue $ — $ 161,174 $ 9,958 $ — $ 171,132 Operating expenses: Operations: Water production costs — 62,089 2,042 — 64,131 Administrative and general — 21,147 2,649 — 23,796 Other operations — 16,729 1,725 (126 ) 18,328 Maintenance — 4,509 199 — 4,708 Depreciation and amortization 26 18,102 1,113 (23 ) 19,218 Income tax (benefit) expense (123 ) 9,100 395 263 9,635 Property and other taxes — 5,315 742 — 6,057 Total operating (income) expenses (97 ) 136,991 8,865 114 145,873 Net operating income 97 24,183 1,093 (114 ) 25,259 Other income and expenses: Non-regulated revenue 496 3,469 396 (622 ) 3,739 Non-regulated expenses — (1,428 ) (186 ) — (1,614 ) Allowance for equity funds used during construction — 879 — — 879 Income tax expense on other income and expenses (202 ) (1,190 ) (78 ) 253 (1,217 ) Total other income 294 1,730 132 (369 ) 1,787 Interest: Interest expense 275 8,795 505 (496 ) 9,079 Allowance for borrowed funds used during construction — (542 ) (22 ) — (564 ) Net interest expense 275 8,253 483 (496 ) 8,515 Equity earnings of subsidiaries 18,415 — — (18,415 ) — Net income $ 18,531 $ 17,660 $ 742 $ (18,402 ) $ 18,531 CALIFORNIA WATER SERVICE GROUP CONDENSED CONSOLIDATING STATEMENT OF INCOME For the three months ended June 30, 2016 (In thousands) Parent Company Cal Water All Other Subsidiaries Consolidating Adjustments Consolidated Operating revenue $ — $ 142,342 $ 10,103 $ — $ 152,445 Operating expenses: Operations: Water production costs — 55,643 1,946 — 57,589 Administrative and general — 20,667 2,699 — 23,366 Other operations — 17,365 1,622 (84 ) 18,903 Maintenance — 5,692 242 — 5,934 Depreciation and amortization 57 14,735 1,074 (24 ) 15,842 Income tax (benefit) expense (93 ) 6,228 497 238 6,870 Property and other taxes — 4,669 738 — 5,407 Total operating (income) expenses (36 ) 124,999 8,818 130 133,911 Net operating income 36 17,343 1,285 (130 ) 18,534 Other income and expenses: Non-regulated revenue 462 3,439 423 (560 ) 3,764 Non-regulated expenses — (2,547 ) (262 ) — (2,809 ) Income tax expense on other income and expenses (188 ) (364 ) (60 ) 228 (384 ) Total other income 274 528 101 (332 ) 571 Interest: Interest expense 173 8,263 474 (476 ) 8,434 Less: capitalized interest — (820 ) (17 ) — (837 ) Net interest expense 173 7,443 457 (476 ) 7,597 Equity earnings of subsidiaries 11,371 — — (11,371 ) — Net income $ 11,508 $ 10,428 $ 929 $ (11,357 ) $ 11,508 CALIFORNIA WATER SERVICE GROUP CONDENSED CONSOLIDATING STATEMENT OF INCOME For the six months ended June 30, 2017 (In thousands) Parent Company Cal Water All Other Subsidiaries Consolidating Adjustments Consolidated Operating revenue $ — $ 274,516 $ 18,652 $ — $ 293,168 Operating expenses: Operations: Water production costs — 102,278 3,921 — 106,199 Administrative and general — 43,623 5,422 — 49,045 Other operations — 31,129 3,575 (252 ) 34,452 Maintenance — 10,415 405 — 10,820 Depreciation and amortization 49 36,213 2,203 (46 ) 38,419 Income tax (benefit) expense (226 ) 8,154 303 520 8,751 Property and other taxes (4 ) 10,727 1,450 — 12,173 Total operating (income) expenses (181 ) 242,539 17,279 222 259,859 Net operating income 181 31,977 1,373 (222 ) 33,309 Other income and expenses: Non-regulated revenue 977 6,604 850 (1,230 ) 7,201 Non-regulated expenses — (3,175 ) (493 ) — (3,668 ) Allowance for equity funds used during construction — 1,658 — — 1,658 Income tax expense on other income and expenses (398 ) (2,073 ) (136 ) 501 (2,106 ) Net other income 579 3,014 221 (729 ) 3,085 Interest: Interest expense 510 17,265 991 (977 ) 17,789 Allowance for borrowed funds used during construction — (1,018 ) (40 ) — (1,058 ) Net interest expense 510 16,247 951 (977 ) 16,731 Equity earnings of subsidiaries 19,413 — — (19,413 ) — Net income $ 19,663 $ 18,744 $ 643 $ (19,387 ) $ 19,663 CALIFORNIA WATER SERVICE GROUP CONDENSED CONSOLIDATING STATEMENT OF INCOME For the six months ended June 30, 2016 (In thousands) Parent Company Cal Water All Other Subsidiaries Consolidating Adjustments Consolidated Operating revenue $ — $ 255,369 $ 18,803 $ — $ 274,172 Operating expenses: Operations: Water production costs — 94,888 3,770 — 98,658 Administrative and general — 45,610 5,583 — 51,193 Other operations — 35,091 3,324 (210 ) 38,205 Maintenance — 11,532 465 — 11,997 Depreciation and amortization 114 29,650 2,172 (48 ) 31,888 Income tax (benefit) expense (187 ) 5,191 446 495 5,945 Property and other taxes — 10,059 1,423 — 11,482 Total operating (income) expenses (73 ) 232,021 17,183 237 249,368 Net operating income 73 23,348 1,620 (237 ) 24,804 Other income and expenses: Non-regulated revenue 926 6,635 797 (1,166 ) 7,192 Non-regulated expenses — (5,252 ) (537 ) — (5,789 ) Income tax expense on other income and expenses (377 ) (564 ) (99 ) 475 (565 ) Total other income 549 819 161 (691 ) 838 Interest: Interest expense 346 16,162 947 (956 ) 16,499 Less: capitalized interest — (1,534 ) (33 ) — (1,567 ) Net interest expense 346 14,628 914 (956 ) 14,932 Equity earnings of subsidiaries 10,434 — — (10,434 ) — Net income $ 10,710 $ 9,539 $ 867 $ (10,406 ) $ 10,710 |
Schedule of Condensed Consolidating Statement of Cash Flows | CALIFORNIA WATER SERVICE GROUP CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS For the six months ended June 30, 2017 (In thousands) Parent Company Cal Water All Other Subsidiaries Consolidating Adjustments Consolidated Operating activities: Net income $ 19,663 $ 18,744 $ 643 $ (19,387 ) $ 19,663 Adjustments to reconcile net income to net cash provided by operating activities: Equity earnings of subsidiaries (19,413 ) — — 19,413 — Dividends received from affiliates 17,278 — — (17,278 ) — Depreciation and amortization 47 37,074 2,253 (46 ) 39,328 Changes in value of life insurance contracts — (1,208 ) — — (1,208 ) Allowance for equity funds used during construction — (1,658 ) — — (1,658 ) Changes in operating assets and liabilities (172 ) (40,755 ) 841 — (40,086 ) Other changes in noncurrent assets and liabilities 1,520 17,650 497 20 19,687 Net cash provided by operating activities 18,923 29,847 4,234 (17,278 ) 35,726 Investing activities: Utility plant expenditures — (105,684 ) (3,028 ) — (108,712 ) Changes in affiliate advances 429 2,491 (138 ) (2,782 ) — Issuance of affiliate short-term borrowings (2,610 ) — — 2,610 — Reduction of affiliates long-term debt 668 — — (668 ) — Life insurance proceeds — 450 — — 450 Purchase of life insurance contracts — (1,216 ) — — (1,216 ) Changes in restricted cash — (598 ) — — (598 ) Net cash used in investing activities (1,513 ) (104,557 ) (3,166 ) (840 ) (110,076 ) Financing Activities: Short-term borrowings — 140,000 — — 140,000 Repayment of short-term borrowings (2,000 ) (45,000 ) — — (47,000 ) Changes in affiliate advances — (238 ) (2,544 ) 2,782 — Proceeds from affiliate short-term borrowings — — 2,610 (2,610 ) — Repayment of affiliates long-term borrowings — — (668 ) 668 — Repayment of long-term debt — (2,161 ) (246 ) — (2,407 ) Advances and contributions in aid of construction — 10,225 87 — 10,312 Refunds of advances for construction — (4,430 ) — — (4,430 ) Repurchase of common stock (1,236 ) — — — (1,236 ) Dividends paid to non-affiliates (17,278 ) — — — (17,278 ) Dividends paid to affiliates — (16,484 ) (794 ) 17,278 — Net cash (used in) provided by financing activities (20,514 ) 81,912 (1,555 ) 18,118 77,961 Change in cash and cash equivalents (3,104 ) 7,202 (487 ) — 3,611 Cash and cash equivalents at beginning of period 5,216 13,215 7,061 — 25,492 Cash and cash equivalents at end of period $ 2,112 $ 20,417 $ 6,574 $ — $ 29,103 CALIFORNIA WATER SERVICE GROUP CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS For the six months ended June 30, 2016 (In thousands) Parent Company Cal Water All Other Subsidiaries Consolidating Adjustments Consolidated Operating activities: Net income $ 10,710 $ 9,539 $ 867 $ (10,406 ) $ 10,710 Adjustments to reconcile net income to net cash provided by operating activities: Equity earnings of subsidiaries (10,434 ) — — 10,434 — Dividends received from affiliates 16,532 — — (16,532 ) — Depreciation and amortization 114 30,372 2,263 (48 ) 32,701 Changes in value of life insurance contracts — (336 ) — — (336 ) Changes in operating assets and liabilities (218 ) (987 ) 984 — (221 ) Other changes in noncurrent assets and liabilities 1,440 14,567 730 20 16,757 Net cash provided by operating activities 18,144 53,155 4,844 (16,532 ) 59,611 Investing activities: Utility plant expenditures — (113,894 ) (2,261 ) — (116,155 ) Changes in affiliate advances (561 ) 787 (199 ) (27 ) — Reduction of affiliate short-term borrowings 2,000 42,100 — (44,100 ) — Issuance of affiliate short-term borrowings (2,615 ) (20,600 ) — 23,215 — Reduction of affiliates long-term debt 544 — — (544 ) — Life insurance proceeds — 495 — — 495 Purchase of life insurance contracts — (1,065 ) — — (1,065 ) Changes in restricted cash — (653 ) — — (653 ) Net cash used in investing activities (632 ) (92,830 ) (2,460 ) (21,456 ) (117,378 ) Financing Activities: Short-term borrowings 42,100 61,000 — — 103,100 Repayment of short-term borrowings (20,615 ) (41,000 ) — — (61,615 ) Changes in affiliate advances — 651 (678 ) 27 — Proceeds from affiliate short-term borrowings 20,600 — 2,615 (23,215 ) — Repayment of affiliate short-term borrowings (42,100 ) — (2,000 ) 44,100 — Repayment of affiliates long-term borrowings — — (544 ) 544 — Proceeds from long-term debt, net of issuance costs — 49,823 — — 49,823 Repayment of long-term debt — (2,287 ) (176 ) — (2,463 ) Advances and contributions in aid for construction — 11,413 50 — 11,463 Refunds of advances for construction — (3,454 ) (18 ) — (3,472 ) Repurchase of common stock (548 ) — — — (548 ) Dividends paid to non-affiliates — (16,135 ) (397 ) — (16,532 ) Dividends paid to affiliates (16,532 ) — — 16,532 — Net cash (used in) provided by financing activities (17,095 ) 60,011 (1,148 ) 37,988 79,756 Change in cash and cash equivalents 417 20,336 1,236 — 21,989 Cash and cash equivalents at beginning of period 582 4,270 3,985 — 8,837 Cash and cash equivalents at end of period $ 999 $ 24,606 $ 5,221 $ — $ 30,826 |
Organization and Operations a28
Organization and Operations and Basis of Presentation (Details) | 6 Months Ended |
Jun. 30, 2017segment | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of reportable segments | 1 |
Summary of Significant Accoun29
Summary of Significant Accounting Policies (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | Dec. 31, 2015 | |
Summary of Significant Accounting Policies [Line Items] | ||||||
Markup for return or profit for cost-recovery expenses | $ 0 | |||||
Maturity period of commercial paper | 90 days | |||||
Minimum collection period after net receivable balances were recognized in which the Company defers net WRAM and MCBA operating revenues and associated costs | 24 months | |||||
Maximum collection period in which deferred net WRAM and MCBA revenues and associated costs will be recognized | 24 months | |||||
Unearned revenue liability | $ 800,000 | $ 800,000 | $ 800,000 | |||
Allowance for equity funds used during construction | 879,000 | $ 0 | 1,658,000 | $ 0 | ||
Allowance for borrowed funds used during construction | 564,000 | 837,000 | 1,058,000 | 1,567,000 | ||
Allowance for Equity and Borrowed Funds Used During Construction | 1,443,000 | 837,000 | 2,716,000 | 1,567,000 | ||
Allowance for equity funds used during construction, Change | 879,000 | 1,658,000 | ||||
Allowance for borrowed funds used during construction, Change | (273,000) | (509,000) | ||||
Allowance for Equity and Borrowed Funds Used During Construction, Change | 606,000 | 1,149,000 | ||||
Carrying value of cash and cash equivalents | 29,103,000 | $ 30,826,000 | 29,103,000 | 30,826,000 | 25,492,000 | $ 8,837,000 |
Income tax benefits in excess compensation costs for share-based compensation | 500,000 | |||||
Other changes in noncurrent assets and liabilities | 19,687,000 | 16,757,000 | ||||
Net cash provided by operating activities | 35,726,000 | 59,611,000 | ||||
Repurchase of common stock | (1,236,000) | (548,000) | ||||
Net cash provided by financing activities | 77,961,000 | 79,756,000 | ||||
As Reported on Form 10-Q | ||||||
Summary of Significant Accounting Policies [Line Items] | ||||||
Other changes in noncurrent assets and liabilities | 16,209,000 | |||||
Net cash provided by operating activities | 59,063,000 | |||||
Repurchase of common stock | 0 | |||||
Net cash provided by financing activities | 80,304,000 | |||||
Taxes, prepaid expenses and other assets | ||||||
Summary of Significant Accounting Policies [Line Items] | ||||||
Carrying value of restricted cash | $ 1,000,000 | $ 1,000,000 | $ 400,000 | |||
Minimum | ||||||
Summary of Significant Accounting Policies [Line Items] | ||||||
Expected collection period for undercollected net WRAM and MCBA receivables | 12 months | |||||
Maximum | ||||||
Summary of Significant Accounting Policies [Line Items] | ||||||
Expected collection period for undercollected net WRAM and MCBA receivables | 18 months | |||||
Accounting Standards Update 2016-09 | Increase (Decrease) from Retrospective Adoption | ||||||
Summary of Significant Accounting Policies [Line Items] | ||||||
Other changes in noncurrent assets and liabilities | 548,000 | |||||
Net cash provided by operating activities | 548,000 | |||||
Repurchase of common stock | (548,000) | |||||
Net cash provided by financing activities | $ (548,000) |
Stock-based Compensation (Detai
Stock-based Compensation (Details) - Equity Incentive Plan - USD ($) $ / shares in Units, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Stock-based Compensation | ||||
Recorded compensation costs for the RSAs and RSUs | $ 1.5 | $ 1.4 | ||
Restricted Stock Awards (RSAs) | ||||
Stock-based Compensation | ||||
Weighted average grant date fair value (in dollars per share) | $ 36.75 | $ 25.17 | ||
Restricted Stock Awards (RSAs) | Officers and Directors | ||||
Stock-based Compensation | ||||
Awards granted (in shares) | 0 | 48,717 | 72,317 | |
Awards cancelled (in shares) | 3,284 | 2,869 | 14,186 | 10,600 |
Restricted Stock Awards (RSAs) | Employees | ||||
Stock-based Compensation | ||||
Vesting period | 36 months | |||
Restricted Stock Awards (RSAs) | Director | ||||
Stock-based Compensation | ||||
Vesting period | 12 months | |||
Restricted Stock Unit Award (RSUs) | Officer | ||||
Stock-based Compensation | ||||
Awards granted (in shares) | 31,389 | 43,659 | ||
Awards cancelled (in shares) | 0 | 19,735 | 6,602 | |
Awards issued (in shares) | 38,709 | 28,424 | ||
Expiration period of award | 3 years | 3 years | ||
Weighted average grant date fair value (in dollars per share) | $ 36.75 | $ 25.17 |
Equity (Details)
Equity (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Changes in total common stockholders' equity | ||||
Balance at December 31, 2016 | $ 659,471 | |||
Common stock issued | 0 | |||
Share-based compensation expense | (22) | |||
Common stock dividends declared | (17,278) | |||
Net income | $ 18,531 | $ 11,508 | 19,663 | $ 10,710 |
Balance at June 30, 2017 | $ 661,834 | $ 661,834 |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Earnings Per Share [Abstract] | ||||
Net income available to common stockholders | $ 18,531 | $ 11,508 | $ 19,663 | $ 10,710 |
Weighted average common shares outstanding, basic (in shares) | 48,020,000 | 47,972,000 | 48,002,000 | 47,938,000 |
Dilutive SARs (treasury method) (in shares) | 0 | 0 | 0 | 5,000 |
Weighed average common shares outstanding, dilutive (in shares) | 48,020,000 | 47,972,000 | 48,002,000 | 47,943,000 |
Earnings per share - basic (in dollars per share) | $ 0.39 | $ 0.24 | $ 0.41 | $ 0.22 |
Earnings per share - diluted (in dollars per share) | $ 0.39 | $ 0.24 | $ 0.41 | $ 0.22 |
Net Income Per Share Calculations | ||||
Dilutive SARs (treasury method) (in shares) | 0 | 0 | 0 | 5,000 |
Stock Appreciation Rights (SARs) | ||||
Earnings Per Share [Abstract] | ||||
Dilutive SARs (treasury method) (in shares) | 0 | 0 | ||
Net Income Per Share Calculations | ||||
Dilutive SARs (treasury method) (in shares) | 0 | 0 |
Pension Plan and Other Postre33
Pension Plan and Other Postretirement Benefits (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Pension Plan | ||||
Pension Plan and Other Postretirement Benefits | ||||
Employer cash contributions | $ 14,800,000 | $ 14,000,000 | ||
Estimated cash contributions in the current fiscal year | 29,500,000 | |||
Components of the pension plans and other postretirement benefits | ||||
Service cost | $ 5,865,000 | $ 5,067,000 | 11,730,000 | 10,134,000 |
Interest cost | 5,791,000 | 5,453,000 | 11,581,000 | 10,906,000 |
Expected return on plan assets | (6,029,000) | (5,454,000) | (12,058,000) | (10,908,000) |
Amortization of prior service cost | 1,445,000 | 1,555,000 | 2,890,000 | 3,109,000 |
Recognized net actuarial loss | 1,752,000 | 1,293,000 | 3,504,000 | 2,586,000 |
Net periodic benefit cost | 8,824,000 | 7,914,000 | 17,647,000 | 15,827,000 |
Other Benefits | ||||
Pension Plan and Other Postretirement Benefits | ||||
Employer cash contributions | 0 | 3,300,000 | ||
Estimated cash contributions in the current fiscal year | 9,300,000 | |||
Components of the pension plans and other postretirement benefits | ||||
Service cost | 2,019,000 | 2,304,000 | 4,038,000 | 4,608,000 |
Interest cost | 1,491,000 | 1,800,000 | 2,982,000 | 3,600,000 |
Expected return on plan assets | (1,218,000) | (1,046,000) | (2,436,000) | (2,092,000) |
Amortization of prior service cost | 11,000 | 11,000 | 22,000 | 22,000 |
Recognized net actuarial loss | 649,000 | 1,261,000 | 1,298,000 | 2,523,000 |
Net periodic benefit cost | $ 2,952,000 | $ 4,330,000 | $ 5,904,000 | $ 8,661,000 |
Short-term and Long-term Borr34
Short-term and Long-term Borrowings (Details) - USD ($) | 1 Months Ended | 6 Months Ended | ||
Mar. 31, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2016 | |
Debt Instrument [Line Items] | ||||
Proceeds from long-term debt | $ 0 | $ 49,823,000 | ||
Parent Company | ||||
Debt Instrument [Line Items] | ||||
Proceeds from long-term debt | 0 | |||
Cal Water | ||||
Debt Instrument [Line Items] | ||||
Proceeds from long-term debt | $ 49,823,000 | |||
Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Average borrowing rate | 1.82% | 1.30% | ||
Revolving Credit Facility | Parent Company | ||||
Debt Instrument [Line Items] | ||||
Outstanding borrowings | $ 55,100,000 | $ 57,100,000 | ||
Revolving Credit Facility | Cal Water | ||||
Debt Instrument [Line Items] | ||||
Repayment of debt | $ 48,600,000 | |||
Outstanding borrowings | $ 135,000,000 | $ 40,000,000 | ||
Secured Debt | Cal Water | ||||
Debt Instrument [Line Items] | ||||
Debt issuance cost | 300,000 | |||
Proceeds from long-term debt | 49,700,000 | |||
Secured Debt | First Mortgage Bonds Issue 2 | Cal Water | ||||
Debt Instrument [Line Items] | ||||
Debt issued | 50,000,000 | |||
Secured Debt | Series SSS Bond | Cal Water | ||||
Debt Instrument [Line Items] | ||||
Debt issued | $ 40,000,000 | |||
Interest rate | 4.41% | |||
Secured Debt | Series TTT Bond | Cal Water | ||||
Debt Instrument [Line Items] | ||||
Debt issued | $ 10,000,000 | |||
Interest rate | 4.61% |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended | |||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | Dec. 31, 2017 | Dec. 31, 2016 | |
Income Taxes [Line Items] | ||||||
Income tax provision | $ 10,852 | $ 7,254 | $ 10,857 | $ 6,510 | ||
Tax benefit associated with the settlement of equity awards | 100 | 500 | ||||
Unrecognized tax benefits | 10,200 | 10,200 | $ 10,200 | |||
Tax benefits that, if recognized, would affect the effective tax rate | $ 1,900 | $ 1,900 | $ 1,900 | |||
Scenario, Forecast [Member] | ||||||
Income Taxes [Line Items] | ||||||
Effective tax rate estimate | 37.00% |
Regulatory Assets and Liabili36
Regulatory Assets and Liabilities (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 |
Regulatory Assets and Liabilities | ||
Regulatory assets | $ 375,868 | $ 355,930 |
Regulatory liabilities | 40,569 | 38,735 |
Short-term portion of the regulatory assets | 29,071 | 30,332 |
Short-term portion of the regulatory liabilities | 6,743 | 4,759 |
Property-related temporary differences (tax benefits flowed through to customers) | ||
Regulatory Assets and Liabilities | ||
Regulatory liabilities | 33,317 | 33,231 |
Health care balancing account | ||
Regulatory Assets and Liabilities | ||
Regulatory liabilities | 4,224 | 0 |
Conservation program | ||
Regulatory Assets and Liabilities | ||
Regulatory liabilities | 1,358 | 584 |
Pension balancing account | ||
Regulatory Assets and Liabilities | ||
Regulatory liabilities | 146 | 695 |
Net WRAM and MCBA long-term payable | ||
Regulatory Assets and Liabilities | ||
Regulatory liabilities | 720 | 611 |
Other regulatory liabilities | ||
Regulatory Assets and Liabilities | ||
Regulatory liabilities | 804 | 3,614 |
Pension and retiree group health | ||
Regulatory Assets and Liabilities | ||
Regulatory assets | 188,550 | 188,880 |
Property-related temporary differences (tax benefits flowed through to customers) | ||
Regulatory Assets and Liabilities | ||
Regulatory assets | 93,326 | 92,099 |
Other accrued benefits | ||
Regulatory Assets and Liabilities | ||
Regulatory assets | 26,663 | 27,503 |
Net WRAM and MCBA long-term accounts receivable | ||
Regulatory Assets and Liabilities | ||
Regulatory assets | 33,327 | 16,148 |
Asset retirement obligations, net | ||
Regulatory Assets and Liabilities | ||
Regulatory assets | 16,488 | 15,812 |
Interim rates long-term accounts receivable | ||
Regulatory Assets and Liabilities | ||
Regulatory assets | 4,634 | 4,605 |
Tank coating | ||
Regulatory Assets and Liabilities | ||
Regulatory assets | 9,501 | 8,452 |
Health care balancing account | ||
Regulatory Assets and Liabilities | ||
Regulatory assets | 227 | 1,000 |
Pension balancing account | ||
Regulatory Assets and Liabilities | ||
Regulatory assets | 910 | 0 |
Other regulatory assets | ||
Regulatory Assets and Liabilities | ||
Regulatory assets | $ 2,242 | $ 1,431 |
Commitments and Contingencies (
Commitments and Contingencies (Details) - USD ($) $ in Millions | Jun. 30, 2017 | Dec. 31, 2016 |
Commitments and Contingencies Disclosure [Abstract] | ||
Contingency loss recognized liability | $ 6.2 | $ 6 |
Fair Value of Financial Asset38
Fair Value of Financial Assets and Liabilities (Details) - USD ($) $ in Thousands | 6 Months Ended | |
Jun. 30, 2017 | Dec. 31, 2016 | |
Fair Value of Financial Assets and Liabilities | ||
Risk premium (as a percent) | 1.70% | |
Advances for construction | $ 182,394 | $ 182,448 |
Level 1 | ||
Fair Value of Financial Assets and Liabilities | ||
Long-term debt, including current maturities | 0 | 0 |
Advances for construction | 0 | 0 |
Total | 0 | 0 |
Level 2 | ||
Fair Value of Financial Assets and Liabilities | ||
Long-term debt, including current maturities | 630,712 | 630,510 |
Advances for construction | 75,924 | 74,460 |
Total | 706,636 | 704,970 |
Level 3 | ||
Fair Value of Financial Assets and Liabilities | ||
Long-term debt, including current maturities | 0 | 0 |
Advances for construction | 0 | 0 |
Total | 0 | 0 |
Cost | ||
Fair Value of Financial Assets and Liabilities | ||
Long-term debt, including current maturities | 555,985 | 557,953 |
Advances for construction | 182,394 | 182,448 |
Total | 738,379 | 740,401 |
Total | ||
Fair Value of Financial Assets and Liabilities | ||
Long-term debt, including current maturities | 630,712 | 630,510 |
Advances for construction | 75,924 | 74,460 |
Total | $ 706,636 | $ 704,970 |
Condensed Consolidating Finan39
Condensed Consolidating Financial Statements - Additional Information (Details) - USD ($) | Jun. 30, 2017 | Nov. 17, 2010 | Apr. 17, 2009 |
Cal Water | |||
Debt Instrument [Line Items] | |||
Ownership interest (as a percent) | 100.00% | ||
All Other Subsidiaries | |||
Debt Instrument [Line Items] | |||
Ownership interest (as a percent) | 100.00% | ||
First Mortgage Bonds, 5.875% due 2019 | Cal Water | |||
Debt Instrument [Line Items] | |||
Debt issued | $ 100,000,000 | ||
Interest rate | 5.875% | ||
First Mortgage Bonds, 5.500% due 2040 | Cal Water | |||
Debt Instrument [Line Items] | |||
Debt issued | $ 100,000,000 | ||
Interest rate | 5.50% |
Condensed Consolidating Finan40
Condensed Consolidating Financial Statements - Condensed Consolidating Balance Sheet (Details) - USD ($) $ in Thousands | Jun. 30, 2017 | Dec. 31, 2016 | Jun. 30, 2016 | Dec. 31, 2015 |
Utility plant: | ||||
Utility plant | $ 2,826,187 | $ 2,717,339 | ||
Less accumulated depreciation and amortization | (897,575) | (858,062) | ||
Net utility plant | 1,928,612 | 1,859,277 | ||
Current assets: | ||||
Cash and cash equivalents | 29,103 | 25,492 | $ 30,826 | $ 8,837 |
Receivables and unbilled revenue, net | 120,277 | |||
Receivables | 103,023 | |||
Receivables from affiliates | 0 | 0 | ||
Other current assets | 21,200 | 13,554 | ||
Total current assets | 170,580 | 142,069 | ||
Other assets: | ||||
Regulatory assets | 375,868 | 355,930 | ||
Investments in affiliates | 0 | 0 | ||
Long-term affiliate notes receivable | 0 | 0 | ||
Other assets | 57,966 | 54,469 | ||
Total other assets | 433,834 | 410,399 | ||
TOTAL ASSETS | 2,533,026 | 2,411,745 | ||
Capitalization: | ||||
Common stockholders' equity | 661,834 | 659,471 | ||
Affiliate long-term debt | 0 | 0 | ||
Long-term debt, less current maturities | 519,875 | 531,745 | ||
Total capitalization | 1,181,709 | 1,191,216 | ||
Current liabilities: | ||||
Current maturities of long-term debt | 36,110 | 26,208 | ||
Short-term borrowings | 190,100 | 97,100 | ||
Payables to affiliates | 0 | 0 | ||
Accounts payable | 84,222 | 77,813 | ||
Accrued expenses and other liabilities | 50,595 | 49,109 | ||
Total current liabilities | 361,027 | 250,230 | ||
Unamortized investment tax credits | 1,798 | 1,798 | ||
Deferred income taxes | 310,936 | 298,924 | ||
Pension and postretirement benefits other than pensions | 227,186 | 222,691 | ||
Regulatory liabilities and other | 86,821 | 83,648 | ||
Advances for construction | 182,394 | 182,448 | ||
Contributions in aid of construction | 181,155 | 180,790 | ||
TOTAL CAPITALIZATION AND LIABILITIES | 2,533,026 | 2,411,745 | ||
Consolidating Adjustments | ||||
Utility plant: | ||||
Utility plant | (7,197) | (7,197) | ||
Less accumulated depreciation and amortization | 1,965 | 1,919 | ||
Net utility plant | (5,232) | (5,278) | ||
Current assets: | ||||
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Receivables and unbilled revenue, net | 0 | |||
Receivables | 0 | |||
Receivables from affiliates | (23,046) | (23,182) | ||
Other current assets | 0 | 0 | ||
Total current assets | (23,046) | (23,182) | ||
Other assets: | ||||
Regulatory assets | 0 | 0 | ||
Investments in affiliates | (668,660) | (666,525) | ||
Long-term affiliate notes receivable | (25,037) | (25,744) | ||
Other assets | (205) | (33) | ||
Total other assets | (693,902) | (692,302) | ||
TOTAL ASSETS | (722,180) | (720,762) | ||
Capitalization: | ||||
Common stockholders' equity | (673,944) | (671,836) | ||
Affiliate long-term debt | (25,037) | (25,744) | ||
Long-term debt, less current maturities | 0 | 0 | ||
Total capitalization | (698,981) | (697,580) | ||
Current liabilities: | ||||
Current maturities of long-term debt | 0 | 0 | ||
Short-term borrowings | 0 | 0 | ||
Payables to affiliates | (23,046) | (23,182) | ||
Accounts payable | 0 | 0 | ||
Accrued expenses and other liabilities | 0 | 0 | ||
Total current liabilities | (23,046) | (23,182) | ||
Unamortized investment tax credits | 0 | 0 | ||
Deferred income taxes | (153) | 0 | ||
Pension and postretirement benefits other than pensions | 0 | 0 | ||
Regulatory liabilities and other | 0 | 0 | ||
Advances for construction | 0 | 0 | ||
Contributions in aid of construction | 0 | 0 | ||
TOTAL CAPITALIZATION AND LIABILITIES | (722,180) | (720,762) | ||
Parent Company | ||||
Utility plant: | ||||
Utility plant | 1,321 | 1,318 | ||
Less accumulated depreciation and amortization | (872) | (826) | ||
Net utility plant | 449 | 492 | ||
Current assets: | ||||
Cash and cash equivalents | 2,112 | 5,216 | 999 | 582 |
Receivables and unbilled revenue, net | 0 | |||
Receivables | 0 | |||
Receivables from affiliates | 21,786 | 19,566 | ||
Other current assets | 290 | 80 | ||
Total current assets | 24,188 | 24,862 | ||
Other assets: | ||||
Regulatory assets | 0 | 0 | ||
Investments in affiliates | 668,660 | 666,525 | ||
Long-term affiliate notes receivable | 25,037 | 25,744 | ||
Other assets | 238 | 376 | ||
Total other assets | 693,935 | 692,645 | ||
TOTAL ASSETS | 718,572 | 717,999 | ||
Capitalization: | ||||
Common stockholders' equity | 661,834 | 659,471 | ||
Affiliate long-term debt | 0 | 0 | ||
Long-term debt, less current maturities | 0 | 0 | ||
Total capitalization | 661,834 | 659,471 | ||
Current liabilities: | ||||
Current maturities of long-term debt | 0 | 0 | ||
Short-term borrowings | 55,100 | 57,100 | ||
Payables to affiliates | 0 | 0 | ||
Accounts payable | 0 | 0 | ||
Accrued expenses and other liabilities | 126 | 88 | ||
Total current liabilities | 55,226 | 57,188 | ||
Unamortized investment tax credits | 0 | 0 | ||
Deferred income taxes | 1,512 | 1,340 | ||
Pension and postretirement benefits other than pensions | 0 | 0 | ||
Regulatory liabilities and other | 0 | 0 | ||
Advances for construction | 0 | 0 | ||
Contributions in aid of construction | 0 | 0 | ||
TOTAL CAPITALIZATION AND LIABILITIES | 718,572 | 717,999 | ||
Cal Water | ||||
Utility plant: | ||||
Utility plant | 2,625,435 | 2,519,785 | ||
Less accumulated depreciation and amortization | (842,974) | (805,992) | ||
Net utility plant | 1,782,461 | 1,713,793 | ||
Current assets: | ||||
Cash and cash equivalents | 20,417 | 13,215 | 24,606 | 4,270 |
Receivables and unbilled revenue, net | 115,606 | |||
Receivables | 98,850 | |||
Receivables from affiliates | 1,117 | 3,608 | ||
Other current assets | 19,810 | 12,442 | ||
Total current assets | 156,950 | 128,115 | ||
Other assets: | ||||
Regulatory assets | 372,048 | 352,139 | ||
Investments in affiliates | 0 | 0 | ||
Long-term affiliate notes receivable | 0 | 0 | ||
Other assets | 53,928 | 50,361 | ||
Total other assets | 425,976 | 402,500 | ||
TOTAL ASSETS | 2,365,387 | 2,244,408 | ||
Capitalization: | ||||
Common stockholders' equity | 597,262 | 595,003 | ||
Affiliate long-term debt | 0 | 0 | ||
Long-term debt, less current maturities | 518,839 | 530,850 | ||
Total capitalization | 1,116,101 | 1,125,853 | ||
Current liabilities: | ||||
Current maturities of long-term debt | 35,624 | 25,657 | ||
Short-term borrowings | 135,000 | 40,000 | ||
Payables to affiliates | 302 | 539 | ||
Accounts payable | 81,399 | 74,998 | ||
Accrued expenses and other liabilities | 47,124 | 47,232 | ||
Total current liabilities | 299,449 | 188,426 | ||
Unamortized investment tax credits | 1,798 | 1,798 | ||
Deferred income taxes | 308,164 | 296,781 | ||
Pension and postretirement benefits other than pensions | 227,186 | 222,691 | ||
Regulatory liabilities and other | 83,579 | 80,518 | ||
Advances for construction | 181,832 | 181,907 | ||
Contributions in aid of construction | 147,278 | 146,434 | ||
TOTAL CAPITALIZATION AND LIABILITIES | 2,365,387 | 2,244,408 | ||
All Other Subsidiaries | ||||
Utility plant: | ||||
Utility plant | 206,628 | 203,433 | ||
Less accumulated depreciation and amortization | (55,694) | (53,163) | ||
Net utility plant | 150,934 | 150,270 | ||
Current assets: | ||||
Cash and cash equivalents | 6,574 | 7,061 | $ 5,221 | $ 3,985 |
Receivables and unbilled revenue, net | 4,671 | |||
Receivables | 4,173 | |||
Receivables from affiliates | 143 | 8 | ||
Other current assets | 1,100 | 1,032 | ||
Total current assets | 12,488 | 12,274 | ||
Other assets: | ||||
Regulatory assets | 3,820 | 3,791 | ||
Investments in affiliates | 0 | 0 | ||
Long-term affiliate notes receivable | 0 | 0 | ||
Other assets | 4,005 | 3,765 | ||
Total other assets | 7,825 | 7,556 | ||
TOTAL ASSETS | 171,247 | 170,100 | ||
Capitalization: | ||||
Common stockholders' equity | 76,682 | 76,833 | ||
Affiliate long-term debt | 25,037 | 25,744 | ||
Long-term debt, less current maturities | 1,036 | 895 | ||
Total capitalization | 102,755 | 103,472 | ||
Current liabilities: | ||||
Current maturities of long-term debt | 486 | 551 | ||
Short-term borrowings | 0 | 0 | ||
Payables to affiliates | 22,744 | 22,643 | ||
Accounts payable | 2,823 | 2,815 | ||
Accrued expenses and other liabilities | 3,345 | 1,789 | ||
Total current liabilities | 29,398 | 27,798 | ||
Unamortized investment tax credits | 0 | 0 | ||
Deferred income taxes | 1,413 | 803 | ||
Pension and postretirement benefits other than pensions | 0 | 0 | ||
Regulatory liabilities and other | 3,242 | 3,130 | ||
Advances for construction | 562 | 541 | ||
Contributions in aid of construction | 33,877 | 34,356 | ||
TOTAL CAPITALIZATION AND LIABILITIES | $ 171,247 | $ 170,100 |
Condensed Consolidating Finan41
Condensed Consolidating Financial Statements - Condensed Consolidating Statement of Income (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Condensed Consolidating Financial Statements | ||||
Operating revenue | $ 171,132 | $ 152,445 | $ 293,168 | $ 274,172 |
Operations: | ||||
Water production costs | 64,131 | 57,589 | 106,199 | 98,658 |
Administrative and general | 23,796 | 23,366 | 49,045 | 51,193 |
Other operations | 18,328 | 18,903 | 34,452 | 38,205 |
Maintenance | 4,708 | 5,934 | 10,820 | 11,997 |
Depreciation and amortization | 19,218 | 15,842 | 38,419 | 31,888 |
Income tax (benefit) expense | 9,635 | 6,870 | 8,751 | 5,945 |
Property and other taxes | 6,057 | 5,407 | 12,173 | 11,482 |
Total operating (income) expense | 145,873 | 133,911 | 259,859 | 249,368 |
Net operating income (loss) | 25,259 | 18,534 | 33,309 | 24,804 |
Other income and expenses: | ||||
Non-regulated revenue | 3,739 | 3,764 | 7,201 | 7,192 |
Non-regulated expenses | (1,614) | (2,809) | (3,668) | (5,789) |
Allowance for equity funds used during construction | 879 | 0 | 1,658 | 0 |
Income tax expense on other income and expenses | (1,217) | (384) | (2,106) | (565) |
Net other income | 1,787 | 571 | 3,085 | 838 |
Interest expense: | ||||
Interest expense | 9,079 | 8,434 | 17,789 | 16,499 |
Allowance for borrowed funds used during construction | (564) | (837) | (1,058) | (1,567) |
Net interest expense | 8,515 | 7,597 | 16,731 | 14,932 |
Equity earnings of subsidiaries | 0 | 0 | 0 | 0 |
Net income | 18,531 | 11,508 | 19,663 | 10,710 |
Consolidating Adjustments | ||||
Condensed Consolidating Financial Statements | ||||
Operating revenue | 0 | 0 | 0 | 0 |
Operations: | ||||
Water production costs | 0 | 0 | 0 | 0 |
Administrative and general | 0 | 0 | 0 | 0 |
Other operations | (126) | (84) | (252) | (210) |
Maintenance | 0 | 0 | 0 | 0 |
Depreciation and amortization | (23) | (24) | (46) | (48) |
Income tax (benefit) expense | 263 | 238 | 520 | 495 |
Property and other taxes | 0 | 0 | 0 | 0 |
Total operating (income) expense | 114 | 130 | 222 | 237 |
Net operating income (loss) | (114) | (130) | (222) | (237) |
Other income and expenses: | ||||
Non-regulated revenue | (622) | (560) | (1,230) | (1,166) |
Non-regulated expenses | 0 | 0 | 0 | 0 |
Allowance for equity funds used during construction | 0 | 0 | ||
Income tax expense on other income and expenses | 253 | 228 | 501 | 475 |
Net other income | (369) | (332) | (729) | (691) |
Interest expense: | ||||
Interest expense | (496) | (476) | (977) | (956) |
Allowance for borrowed funds used during construction | 0 | 0 | 0 | 0 |
Net interest expense | (496) | (476) | (977) | (956) |
Equity earnings of subsidiaries | (18,415) | (11,371) | (19,413) | (10,434) |
Net income | (18,402) | (11,357) | (19,387) | (10,406) |
Parent Company | ||||
Condensed Consolidating Financial Statements | ||||
Operating revenue | 0 | 0 | 0 | 0 |
Operations: | ||||
Water production costs | 0 | 0 | 0 | 0 |
Administrative and general | 0 | 0 | 0 | 0 |
Other operations | 0 | 0 | 0 | 0 |
Maintenance | 0 | 0 | 0 | 0 |
Depreciation and amortization | 26 | 57 | 49 | 114 |
Income tax (benefit) expense | (123) | (93) | (226) | (187) |
Property and other taxes | 0 | 0 | (4) | 0 |
Total operating (income) expense | (97) | (36) | (181) | (73) |
Net operating income (loss) | 97 | 36 | 181 | 73 |
Other income and expenses: | ||||
Non-regulated revenue | 496 | 462 | 977 | 926 |
Non-regulated expenses | 0 | 0 | 0 | 0 |
Allowance for equity funds used during construction | 0 | 0 | ||
Income tax expense on other income and expenses | (202) | (188) | (398) | (377) |
Net other income | 294 | 274 | 579 | 549 |
Interest expense: | ||||
Interest expense | 275 | 173 | 510 | 346 |
Allowance for borrowed funds used during construction | 0 | 0 | 0 | 0 |
Net interest expense | 275 | 173 | 510 | 346 |
Equity earnings of subsidiaries | 18,415 | 11,371 | 19,413 | 10,434 |
Net income | 18,531 | 11,508 | 19,663 | 10,710 |
Cal Water | ||||
Condensed Consolidating Financial Statements | ||||
Operating revenue | 161,174 | 142,342 | 274,516 | 255,369 |
Operations: | ||||
Water production costs | 62,089 | 55,643 | 102,278 | 94,888 |
Administrative and general | 21,147 | 20,667 | 43,623 | 45,610 |
Other operations | 16,729 | 17,365 | 31,129 | 35,091 |
Maintenance | 4,509 | 5,692 | 10,415 | 11,532 |
Depreciation and amortization | 18,102 | 14,735 | 36,213 | 29,650 |
Income tax (benefit) expense | 9,100 | 6,228 | 8,154 | 5,191 |
Property and other taxes | 5,315 | 4,669 | 10,727 | 10,059 |
Total operating (income) expense | 136,991 | 124,999 | 242,539 | 232,021 |
Net operating income (loss) | 24,183 | 17,343 | 31,977 | 23,348 |
Other income and expenses: | ||||
Non-regulated revenue | 3,469 | 3,439 | 6,604 | 6,635 |
Non-regulated expenses | (1,428) | (2,547) | (3,175) | (5,252) |
Allowance for equity funds used during construction | 879 | 1,658 | ||
Income tax expense on other income and expenses | (1,190) | (364) | (2,073) | (564) |
Net other income | 1,730 | 528 | 3,014 | 819 |
Interest expense: | ||||
Interest expense | 8,795 | 8,263 | 17,265 | 16,162 |
Allowance for borrowed funds used during construction | (542) | (820) | (1,018) | (1,534) |
Net interest expense | 8,253 | 7,443 | 16,247 | 14,628 |
Equity earnings of subsidiaries | 0 | 0 | 0 | 0 |
Net income | 17,660 | 10,428 | 18,744 | 9,539 |
All Other Subsidiaries | ||||
Condensed Consolidating Financial Statements | ||||
Operating revenue | 9,958 | 10,103 | 18,652 | 18,803 |
Operations: | ||||
Water production costs | 2,042 | 1,946 | 3,921 | 3,770 |
Administrative and general | 2,649 | 2,699 | 5,422 | 5,583 |
Other operations | 1,725 | 1,622 | 3,575 | 3,324 |
Maintenance | 199 | 242 | 405 | 465 |
Depreciation and amortization | 1,113 | 1,074 | 2,203 | 2,172 |
Income tax (benefit) expense | 395 | 497 | 303 | 446 |
Property and other taxes | 742 | 738 | 1,450 | 1,423 |
Total operating (income) expense | 8,865 | 8,818 | 17,279 | 17,183 |
Net operating income (loss) | 1,093 | 1,285 | 1,373 | 1,620 |
Other income and expenses: | ||||
Non-regulated revenue | 396 | 423 | 850 | 797 |
Non-regulated expenses | (186) | (262) | (493) | (537) |
Allowance for equity funds used during construction | 0 | 0 | ||
Income tax expense on other income and expenses | (78) | (60) | (136) | (99) |
Net other income | 132 | 101 | 221 | 161 |
Interest expense: | ||||
Interest expense | 505 | 474 | 991 | 947 |
Allowance for borrowed funds used during construction | (22) | (17) | (40) | (33) |
Net interest expense | 483 | 457 | 951 | 914 |
Equity earnings of subsidiaries | 0 | 0 | 0 | 0 |
Net income | $ 742 | $ 929 | $ 643 | $ 867 |
Condensed Consolidating Finan42
Condensed Consolidating Financial Statements - Condensed Consolidating Statement of Cash Flows (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2017 | Jun. 30, 2016 | Jun. 30, 2017 | Jun. 30, 2016 | |
Operating activities: | ||||
Net income | $ 18,531 | $ 11,508 | $ 19,663 | $ 10,710 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Equity earnings of subsidiaries | 0 | 0 | 0 | 0 |
Dividends received from affiliates | 0 | 0 | ||
Depreciation and amortization | 39,328 | 32,701 | ||
Change in value of life insurance contracts | (1,208) | (336) | ||
Allowance for equity funds used during construction | (879) | 0 | (1,658) | 0 |
Changes in operating assets and liabilities: | ||||
Changes in operating assets and liabilities | (40,086) | (221) | ||
Other changes in noncurrent assets and liabilities | 19,687 | 16,757 | ||
Net cash provided by operating activities | 35,726 | 59,611 | ||
Investing activities: | ||||
Utility plant expenditures | (108,712) | (116,155) | ||
Changes in affiliate advances | 0 | 0 | ||
Reduction of affiliate short-term borrowings | 0 | |||
Issuance of affiliate short-term borrowings | 0 | 0 | ||
Reduction of affiliates long-term debt | 0 | 0 | ||
Life insurance proceeds | 450 | 495 | ||
Purchase of life insurance contracts | (1,216) | (1,065) | ||
Change in restricted cash | (598) | (653) | ||
Net cash used in investing activities | (110,076) | (117,378) | ||
Financing Activities: | ||||
Short-term borrowings | 140,000 | 103,100 | ||
Repayment of short-term borrowings | (47,000) | (61,615) | ||
Proceeds from affiliate short-term borrowings | 0 | 0 | ||
Changes in affiliate advances | 0 | 0 | ||
Repayment of affiliate short-term borrowings | 0 | |||
Repayment of affiliates long-term borrowings | 0 | 0 | ||
Proceeds from long-term debt | 0 | 49,823 | ||
Repayment of long-term debt | (2,407) | (2,463) | ||
Advances and contributions in aid of construction | 10,312 | 11,463 | ||
Refunds of advances for construction | (4,430) | (3,472) | ||
Repurchase of common stock | (1,236) | (548) | ||
Dividends paid to non-affiliates | (17,278) | (16,532) | ||
Dividends paid to affiliates | 0 | 0 | ||
Net cash provided by financing activities | 77,961 | 79,756 | ||
Change in cash and cash equivalents | 3,611 | 21,989 | ||
Cash and cash equivalents at beginning of period | 25,492 | 8,837 | ||
Cash and cash equivalents at end of period | 29,103 | 30,826 | 29,103 | 30,826 |
Consolidating Adjustments | ||||
Operating activities: | ||||
Net income | (18,402) | (11,357) | (19,387) | (10,406) |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Equity earnings of subsidiaries | 18,415 | 11,371 | 19,413 | 10,434 |
Dividends received from affiliates | (17,278) | (16,532) | ||
Depreciation and amortization | (46) | (48) | ||
Change in value of life insurance contracts | 0 | 0 | ||
Allowance for equity funds used during construction | 0 | 0 | ||
Changes in operating assets and liabilities: | ||||
Changes in operating assets and liabilities | 0 | 0 | ||
Other changes in noncurrent assets and liabilities | 20 | 20 | ||
Net cash provided by operating activities | (17,278) | (16,532) | ||
Investing activities: | ||||
Utility plant expenditures | 0 | 0 | ||
Changes in affiliate advances | (2,782) | (27) | ||
Reduction of affiliate short-term borrowings | (44,100) | |||
Issuance of affiliate short-term borrowings | 2,610 | 23,215 | ||
Reduction of affiliates long-term debt | (668) | (544) | ||
Life insurance proceeds | 0 | 0 | ||
Purchase of life insurance contracts | 0 | 0 | ||
Change in restricted cash | 0 | 0 | ||
Net cash used in investing activities | (840) | (21,456) | ||
Financing Activities: | ||||
Short-term borrowings | 0 | 0 | ||
Repayment of short-term borrowings | 0 | 0 | ||
Proceeds from affiliate short-term borrowings | (2,610) | (23,215) | ||
Changes in affiliate advances | 2,782 | 27 | ||
Repayment of affiliate short-term borrowings | 44,100 | |||
Repayment of affiliates long-term borrowings | 668 | 544 | ||
Proceeds from long-term debt | 0 | |||
Repayment of long-term debt | 0 | 0 | ||
Advances and contributions in aid of construction | 0 | 0 | ||
Refunds of advances for construction | 0 | 0 | ||
Repurchase of common stock | 0 | 0 | ||
Dividends paid to non-affiliates | 0 | 0 | ||
Dividends paid to affiliates | 17,278 | 16,532 | ||
Net cash provided by financing activities | 18,118 | 37,988 | ||
Change in cash and cash equivalents | 0 | 0 | ||
Cash and cash equivalents at beginning of period | 0 | 0 | ||
Cash and cash equivalents at end of period | 0 | 0 | 0 | 0 |
Parent Company | ||||
Operating activities: | ||||
Net income | 18,531 | 11,508 | 19,663 | 10,710 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Equity earnings of subsidiaries | (18,415) | (11,371) | (19,413) | (10,434) |
Dividends received from affiliates | 17,278 | 16,532 | ||
Depreciation and amortization | 47 | 114 | ||
Change in value of life insurance contracts | 0 | 0 | ||
Allowance for equity funds used during construction | 0 | 0 | ||
Changes in operating assets and liabilities: | ||||
Changes in operating assets and liabilities | (172) | (218) | ||
Other changes in noncurrent assets and liabilities | 1,520 | 1,440 | ||
Net cash provided by operating activities | 18,923 | 18,144 | ||
Investing activities: | ||||
Utility plant expenditures | 0 | 0 | ||
Changes in affiliate advances | 429 | (561) | ||
Reduction of affiliate short-term borrowings | 2,000 | |||
Issuance of affiliate short-term borrowings | (2,610) | (2,615) | ||
Reduction of affiliates long-term debt | 668 | 544 | ||
Life insurance proceeds | 0 | 0 | ||
Purchase of life insurance contracts | 0 | 0 | ||
Change in restricted cash | 0 | 0 | ||
Net cash used in investing activities | (1,513) | (632) | ||
Financing Activities: | ||||
Short-term borrowings | 0 | 42,100 | ||
Repayment of short-term borrowings | (2,000) | (20,615) | ||
Proceeds from affiliate short-term borrowings | 0 | 20,600 | ||
Changes in affiliate advances | 0 | 0 | ||
Repayment of affiliate short-term borrowings | (42,100) | |||
Repayment of affiliates long-term borrowings | 0 | 0 | ||
Proceeds from long-term debt | 0 | |||
Repayment of long-term debt | 0 | 0 | ||
Advances and contributions in aid of construction | 0 | 0 | ||
Refunds of advances for construction | 0 | 0 | ||
Repurchase of common stock | (1,236) | (548) | ||
Dividends paid to non-affiliates | (17,278) | 0 | ||
Dividends paid to affiliates | 0 | (16,532) | ||
Net cash provided by financing activities | (20,514) | (17,095) | ||
Change in cash and cash equivalents | (3,104) | 417 | ||
Cash and cash equivalents at beginning of period | 5,216 | 582 | ||
Cash and cash equivalents at end of period | 2,112 | 999 | 2,112 | 999 |
Cal Water | ||||
Operating activities: | ||||
Net income | 17,660 | 10,428 | 18,744 | 9,539 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Equity earnings of subsidiaries | 0 | 0 | 0 | 0 |
Dividends received from affiliates | 0 | 0 | ||
Depreciation and amortization | 37,074 | 30,372 | ||
Change in value of life insurance contracts | (1,208) | (336) | ||
Allowance for equity funds used during construction | (879) | (1,658) | ||
Changes in operating assets and liabilities: | ||||
Changes in operating assets and liabilities | (40,755) | (987) | ||
Other changes in noncurrent assets and liabilities | 17,650 | 14,567 | ||
Net cash provided by operating activities | 29,847 | 53,155 | ||
Investing activities: | ||||
Utility plant expenditures | (105,684) | (113,894) | ||
Changes in affiliate advances | 2,491 | 787 | ||
Reduction of affiliate short-term borrowings | 42,100 | |||
Issuance of affiliate short-term borrowings | 0 | (20,600) | ||
Reduction of affiliates long-term debt | 0 | 0 | ||
Life insurance proceeds | 450 | 495 | ||
Purchase of life insurance contracts | (1,216) | (1,065) | ||
Change in restricted cash | (598) | (653) | ||
Net cash used in investing activities | (104,557) | (92,830) | ||
Financing Activities: | ||||
Short-term borrowings | 140,000 | 61,000 | ||
Repayment of short-term borrowings | (45,000) | (41,000) | ||
Proceeds from affiliate short-term borrowings | 0 | 0 | ||
Changes in affiliate advances | (238) | 651 | ||
Repayment of affiliate short-term borrowings | 0 | |||
Repayment of affiliates long-term borrowings | 0 | 0 | ||
Proceeds from long-term debt | 49,823 | |||
Repayment of long-term debt | (2,161) | (2,287) | ||
Advances and contributions in aid of construction | 10,225 | 11,413 | ||
Refunds of advances for construction | (4,430) | (3,454) | ||
Repurchase of common stock | 0 | 0 | ||
Dividends paid to non-affiliates | 0 | (16,135) | ||
Dividends paid to affiliates | (16,484) | 0 | ||
Net cash provided by financing activities | 81,912 | 60,011 | ||
Change in cash and cash equivalents | 7,202 | 20,336 | ||
Cash and cash equivalents at beginning of period | 13,215 | 4,270 | ||
Cash and cash equivalents at end of period | 20,417 | 24,606 | 20,417 | 24,606 |
All Other Subsidiaries | ||||
Operating activities: | ||||
Net income | 742 | 929 | 643 | 867 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Equity earnings of subsidiaries | 0 | 0 | 0 | 0 |
Dividends received from affiliates | 0 | 0 | ||
Depreciation and amortization | 2,253 | 2,263 | ||
Change in value of life insurance contracts | 0 | 0 | ||
Allowance for equity funds used during construction | 0 | 0 | ||
Changes in operating assets and liabilities: | ||||
Changes in operating assets and liabilities | 841 | 984 | ||
Other changes in noncurrent assets and liabilities | 497 | 730 | ||
Net cash provided by operating activities | 4,234 | 4,844 | ||
Investing activities: | ||||
Utility plant expenditures | (3,028) | (2,261) | ||
Changes in affiliate advances | (138) | (199) | ||
Reduction of affiliate short-term borrowings | 0 | |||
Issuance of affiliate short-term borrowings | 0 | 0 | ||
Reduction of affiliates long-term debt | 0 | 0 | ||
Life insurance proceeds | 0 | 0 | ||
Purchase of life insurance contracts | 0 | 0 | ||
Change in restricted cash | 0 | 0 | ||
Net cash used in investing activities | (3,166) | (2,460) | ||
Financing Activities: | ||||
Short-term borrowings | 0 | 0 | ||
Repayment of short-term borrowings | 0 | 0 | ||
Proceeds from affiliate short-term borrowings | 2,610 | 2,615 | ||
Changes in affiliate advances | (2,544) | (678) | ||
Repayment of affiliate short-term borrowings | (2,000) | |||
Repayment of affiliates long-term borrowings | (668) | (544) | ||
Proceeds from long-term debt | 0 | |||
Repayment of long-term debt | (246) | (176) | ||
Advances and contributions in aid of construction | 87 | 50 | ||
Refunds of advances for construction | 0 | (18) | ||
Repurchase of common stock | 0 | 0 | ||
Dividends paid to non-affiliates | 0 | (397) | ||
Dividends paid to affiliates | (794) | 0 | ||
Net cash provided by financing activities | (1,555) | (1,148) | ||
Change in cash and cash equivalents | (487) | 1,236 | ||
Cash and cash equivalents at beginning of period | 7,061 | 3,985 | ||
Cash and cash equivalents at end of period | $ 6,574 | $ 5,221 | $ 6,574 | $ 5,221 |