FORM 10-Q Page 1 of 17
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
(Mark One)
(X) QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31, 1999
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OR
( ) TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from to
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Commission File Number 1-3437-2
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AMERICAN WATER WORKS COMPANY, INC.
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(Exact name of registrant as specified in its charter)
Delaware 51-0063696
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(State or other jurisdiction of (IRS Employer Identification No.)
incorporation or organization)
1025 Laurel Oak Road, Voorhees, New Jersey 08043
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(Address of principal executive offices) (Zip Code)
(609) 346-8200
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(Registrant's telephone number, including area code)
Not Applicable
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(Former name, former address and former fiscal year, if changed since
last report)
Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act
of 1934 during the preceding 12 months, and (2) has been subject to such
filing requirements for the past 90 days. Yes X No
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At May 1, 1999, the number of shares of common stock, $1.25 par value,
outstanding was 81,339,945 shares.
Page 2 FORM 10-Q
PART I FINANCIAL INFORMATION
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Item 1. Financial Statements
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AMERICAN WATER WORKS COMPANY, INC. AND SUBSIDIARY COMPANIES
-----------------------------------------------------------
Consolidated Statements of Income and Retained Earnings (Unaudited)
(In thousands, except per share amounts)
Three Months Ended
March 31,
1999 1998
-------- --------
CONSOLIDATED INCOME
Operating revenues $237,002 $226,000
-------- --------
Operating expenses
Operation and maintenance 111,039 102,032
Depreciation and amortization 31,304 28,509
General taxes 25,317 23,543
-------- --------
167,660 154,084
-------- --------
Operating income 69,342 71,916
Allowance for other funds used during
construction 3,185 1,577
Other income (257) (169)
-------- --------
72,270 73,324
-------- --------
Income deductions
Interest 40,053 36,546
Allowance for borrowed funds used
during construction (2,380) (783)
Amortization of debt expense 465 426
Preferred dividends of subsidiaries 821 866
Other deductions 753 807
-------- --------
39,712 37,862
-------- --------
Income before income taxes 32,558 35,462
Provision for income taxes 12,873 13,874
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Net income 19,685 21,588
Dividends on preferred stocks 996 996
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Net income to common stock $ 18,689 $ 20,592
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Average shares of basic common stock outstanding 80,970 79,815
Basic and diluted earnings per common share on
average shares outstanding $ 0.23 $ 0.26
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Page 3 FORM 10-Q
Three Months Ended
March 31,
1999 1998
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CONSOLIDATED RETAINED EARNINGS
Balance at beginning of period $778,526 $717,243
Add - net income 19,685 21,588
-------- --------
798,211 738,831
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Deduct - dividends paid
Preferred stock 882 882
Preference stock 114 114
Common stock - $.215 per share in 1999;
$.205 per share in 1998 17,386 16,346
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18,382 17,342
-------- --------
Balance at end of period $779,829 $721,489
======== ========
The accompanying notes are an integral part of these financial statements.
Page 4 FORM 10-Q
AMERICAN WATER WORKS COMPANY, INC. AND SUBSIDIARY COMPANIES
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Consolidated Balance Sheet (Unaudited)
(In thousands)
March 31 December 31
1999 1998
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ASSETS
Property, plant and equipment
Utility plant - at original cost less
accumulated depreciation $ 4,077,913 $ 4,041,819
Utility plant acquisition adjustments, net 54,313 54,739
Non-utility property, net of accumulated
depreciation 31,823 32,217
Excess of cost of investments in
subsidiaries over book equity at
acquisition, net 24,416 24,431
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4,188,465 4,153,206
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Current assets
Cash and cash equivalents 45,609 39,059
Customer accounts receivable 69,547 73,774
Allowance for uncollectible accounts (1,401) (1,583)
Unbilled revenues 56,946 58,778
Miscellaneous receivables 8,250 8,786
Materials and supplies 12,130 11,943
Deferred vacation pay 13,494 10,127
Other 8,739 10,888
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213,314 211,772
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Regulatory and other long-term assets
Regulatory asset - income taxes
recoverable through rates 187,963 186,748
Debt and preferred stock expense 33,203 33,617
Deferred pension expense 27,441 26,345
Deferred postretirement benefit expense 10,936 11,181
Deferred treatment plant costs 6,607 6,873
Deferred water utility billings 1,560 1,862
Tank painting costs 12,124 12,599
Funds restricted for construction 11,778 10,935
Other 56,719 53,169
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348,331 343,329
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$ 4,750,110 $ 4,708,307
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Page 5 FORM 10-Q
March 31 December 31
1999 1998
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CAPITALIZATION AND LIABILITIES
Capitalization
Common stock $ 101,557 $ 101,118
Paid-in capital 370,455 360,510
Retained earnings 779,829 778,526
Unearned compensation (1,613) (980)
Treasury stock (3,675) --
----------- -----------
Common stockholders' equity 1,246,553 1,239,174
Preferred stocks with mandatory redemption
requirements 40,000 40,000
Preferred stocks without mandatory
redemption requirements 11,673 11,673
Preferred stocks of subsidiaries with
mandatory redemption requirements 36,727 39,161
Preferred stocks of subsidiaries without
mandatory redemption requirements 6,255 6,255
Long-term debt
American Water Works Company, Inc. 201,000 201,000
Subsidiaries 1,904,129 1,905,011
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3,446,337 3,442,274
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Current liabilities
Bank debt 114,057 88,590
Current portion of long-term debt 43,301 53,321
Accounts payable 33,752 56,728
Taxes accrued, including federal income 33,213 18,867
Interest accrued 44,386 38,313
Accrued vacation pay 13,728 10,243
Other 43,443 35,269
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325,880 301,331
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Page 6 FORM 10-Q
March 31 December 31
1999 1998
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Regulatory and other long-term liabilities
Advances for construction $ 138,565 $ 138,204
Deferred income taxes 456,628 451,118
Deferred investment tax credits 34,801 35,083
Accrued pension expense 50,835 48,755
Accrued postretirement benefit expense 14,066 10,034
Other 9,743 9,602
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704,638 692,796
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Contributions in aid of construction 273,255 271,906
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Commitments and contingencies -- --
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$ 4,750,110 $ 4,708,307
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The accompanying notes are an integral part of these financial statements.
Page 7 FORM 10-Q
AMERICAN WATER WORKS COMPANY, INC. AND SUBSIDIARY COMPANIES
-----------------------------------------------------------
Consolidated Statement of Cash Flows (Unaudited)
(In thousands)
Three Months Ended
March 31,
1999 1998
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CASH FLOWS FROM OPERATING ACTIVITIES
Net income $ 19,685 $ 21,588
Adjustments
Depreciation and amortization 31,304 28,509
Provision for deferred income taxes 5,228 4,849
Provision for losses on accounts receivable 1,047 1,299
Allowance for other funds used during
construction (3,185) (1,577)
Employee benefit expenses greater than
funding 5,100 442
Employee stock plan expenses 698 998
Deferred tank painting costs (65) (138)
Deferred rate case expense (900) (265)
Deferred treatment plant costs (1,339) (726)
Amortization of deferred charges 3,392 2,334
Other, net (5,302) (2,580)
Changes in assets and liabilities
Accounts receivable 3,534 3,361
Unbilled revenues 1,832 1,015
Other current assets 1,962 (330)
Accounts payable (22,976) (15,889)
Taxes accrued, including federal income 14,346 17,951
Interest accrued 6,073 7,086
Other current liabilities 8,174 (8,894)
-------- --------
Net cash from operating activities 68,608 59,033
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CASH FLOWS FROM INVESTING ACTIVITIES
Construction expenditures (67,983) (52,963)
Allowance for other funds used during
construction 3,185 1,577
Utility system acquisitions (826) (21,384)
Proceeds from the disposition of property,
plant and equipment 84 228
Removal costs from property, plant and
equipment retirements (495) (227)
Funds restricted for construction activity (843) (840)
-------- --------
Net cash used in investing activities (66,878) (73,609)
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Page 8 FORM 10-Q
Three Months Ended
March 31,
1999 1998
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CASH FLOWS FROM FINANCING ACTIVITIES
Proceeds from long-term debt $ 452 $ 17,200
Proceeds from common stock 9,032 5,381
Purchase of common stock for treasury (1,190) --
Net borrowings under
line-of-credit agreements 25,467 25,430
Advances and contributions for construction,
net of refunds 3,390 2,964
Debt issuance costs (161) (1,488)
Repayment of long-term debt (11,354) (4,567)
Redemption of preferred stocks (2,434) (406)
Dividends paid (18,382) (17,342)
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Net cash from financing activities 4,820 27,172
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Net increase in cash and
cash equivalents 6,550 12,596
Cash and cash equivalents at beginning
of period 39,059 12,661
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Cash and cash equivalents at end of period $ 45,609 $ 25,257
======== ========
Cash paid during the period for:
Interest, net of capitalized amount $ 34,648 $ 29,947
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Income taxes $ 8,413 $ 8,917
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Common stock issued in lieu of cash in connection with the Employees' Stock
Ownership Plan, the Savings Plan for Employees and the Long-Term
Performance-Based Incentive Plan totaled $1,565 in 1999 and $3,172 in 1998.
Common stock placed into treasury in connection with the Long-Term
Performance-Based Incentive Plan totaled $3,675 in 1999.
The accompanying notes are an integral part of these financial statements.
Page 9 FORM 10-Q
AMERICAN WATER WORKS COMPANY, INC. AND SUBSIDIARY COMPANIES
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Information Accompanying Financial Statements (Unaudited)
(In thousands, except share and per share amounts)
March 31 December 31
1999 1998
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Preferred stocks with mandatory redemption requirements
Cumulative preferred stock - $25 par value
Authorized - 1,770,000 shares
8.50% series (non-voting) - 1,600,000 shares
outstanding $ 40,000 $ 40,000
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Preferred stocks without mandatory redemption requirements
Cumulative preferred stock - $25 par value
5% series (one-tenth of a vote per share)
- 101,777 shares outstanding $ 2,544 $ 2,544
Cumulative preference stock - $25 par value
Authorized - 750,000 shares
5% series (non-voting) - 365,158 shares
outstanding 9,129 9,129
Cumulative preferential stock - $35 par value
Authorized - 3,000,000 shares -- --
---------- -----------
$ 11,673 $ 11,673
========== ===========
The terms of the 8.50% preferred stock provide that all shares of the
series shall be redeemed on December 1, 2000.
Common stockholders' equity
Common stock - $1.25 par value
Authorized - 300,000,000 shares
Outstanding - 81,245,744 shares at March 31, 1999;
80,894,790 at December 31, 1998 $ 101,557 $ 101,118
Paid-in capital 370,455 360,510
Retained earnings 779,829 778,526
Unearned compensation (1,613) (980)
Treasury stock - 108,875 shares at March 31, 1999 (3,675) --
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$1,246,553 $ 1,239,174
========== ===========
During the first three months of 1999, 268,104 shares were issued in
connection with the Dividend Reinvestment and Stock Purchase Plan, 52,063
shares were issued in connection with the Savings Plan for Employees and
30,788 shares were issued in connection with the Long-Term
Performance-Based Incentive Plan. At March 31, 1999, common shares
reserved for issuance in connection with the Company's stock plans were
80,865,863 shares for the Stockholder Rights Plan, 5,077,496 shares for the
Dividend Reinvestment and Stock Purchase Plan, 707,559 shares for the
Employees' Stock Ownership Plan, 746,015 shares for the Savings Plan for
Employees and 296,347 shares for the Long-Term Performance-Based Incentive
Plan.
Page 10 FORM 10-Q
AMERICAN WATER WORKS COMPANY, INC. AND SUBSIDIARY COMPANIES
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Notes to Consolidated Financial Statements (Unaudited)
NOTE 1 -- Financial Statement Presentation
The information presented in this Form 10-Q is unaudited. In the opinion
of management the information reported reflects all adjustments, consisting
of normal recurring adjustments, which were necessary to a fair statement
of the results for the periods reported. Certain reclassifications have
been made to conform previously reported data to the current presentation.
NOTE 2 -- Acquisitions
On October 13, 1998, the Company announced that an agreement in principle
had been reached to acquire National Enterprises Inc.(NEI)in a transaction
valued at $700 million. Subsidiaries of NEI, a privately owned company,
provide water service to 504,000 customers in Missouri, Illinois, Indiana
and New York.
The transaction, which will be accounted for as a pooling of interests,
will be accomplished through a tax free exchange of 14,937,000 shares of
the Company's stock valued at $475 million, for all of the outstanding
shares of NEI and $225 million of assumed debt. It is anticipated that the
transaction will be completed in the third quarter of 1999, following
regulatory approvals, termination of the waiting period under Federal
anti-trust laws and completion of other requirements.
NEI is the parent company of Continental Water Company, which in turn owns:
St. Louis County Water Company serving suburban St. Louis, Missouri;
Northwest Indiana Water Company serving Gary, Hobart and surrounding areas;
Northern Illinois Water Company serving Champaign, Urbana and surrounding
areas; and Long Island Water Corporation serving the southwest portion of
Nassau County on Long Island, New York. NEI also has passive investments
in the telecommunications industry owning approximately 4 million shares of
ITC Deltacom and .6 million shares of Powertel as well as an interest in
privately held ITC Holdings.
All of the common stock of NEI is currently owned by descendants of the
Charles Stewart Mott family. Upon completion of this transaction, the Mott
family will hold approximately 16% of the outstanding shares of American
Water Works common stock. It is expected that two representatives of the
Mott family will be elected to the Board of the Company.
NOTE 3 -- New Accounting Standards
In 1999, the Company will adopt Statement of Financial Accounting Standards
No. 133 "Accounting for Derivative Instruments and Hedging Activities"
(SFAS 133). This statement establishes accounting and reporting standards
for derivative instruments and hedging activities. SFAS 133 was issued by
the Financial Accounting Standards Board in June of 1998 and requires that
an entity recognize all derivatives as either assets or liabilities in the
statement of financial position and measure those instruments at fair
value. As of March 31, 1999, the Company had no derivative instruments or
hedging activities.
Page 11 FORM 10-Q
PART I - FINANCIAL INFORMATION
Item 2. Management's Discussion and Analysis of Financial Condition
and Results of Operations
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Results of Operations
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First quarter revenues increased 5 percent from $226 million in 1998 to
$237 million this year. Revenue growth for the first quarter of 1999 was
driven primarily by a 4 percent increase in water sales over the previous
period due to customer growth and recovery from reduced sales in California
related to El Nino in the first quarter of 1998.
During the first four months of 1999, two utility subsidiaries received
rate orders which are expected to provide $13.9 million in additional
annual revenues. Included in this $13.9 million is $13.1 million awarded
to the Company's New Jersey subsidiary in early April. Six subsidiaries
have rate increase applications on file before regulatory agencies which,
if granted in full, would provide approximately $60.3 million in additional
annual revenues. The largest of these, the Company's Pennsylvania
subsidiary's rate case, has been filed requesting $40 million in additional
annual revenues.
Operating expenses were up 9 percent to $167.7 million in 1999 from $154.1
million in the first quarter of 1998. Adverse winter weather experienced
at several utility subsidiaries contributed to increased maintenance,
purchased water and production costs. Other expense elements of note were
expected increases in depreciation expense and general taxes, both related
to the Company's ongoing program of utility plant construction.
Interest expense rose by 10% to $40.1 million in the first quarter of 1999
compared to the first quarter of 1998, primarily due to an increase in
total debt to fund construction of new water service assets. The total
allowance for funds used (equity and borrowed) during construction
("AFUDC") recorded in the first quarter of 1999 was $5.6 million, compared
to $2.4 million in the first quarter of 1998. The utility subsidiaries
record AFUDC to the extent permitted by the regulatory authorities.
Income taxes decreased in the first three months of 1999 when compared to
the first three months in 1998, as a result of decreased earnings.
Net income to common stock was $18.7 million for the first quarter of 1999
compared with $20.6 million for the same period in 1998.
Capital Resources and Liquidity
- -------------------------------
All shares of common stock issued during 1999 have been the result of stock
issued in conjunction with the Dividend Reinvestment and Stock Purchase
Plan, the Employees' Stock Ownership Plan, the Savings Plan for Employees,
and the Long-Term Performance-Based Incentive Plan.
Page 12 FORM 10-Q
During the balance of 1999, in addition to the NEI acquisition (see Note
2), the Company plans to issue shares of common stock through its Dividend
Reinvestment and Stock Purchase Plan, the Employees' Stock Ownership Plan
and the Savings Plan for Employees. Proceeds from the issuance of common
stock will fund additional equity investments in subsidiaries.
The Company placed 108,875 shares of common stock into treasury in
connection with the Long-Term Performance-Based Incentive Plan in the first
quarter of 1999.
In the first four months of 1999, the Company invested $2.1 million in the
common stock of a subsidiary. It is anticipated that some subsidiaries
will sell long-term debt to institutional investors and common stock to the
Company during the remainder of 1999, with the proceeds used to fund
construction programs, continue acquisitions and repay bank loans.
Year 2000 Issues
- ----------------
Many computer systems in use today were designed and developed without
regard to the impact of the upcoming century change. Computer programs and
devices often use only two digits for the year to identify dates. As a
result, computer systems may fail completely or create erroneous results
unless corrective measures are taken.
The Company utilizes numerous computerized systems and date sensitive
devices in its operations. If some of these key systems and devices are
not ready for the Year 2000 there will likely be adverse effects on the
Company's business, results of operations, and financial condition. The
Company is also dependent on third parties that supply important materials
and services such as water treatment chemicals, electric power for pumps
and the processing of customer payments. The failure of some of these
third parties to be Year 2000 compliant on a timely basis would also have
an adverse effect on the Company. The Company has assigned a very high
priority to its Year 2000 compliance efforts, and as discussed below,
considerable progress has been made. These efforts are expected to be
substantially completed in the second quarter of 1999.
An inventory of all important computer programs and devices with embedded
technology has been prepared for each utility subsidiary. Those
inventories are being used to track the status of any necessary upgrades or
replacements, and to log the results of testing by Company personnel to
ensure that all important systems are in fact Year 2000 compliant. In some
instances work on other information technology projects has been delayed
because of Year 2000 remediation projects, but these delays are not
expected to have a significant impact on the Company's operations.
Because the Company is particularly dependent on its computerized
financial, customer service and treatment plant automation systems, those
systems are the primary areas in which Year 2000 efforts are focused.
The Company is currently implementing two new software packages for
financial and customer service applications that are Year 2000 compliant.
Although the decision to purchase and implement this software was based on
an analysis of all of the Company's current and future systems
Page 13 FORM 10-Q
requirements, once the decision was made these projects became a key part
of the Company's Year 2000 compliance plan. New enterprise software for
financial applications is now in use by all of the utility subsidiaries.
The new customer service software is currently being used by two of the
Company's subsidiaries, and another subsidiary is expected to begin using
the new software in July. Implementation of the new customer service
software will continue beyond 1999, so the customer service software
currently used by many of the subsidiaries is also being made Year 2000
compliant. Several of the utility subsidiaries are now using the
remediated Year 2000 compliant customer service software, and this project
is expected to be completed in July. In conjunction with these projects,
midrange and personal computers have been upgraded with hardware and
operating systems that are Year 2000 compliant.
Many of the Company's water treatment plants utilize automation systems
that are controlled by personal computers. These systems are being tested
and upgraded if necessary, and that work has been completed at most
facilities. The Company's production and distribution facilities also
utilize many pieces of equipment with embedded microcontroller chips.
These chips, which may be time/date sensitive, are an integral part of
critical operating equipment. Much of this equipment cannot be field
tested to evaluate Year 2000 compliance, so the Company used a systematic
approach to identify and resolve this issue that was completed during the
first quarter of 1999. As a contingency, the Company's production and
distribution facilities can be operated manually in the event of an
internal Year 2000 related failure.
In addition to the work being done on the Company's internal systems,
interfaces used to exchange information with banks and other entities are
being tested to ensure Year 2000 compliance. And where feasible, plans are
being formulated to minimize the impact of problems outside parties may
have in providing supplies and services.
The cost of the new financial and customer service software, implementation
consulting services, and the cost of upgrading and replacing computers and
other equipment will be capitalized by the utility subsidiaries and
included in future rate increase requests. The total cost of these capital
projects is expected to be approximately $45 million, of which
approximately $39 million has been incurred to date. Costs for specific
Year 2000 remediation projects will be charged to expense unless they meet
the requirements for deferral as regulatory assets. However, current
period expenses are not expected to be materially different from the usual
ongoing level of information systems related expenses.
Page 14 FORM 10-Q
New Accounting Standards
- ------------------------
In 1999, the Company will adopt Statement of Financial Accounting Standards
No. 133 "Accounting for Derivative Instruments and Hedging Activities"
(SFAS 133). This statement establishes accounting and reporting standards
for derivative instruments and hedging activities. SFAS 133 was issued by
the Financial Accounting Standards Board in June of 1998 and requires that
an entity recognize all derivatives as either assets or liabilities in the
statement of financial position and measure those instruments at fair
value. As of March 31, 1999, the Company had no derivative instruments or
hedging activities.
Forward Looking Information
- ---------------------------
Forward looking statements in this report, including, without limitation,
statements relating to the Company's plans, strategies, objectives,
expectations, intentions and adequacy of resources, are made pursuant to
the safe harbor provisions of the U.S. Private Securities Litigation Reform
Act of 1995. These forward looking statements involve known and unknown
risks, uncertainties and other factors which may cause the actual results,
performance or achievements of the Company to be materially different from
any future results, performance or achievements expressed or implied by
such forward looking statements. These factors include, among others, the
following: general economic and business conditions; competition; success
of operating initiatives, advertising and promotional efforts; existence of
adverse publicity or litigation; changes in business strategy or plans;
quality of management; availability, terms and development of capital;
business abilities and judgment of personnel; changes in, or the failure to
comply with governmental regulations; Year 2000 issues; and other factors
described in filings of the Company with the SEC. The Company undertakes
no obligation to publicly update or revise any forward looking statement,
whether as a result of new information, future events or otherwise.
Page 15 FORM 10-Q
PART II - OTHER INFORMATION
Item 4. Submission of Matters to a Vote of Security Holders
-------------------------------------------------------------
(a) The Company held its annual meeting of shareholders on May 6, 1999.
(c) Class I Directors (with a term expiring in 2000) were elected by
a vote of:
For Withheld
--- --------
William O. Albertini 69,928,098 775,999
Rhoda W. Cobb 69,860,057 775,999
Ray J. Groves 69,884,789 775,999
Ross A. Webber 69,920,106 775,999
Horace Wilkins, Jr. 69,895,394 775,999
Class II Directors (with a term expiring in 2001) were elected by
a vote of:
For Withheld
--- --------
Henry G. Hager 69,933,145 775,999
Gerald C. Smith 69,937,464 775,999
Anthony P. Terracciano 69,904,972 775,999
Marilyn Ware 69,860,372 775,999
Class III Directors (with a term expiring in 2002) were elected by
a vote of:
For Withheld
--- --------
J. James Barr 69,957,056 775,999
Elizabeth H. Gemmill 69,909,836 775,999
Nancy Ware Wainwright 69,835,133 775,999
Paul W. Ware 69,860,206 775,999
The amendment of the Registrant's restated certificate of incorporation, as
amended, to provide for the classification of the board of directors into
three separate classes was approved by a vote of 44,369,613 for the
amendment, and 16,054,055 against, with 443,419 abstentions.
The appointment of the PricewaterhouseCoopers LLP as the Company's
independent accountants for the year ending December 1999 was approved by a
vote of 70,156,018 for the appointment and 295,873 against, with 221,593
abstentions.
Page 16 FORM 10-Q
PART II - OTHER INFORMATION
Item 6. Exhibits and Reports on Form 8-K
-----------------------------------------
A. Exhibits
--------
Exhibit Number Description
- -------------- -----------
3 Articles of Incorporation and By-laws
(a) Certificate of Incorporation of the Registrant, as
amended to May 6, 1999, is filed herewith.
(b) By-laws of the Registrant, as amended to May 6, 1999,
are filed herewith.
10 Material Contracts
Amendment dated December 22, 1998 to Consulting Agreement
between Registrant and Anthony P. Terracciano, is filed
herewith.
27 Financial Data Schedule, is filed herewith
electronically.
B. Reports on Form 8-K
-------------------
No report on Form 8-K was filed by the registrant during the quarter ended
March 31, 1999.
Page 17 FORM 10-Q
SIGNATURES
- ----------
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
AMERICAN WATER WORKS COMPANY, INC.
Date May 10, 1999 /s/ J. James Barr
- ---------------------- --------------------------------------
President and Chief Executive Officer
(Authorized Officer)
Date May 10, 1999 /s/ Robert D. Sievers
- ---------------------- --------------------------------------
Comptroller
(Chief Accounting Officer)