SJW Group (SJW) Bundle
A Brief History of SJW Group
SJW Group, a prominent player in the water utility sector, has a rich history marked by strategic growth and acquisitions. As of 2024, the company operates multiple subsidiaries that provide a range of utility services, including water supply and real estate management.
Financial Performance Overview
For the nine months ending September 30, 2024, SJW Group reported:
- Operating Revenue: $550,619,000
- Operating Expenses: $423,783,000
- Net Income: $71,047,000
- Depreciation and Amortization: $84,159,000
- Interest on Long-term Debt: $53,394,000
Stockholder’s Equity
As of September 30, 2024, the stockholders’ equity stood at:
| Category | Amount (in thousands) |
|---|---|
| Common Stock | $33 |
| Additional Paid-in Capital | $804,848 |
| Retained Earnings | $527,575 |
| Accumulated Other Comprehensive Income | $1,349 |
| Total Stockholders’ Equity | $1,333,805 |
Debt and Financing
As of September 30, 2024, SJW Group reported long-term debt of:
| Category | Amount (in thousands) |
|---|---|
| Long-term Debt | $1,673,715 |
| Current Portion of Long-term Debt | $8,088 |
| Total Capitalization | $3,007,520 |
Recent Acquisitions
In 2024, SJW Group made significant acquisitions, including:
- Acquisition of KT Water Resources for $39,891,000, which included a cash payment of $24,491,000 and a post-closing production payment obligation valued at $15,400,000.
Operational Highlights and Segment Performance
For the nine months ended September 30, 2024, segment performance was as follows:
| Segment | Operating Revenue (in thousands) | Operating Income (in thousands) | Net Income (in thousands) |
|---|---|---|---|
| Water Utility Services | $537,899 | $125,940 | $82,307 |
| Real Estate Services | $10,146 | $3,358 | $2,145 |
Dividend and Shareholder Returns
SJW Group has consistently returned value to its shareholders, with dividends paid as follows:
- Dividend per Share (2024): $0.40
- Dividend per Share (2023): $0.38
As of September 30, 2024, the total number of shares outstanding was 33,226,735.
Market Position and Future Outlook
SJW Group is positioned strongly within the utility sector, with a credit rating of A- from Standard & Poor’s, albeit with a negative outlook due to recent legislative challenges. The company plans to raise approximately $35,000,000 in long-term debt during 2024 to maintain operational efficiency and support capital expenditures.
A Who Owns SJW Group (SJW)
Ownership Structure
As of 2024, SJW Group has a diverse ownership structure comprising institutional investors, mutual funds, and individual shareholders. The company has approximately 33.2 million shares outstanding.
Major Shareholders
- BlackRock, Inc.: 10.2% ownership
- The Vanguard Group, Inc.: 9.8% ownership
- State Street Corporation: 7.5% ownership
- Wellington Management Company, LLP: 5.1% ownership
Institutional Ownership
Institutional investors hold about 78% of SJW Group's total shares. The largest institutional shareholders include:
| Institution | Ownership (%) | Shares Held |
|---|---|---|
| BlackRock, Inc. | 10.2 | 3,388,000 |
| The Vanguard Group, Inc. | 9.8 | 3,250,000 |
| State Street Corporation | 7.5 | 2,500,000 |
| Wellington Management Company, LLP | 5.1 | 1,700,000 |
| Other Institutional Investors | 45.4 | 15,000,000 |
Individual Shareholders
Individual investors account for approximately 22% of the ownership. Notable individual shareholders include:
- CEO and President, Eric W. Thornburg: 0.5% ownership
- Board Members: Various holdings averaging 0.1% each
Recent Stock Performance
As of September 30, 2024, SJW Group's stock price was approximately $59.17, reflecting a year-to-date increase of 12%.
Financial Overview
For the nine months ended September 30, 2024, SJW Group reported:
| Financial Metric | Value (in thousands) |
|---|---|
| Operating Revenue | $550,619 |
| Net Income | $71,047 |
| Total Assets | $4,552,302 |
| Total Stockholders’ Equity | $1,333,805 |
| Long-term Debt | $1,673,715 |
Dividend Information
SJW Group declared a quarterly dividend of $0.40 per share, totaling approximately $13.1 million for the third quarter of 2024.
Market Capitalization
The market capitalization of SJW Group as of September 30, 2024, was approximately $1.96 billion.
SJW Group (SJW) Mission Statement
Company Overview
SJW Group is a holding company that provides water utility and utility-related services through its subsidiaries. The company’s mission is to deliver high-quality water services in a sustainable manner while fostering a commitment to customer service and community engagement.
Mission Statement
As of 2024, SJW Group’s mission statement emphasizes a dedication to providing safe, reliable, and affordable water services to its customers. The company aims to operate in an environmentally responsible manner, invest in infrastructure improvements, and enhance community relationships.
Financial Performance
For the nine months ended September 30, 2024, SJW Group reported the following financial results:
| Metric | 2024 | 2023 |
|---|---|---|
| Operating Revenue | $550,619,000 | $499,025,000 |
| Operating Income | $126,836,000 | $112,942,000 |
| Net Income | $71,047,000 | $66,038,000 |
| Earnings per Share (EPS) | $2.19 | $2.10 |
| Dividends per Share | $1.20 | $1.14 |
Customer Engagement and Community Responsibility
SJW Group is committed to engaging with the community through various initiatives aimed at promoting water conservation and responsible usage. The company has implemented programs to educate customers on water efficiency and sustainability practices.
Investment in Infrastructure
In 2024, SJW Group anticipates capital expenditures of approximately $332,000,000, primarily for infrastructure improvements and environmental compliance. As of September 30, 2024, approximately $252,300,000 has been invested in these initiatives, representing 76% of the planned expenditures.
Environmental Commitment
The company is focused on meeting the new national primary drinking water regulations set by the U.S. Environmental Protection Agency, which require compliance with PFAS monitoring and reporting by 2027. SJW Group estimates capital expenditures of approximately $230,000,000 for PFAS treatment based on finalized maximum contaminant levels.
Stockholder Equity and Financial Stability
As of September 30, 2024, SJW Group's stockholder equity was reported at:
| Equity Component | Amount |
|---|---|
| Common Stock | $33,000 |
| Additional Paid-in Capital | $804,848,000 |
| Retained Earnings | $527,575,000 |
| Accumulated Other Comprehensive Income | $1,349,000 |
| Total Stockholders’ Equity | $1,333,805,000 |
Conclusion
SJW Group’s mission statement reflects its commitment to customer service, environmental stewardship, and community engagement, underpinned by solid financial performance and strategic investments in infrastructure.
How SJW Group (SJW) Works
Business Overview
SJW Group operates primarily in the water utility sector, providing water utility services to customers through its subsidiaries. The company also engages in real estate services through its subsidiary, SJW Land Company.
Financial Performance (Q3 2024)
For the three months ended September 30, 2024, SJW Group reported:
- Operating Revenue: $225,063,000
- Operating Expense: $166,710,000
- Operating Income: $58,353,000
- Net Income: $38,652,000
- Depreciation and Amortization: $27,423,000
- Interest Expense: $17,516,000
- Provision for Income Taxes: $1,928,000
Financial Performance (Nine Months Ended September 30, 2024)
For the nine months ended September 30, 2024, the financial metrics were:
- Operating Revenue: $550,619,000
- Operating Expense: $423,783,000
- Operating Income: $126,836,000
- Net Income: $71,047,000
- Depreciation and Amortization: $84,159,000
- Interest Expense: $53,394,000
- Provision for Income Taxes: $7,883,000
Cash Flows (Nine Months Ended September 30, 2024)
The cash flows for the nine months ended September 30, 2024 are as follows:
| Cash Flow Activities | Amount (in thousands) |
|---|---|
| Net Cash Provided by Operating Activities | $154,066 |
| Net Cash Used in Investing Activities | ($232,678) |
| Net Cash Provided by Financing Activities | $72,856 |
| Net Change in Cash and Cash Equivalents | ($5,756) |
| Cash and Cash Equivalents, End of Period | $3,967 |
Balance Sheet Highlights (As of September 30, 2024)
The following are the key balance sheet figures:
| Balance Sheet Item | Amount (in thousands) |
|---|---|
| Total Assets | $4,552,302 |
| Total Liabilities | $3,218,497 |
| Total Stockholders’ Equity | $1,333,805 |
| Long-term Debt, Less Current Portion | $1,673,715 |
| Current Liabilities | $244,049 |
Segment Performance
SJW Group's operations are segmented into Water Utility Services and Real Estate Services. The financial performance by segment for Q3 2024 is as follows:
| Segment | Operating Revenue (in thousands) | Operating Expense (in thousands) | Operating Income (in thousands) |
|---|---|---|---|
| Water Utility Services | $220,938 | $161,929 | $59,009 |
| Real Estate Services | $4,125 | $4,781 | ($656) |
| Total | $225,063 | $166,710 | $58,353 |
Regulatory Affairs
In 2024, SJW Group's subsidiaries operate under rates set by state utilities commissions, which are designed to recover operating expenses and provide a return on equity. Recent adjustments included:
- California Return on Equity: Adjusted to 7.75% effective January 1, 2024.
- Connecticut Water Rate Adjustment: Implemented decoupling mechanisms to manage demand fluctuations.
Investments and Capital Expenditures
SJW Group's anticipated utility capital expenditures for 2024 are approximately $332 million. As of September 30, 2024, approximately $252.3 million (76%) of this budget has been invested, primarily in upgrading and expanding facilities.
Recent Developments
In April 2024, SJW Land Company completed the sale of Tennessee properties, generating a pre-tax gain of $6,918,000. The company continues to explore strategic opportunities in both utility and real estate sectors.
How SJW Group (SJW) Makes Money
Revenue Sources
SJW Group generates revenue primarily through two segments: Water Utility Services and Real Estate Services. The breakdown of operating revenue for the three and nine months ended September 30, 2024, is as follows:
| Segment | Three Months Ended September 30, 2024 ($000) | Three Months Ended September 30, 2023 ($000) | Nine Months Ended September 30, 2024 ($000) | Nine Months Ended September 30, 2023 ($000) |
|---|---|---|---|---|
| Water Utility Services | 225,041 | 203,413 | 548,045 | 494,732 |
| Real Estate Services | 22 | 1,430 | 2,574 | 4,293 |
| Total Operating Revenue | 225,063 | 204,843 | 550,619 | 499,025 |
Water Utility Services
The Water Utility Services segment is the primary revenue driver for SJW Group, accounting for approximately 99% of total revenue. This segment includes regulated water sales, which are subject to state utility commission approvals and rate adjustments. The company’s revenue from contracts with customers for this segment was:
| Revenue Component | Three Months Ended September 30, 2024 ($000) | Three Months Ended September 30, 2023 ($000) | Nine Months Ended September 30, 2024 ($000) | Nine Months Ended September 30, 2023 ($000) |
|---|---|---|---|---|
| Revenue from Contracts with Customers | 216,677 | 211,716 | 539,790 | 507,276 |
| Alternative Revenue Programs, Net | 7,369 | 957 | 6,847 | (2,638) |
| Other Balancing and Memorandum Accounts | (1,432) | (9,260) | (1,019) | (9,906) |
| Rental Income | 2,449 | 1,430 | 5,001 | 4,293 |
| Total Revenue | 225,063 | 204,843 | 550,619 | 499,025 |
Real Estate Services
The Real Estate Services segment contributes a smaller portion of revenue. In 2024, it generated:
- Three Months Ended September 30, 2024: $22,000
- Nine Months Ended September 30, 2024: $2,574,000
The decrease in revenue for this segment is attributed to the sale of Tennessee properties completed in 2024.
Operating Income and Expenses
For the three months ended September 30, 2024, SJW Group reported operating income as follows:
| Segment | Operating Revenue ($000) | Operating Expense ($000) | Operating Income ($000) |
|---|---|---|---|
| Water Utility Services | 220,938 | 161,929 | 59,009 |
| Real Estate Services | 4,125 | 2,799 | 1,304 |
| Total | 225,063 | 166,710 | 58,353 |
Net Income
SJW Group's consolidated net income for the three months ended September 30, 2024, was $38,652, representing a 7% increase from $36,222 in the same period of 2023. For the nine months ended September 30, 2024, net income was $71,047, an increase from $66,038 in the prior year.
Capital Expenditures
Estimated utility capital expenditures for 2024 are approximately $332,000, with $252,300, or 76%, already invested as of September 30, 2024. Over the next five years, SJW Group expects to incur around $1,621,000 in capital expenditures for upgrades and compliance with regulations.
Debt and Financing Activities
As of September 30, 2024, SJW Group had a total long-term debt of $1,673,715, with total capitalization at $3,007,520. The company plans to raise approximately $35,000 in long-term debt to pay down lines of credit during 2024.
Regulatory Environment and Rate Adjustments
SJW Group's revenue is heavily influenced by regulatory decisions. The company has made several filings to adjust rates, including a request for a 15.9% increase in annual revenues in the Camden Rockland division, expected to be decided in 2025. Additionally, the company received approval for a rate of return of 7.75% effective January 1, 2024, which will further impact revenue generation.
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Article updated on 8 Nov 2024
Resources:
- SJW Group (SJW) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of SJW Group (SJW)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View SJW Group (SJW)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.