Essential Utilities, Inc. SEC 10-Q Report

Essential Utilities, Inc., a leading provider of water, wastewater, and natural gas services, has released its Form 10-Q report for the second quarter of 2025. The report highlights significant financial growth and operational achievements, driven by strategic investments, regulatory recoveries, and favorable weather conditions.

Financial Highlights

Operating Revenues: Essential Utilities reported operating revenues of $1,298.5 million, marking a 24.1% increase compared to the same period in 2024. This growth was primarily driven by higher rates and increased gas volumes due to colder weather conditions.

Net Income: The company achieved a net income of $391.6 million, up from $341.2 million in the first half of 2024. The increase was mainly due to additional revenues from regulatory recoveries and increased gas volumes.

Operations and Maintenance Expense: Operations and maintenance expenses rose by 2.5% to $286.3 million, attributed to higher employee-related costs and customer assistance surcharge costs.

Purchased Gas: The cost of purchased gas increased by 47.7% to $241.4 million, driven by higher average gas costs and increased usage.

Business Highlights

Regulated Water Segment Performance: The Regulated Water segment saw a revenue increase of 9.9% in Q2 2025 compared to Q2 2024. This growth was driven by higher water and wastewater rates and a larger customer base due to acquisitions and organic growth, despite a decrease in volume consumption due to increased rainfall.

Regulated Natural Gas Segment Performance: The Regulated Natural Gas segment experienced a 38.3% increase in operating revenues in Q2 2025 compared to Q2 2024. This was attributed to higher purchased gas costs, increased rates, and higher volumes delivered due to colder weather conditions.

Geographical Performance: Essential Utilities operates in multiple states, with significant operations in Pennsylvania, Ohio, Texas, and other states. The Regulated Water segment's revenue growth was notably supported by operations in Pennsylvania, while the Regulated Natural Gas segment benefited from colder weather in western Pennsylvania.

Sales Units and Production Volumes: The Regulated Natural Gas segment reported higher gas usage due to colder weather, with 514 actual heating degree days in Q2 2025, a 53% increase from the previous year, indicating increased demand for natural gas.

Future Outlook: The company plans to invest approximately $7.8 billion from 2025 through 2029 to improve water and natural gas systems and enhance customer service through improved information technology, reflecting a strong commitment to infrastructure development.

Acquisitions and Growth: Essential Utilities completed several acquisitions, including the Greenville Sanitary Authority and the Village of Midvale's water system, and has agreements to acquire additional systems, including DELCORA, which will significantly expand its customer base.

Regulatory Developments: The company implemented or received approval for base rate increases in several states, contributing to increased annual revenues and supporting future operational and financial stability.

Operational Investments: During the first half of 2025, the company invested $612.6 million to improve its regulated water and natural gas infrastructure, highlighting its focus on maintaining and enhancing service quality.

SEC Filing: Essential Utilities, Inc. [ WTRG ] - 10-Q - Aug. 04, 2025