Global Water Resources has reached a settlement for rate changes with the Arizona Corporation Commission, pending approval.
Quiver AI Summary
Global Water Resources, Inc. has announced a unanimous settlement agreement regarding its general rate case application for the Farmers Water Company, which was submitted to the Arizona Corporation Commission in June 2024. The settlement, filed on January 10, 2025, proposes a revenue increase of approximately $1.1 million annually based on service connections from 2023, with the new rates phased in over three stages starting May 1, 2025. The agreement also includes a deferral for the recovery of a $3 million acquisition premium related to Global Water's purchase of Farmers and introduces a mechanism for timely recovery of capital costs associated with distribution system improvements. The hearing for this agreement is set for February 10, 2025, and represents a significant step towards enhancing service for customers in the Sahuarita community.
Potential Positives
- Global Water Resources reached a unanimous settlement agreement regarding its rate case application, indicating successful negotiations with regulatory bodies and stakeholders.
- If approved, the proposed rate increase is projected to provide a revenue boost of approximately $1.1 million annually, enhancing the company's financial position.
- The settlement includes provisions for a deferral of the recovery of an acquisition premium, which allows strategic financial planning for future rate cases.
- The introduction of a system improvement benefits mechanism is expected to facilitate timely recovery of capital costs for distribution system improvements, promoting ongoing infrastructure development.
Potential Negatives
- The need for a settlement agreement may indicate ongoing operational or regulatory challenges that the company is facing with GW-Farmers, which could raise concerns among investors.
- The proposed rate increases, while providing additional revenue, may lead to customer dissatisfaction and negative public perception if perceived as excessive or unfair.
- The deferral of the recovery of a $3 million acquisition premium may signal potential financial strain and could affect future profitability if not addressed effectively.
FAQ
What is the recent settlement agreement by Global Water Resources?
Global Water Resources reached a unanimous settlement regarding its rate case application with the Arizona Corporation Commission.
When was the settlement agreement filed?
The settlement agreement was filed with the ACC on January 10, 2025.
What are the expected revenue increases from the new rates?
If approved, the new rates are anticipated to provide a revenue increase of approximately $1.1 million annually.
How will the new rates be implemented?
The new rates will be introduced in three stages: 50% on May 1, 2025, 25% on November 1, 2025, and 25% on May 1, 2026.
What is Total Water Management (TWM)?
TWM is an integrated approach to managing the entire water cycle, optimizing the use of recycled water in service areas.
Disclaimer: This is an AI-generated summary of a press release distributed by GlobeNewswire. The model used to summarize this release may make mistakes. See the full release here.
$GWRS Insider Trading Activity
$GWRS insiders have traded $GWRS stock on the open market 6 times in the past 6 months. Of those trades, 5 have been purchases and 1 have been sales.
Here’s a breakdown of recent trading of $GWRS stock by insiders over the last 6 months:
- SUZANNE MICHELLE KITTS (Vice President and Controller) sold 1,513 shares for an estimated $18,572
- CHRISTOPHER D KRYGIER (Chief Operating Officer) has made 2 purchases buying 1,258 shares for an estimated $14,999 and 0 sales.
- STEVEN D. BRILL (VP of IT Operations) has made 3 purchases buying 26 shares for an estimated $315 and 0 sales.
To track insider transactions, check out Quiver Quantitative's insider trading dashboard.
$GWRS Hedge Fund Activity
We have seen 29 institutional investors add shares of $GWRS stock to their portfolio, and 29 decrease their positions in their most recent quarter.
Here are some of the largest recent moves:
- POLAR ASSET MANAGEMENT PARTNERS INC. removed 70,748 shares (-8.5%) from their portfolio in Q3 2024, for an estimated $890,717
- KENNEDY CAPITAL MANAGEMENT LLC removed 39,088 shares (-25.1%) from their portfolio in Q3 2024, for an estimated $492,117
- GOLDMAN SACHS GROUP INC added 35,428 shares (+108.2%) to their portfolio in Q3 2024, for an estimated $446,038
- WESBANCO BANK INC added 31,000 shares (+inf%) to their portfolio in Q4 2024, for an estimated $356,500
- JANE STREET GROUP, LLC removed 19,444 shares (-100.0%) from their portfolio in Q3 2024, for an estimated $244,799
- MORGAN STANLEY added 18,961 shares (+33.9%) to their portfolio in Q3 2024, for an estimated $238,718
- CITADEL ADVISORS LLC added 15,605 shares (+172.2%) to their portfolio in Q3 2024, for an estimated $196,466
To track hedge funds' stock portfolios, check out Quiver Quantitative's institutional holdings dashboard.
Full Release
PHOENIX, Feb. 04, 2025 (GLOBE NEWSWIRE) -- Global Water Resources, Inc. (NASDAQ: GWRS), a pure-play water resource management company, has reached a unanimous settlement agreement related to the Global Water – Farmers Water Company, Inc. (GW-Farmers) general rate case application it had filed with the Arizona Corporation Commission (ACC) on June 27, 2024. The settlement agreement was filed with the ACC on January 10, 2025, with a hearing on the agreement scheduled to begin on February 10, 2025.
This is the first rate case submitted for GW-Farmers since Global Water acquired the utility in 2023. The proposed new rates are based on 2023 test-year service connections. If approved, the new rates are expected to provide a revenue increase of approximately $1.1 million on an annualized basis. The increase would be implemented in three stages: 50% on May 1, 2025, 25% on November 1, 2025, and 25% on May 1, 2026.
“We appreciate the collaboration with the Utilities Division Staff and Residential Utility Consumer Office in reaching this unanimous settlement,” commented Global Water chief operating officer, Chris Krygier. “This rate case represents the next step in our plan to improve this utility for customers and the broader Sahuarita community.”
In addition to the rate increase, the agreement proposes a deferral of the recovery of an acquisition premium of approximately $3 million related to Global Water’s acquisition of GW-Farmers. This would enable Global Water to recover that investment in a future rate case as a regulatory asset. The agreement also proposes a system improvement benefits (SIB) mechanism that provides for the timely recovery of the capital costs associated with distribution system improvement projects.
The next step in the process is for a hearing before an Administrative Law Judge, who would then draft a Recommended Opinion and Order for the Commission’s consideration at a future Open Meeting.
About Global Water Resources
Global Water Resources, Inc. is a leading water resource management company that owns and operates 32 systems which provide water, wastewater, and recycled water services. The company’s service areas are located primarily in growth corridors around metropolitan Phoenix. Global Water recycles over 1 billion gallons of water annually with 17.4 billion gallons recycled since 2004.
The company has been recognized for its highly effective implementation of Total Water Management (TWM). TWM is an integrated approach to managing the entire water cycle that involves owning and operating water, wastewater and recycled water utilities within the same geographic area in order to maximize the beneficial use of recycled water. It enables smart water management programs such as remote metering infrastructure and other advanced technologies, rate designs, and incentives that result in real conservation. TWM helps protect water supplies in water-scarce areas experiencing population growth.
Global Water has received numerous industry awards, including national recognition as a ‘Utility of the Future Today’ for its superior water reuse practices by a national consortium of water and conservation organizations led by the Water Environment Federation (WEF). The company also received Cityworks’ Excellence in Departmental Practice Award for demonstrating leadership and creativity in applying public asset management strategies to daily operations and long-term planning.
To learn more, visit www.gwresources.com .
Cautionary Note Regarding Forward-Looking Statements
Certain statements in this press release include certain forward-looking statements which reflect the company's expectations regarding future events. The forward-looking statements involve a number of assumptions, risks, uncertainties, and other factors that could cause actual results to differ materially from those contained in the forward-looking statements. These forward-looking statements include, but are not limited to, statements about our strategies; expectations about future business plans, prospective performance, growth, and opportunities; future financial performance; technologies; plans and expectations for capital expenditures and regulatory compliance; and other statements that are not historical facts, as well as statements identified by words such as "expects", "anticipates", "intends", "plans", "believes", "seeks", "estimates", or the negative of these terms, or other words of similar meaning. These statements are based on our current beliefs or expectations and are inherently subject to a number of risks, uncertainties, and assumptions, most of which are difficult to predict and many of which are beyond our control. Actual results may differ materially from these expectations due to changes in political, economic, business, market, regulatory, and other factors. Factors that may also affect future results are disclosed under the headings “Risk Factors” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our filings with the Securities and Exchange Commission (the "SEC"), which are available at the SEC's website at www.sec.gov. This includes, but is not limited to, our most recently filed periodic reports on Form 10-K and Form 10-Q and subsequent filings with the SEC. Accordingly, investors are cautioned not to place undue reliance on any forward-looking statements, which reflect management’s views as of the date hereof. We undertake no obligation to publicly update any forward-looking statement, except as required by law, whether as a result of new information, future developments or otherwise.
Company Contact:
Michael Liebman
CFO and SVP
Tel (480) 999-5104
Email Contact
Investor Relations Contact:
Ron Both or Grant Stude
CMA
Tel (949) 432-7566
Email contact