Segment Information

3 Months Ended

Mar. 31, 2022

Segment Information [Abstract]

Segment Information

Note 12 – Segment Information 

The Company has twelve operating segments and two reportable segments. The Regulated Water segment is comprised of eight operating segments representing its water and wastewater regulated utility companies, which are organized by the states where the Company provides water and wastewater services. The eight water and wastewater utility operating segments are aggregated into one reportable segment, because each of these operating segments has the following similarities: economic characteristics, nature of services, production processes, customers, water distribution or wastewater collection methods, and the nature of the regulatory environment. The Regulated Natural Gas segment is comprised of one operating segment representing natural gas utility companies, acquired in the Peoples Gas Acquisition, for which the Company provides natural gas distribution services.

In addition to the Company’s two reportable segments, we include three of our operating segments within the Other category below. These segments are not quantitatively significant and are comprised of our non-regulated natural gas operations, Aqua Infrastructure, and Aqua Resources. Our non-regulated natural gas operations consist of utility service line protection solutions and repair services to households and the operation of gas marketing and production entities. Prior to the October 30, 2020 sale of our investment in joint venture, Aqua Infrastructure provided non-utility raw water supply services for firms in the natural gas drilling industry. Aqua Resources offers, through a third party, water and sewer service line protection solutions and repair services to households. In addition to these segments, Other is comprised of business activities not included in the reportable segments, corporate costs that have not been allocated to the Regulated Water and Regulated Natural Gas segments, and intersegment eliminations. Corporate costs include general and administrative expenses, and interest expense. The Company reports these corporate costs within Other as they relate to corporate-focused responsibilities and decisions and are not included in internal measures of segment operating performance used by the Company to measure the underlying performance of the operating segments. The Regulated Water and Regulated Natural Gas segments report interest expense that includes long-term debt that was pushed-down to the regulated operating subsidiaries from Essential Utilities, Inc.

The following table presents information about the Company’s reportable segments:

	Three Months Ended								Three Months Ended
	March 31, 2022								March 31, 2021
	Regulated Water		Regulated Natural Gas		Other		Consolidated		Regulated Water		Regulated Natural Gas		Other		Consolidated
Operating revenues	$	239,198	$	445,183	$	14,894	$	699,275	$	228,353	$	343,115	$	12,097	$	583,565
Operations and maintenance expense		86,088		59,452		(2,959)		142,581		78,347		51,326		(4,598)		125,075
Purchased gas		-		217,306		10,406		227,712		-		122,888		9,265		132,153
Depreciation and amortization		48,716		29,704		(74)		78,346		45,138		27,590		216		72,944
Taxes other than income taxes		15,891		6,191		925		23,007		15,421		4,447		1,173		21,041
Operating income (loss)		88,503		132,530		6,596		227,629		89,447		136,864		6,041		232,352
Interest expense, net (a)		27,554		20,652		4,821		53,027		26,460		17,296		6,626		50,382
Allowance for funds used during construction		(5,149)		(690)		-		(5,839)		(3,247)		313		-		(2,934)
Other		(1,944)		(444)		686		(1,702)		(1,429)		(428)		(1,694)		(3,551)
Income before income taxes		68,042		113,012		1,089		182,143		67,663		119,683		1,109		188,455
Provision for income taxes (benefit)		7,499		(26,474)		1,742		(17,233)		3,633		432		701		4,766
Net income (loss)	$	60,543	$	139,486	$	(653)	$	199,376	$	64,030	$	119,251	$	408	$	183,689
Capital expenditures	$	100,803	$	82,122	$	397	$	183,322	$	113,793	$	64,114	$	102	$	178,009

^(a) The regulated water and regulated natural gas segments report interest expense that includes long-term debt that was pushed-down to the regulated operating subsidiaries from Essential Utilities, Inc.

	March 31,		December 31,
	2022		2021
Total assets:
Regulated water	$	8,487,684	$	8,403,586
Regulated natural gas		6,090,675		5,960,602
Other		298,664		294,090
Consolidated	$	14,877,023	$	14,658,278