Earnings per Share/Capital Stock

6 Months Ended

Jun. 30, 2024

In accordance with the accounting guidance for participating securities and earnings per share (“EPS”), Registrant uses the “two-class” method of computing EPS. The “two-class” method is an earnings allocation formula that determines EPS for each class of common stock and participating security. AWR has participating securities related to restricted stock units that earn dividend equivalents on an equal basis with AWR’s Common Shares, and that have been issued under AWR’s stock incentive plans for employees and the non-employee directors stock plans. In applying the “two-class” method, undistributed earnings are allocated to both Common Shares and participating securities.

The following is a reconciliation of Registrant’s net income and weighted average Common Shares outstanding used to calculate basic EPS:


Basic:	For The Three Months Ended June 30,				For The Six Months Ended June 30,
(in thousands, except per share amounts)	2024		2023		2024		2023
Net income	$	31,864	$	38,521	$	54,999	$	72,928
Less: impact from participating securities	110		112		162		197
Total income available to common shareholders	$	31,754	$	38,409	$	54,837	$	72,731


Weighted average Common Shares outstanding, basic	37,309		36,976		37,169		36,972

Basic earnings per Common Share	$	0.85	$	1.04	$	1.48	$	1.97

Diluted EPS is based upon the weighted average number of Common Shares, including both outstanding shares and shares potentially issuable in connection with restricted stock units granted under AWR’s stock incentive plans for employees and directors, and net income. There were no stock options outstanding as of June 30, 2024 and 2023 under these plans.

The following is a reconciliation of Registrant’s net income and weighted average Common Shares outstanding used to calculate diluted EPS:


Diluted:	For The Three Months Ended June 30,				For The Six Months Ended June 30,
(in thousands, except per share amounts)	2024		2023		2024		2023
Common shareholders earnings, basic	$	31,754	$	38,409	$	54,837	$	72,731
Undistributed earnings for dilutive stock options and restricted stock units	54		69		67		117
Total common shareholders earnings, diluted	$	31,808	$	38,478	$	54,904	$	72,848

Weighted average Common Shares outstanding, basic	37,309		36,976		37,169		36,972
Stock-based compensation (1)	109		91		94		86
Weighted average Common Shares outstanding, diluted	37,418		37,067		37,263		37,058

Diluted earnings per Common Share	$	0.85	$	1.04	$	1.47	$	1.97

(1) In applying the treasury stock method of reflecting the dilutive effect of outstanding stock-based compensation in calculating diluted EPS, 132,530 and 110,576 restricted stock units, including performance awards to officers of the Company at June 30, 2024 and 2023, respectively, were deemed to be outstanding and included in the calculation of diluted EPS.

During the three and six months ended June 30, 2024, AWR sold 227,667 and 455,648 Common Shares, respectively, through its ATM offering program and raised proceeds of $16.8 million, net of $0.3 million in commissions paid and $33.0 million, net of $0.5 million in commissions paid, respectively (Note 1). During the six months ended June 30, 2024 and 2023, AWR also issued 20,939 and 14,358 Common Shares related to restricted stock units, respectively, pursuant to stock-based compensation plans.

During the six months ended June 30, 2024 and 2023, AWR paid $1.1 million and $0.9 million, respectively, to taxing authorities on employees’ behalf for shares withheld related to net share settlements. During the six months ended June 30, 2024 and 2023, GSWC paid $1.1 million and $0.8 million, respectively, to taxing authorities on employees’ behalf for shares withheld related to net share settlements. These payments are included in the stock-based compensation caption of the statements of equity.

During the three months ended June 30, 2024 and 2023, AWR paid quarterly dividends of approximately $16.0 million, or $0.4300 per share, and $14.7 million, or $0.3975 per share, respectively. During the six months ended June 30, 2024 and 2023, AWR paid quarterly dividends of approximately $31.9 million, or $0.8600 per share, and $29.4 million, or $0.7950 per share, respectively.

GSWC did not pay a dividend to AWR during the three and six months ended June 30, 2024. During the three and six months ended June 30, 2023, GSWC paid dividends of $14.7 million and $39.4 million, respectively, to AWR. ASUS paid a $16.0 million dividend to AWR during the three months ended June 30, 2024, but did not pay any dividends to AWR during the three and six months ended June 30, 2023.

During the six months ended June 30, 2023, GSWC issued one Common Share to AWR for $10.0 million. Proceeds from the stock issuance were used to pay down a portion of intercompany borrowings owed to AWR.