Connecticut Water Service, Inc. (CTWS) has reported an 8.91 percent rise in profit for the quarter ended Sep. 30, 2016. The company has earned $9.54 million, or $0.84 a share in the quarter, compared with $8.76 million, or $0.79 a share for the same period last year.
Revenue during the quarter went up marginally by 2.36 percent to $31.22 million from $30.50 million in the previous year period. Total expenses were 64.96 percent of quarterly revenues, down from 68.17 percent for the same period last year. This has led to an improvement of 321 basis points in operating margin to 35.04 percent.
Operating income for the quarter was $10.94 million, compared with $9.71 million in the previous year period.
Eric W. Thornburg, president and chief executive officer of CTWS, noted that much of the Company's service area is currently classified as being in 'Severe Drought' by the U.S. Drought Monitor. Mr. Thornburg stated, "We are fortunate to have innovative regulatory tools available to us in both states. In Connecticut, where we are already utilizing the Water Revenue Adjustment (WRA), we are able to aggressively promote water conservation during times of drought without materially impacting our revenues. This allows us to focus on preserving water resources and serving our customers rather than on water sales."
Working capital turns negative
Working capital of Connecticut Water Service, Inc. has turned negative to $4.88 million on Sep. 30, 2016 from positive $7.01 million on Sep. 30, 2015. Current ratio was at 0.88 as on Sep. 30, 2016, down from 1.22 on Sep. 30, 2015.
Days sales outstanding went down to 17 days for the quarter compared with 37 days for the same period last year.
Debt moves up
Connecticut Water Service, Inc. has witnessed an increase in total debt over the last one year. It stood at $200.16 million as on Sep. 30, 2016, up 13.29 percent or $23.48 million from $176.68 million on Sep. 30, 2015. Total debt was 26 percent of total assets as on Sep. 30, 2016, compared with 24.87 percent on Sep. 30, 2015. Debt to equity ratio was at 0.84 as on Sep. 30, 2016, up from 0.44 as on Sep. 30, 2015.
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