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SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF PARENT
 12 Months Ended
Dec. 31, 2014
Condensed Financial Information of Parent Company Only Disclosure [Abstract]  
SCHEDULE I - CONDENSED FINANCIAL INFORMATION OF PARENT
CONDENSED BALANCE SHEET
 
 
December 31,
(in thousands)
 
2014
 
2013
Assets
 
 

 
 

 
 
 
 
 
Cash and equivalents
 
$
31,629

 
$
107

Inter-company note receivables
 
1,445

 
21,113

Deferred tax assets
 
503

 
388

Income taxes receivable and other receivables
 
44

 
1,733

Total current assets
 
33,621

 
23,341

 
 
 
 
 
Investments in subsidiaries
 
478,677

 
468,568

Other assets
 
4,948

 
3,364

Total assets
 
$
517,246

 
$
495,273

 
 
 
 
 
Liabilities and Capitalization
 
 

 
 

 
 
 
 
 
Note payable to GSWC
 
$
—

 
$
500

Income taxes payable
 
9,902

 
1,851

Deferred taxes and other liabilities
 
154

 
84

Total current liabilities
 
10,056

 
2,435

 
 
 
 
 
Deferred taxes
 
100

 
146

Income taxes payable and other liabilities
 
289

 
288

Total other liabilities
 
389

 
434

 
 
 
 
 
Common shareholders’ equity
 
506,801

 
492,404

Total capitalization
 
506,801

 
492,404

 
 
 
 
 
Total liabilities and capitalization
 
$
517,246

 
$
495,273

 
The accompanying condensed notes are an integral part of these condensed financial statements.
CONDENSED STATEMENTS OF INCOME 
 
 
For the Years Ended December 31,
(In thousands, except per share amounts)
 
2014
 
2013
 
2012
Operating revenues and other income
 
$
81

 
$
227

 
$
64

Operating expenses and other expenses
 
48

 
8

 
120

Income (loss) before equity in earnings of subsidiaries and income taxes
 
33

 
219

 
(56
)
 
 
 
 
 
 
 
Equity in earnings of subsidiaries
 
60,029

 
60,205

 
54,212

 
 
 
 
 
 
 
Income before income taxes
 
60,062

 
60,424

 
54,156

 
 
 
 
 
 
 
Income tax expense (benefit)
 
(996
)
 
(2,262
)
 
8

 
 
 
 
 
 
 
Net income
 
$
61,058

 
$
62,686

 
$
54,148

 
 
 
 
 
 
 
Weighted Average Number of Common Shares Outstanding
 
38,658

 
38,639

 
37,998

Basic Earnings Per Common Share
 
$
1.57

 
$
1.61

 
$
1.42

 
 
 
 
 
 
 
Weighted Average Number of Diluted Common Shares Outstanding
 
38,880

 
38,869

 
38,262

Fully Diluted Earnings per Common Share
 
$
1.57

 
$
1.61

 
$
1.41

 
The accompanying condensed notes are an integral part of these condensed financial statements.
CONDENSED STATEMENTS OF CASH FLOWS
 
 
 
For the Years Ended December 31,
(in thousands)
 
2014
 
2013
 
2012
Cash Flows From Operating Activities
 
$
61,092

 
$
32,645

 
$
16,885

 
 
 
 
 
 
 
Cash Flows From Investing Activities:
 
 

 
 

 
 

Loans (made to)/repaid from, wholly-owned subsidiaries
 
19,668

 
(6,100
)
 
(4,720
)
Net cash provided (used) in investing activities
 
19,668

 
(6,100
)
 
(4,720
)
 
 
 
 
 
 
 
Cash Flows From Financing Activities:
 
 

 
 

 
 

Repurchase of Common Shares
 
(17,180
)
 
—

 
—

Proceeds from note payable to GSWC
 
8,300

 
18,236

 
—

Repayment of note payable to GSWC
 
(8,800
)
 
(17,736
)
 
—

Proceeds from stock option exercises
 
589

 
2,111

 
13,295

Net change in notes payable to banks
 
—

 
—

 
(2,000
)
Dividends paid
 
(32,111
)
 
(29,360
)
 
(24,130
)
  Other
 
(36
)
 
—

 
—

Net cash used in financing activities
 
(49,238
)
 
(26,749
)
 
(12,835
)
 
 
 
 
 
 
 
Change in cash and equivalents
 
31,522

 
(204
)
 
(670
)
Cash and equivalents at beginning of period
 
107

 
311

 
981

 
 
 
 
 
 
 
Cash and equivalents at the end of period
 
$
31,629

 
$
107

 
$
311

 
The accompanying condensed notes are an integral part of these condensed financial statements.
Basis of Presentation
 
The accompanying condensed financial statements of AWR (parent) should be read in conjunction with the consolidated financial statements and notes thereto of American States Water Company and subsidiaries (“Registrant”) included in Part II, Item 8 of this Form 10-K.  AWR’s (parent) significant accounting policies are consistent with those of Registrant and its wholly-owned subsidiaries, Golden State Water Company (“GSWC”) and American States Utility Services, Inc. ("ASUS"), except that all subsidiaries are accounted for as equity method investments.
 
Related Party Transactions:
As further discussed in Note 2 — Notes Payable to Banks, AWR (parent) has access to a $100.0 million syndicated credit facility. AWR (parent) borrows under this facility and provides funds to its subsidiaries, in support of their operations. Any amounts owed to AWR (parent) for borrowings under this facility are reflected as inter-company receivables on the condensed balance sheets.  The interest rate charged to the subsidiaries is sufficient to cover AWR (parent)’s interest cost under the credit facility.

During 2013, AWR (parent) issued an interest bearing promissory note (the "Note") to GSWC for $20.0 million which expires on May 23, 2018. Under the terms of the Note, AWR (parent) may borrow from GSWC amounts up to $20.0 million for working capital purposes. As of December 31, 2014, no amounts were outstanding under this Note.

AWR (parent) guarantees performance of ASUS's military privatization contracts and agrees to provide necessary resources, including financing, which are necessary to assure the complete and satisfactory performance of such contracts.
Note Payable to Banks
 
 AWR (parent) has access to a syndicated credit facility which was amended on May 23, 2013 to, among other things, extend the expiration date of the syndicated credit facility to May 23, 2018, reduce the amount of interest and fees paid by AWR, and update certain representations and covenants in the credit agreement.  AWR may, under the terms of the fourth amendment, elect to increase the aggregate commitment by up to an additional $50.0 million. The aggregate effective amount that may be outstanding under letters of credit is $25.0 million.  AWR has obtained letters of credit, primarily for GSWC, in the aggregate amount of $11.2 million , with fees of 0.65% including: (i) a $6.7 million letter of credit representing a percentage of the outstanding American Recovery and Reinvestment Act (“ARRA”) funds received by GSWC for reimbursement of capital costs related to the installation of meters in GSWC’s Arden-Cordova water system; (ii) letters of credit , in an aggregate amount of $340,000 as security for GSWC’s business automobile insurance policy; (iii) a letter of credit , in an amount of $585,000 as security for the purchase of power; (iv) a $15,000 irrevocable letter of credit pursuant to a franchise agreement with the City of Rancho Cordova, and (v) an irrevocable letter of credit in the amount of $3.6 million, pursuant to a settlement agreement with Southern California Edison Company to cover GSWC’s commitment to pay the settlement amount. Letters of credit outstanding reduce the amount that may be borrowed under the revolving credit facility. There were no compensating balances required.

Loans can be obtained at the option of AWR and bear interest at rates based on credit ratings and Euro rate margins.  In July 2014, Standard & Poor’s Ratings Services (“S&P”) revised its rating outlook on AWR from stable to positive. S&P also affirmed the ‘A+’ corporate credit rating on AWR. S&P debt ratings range from AAA (highest rating possible) to D (obligation is in default).

At December 31, 2014, there were no borrowings outstanding under this facility. At times, AWR (parent) borrows under this facility and provides loans to its subsidiaries in support of its operations, under terms that are similar to that of the credit facility.
 
AWR’s (parent) short-term borrowing activities (excluding letters of credit) for the last three years were as follows:
 
 
December 31,
(in thousands, except percent)
 
2014
 
2013
 
2012
Balance Outstanding at December 31,
 
$
—

 
$
—

 
$
—

Interest Rate at December 31,
 
0.82
%
 
0.82
%
 
1.41
%
Average Amount Outstanding
 
$
6,181

 
$
—

 
$
885

Weighted Average Annual Interest Rate
 
0.81
%
 
1.02
%
 
1.49
%
Maximum Amount Outstanding
 
$
24,000

 
$
—

 
$
6,000

 
All of the letters of credit are issued pursuant to the syndicated revolving credit facility. The syndicated revolving credit facility contains restrictions on prepayments, disposition of property, mergers, liens and negative pledges, indebtedness and guaranty obligations, transactions with affiliates, minimum interest coverage requirements, a maximum debt to capitalization ratio and a minimum debt rating. Pursuant to the credit agreement, AWR must maintain a minimum interest coverage ratio of 3.25 times interest expense, a maximum total funded debt ratio of 0.65 to 1.00 and a minimum debt rating from Moody’s or S&P of Baa3 or BBB-, respectively. As of December 31, 2014, AWR was in compliance with these covenants with an interest coverage ratio of 7.52 times interest expense, a debt ratio of 0.40 to 1.00 and a debt rating of A+.
Income Taxes
 
AWR (parent) receives a tax benefit for expenses incurred at the parent-company level.  AWR (parent) also recognizes the effect of AWR’s consolidated California unitary apportionment, which is beneficial or detrimental depending on a combination of the profitability of AWR’s consolidated non-California activities as well as the proportion of its consolidated California sales to total sales.
    
During the year ended December 31, 2013, AWR (parent) recorded a cumulative tax benefit of $1.5 million related to an employee benefit plan for deductions taken on recently filed tax returns and amounts taken, and to be taken, on amended income tax returns.
Dividend from Subsidiaries
 
Dividends in the amount of $52.0 million, $29.4 million and $16.9 million were paid to AWR (parent) by its wholly-owned subsidiaries during the years ended December 31, 2014, 2013 and 2012, respectively.