Earnings per Share/Capital Stock

9 Months Ended

Sep. 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 September 30,				For The Nine Months Ended September 30,
(in thousands, except per share amounts)	2024		2023		2024		2023
Net income	$	35,834	$	31,565	$	90,833	$	104,493
Less: impact from participating securities	128		91		294		286
Total income available to common shareholders	$	35,706	$	31,474	$	90,539	$	104,207


Weighted average Common Shares outstanding, basic	37,564		36,977		37,302		36,974

Basic earnings per Common Share	$	0.95	$	0.85	$	2.43	$	2.82

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 September 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 September 30,				For The Nine Months Ended September 30,
(in thousands, except per share amounts)	2024		2023		2024		2023
Common shareholders earnings, basic	$	35,706	$	31,474	$	90,539	$	104,207
Undistributed earnings for dilutive stock options and restricted stock units	66		45		134		162
Total common shareholders earnings, diluted	$	35,772	$	31,519	$	90,673	$	104,369

Weighted average Common Shares outstanding, basic	37,564		36,977		37,302		36,974
Stock-based compensation (1)	119		94		107		90
Weighted average Common Shares outstanding, diluted	37,683		37,071		37,409		37,064

Diluted earnings per Common Share	$	0.95	$	0.85	$	2.42	$	2.82

(1) In applying the treasury stock method of reflecting the dilutive effect of outstanding stock-based compensation in calculating diluted EPS, 135,575 and 106,879 restricted stock units, including performance awards to officers of the Company at September 30, 2024 and 2023, respectively, were deemed to be outstanding and included in the calculation of diluted EPS.

During the three and nine months ended September 30, 2024, AWR sold 335,449 and 791,097 Common Shares, respectively, through its ATM offering program and raised proceeds of $27.0 million, net of $0.4 million in commissions paid and $60.0 million, net of $0.9 million in commissions paid, respectively (Note 1). During the nine months ended September 30, 2024 and 2023, AWR also issued 25,164 and 18,351 Common Shares related to restricted stock units, respectively, pursuant to stock-based compensation plans.

During the nine months ended September 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 nine months ended September 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 September 30, 2024 and 2023, AWR paid quarterly dividends of approximately $17.5 million, or $0.4655 per share, and $15.9 million, or $0.4300 per share, respectively. During the nine months ended September 30, 2024 and 2023, AWR paid quarterly dividends of approximately $49.4 million, or $1.3255 per share, and $45.3 million, or $1.2250 per share, respectively.

During the three and nine months ended September 30, 2024, GSWC paid dividends of $17.5 million to AWR. During the three and nine months ended September 30, 2023, GSWC paid dividends of $16.0 million and $55.4 million, respectively, to AWR. ASUS paid a $16.0 million dividend to AWR during the nine months ended September 30, 2024, but did not pay any dividends to AWR during the nine months ended September 30, 2023.

During the three and nine months ended September 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.