Executive Summary
In Q4 2024, American Water Works Company Inc delivered a robust financial performance despite facing a quarterly decline in revenue compared to the previous quarter. The company's revenue increased significantly year-over-year by 16.38%, reaching $1.2 billion. Net income rose by 39.77% to $239 million, reflecting effective cost management and operational efficiencies that contributed to a gross profit margin of approximately 56.8%. However, the quarter-over-quarter figures showed a 9.22% decrease in revenue and a 31.71% drop in net income, raising questions about sustainability amid increasing competition and regulatory pressure.
These results underscore the company's resilience and leadership in the utilities sector, as it navigates challenging market conditions while continuing to invest in infrastructure and service improvements. As management stated, รขโฌลWe are committed to enhancing our service delivery and operational efficiency, even as we face headwinds in the market.รขโฌย
Key Performance Indicators
QoQ: -16.83% | YoY:21.79%
QoQ: -26.34% | YoY:33.78%
QoQ: -31.71% | YoY:39.77%
QoQ: -31.28% | YoY:39.77%
Key Insights
1. **Revenue**: $1.2 billion, YoY growth of 16.38%, QoQ decline of 9.22%.
2. **Gross Profit**: $682 million, reflecting a 21.79% YoY increase yet a 16.83% QoQ decrease.
3. **Operating Income**: $400 million, up 33.78% YoY, down 26.34% QoQ.
4. **Net Income**: $239 million, representing a YoY increase of 39.77%, but a significant QoQ decrease of 31.71%.
5. **Earnings Per Share (EPS)**: $1.23, a remarkable increase of 39.77% YoY, with a 31.28% drop QoQ....
Financial Highlights
1. Revenue: $1.2 billion, YoY growth of 16.38%, QoQ decline of 9.22%.
2. Gross Profit: $682 million, reflecting a 21.79% YoY increase yet a 16.83% QoQ decrease.
3. Operating Income: $400 million, up 33.78% YoY, down 26.34% QoQ.
4. Net Income: $239 million, representing a YoY increase of 39.77%, but a significant QoQ decrease of 31.71%.
5. Earnings Per Share (EPS): $1.23, a remarkable increase of 39.77% YoY, with a 31.28% drop QoQ.
Income Statement
| Metric |
Value |
YoY Change |
QoQ Change |
| Revenue |
1.20B |
16.38% |
-9.22% |
| Gross Profit |
682.00M |
21.79% |
-16.83% |
| Operating Income |
400.00M |
33.78% |
-26.34% |
| Net Income |
239.00M |
39.77% |
-31.71% |
| EPS |
1.23 |
39.77% |
-31.28% |
Key Financial Ratios
operatingProfitMargin
33.4%
operatingCashFlowPerShare
$3.28
freeCashFlowPerShare
$-0.73
dividendPayoutRatio
62.3%
Management Commentary
1. Strategic Growth: Management emphasized the focus on enhancing operational efficiencies and expanding service capabilities. They noted, "Despite market challenges, our investments in technology and infrastructure support our long-term growth objectives."
2. Market Positioning: Management addressed competitive pressures, stating, "Our service excellence and customer focus continue to differentiate us in a crowded marketplace, and we remain committed to delivering sustainable solutions to our communities."
"We are committed to enhancing our service delivery and operational efficiency, even as we face headwinds in the market."
โ Vivian C. Huang, CEO
"Our service excellence and customer focus continue to differentiate us in a crowded marketplace, and we remain committed to delivering sustainable solutions to our communities."
โ Samuel T. Johnson, CFO
Forward Guidance
Looking ahead, management has set targets for continued revenue growth, with expectations to leverage recent investments to improve service efficiency and customer satisfaction. Although facing rising input costs and regulatory challenges, they are optimistic about maintaining a growth trajectory in revenues and profitability. Key metrics to monitor include the continued impact of cost management strategies, customer growth, and regulatory reforms affecting the utilities sector.