Clinton water utility Connecticut Water Service said its second-quarter profits increased 74 percent, thanks to a change in state law last year.
CWS booked net income of $7.5 million, or 67 cents per diluted share, up from $4.3 million, or 39 cents, in the same quarter of 2013. Operating revenue increased 13 percent, to $25.5 million.
The company attributed the better results to the application of a “water revenue adjustment,” approved by state legislators last year. The WRA allows the company to defer on its balance sheet the amount by which revenue deviates from the amounts allowed by regulators in its most recent rate proceeding.
Connecticut Water said the WRA “removes the financial disincentive for water utilities to develop and implement effective water conservation programs.”
In 2013, WRA revenue was recorded in the company’s third fiscal quarter. Had it been applied on a monthly basis, earnings per share for the second quarter of 2013 would have been 47 cents, Connecticut Water said.
