BRYN MAWR, PA — Essential Utilities Inc. (NYSE: WTRG) delivered robust financial results for the second quarter of 2025, reporting net income of $107.8 million, or $0.38 per share, up from $75.4 million, or $0.28 per share, in the same period last year. The company also raised its quarterly dividend and signaled earnings would exceed previous full-year guidance due to one-time benefits.
Revenues climbed 18.5% year-over-year to $514.9 million, fueled by rate increases across both its regulated water and natural gas segments, along with higher purchased gas costs. Operating expenses rose modestly, with operations and maintenance expenses totaling $148.5 million, up from $142.5 million a year ago, largely due to increases in labor, bad debt, and production costs.
“Our water and gas operations are both performing well, enabling us to deliver solid second-quarter results,” said Essential Chairman and CEO Christopher Franklin. He pointed to recent initiatives such as hydrogen innovation and PFAS mitigation efforts as examples of the company’s long-term focus on community value and environmental compliance.
Segment Performance
Essential’s regulated water segment reported revenues of $332.3 million, a 9.9% increase from Q2 2024. Rate adjustments were the primary growth driver. Maintenance costs also rose slightly, reaching $100.1 million, due to higher employee-related expenses and production costs.
The natural gas segment saw stronger growth, with revenues jumping 38.3% year-over-year to $177.3 million. This was driven by increased gas purchases, rate hikes, and surcharges. Operating costs held steady at $49.8 million, maintaining cost efficiency in the face of rising inputs.
For the first half of 2025, total revenues reached $1.3 billion, a 24.1% year-over-year increase. Net income over the same period totaled $391.6 million, or $1.41 per share, compared to $1.25 per share in the first half of 2024.
Dividend and Capital Strategy
The board approved a 5.25% increase in its quarterly dividend to $0.3426 per share, marking the 35th increase in 34 years. The dividend will be payable on September 2 to shareholders of record as of August 12.
Capital investments for the first six months of the year totaled $613 million. The company remains on track to exceed $1.4 billion in infrastructure upgrades for 2025 and plans to invest $7.8 billion through 2029 to improve water and gas systems, address PFAS contamination, and reduce methane emissions.
Acquisition Growth
Essential continues to expand its customer base through strategic acquisitions. In July, the company completed the $37.75 million purchase of the Beaver Falls wastewater system, serving about 3,200 customers directly and 3,800 more through bulk services. This year’s acquisitions to date total $58 million and roughly 10,300 new customer connections.
Four additional transactions are pending, including the $276.5 million acquisition of DELCORA, which serves nearly 200,000 customers in Pennsylvania. Altogether, these deals represent over 200,000 customer additions.
Updated Guidance and Outlook
The company now expects 2025 GAAP earnings per share to exceed its prior guidance range of $2.07 to $2.11, citing non-recurring benefits. Long-term projections call for 5% to 7% annual earnings growth through 2027 and more than 8% compound growth in the utility rate base through 2029.
Water rate base is forecasted to grow at 6% annually, while the natural gas rate base is expected to grow 11% annually, supported by infrastructure investment and stable customer demand. The company anticipates maintaining stable gas customer levels in 2025 and 2% to 3% annual water customer growth.
In line with its environmental goals, Essential reaffirmed plans to cut Scope 1 and 2 greenhouse gas emissions by 60% by 2035. The company also reiterated its commitment to complying with federal PFAS regulations across all jurisdictions it serves.
Financial Position
As of June 30, 2025, the company maintained $802 million in available credit and a weighted average cost of long-term debt at 4.03%. It expects to raise $315 million in equity through its ATM program this year, of which $210 million has already been issued.
With continued investment, customer growth through acquisitions, and rising rates, Essential Utilities remains positioned for steady expansion and long-term shareholder returns.
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