California Water Service Group Q3 profit rises to $65.4M
Nine-month capital investment reached $424.8 million, up 16.5%; Nevada and Oregon acquisitions are expected to close in Q4 2026.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Rhea-AI Filing Summary
California Water Service Group (CWT) reported third-quarter 2026 operating revenue of $332.2 million, versus $311.2 million a year earlier, and net income attributable to the Group of $65.4 million, versus $61.2 million. Diluted earnings per share were $1.05, compared with $1.03.
For the nine months ended September 30, 2026, revenue was $855.3 million versus $780.2 million, and net income attributable to the Group was $125.9 million versus $116.7 million. Capital investment was $424.8 million, up 16.5% from $364.7 million. The company expects its Nevada and Oregon acquisitions to close in the fourth quarter of 2026.
During Q3, the company sold 1.0 million shares through its at-the-market program for $49.8 million and entered forward sales agreements for 1.6 million additional shares, with settlement available for up to 12 months after contract entry. It declared a $0.335 quarterly dividend; its previously announced annual dividend is expected to be $1.34 per share, 8.1% above 2025.
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Hollow bars mark forward-looking points. How the balance works
Positive
- Moderate pointQ3 revenue: $332.2 million, versus $311.2 million in 2025.
- Moderate pointQ3 attributable net income: $65.4 million, versus $61.2 million.
- Minor pointNine-month revenue: $855.3 million, versus $780.2 million in 2025.
- Minor pointNine-month attributable net income: $125.9 million, versus $116.7 million.
- Minor point. Forward-looking: it has not happened yet and may not happen.Annual dividend: expected $1.34 per share, 8.1% above 2025.
Negative
- None.
Filing Explained
Nevada and Oregon approvals are in place, while the company still expects the acquisitions to close in the fourth quarter.
After the quarter ended, the Group and Cal Water entered into purchase agreements providing for
The presentation says the entities “issued” these borrowings, but the release describes agreements and expected issuance, so the disclosed status is not completed issuance. The agreements specify note interest rates of
As of
Nevada approved the acquisition on
8-K Event Classification
Key Figures
Key Terms
at-the-market equity program financial
forward sales agreements financial
advice letter process regulatory
authorized return on equity financial
rate base financial
Earnings Snapshot
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What were CWT's third-quarter 2026 revenue and net income?
How did CWT perform in the first nine months of 2026?
When are CWT's Nevada and Oregon acquisitions expected to close?
How much has CWT invested in PFAS projects?
What rate increases were approved for CWT's Washington and Hawaii systems?
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
Current Report Pursuant to Section 13
or 15(d) of
The Securities Exchange Act of 1934
Date of Report (date of earliest event
reported):
(Exact name of Registrant as Specified in its Charter)
(State or other jurisdiction of incorporation) |
(Commission file number) |
(I.R.S. Employer Identification Number) |
(Address of principal executive offices) |
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(
(Registrant’s telephone number, including area code)
N/A
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||
Indicate by check mark whether the registrant is an emerging growth company as defined by Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨
| Item 2.02. | Results of Operations and Financial Condition |
On October 28, 2026, California Water Service Group (the “Company”) issued a press release (a copy of which is attached hereto as Exhibit 99.1 and incorporated herein by reference) announcing its financial results for the third quarter of 2026, ended September 30, 2026.
As announced, the Company will host a conference call on Thursday, October 29, 2026, at 11:00 am EDT to discuss financial results and management’s business outlook. The financial results announcement contains information about how to access the conference call and webcast. A slide presentation, which includes supplemental information relating to the Company, will be used by management during the conference call. A copy of the slide presentation is attached hereto as Exhibit 99.2 and is incorporated by reference herein. The press release and presentation will also be posted on the Company’s website at www.calwatergroup.com under the “Investor Relations” tab.
The information furnished pursuant to Item 2.02 of this Current Report shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.
| Item 9.01. | Financial Statements and Exhibits. |
We hereby furnish the following exhibits, which shall not be deemed “filed” for the purposes of Section 18 of the Exchange Act, with this report:
| Exhibit No. | Description | |
| 99.1 | Press Release issued October 28, 2026 | |
| 99.2 | Slide presentation relating to conference call | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| CALIFORNIA WATER SERVICE GROUP | ||
| Date: October 29, 2026 | By: | /s/ James P. Lynch |
| Name: | James P. Lynch | |
| Title: | Senior Vice President, Chief Financial Officer and Treasurer | |
Exhibit 99.1
 |
 |
California Water Service Group Reports Solid Third Quarter 2026 Results and
Successful Execution of Business Strategy
SAN JOSE, Calif., October 28, 2026 -- California Water Service Group (Group or Company, NYSE: CWT), a leading publicly traded water utility serving California, Hawaii, New Mexico, Washington, and Texas, today reported solid financial results for the third quarter 2026.
Financial Highlights
| · | Recorded net income of $65.4 million and diluted EPS of $1.05 in Q3 2026, compared to net income of $61.2 million and diluted EPS of $1.03 reported in Q3 2025. |
| · | Invested $148.3 million in water system infrastructure. |
| · | Received approval from the Washington Utilities and Transportation Commission (WUTC) on the Washington Water Service (Washington Water) General Rate Case (GRC) that will add $4.1 million to annual revenues. |
| · | Received change-of-control approval from the public utilities commissions in Nevada and Oregon for water and wastewater system acquisitions. |
| · | Declared the 327th consecutive quarterly dividend in the amount of $0.335 per common share. |
According to Chairman and Chief Executive Officer Martin A. Kropelnicki, the Company’s solid financial performance reflects the continued successful execution of its business strategy, including improving water system sustainability and keeping rates affordable.
“We are making investments needed to provide safe, reliable water service; working with our regulators to recover costs while keeping rates affordable; focusing on maintaining a strong balance sheet; preparing for emergencies that can affect our customers, including extreme weather events and wildfires; and making a difference in our communities. We delivered strong results by maintaining a laser focus on executing our strategy and putting our customers first,” he said.
Q3 2026 Financial Results
| · | Q3 2026 revenue increased $21.0 million or 6.7% to $332.2 million, compared to revenue of $311.2 million in Q3 2025. |
| ◦ | Rate changes and new customers added $22.1 million in revenue, while changes in the Drought Response Memorandum Account (DREMA) contributed an additional $3.9 million. |
| ◦ | Decline in customer water usage offset revenue increases by $4.4 million. |
| · | Q3 2026 operating expenses increased $8.9 million or 3.7% to $249.5 million compared to Q3 2025 operating expenses of $240.6 million. |
| ◦ | Water production costs were consistent between the quarters with higher wholesale water costs, partially offset by lower customer usage. |
| ◦ | Other operations expenses increased $4.1 million compared to Q3 2025 primarily due to a $2.8 million increase in water conservation program expenditures. |
| ◦ | Income tax expense on operating income increased $7.1 million compared to Q3 2025 due to higher pre-tax income and a scheduled reduction in the Tax Cut and Jobs Act (TCJA) refund. |
| · | Net other income decreased $6.0 million during the quarter due to a $3.9 million reduction in non-qualified benefit plan investment gains and an increase of $1.4 million in business acquisition expenses. |
YTD 2026 Financial Results
| · | YTD 2026 net income was $125.9 million or $2.07 per diluted share, an increase of 7.9% or $9.2 million and $0.11 per diluted share compared to YTD 2025 net income of $116.7 million or $1.96 per diluted share. |
| · | YTD 2026 revenue increased $75.1 million or 9.6% to $855.3 million, compared to YTD revenue of $780.2 million in 2025. |
| ◦ | Rate changes and new customers added $51.9 million in revenue. |
| ◦ | DREMA added $3.9 million in revenue. |
| ◦ | The Interim Rates Memorandum Account related to the recently completed 2024 California GRC proceeding added $15.7 million. |
| ◦ | Recognition of remaining deferred revenue under California Water Service’s (Cal Water) previous Water Revenue Adjustment Mechanism (WRAM) added $9.9 million. |
| ◦ | Decline in customer water usage offset revenue increases by $3.9 million. |
| · | YTD 2026 operating expenses increased $48.2 million or 7.6% to $683.6 million compared to YTD operating expenses of $635.4 million in 2025. |
| ◦ | Water production costs increased $14.1 million, primarily due to an increase in wholesale water rates, partially offset by lower customer usage. |
| ◦ | Other operations expenses increased $19.9 million, primarily due to the recognition of $8.1 million of deferred WRAM costs and an increase of $5.5 million in water conservation program expenses. |
| ◦ | Income tax expense on operating income increased $13.1 million due to higher pre-tax income and a scheduled reduction in the TCJA refund. |
| · | Net other income decreased $9.5 million due to a $4.7 million decrease in the net periodic benefit credit, an increase of $4.1 million in business acquisition expenses, and a $3.0 million reduction in non-qualified benefit plan investment gains. |
Investing in Infrastructure to Provide Safe, High-Quality Water Service
The Company continued to invest responsibly in infrastructure projects that enhance quality and reliability for customers, including water main replacements, groundwater wells, and water quality treatment projects. Group capital investments for the nine months ended September 30, 2026, were $424.8 million, up 16.5% compared to September 30, 2025, YTD investments of $364.7 million.
Working with Regulators to Recover Costs While Keeping Rates Affordable
In the third quarter, the California Public Utilities Commission (CPUC) granted Cal Water’s request to recover certain PFAS treatment costs using the advice letter process. In 2026, Cal Water has invested $23 million YTD in PFAS treatment projects and has 18 plants under construction. Company-wide, Group expects to invest $228.0 million in PFAS treatment and well replacement projects; to date, it has recovered $59.4 million in net proceeds from PFAS manufacturers to help reduce the rate impact on customers.
Importantly, Cal Water assesses customer affordability during every GRC. In 2025, median water bills were 0.88% of median household income, which is well within the affordability guideline of 2% established by the United States Environmental Protection Agency. In addition, Cal Water provides a low-income assistance program, an additional discount for customers in higher-cost service areas, customer conservation programs and rebates, and interest-free payment plans. It also actively pursues state and federal grants to help mitigate rate increases, especially in low-income communities.
In Washington, the WUTC adopted the joint settlement agreement of Washington Water, WUTC staff, and the Consumer Advocate team from the Public Counsel Unit of the Washington Attorney General’s Office, which authorizes rate increases that will increase annual revenues by $4.1 million, effective October 1, 2026.
After the close of the third quarter, the State of Hawaii Public Utilities Commission (HPUC) adopted a settlement agreement between Hawaii Water and the HPUC Consumer Advocate that authorizes rate increases in the Kapalua water and wastewater systems that will increase annual revenues by $1.94 million, effective October 21, 2026. This rate increase will be the first one implemented since these systems were acquired in 2021 and reflects the capital improvements Hawaii Water continues to make to improve water system reliability.
Progressing on Nevada and Oregon Acquisitions
On August 11, 2026, the Public Utilities Commission of Nevada approved California Water Service Group’s acquisition of Nexus Water Group’s (Nexus) Nevada systems and operations, and on October 27, 2026, the Oregon Public Utilities Commission (OPUC) followed suit. The Company expects to close the Nevada and Oregon acquisitions in the fourth quarter of 2026.
Maintaining a Strong Balance Sheet
As of September 30, 2026, Group’s cash and cash equivalents totaled $45.1 million and restricted cash was $45.8 million. Group and Cal Water had additional short-term borrowing capacity of $200.0 million and $225.0 million, respectively, subject to meeting the borrowing conditions on its Group and Cal Water lines of credit.
During the third quarter, the Company sold 1.0 million shares of common stock through its at-the-market equity program and raised proceeds of $49.8 million. In addition, the Company entered into forward sales agreements with investors to sell an additional 1.6 million shares. The Company has up to 12 months from date it entered into the forward contracts to settle the agreements. As of September 30, 2026, we could have physically settled with the investors for $77.8 million.
Subsequent to the end of the third quarter, the Company and Cal Water also entered into Note and First Mortgage Bond purchase agreements, respectively, which provide for the issuance of $125.0 million in unsecured borrowings (the Notes) and $150.0 million in secured borrowings (the Bonds). The Notes will accrue interest at 6.08% and 6.41% with maturities of December 15, 2031 and December 15, 2036. The Bonds will accrue interest at 6.49% and 6.54% with maturities of December 15, 2046 and December 15, 2056. The Notes and Bonds are expected to be issued on or before December 31, 2026.
With the long-term debt agreements and equity forward arrangements in place, the Company believes it has the resources to finance its on-going initiatives into the first half of 2027, including the acquisition of Nevada and Oregon systems which we expect to close before December 31, 2026.
The most recent Cost of Capital decision for Cal Water, which remains effective through December 2027, establishes a 10.27% authorized return on equity, a 7.46% authorized return on rate base, and a debt/equity structure of 46.6%/53.4%.
Increasing Dividends for 59 Consecutive Years
The Group Board of Directors has declared the 327th consecutive quarterly dividend in the amount of $0.335 per common share. The Company’s 59th consecutive annual dividend increase announced earlier this year is expected to yield an annual dividend of $1.34 per common share, an increase of 8.1% over 2025.
Preparing for Emergencies
Group continued to prioritize emergency preparedness in the third quarter, providing emergency preparedness and response training to employees and first responders; equipping and preparing its Operations Rapid Response Teams; positioning and fueling back-up power sources; testing satellite phones and two-way radios; maintaining vegetation to help minimize damage to key facilities in the event of storms or fires; and preparing to conduct additional water quality monitoring, if needed. These ongoing efforts are expected to better prepare the Company to deal with natural disasters, including wildfires and forecasted El Niño conditions.
Making an Impact in the Community
During the third quarter, Group celebrated its centennial with customers, awarded scholarships to students, and opened its firefighter grant program. The Company was named one of America’s Greatest Workplaces, America’s Greatest Companies, and World’s Greenest Companies by Newsweek. And Cal Water partnered with Selma Unified School District and Self-Help Enterprises to do the work necessary to connect Indianola Elementary School to its system in order to provide high-quality water to 400 students and faculty.
For additional details on the Company’s third quarter results, please see the Form 10-Q which will be available at: www.calwatergroup.com/investors/financials-filings-reports/sec-filings, or listen to the earnings teleconference or teleconference replay.
Quarterly Earnings Teleconference
The quarterly teleconference will take place on October 29, 2026, at 8 a.m. PT/11 a.m. ET. To join, dial 1-800-715-9871 or 1-646-307-1963 and key in ID# 2080463, or access the live audio webcast at edge.media-server.com/mmc/p/5ckhdfck.
A replay of the call will be available from 2 p.m. ET on October 29, 2026, through November 28, 2026, at 1-800-770-2030 or 1-609-800-9909 by keying in ID# 2080463, or by accessing the webcast above. The call will be hosted by Chairman and Chief Executive Officer Martin A. Kropelnicki and Senior Vice President, Chief Financial Officer and Treasurer James P. Lynch. Prior to the call, the Company will publish a slide presentation on its website.
About California Water Service Group
Group is the parent company of regulated utilities California Water Service Company, Hawaii Water Service Company, Inc., New Mexico Water Service Company, and Washington Water Service Company, as well as TWSC, Inc. (Texas Water Service), a utility holding company. Together, these companies provide regulated and non-regulated water and wastewater service to more than 2.2 million people in California, Hawaii, New Mexico, Washington, and Texas. Group’s common stock trades on the New York Stock Exchange under the symbol “CWT.” Additional information is available online at www.calwatergroup.com.
This news release contains forward-looking statements within the meaning established by the Private Securities Litigation Reform Act of 1995 (“PSLRA”). The forward-looking statements are intended to qualify under provisions of the federal securities laws for “safe harbor” treatment established by the PSLRA. Forward-looking statements in this news release are based on currently available information, expectations, estimates, assumptions and projections and our management’s beliefs, assumptions, judgments and expectations about us, the water utility industry and general economic conditions. These statements are not statements of historical fact. When used in our documents, statements that are not historical in nature, including words like will, would, expects, intends, plans, believes, may, could, estimates, assumes, anticipates, projects, progress, predicts, hopes, targets, forecasts, should, seeks or variations of these words or similar expressions are intended to identify forward-looking statements. Examples of forward-looking statements in this news release include, but are not limited to, statements describing the Company’s expected financial performance, expectations regarding the Company’s plans and proposals pursuant to the 2024 CA GRC, the anticipated closing of the Company’s acquisition of Nexus Water Group’s Nevada and Oregon subsidiaries and expected integration of the acquired systems and benefits resulting from the acquisition, the expected timing and the amount of proceeds from the Company’s forward sales agreements, the ability to complete the issuance of the Notes and Bonds on the expected timing, the sufficiency of the Company’s resources to finance its initiatives and expectations regarding dividends. Forward-looking statements are not guarantees of future performance. They are based on numerous assumptions that we believe are reasonable, but they are open to a wide range of uncertainties and business risks. Consequently, actual results or outcomes may vary materially from what is contained in a forward-looking statement. Factors that may cause actual results or outcomes to be different than those expected or anticipated include, but are not limited to: the outcome and timeliness of regulatory commissions’ actions concerning rate relief and other matters, including with respect to general rate cases and other regulatory proceedings; the impact of opposition to rate increases; our ability to recover costs; federal governmental and state regulatory commissions’ decisions, including decisions on proper disposition of property; changes in state regulatory commissions’ policies and procedures; changes in California State Water Resources Control Board water quality standards; changes in environmental compliance and water quality requirements, such as the United States Environmental Protection Agency’s (EPA) finalization of a National Primary Drinking Water Regulation (NPDWR) establishing legally enforceable maximum contaminant levels (MCL) for PFAS in drinking water in 2024 as well as legal challenges to such MCLs; EPA’s proposed new PFAS rulemaking, including impacts to the current PFAS NPDWR; the impact of weather, climate change, natural disasters, including wildfires and landslides and actual or threatened public health emergencies, including disease outbreaks, on our operations, water quality, water availability, water sales and operating results and the adequacy of our emergency preparedness; electric power interruptions, especially as a result of public safety power shutoff programs; availability of water supplies; our ability to invest or apply the proceeds from the issuance of common stock in an accretive manner; our ability to complete [the issuance of the Notes and Bonds and] the settlement of the forward sales agreements on the expected timing or at all]; consequences of eminent domain actions relating to our water systems; increased risk of inverse condemnation losses as a result of the impact of weather, climate change and natural disasters, including wildfires and landslides; shifts in population, including housing and customer growth; issues with the implementation, maintenance or security of our information technology and operational technology systems; physical and cyber security risks and threats and the adequacy of our efforts to mitigate such risks and threats; the ability of our enterprise risk management processes to identify or address risks adequately; labor relations matters as we negotiate with the unions; changes in customer water use patterns and the effects of conservation, including as a result of drought conditions; our ability to complete, in a timely manner or at all, successfully integrate and achieve anticipated benefits from announced acquisitions, including the Oregon, Nevada and BVRT acquisitions; restrictive covenants in or changes to the credit ratings on our current or future debt that could increase our financing costs or affect our ability to borrow, make payments on debt or pay dividends; risks associated with expanding our business and operations, including into other geographic areas; the impact of stagnating or worsening business and economic conditions, including inflationary pressures, general economic slowdown or a recession, changes in tariff policy, the interest rate environment, changes in monetary policy, adverse capital markets activity or macroeconomic conditions as a result of geopolitical conflicts, including ongoing conflicts in Ukraine and the Middle East, and the prospect of shutdowns of the U.S. federal government; the impact of market conditions and volatility on unrealized gains or losses on our non-qualified benefit plan investments and our operating results; the impact of weather and timing of meter reads on our accrued and unbilled revenue; the impact of evolving legal and regulatory requirements, including sustainability requirements; the impact of the evolving U.S. political environment and changes effected, proposed, or threatened by the U.S. federal government that has led to, in some cases, legal challenges and uncertainty around the funding, functioning and policy priorities of U.S. federal regulatory agencies and the status of current and future regulations; and other risks and unforeseen events described in our Securities and Exchange Commission (“SEC”) filings. In light of these risks, uncertainties and assumptions, investors are cautioned not to place undue reliance on forward-looking statements, which speak only as of the date of this news release. When considering forward-looking statements, you should keep in mind the cautionary statements included in this paragraph, as well as the Annual Report on Form 10-K, Quarterly Reports on Form 10-Q and other reports filed from time-to-time with the SEC. We are not under any obligation and we expressly disclaim any obligation to update or alter any forward-looking statements, whether as a result of new information, future events or otherwise. A credit rating is not a recommendation to buy, sell or hold any securities, may be changed at any time by the applicable ratings agency and should be evaluated independently of any other information.
Contacts:
James P. Lynch, (408) 367-8200 (analysts)
Shannon Dean, (408) 367-8243 (media)
CALIFORNIA WATER SERVICE GROUP
CONDENSED CONSOLIDATED BALANCE SHEETS
Unaudited
(In thousands, except per share data)
| September 30, 2026 | December 31, 2025 | |||||||
| ASSETS | ||||||||
| Utility plant: | ||||||||
| Utility plant | $ | 6,297,996 | $ | 5,909,242 | ||||
| Less accumulated depreciation and amortization | (1,367,753 | ) | (1,329,652 | ) | ||||
| Net utility plant | 4,930,243 | 4,579,590 | ||||||
| Current assets: | ||||||||
| Cash and cash equivalents | 45,117 | 51,820 | ||||||
| Restricted cash | 45,834 | 45,553 | ||||||
| Receivables: | ||||||||
| Customers, net | 80,740 | 56,322 | ||||||
| Short-term regulatory assets | 86,507 | 72,511 | ||||||
| Other, net | 37,202 | 49,004 | ||||||
| Accrued and unbilled revenue, net | 64,122 | 39,674 | ||||||
| Materials and supplies | 18,360 | 19,784 | ||||||
| Taxes, prepaid expenses, and other assets | 29,697 | 19,760 | ||||||
| Total current assets | 407,579 | 354,428 | ||||||
| Other assets: | ||||||||
| Regulatory assets | 320,115 | 339,865 | ||||||
| Goodwill | 37,063 | 37,063 | ||||||
| Other assets | 379,373 | 360,219 | ||||||
| Total other assets | 736,551 | 737,147 | ||||||
| TOTAL ASSETS | $ | 6,074,373 | $ | 5,671,165 | ||||
| CAPITALIZATION AND LIABILITIES | ||||||||
| Capitalization: | ||||||||
| Common stock, $0.01 par value; 136,000 shares authorized, 62,877 and 59,638 outstanding on September 30, 2026 and December 31, 2025, respectively | $ | 629 | $ | 596 | ||||
| Additional paid-in capital | 1,121,845 | 973,454 | ||||||
| Retained earnings | 794,184 | 729,276 | ||||||
| Accumulated other comprehensive loss | (12,768 | ) | (13,922 | ) | ||||
| Noncontrolling interests | 2,639 | 2,571 | ||||||
| Total equity | 1,906,529 | 1,691,975 | ||||||
| Long-term debt, net | 1,472,021 | 1,471,968 | ||||||
| Total capitalization | 3,378,550 | 3,163,943 | ||||||
| Current liabilities: | ||||||||
| Current maturities of long-term debt, net | 316 | 2,270 | ||||||
| Short-term borrowings | 175,000 | 130,000 | ||||||
| Accounts payable | 207,633 | 175,729 | ||||||
| Short-term regulatory liabilities | 89,889 | 25,458 | ||||||
| Accrued other taxes | 12,635 | 6,048 | ||||||
| Accrued interest | 23,309 | 12,976 | ||||||
| Other accrued liabilities | 66,068 | 65,683 | ||||||
| Total current liabilities | 574,850 | 418,164 | ||||||
| Deferred income taxes | 473,399 | 450,946 | ||||||
| Regulatory liabilities | 920,323 | 929,814 | ||||||
| Pension | 95,677 | 94,226 | ||||||
| Advances for construction | 213,334 | 210,638 | ||||||
| Contributions in aid of construction | 307,951 | 297,016 | ||||||
| Other long-term liabilities | 110,289 | 106,418 | ||||||
| Commitments and contingencies | ||||||||
| TOTAL CAPITALIZATION AND LIABILITIES | $ | 6,074,373 | $ | 5,671,165 | ||||
CALIFORNIA WATER SERVICE GROUP
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
Unaudited
(In thousands, except per share data)
| Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||||||||
| 2026 | 2025 | 2026 | 2025 | |||||||||||||
| Operating revenue | $ | 332,168 | $ | 311,235 | $ | 855,337 | $ | 780,162 | ||||||||
| Operating expenses: | ||||||||||||||||
| Operations: | ||||||||||||||||
| Water production costs | 102,103 | 102,703 | 265,275 | 251,197 | ||||||||||||
| Administrative and general | 35,010 | 36,237 | 104,917 | 103,728 | ||||||||||||
| Other operations | 37,512 | 33,455 | 113,889 | 93,986 | ||||||||||||
| Maintenance | 9,428 | 9,812 | 26,944 | 26,523 | ||||||||||||
| Depreciation and amortization | 34,708 | 36,118 | 104,208 | 108,103 | ||||||||||||
| Income tax expense | 17,726 | 10,639 | 31,672 | 18,589 | ||||||||||||
| Property and other taxes | 13,003 | 11,656 | 36,691 | 33,267 | ||||||||||||
| Total operating expenses | 249,490 | 240,620 | 683,596 | 635,393 | ||||||||||||
| Net operating income | 82,678 | 70,615 | 171,741 | 144,769 | ||||||||||||
| Other income and expenses: | ||||||||||||||||
| Non-regulated revenue | 5,917 | 5,349 | 17,379 | 15,341 | ||||||||||||
| Non-regulated expenses | (9,121 | ) | (2,456 | ) | (18,157 | ) | (8,790 | ) | ||||||||
| Other components of net periodic benefit credit | 3,010 | 4,548 | 9,270 | 13,937 | ||||||||||||
| Allowance for equity funds used during construction | 2,478 | 2,145 | 6,642 | 5,840 | ||||||||||||
| Income tax expense on other income and expenses | (612 | ) | (1,960 | ) | (3,719 | ) | (5,415 | ) | ||||||||
| Net other income | 1,672 | 7,626 | 11,415 | 20,913 | ||||||||||||
| Interest expense: | ||||||||||||||||
| Interest expense | 20,170 | 18,113 | 60,598 | 52,086 | ||||||||||||
| Allowance for borrowed funds used during construction | (1,216 | ) | (988 | ) | (3,328 | ) | (2,772 | ) | ||||||||
| Net interest expense | 18,954 | 17,125 | 57,270 | 49,314 | ||||||||||||
| Net income | 65,396 | 61,116 | 125,886 | 116,368 | ||||||||||||
| Net loss attributable to noncontrolling interests | (12 | ) | (114 | ) | (24 | ) | (361 | ) | ||||||||
| Net income attributable to California Water Service Group | $ | 65,408 | $ | 61,230 | $ | 125,910 | $ | 116,729 | ||||||||
| Earnings per share of common stock: | ||||||||||||||||
| Basic | $ | 1.05 | $ | 1.03 | $ | 2.07 | $ | 1.96 | ||||||||
| Diluted | $ | 1.05 | $ | 1.03 | $ | 2.07 | $ | 1.96 | ||||||||
| Weighted average shares outstanding: | ||||||||||||||||
| Basic | 62,393 | 59,585 | 60,826 | 59,557 | ||||||||||||
| Diluted | 62,502 | 59,653 | 60,913 | 59,615 | ||||||||||||
| Dividends per share of common stock | $ | 0.34 | $ | 0.30 | $ | 1.01 | $ | 0.94 | ||||||||
Exhibit 99.2
Third Quarter 2026 Earnings Presentation October 29, 2026
Today’s Speakers 2 Marty Kropelnicki Chairman & CEO James Lynch Sr. Vice President, CFO & Treasurer
This presentation contains forward - looking statements within the meaning established by the Private Securities Litigation Reform Act of 1995 (“PSLRA”) . The forward - looking statements are intended to qualify under provisions of the federal securities laws for “safe harbor” treatment established by the PSLRA . Forward - looking statements in this presentation are based on currently available information, expectations, estimates, assumptions and projections, and our management’s beliefs, assumptions, judgments and expectations about us, the water utility industry and general economic conditions . These statements are not statements of historical fact . When used in our documents, statements that are not historical in nature, including words like will, would, expects, intends, plans, believes, may, could, estimates, assumes, anticipates, projects, progress, predicts, hopes, targets, forecasts, should, seeks or variations of these words or similar expressions are intended to identify forward - looking statements . Examples of forward - looking statements in this presentation include, but are not limited to, statements describing expectations regarding financial performance, operating plans, capital investments and expenditures, depreciation, M&A investments, the anticipated closing and timing of acquisitions of Nexus Water Group’s Nevada and Oregon utilities, and remaining outstanding membership interests in BVRT and expected benefits resulting from the Nevada, Oregon, and BVRT acquisitions, rate base growth, customer growth potential, compound annual growth rate and annual dividend yield ; the expected timing and the amount of proceeds from the California Water Service Group’s (Group or Company) forward sales agreements, the ability to complete the issuance of the notes and bonds described in this presentation on the expected timing or at all and the sufficiency of the Company’s resources to finance its initiatives . Forward - looking statements are not guarantees of future performance . They are based on numerous assumptions that we believe are reasonable, but they are open to a wide range of uncertainties and business risks . Consequently, actual results or outcomes may vary materially from what is contained in a forward - looking statement . Factors that may cause actual results or outcomes to be different than those expected or anticipated include, but are not limited to : the outcome and timeliness of regulatory commissions’ actions concerning rate relief and other matters ; the impact of opposition to rate increases ; our ability to recover costs ; Federal governmental and state regulatory commissions’ decisions, including decisions on proper disposition of property ; changes in state regulatory commissions’ policies and procedures ; changes in California State Water Resources Control Board water quality standards ; changes in environmental compliance and water quality requirements, EPA’s finalization of and changes to a National Primary Drinking Water Regulation (NPDWR) establishing legally enforceable maximum contaminant levels (MCL) for PFAS in drinking water in 2024 as well as legal challenges to such MCLS ; EPA’s proposed new PFAS rulemaking including impacts to the current PFAS NPDWR ; the impact of weather, climate change, natural disasters, including wildfires and landslides, and actual or threatened public health emergencies, including disease outbreaks, on our operations, water quality, water availability, water sales and operating results and the adequacy of our emergency preparedness ; electric power interruptions, especially as a result of public safety power shutoff programs ; availability of water supplies ; our ability to invest or apply the proceeds from the issuance of common stock in an accretive manner ; our ability to complete the issuance of the notes and bonds and the settlement of the forward sales agreements on the expected timing or at all ; consequences of eminent domain actions relating to our water systems ; increased risk of inverse condemnation losses as a result of the impact of weather, climate change, and natural disasters, including wildfires and landslides ; shifts in population, including housing and customer growth ; issues with the implementation, maintenance or security of our information technology systems ; physical and cyber security risks and threats and the adequacy of our efforts to mitigate such risks and threats ; the ability of our enterprise risk management processes to identify or address risks adequately ; labor relations matters as we negotiate with the unions ; changes in customer water use patterns and the effects of conservation, including as a result of drought conditions ; our ability to complete, in a timely manner or at all, successfully integrate and achieve anticipated benefits from announced acquisitions ; including the Nevada and Oregon systems, and BVRT acquisitions ; restrictive covenants in or changes to the credit ratings on our current or future debt that could increase our financing costs or affect our ability to borrow, make payments on debt or pay dividends ; risks associated with expanding our business and operations, including into other geographic areas ; the impact of stagnating or worsening business and economic conditions, including inflationary pressures, general economic slowdown or a recession, changes in tariff policy, the interest rate environment, changes in monetary policy, adverse capital markets activity or macroeconomic conditions as a result of geopolitical conflicts, including the ongoing conflict in Ukraine and the Middle East, and the prospect of shutdowns of the U . S . federal government ; the impact of market conditions and volatility on unrealized gains or losses on our non - qualified benefit plan investments and our operating results ; the impact of weather and timing of meter reads on our accrued and unbilled revenue ; the impact of evolving legal and regulatory requirements, including sustainability requirements ; the impact of the evolving U . S . political environment and changes effected, proposed or threatened by the U . S . federal government that has led to, in some cases, legal challenges and uncertainty around the funding, functioning and policy priorities of U . S . federal regulatory agencies and the status of current and future regulations ; and other risks and unforeseen events described in our SEC filings . In light of these risks, uncertainties and assumptions, investors are cautioned not to place undue reliance on forward - looking statements, which speak only as of the date of this presentation . When considering forward - looking statements, you should keep in mind the cautionary statements included in this paragraph, as well as the Annual Report on Form 10 - K, Quarterly Reports on Form 10 - Q, and other reports filed from time - to - time with the SEC . We are not under any obligation, and we expressly disclaim any obligation to update or alter any forward - looking statements, whether as a result of new information, future events or otherwise . A credit rating is not a recommendation to buy, sell, or hold any securities, and may be changed at any time by the applicable ratings agency and should be evaluated independently of any other information . Forward - Looking Statements and Other Important Information 3
Third - Quarter 2026 Highlights 4 Our solid Q3 2026 results reflect April 2026 resolution of the 2024 CA GRC, other regulatory outcomes , and successful execution of our business strategy 1 Our strong liquidity profile supports growth; expecting Q4 close of Nevada and Oregon acquisitions 5 We focused on recovering costs while striving to keep rates affordable for customers 2 We declared 327 th consecutive quarterly dividend ; anticipated annual dividend of $1.34 is an 8.1% increase over 2025 We achieved record Q3 infrastructure investment , which drives earnings and enhances safety and reliability for customers 3 6 We continued to prioritize emergency preparedness in advance of the forecasted El Niño weather event 4
Q3 2026 Results Compared to Q3 2025 Results 5 $332.2 $311.2 $0 $50 $100 $150 $200 $250 $300 $350 $400 Operating Revenue $65.4 $61.2 $0 $10 $20 $30 $40 $50 $60 $70 $80 Net Income $1.05 $1.03 $0.00 $0.15 $0.30 $0.45 $0.60 $0.75 $0.90 $1.05 $1.20 Diluted EPS Q3 2026 vs. Q3 2025 Q3 2025 Q3 2026 Q3 2025 Q3 2026 Q3 2025 Q3 2026 (in millions, except EPS)
Diluted EPS Bridge – Q3 2025 to Q3 2026 Results $1.03 $0.28 $0.05 $0.06 - $0.06 - $0.04 - $0.06 - $0.06 - $0.15 Q3 2025 Diluted EPS Customer rate changes, new customers, and other Drought Recovery Memorandum Account (DREMA) approval Regulatory approval of memorandum account cost recovery Customer consumption decrease Water conservation program expense increase Effective income tax rate change Non - qualified benefit plan investment losses Other Q3 2026 Diluted EPS $0.00 $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 $1.05 6
Q3 2026 YTD Results Compared to Q3 2025 YTD 7 $855.3 $780.2 $0 $100 $200 $300 $400 $500 $600 $700 $800 $900 Operating Revenue $125.9 $116.7 $0 $20 $40 $60 $80 $100 $120 $140 Net Income $2.07 $1.96 $0.00 $0.25 $0.50 $0.75 $1.00 $1.25 $1.50 $1.75 $2.00 $2.25 Diluted EPS Q3 YTD 2026 vs. Q3 YTD 2025 Q3 YTD 2025 Q3 YTD 2026 Q3 YTD 2025 Q3 YTD 2026 Q3 YTD 2025 Q3 YTD 2026 (in millions, except EPS)
Diluted EPS Bridge – Q3 YTD 2025 to Q3 YTD 2026 Results $1.96 $0.66 $0.20 $0.18 - $0.05 - $0.18 - $0.11 - $0.07 - $0.12 - $0.05 - $0.05 - $0.10 - $0.20 $0.00 $0.50 $1.00 $1.50 $2.00 $2.50 $3.00 $3.50 $2.07 8
Infrastructure Investment Improves Reliability, Powers Long - Term Earnings 9 Capital expenditure estimates for 2026 - 2028 are based on actual amounts included in the 2024 California GRC decision, plus estim ated 2028 California capital expenditures and estimated 2026 - 2028 capital expenditures in our other states. The estimated capital expenditures are subject to final approval b y the CPUC and review and approval by commissions in our other states. Note: amounts for 2026 - 2028 exclude anticipated Nevada and Oregon capital investments. $274 $299 $293 $328 $384 $471 $517 $627 $667 $700 $89 $99 $109 $109 $121 $132 $144 $147 $169 $181 $0 $100 $200 $300 $400 $500 $600 $700 $800 2019 2020 2021 2022 2023 2024 2025 2026* 2027* 2028* Capital Investment Depreciation 2026 - 2028 TOTAL CapEx 4x DEPRECIATION (in millions) Growth in capital investment outpaces depreciation Q3 2026 $148.3M $34.7M Depreciation Q3 YTD 2026 $424.8M $104.2M Depreciation CapEx
Earnings Performance Driven by Capital Investment/Rate Base Growth 10 Rate base estimated to reach over $3.45 billion by 2028 Rate base estimates for 2026 - 2028 are based on actual amounts included in the 2024 California GRC decision, plus estimated 2028 California rate base and estimated 2026 - 2028 rate base in our other states. Estimated rate base is subject to final approval by the CPUC and review and approval by commissions in our oth er states. Note: amounts for 2026 - 2028 exclude anticipated Nevada and Oregon capital investments. $1.26 $1.61 $1.87 $2.01 $2.20 $2.39 $2.65 $2.74 $3.15 $3.46 $0.00 $0.50 $1.00 $1.50 $2.00 $2.50 $3.00 $3.50 $4.00 2019 2020 2021 2022 2023 2024 2025 2026* 2027* 2028* (in billions)
Strong Liquidity Profile Supports Growth Strategy 11 Capital structure consistent with authorized Cal Water structure; Cal Water authorized ROE is 10.27% ATM equity program renewed in May 2025; $350.0M shelf registration; $49.8M net program sales occurred in Q3 2026 Group entered into forward sales agreements with investors under the ATM to sell 1.6 million additional shares at a future date; estimated proceeds as of September 30, 2026 of $77.8M Group issued $125.0M in unsecured long - term debt, and Cal Water issued $150.0M in long - term first mortgage bonds Group believes it has met its 2026 financing requirements Credit facilities of $600.0M that can be expanded up to $800.0M ; facilities mature in March 2028; approximately $ 425.0M available as of September 30, 2026 As of September 30, 2026, Company had $45.1M in unrestricted cash and $45.8M in restricted cash Group and Cal Water’s S&P Global credit rating A+/stable
Regulatory Approvals Enable Us to Make Investments to Provide Safe, Reliable Water WUTC approved revenue increase of $4.1 million for Washington, effective October 1, 2026. HPUC approved revenue increase for Kapalua systems of $1.9 million , effective October 21, 2026. CPUC approved use of the advice letter process for $113.1 million in capital costs for certain PFAS projects expected to be completed in 2027 & 2028. Also approved recovery of $2.5 million of previously incurred expenses. 12
PFAS Regulatory Compliance Program 13 $228.0M Total investment projected for PFAS Regulatory Compliance program (CA/NM/WA) $23.3M 2026 YTD PFAS treatment / well replacement investments 65 Number of PFAS treatment / well replacement projects currently planned (8 in grant - funding process) 18 Number of the 44 CA sites in construction $ 59.4M Amount recovered from class - action litigation to date, net ($ 78.7M gross)
Recovering Costs While Keeping Rates Affordable Actively pursue grants to reduce costs that impact water bills Maintain assets strategically to keep facilities operating optimally for longer periods Invest in conservation programs that help reduce water bills (Cal Water bills are up to 20.5% lower over past 15 years than they would have been w/o conservation programs, according to Alliance for Water Efficiency 2024 study) Proactively control expenses : lower - cost water sources, competitive pricing from suppliers Provide convenient, interest - free payment plans Offer Rate Support Fund (discount for customers in higher - cost service areas) and low - income assistance program (benefits 24% of CA customers) Bill as % of Income Median Monthly Cal Water Bill Median Monthly Household Income 1.03% $69.74 $6,798 2021 1.02% $72.62 $7,108 2022 0.86% $64.63 $7,489 2023 0.95% $78.48 $8,383 2024 0.88% $82.70 $9,384 2025 14
59 Years of Dividend Growth Strong history of returning cash to shareholders $1.00 $1.04 $1.12 $1.24 $1.34 $0.00 $0.20 $0.40 $0.60 $0.80 $1.00 $1.20 $1.40 $1.60 2022 2023 2024 2025 2026 327 th $0.335 consecutive quarterly dividend in amount of 59 th $1.34 previously announced annual increase expected to yield 2026 annual dividend of 8.1% 2026 announced annual dividend indicative of $1.34 per share; 8.1% higher than 2025 total 7.6% five - year dividend CAGR 15
Strategic Initiatives 16 Oregon and Nevada System acquisitions: • Change of control applications approved • Integration planning on target and within budget • Expect to close before year end BVRT Joint Venture: • Consolidated Rate Case remanded to the Commission for approval • Interim rates remain in effect, with the next rate increase expected in October 2026 • Change - of - control filing deemed complete and on track for early 2027 approval and closing • 12% increase in new connections through Q3 2026 The Nevada, Oregon, and BVRT acquisitions remain subject to customary regulatory approvals and closing conditions as applicab le. More information on the Nevada, Oregon, and BVRT transactions can be found in the Strategic Initiatives Appendix to this presentation.
Other Q3 Highlights 17 Continued celebrating our centennial ( 100years.calwatergroup.com ) Connected Indianola Elementary to our system and began providing safe water to 400 students and faculty Continue to prioritize emergency preparedness in advance of El Niño
Questions & Answers
Strategic Initiatives Appendix
20 Nevada and Oregon Acquisition Bolsters Our Position as Leader in Western U.S., Provides Platform for Additional Growth Subject matter experts at Group focused on IT, shared service, and operating process integrations Group management has met with future employees and utilities commissions Change in control filings have been approved by the respective utility's commissions Acquiring Nexus Water Group’s subsidiaries in Nevada and Oregon expected to expand Group’s footprint into two additional Western states and increase rate base outside of California (excluding BVRT) by approximately 40% ~98,000 Total equivalent residential connections outside of California at closing 24 Wastewater treatment plants Q3 2026 20% After close, percentage of total customers outside of California
Nevada and Oregon System Highlights 21 • 9,127 total equivalent residential connections: 4,835 water / 4,292 wastewater • 10 utility systems across three counties, regulated water and unregulated wastewater assets • Second largest water utility in Oregon • Regulated by Oregon Public Utility Commission (OPUC) (regulated water operations) • 26,466 total equivalent residential connections: 19,919 water / 6,547 wastewater • 6 utility systems across three counties • Largest investor - owned water/wastewater utility in Nevada • Regulated by Public Utilities Commission of Nevada (PUCN) HI OR NV CA NM WA TX Proposed Future Service Areas Existing Service Areas Nevada Oregon