California Water Service (NYSE:) Group has introduced the issuance of $125 million in First Mortgage Bonds by its subsidiary, California Water Service Firm (Cal Water). The bonds, which carry a 5.22% rate of interest and are due on October 22, 2054, have been offered on Monday to refinance debt and for normal company functions.
The bonds, designated as Sequence 2, pays curiosity quarterly beginning January 22, 2025. These bonds are on par with Cal Water’s different First Mortgage Bonds and are secured by liens on the utility’s properties, with sure exceptions and permitted liens.
This monetary transfer is a part of Cal Water’s technique to handle its indebtedness and keep company liquidity. The web proceeds from the bond sale might be used to refinance present debt and for different company wants in compliance with the California Public Utilities Code Part 817.
The 5.22% First Mortgage Bonds weren’t registered underneath the Securities Act of 1933, and as such, they’re topic to restrictions on their sale in the US. This transaction isn’t a proposal to promote or a solicitation of a proposal to purchase any bonds.
This information, primarily based on a press launch assertion, comes as California Water Service Group continues to navigate the monetary points of offering water provide companies. The corporate, listed on the New York Inventory Change underneath the ticker NYSE:CWT, is headquartered in San Jose, California, and operates as a water utility firm within the state.
In different latest information, California Water Service Group has seen vital developments. The corporate’s Vice President and Chief Human Useful resource Officer, Ronald D. Webb, has introduced his retirement efficient as of March 31, 2025.
On the earnings entrance, the corporate reported a notable enhance in its second-quarter earnings and income, with working income surging by 25.9% to achieve $244.3 million and web revenue standing at $40.6 million.
Along with these monetary outcomes, the corporate has expanded its service within the Bay Space by way of the acquisition of Kings Mountain Park Mutual Water Firm.
Analyst agency Baird has responded to those developments by elevating the value goal for shares of California Water Service Group to $61.00, whereas sustaining an Outperform score on the inventory. This adjustment follows the corporate’s latest submission of the 2024 California Normal Fee Case (GRC), which proposes capital investments surpassing Baird’s preliminary projections.
As a part of its funding plans, the corporate has introduced intentions to take a position over $1.6 billion in infrastructure enhancements from 2025 to 2027.
Moreover, California Water Service Group stays dedicated to its environmental initiatives, planning to deal with roughly 101 wells for PFAS/PFOS at an estimated value of $226 million. These are among the many latest developments for California Water Service Group because it continues to navigate the challenges and alternatives in its sector.
InvestingPro Insights
California Water Service Group’s latest $125 million bond issuance aligns with its sturdy monetary place and progress trajectory. In keeping with InvestingPro knowledge, the corporate has a market capitalization of $3.11 billion and has demonstrated spectacular income progress of 24.25% during the last twelve months as of Q2 2024. This progress is mirrored within the firm’s stable monetary metrics, together with a P/E ratio of 17.76 and a dividend yield of two.12%.
InvestingPro Ideas spotlight that California Water Service Group has raised its dividend for 31 consecutive years and has maintained dividend funds for 54 consecutive years. This constant dividend historical past underscores the corporate’s monetary stability and dedication to shareholder returns, which can be additional supported by the latest bond issuance for debt refinancing and normal company functions.
Buyers contemplating California Water Service Group could also be to know that InvestingPro affords 9 further ideas for this inventory, offering a extra complete evaluation of the corporate’s monetary well being and market place.
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