Short answer
H2O AMERICA (HTO) filed its fiscal 2025 10-K annual report with the SEC on Feb 26, 2026. It reported revenue of $806M (+9.4% year over year) and net income of $103M.
- Top risk flagged: Regulatory/legal risk: Rate increases subject to approval by California and Connecticut utility commissions, impacting $44.1M authorized rate hikes in 2025
FY2025 key financial metrics · XBRL
- Revenue
- $806M
- +9.4% YoY
- Net income
- $103M
- +9.2% YoY
- Operating margin
- 22.0%
- −1.1 pp YoY
- EPS (diluted)
- $2.92
- +1.7% YoY
- ROE
- 6.7%
- −0.2 pp YoY
- Operating cash flow
- $245M
- +25.2% YoY
Source: XBRL data from the H2O AMERICA (HTO) FY2025 10-K on SEC EDGAR. USD.
H2O AMERICA FY2025 10-K analysis
AI summary of each section, grounded in the filing text
Business Overview
- Core business model: Water utility services including water supply, treatment, and distribution primarily through subsidiary companies
- Strategic shift: Standard & Poor’s downgraded H2O America’s credit outlook to negative post-Quadvest acquisition announcement on July 15, 2025
- Notable financing activity: Issued $60M and $55M Senior Notes for CWC and SJWC respectively, both due 2055 with interest ~6.08% and 5.83% rates
- Key quantitative metric: Short-term borrowings decreased to $86.8M from $119.1M YoY with borrowing cost dropping to 4.75% from 6.08%
- Equity raise: Issued 2.39M shares under ATM equity offering raising net proceeds of $122.8M at weighted average $51.90 per share in 2025
Management Discussion & Analysis
- Revenue details not explicitly provided; customer usage change: SJWC -4.6%, CWC +2.7%, TWC -3.1%, MWC +2.5% YoY
- Capital improvements $489.6M in 2025 vs $353.0M in 2024; planned $458.0M in 2026 and $2.568B over next five years including acquisitions
- No goodwill impairment as of 10/1/2025; no disallowed regulatory assets for 2025-2023
- Quadvest acquisition purchase price $540.0M ($483.6M TWC, $56.4M TWOS), expected operational scale and growth exposure in Houston, TX
- Regulatory mechanisms WCMA and WRA mitigate revenue risks from reduced water consumption; WCMA active due to 15% voluntary water reduction in SJWC area
Risk Factors
- Regulatory/legal risk: Rate increases subject to approval by California and Connecticut utility commissions, impacting $44.1M authorized rate hikes in 2025
- Geopolitical/macroeconomic threat: Valley Water's July 2025 rate hikes, +9% purchased water price, +10% groundwater extraction charge, increasing costs for SJWC
- Operational/supply chain vulnerability: Termination of MWC-Kennebec Water District contract in Nov 2025, shift to tariff rates, guaranteeing 0.05 billion gallons annually
- Competitive/market disruption risk: PFAS regulation-driven $400M investment over 5 years for water treatment, potential cost and technology disruption
- Financial/structural risk: Dividends at 57% of net income in 2025, raising sustainability concerns amid rising capital expenditure needs totaling $458M in 2026
Generated from the filing text; verify against the original. How to read a 10-K
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