H2O America

Good day and thank you for standing by. Welcome to the SJW Group 2023 Financial Results Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during this session, you will need to press star 1-1 on your telephone. You will then hear an automated message advising you your hand is raised. To withdraw your question, please press star 1-1 again. Please be advised today's conference is being recorded. I would now like to hand the conference over to one of your speakers today, Andrew Walters, Chief Financial Officer and Treasurer. Please go ahead.

Thank you, Operator. Welcome to the 2023 Financial Results Conference Call for the SJW Group. I will be presenting today with Eric Thornburg, Chair of the Board, President, and Chief Executive Officer. For those who would like to follow along, slides accompanying our remarks are available on our website at sjwgroup.com. Before we begin today, I would like to remind you that this presentation and the related materials posted on our website may contain forward-looking statements. These statements are based on estimates and assumptions made by the company in light of its experience, historical trends, current conditions, and expected future results, as well as other factors that the company believes are appropriate under the circumstances. Many factors could cause the company's actual results and performance to differ materially from those expressed or implied by the forward-looking statements. For a description of some of the factors that could cause actual results to be different from statements in this presentation, we refer you to the financial results press release and to our most recent forms 10-K, 10-Q, and 8-K filed with the Securities and Exchange Commission copies of which may be obtained on our website. All forward-looking statements are made as of today, and SJW Group disclaims any duty to update or revise such statements. You will have an opportunity to ask questions at the end of the presentation. As a reminder, this webcast is being recorded, and an archive of the webcast will be available until April 22, 2024. You can access the press release and the webcast at our corporate website. I will now turn the call over to Eric Thornburg.

Eric. Welcome, everyone, and thank you for joining us. My name is Eric Thornburg, and it is my honor to serve as chair, president, and CEO of SJW Group. I'm pleased to share that we had another successful year as our team continues to meet drinking water and environmental standards, deliver on our public health and environmental stewardship commitments, and provide high-quality water and exceptional service to customers. We also started and ended our 2023 financial performance on a strong note, delivering value for our shareholders through the continued execution of our proven growth strategy. In 2023, we secured constructive regulatory outcomes across our operations, including the cost of capital decision and the reimplementation of the water conservation memorandum account in California water infrastructure and conservation adjustments in Connecticut, and the settlement of our Biddeford-Saco general rate case in Maine. We achieved 12% customer growth year-over-year in Texas. Since 2006, Texas Water has more than quadrupled in customers through organic growth and strategic acquisitions and today serves more than 28,000 water connections and 950 wastewater connections. We invested $272 million in capital improvements, surpassing our planned expenditures announced at this time last year by $17 million. Thanks to the efforts of our local teams, our investments in drinking water and wastewater infrastructure spanned the replacement of over 47 miles of water mains to water treatment improvements, including a $14 million groundwater treatment facility in East Windsor, Connecticut, upgrades at our Park Shores surface water treatment facility in Kamal County, Texas, construction of an 800,000 gallon storage lagoon in Camden, Maine, and two 5 million gallon storage tanks in California. We advanced our commitment to reduce operating costs by investing in capital projects that sustainably reduce operating expenses, like our asset management program in California. This program reduces unplanned repairs and maintenance expenses by leveraging technology, including artificial intelligence, to predict the failure of an asset and the resulting consequences. And we delivered earnings per diluted share of 59 cents in the fourth quarter and $2.68 for the year well above our original forecast. In 2024, we will continue to execute on the key elements of our strategy to create meaningful value and drive future earnings growth. We will continue making strategic investments to maintain and improve our water supply and infrastructure and also focus on opportunities that reduce operating expenses. These include advanced leak detection, advanced metering infrastructure that promises to reduce field visits and fleet miles, additional solar generation, battery energy storage systems, and expansion of our electric vehicle fleet. We will also see increased capital expenditures to remediate per- and polyfluoroalkyl substances, or PFAS. Approximately $230 million is estimated for PFAS treatment. And we remain intensely focused on working with regulators and stakeholders for constructive regulatory outcomes across our operations, such as the recently filed general rate case in California, the ongoing general rate case in Connecticut, and the system improvement charge in Texas, which we will discuss later in the call. For now, Andrew will review our financial results and regulatory updates in our state operations. Andrew?