UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)

☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2024

☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from __________ to __________

Commission file number 001-34245

THE YORK WATER COMPANY

(Exact name of registrant as specified in its charter)

Pennsylvania	23-1242500
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

130 East Market Street, York, Pennsylvania	17401
(Address of principal executive offices)	(Zip Code)

Registrant’s telephone number, including area code (717) 845-3601

Securities registered pursuant to Section 12(b) of the Act:

Common Stock, No par value	YORW	The Nasdaq Global Select Market
(Title of Class)	(Trading Symbol)	(Name of Each Exchange on Which Registered)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.

⌧ Yes

☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).

⌧ Yes

☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act:

Large accelerated filer ☐	Accelerated filer ☐		Non-accelerated filer ⌧

Smaller reporting company ☒		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. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

☐ Yes		⌧ No
Indicate the number of shares outstanding of each of the issuer’s classes of common stock, as of the latest practicable date.
Common stock, No par value	14,344,608 Shares outstanding as of May 7, 2024

TABLE OF CONTENTS

PART I	Financial Information

Item 1.	Financial Statements	3
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	17
Item 3.	Quantitative and Qualitative Disclosures About Market Risk	25
Item 4.	Controls and Procedures	25
Item 5.	Other Information	25

PART II	Other Information

Item 6.	Exhibits	26

Signatures		27

Page 2

THE YORK WATER COMPANY

PART I - FINANCIAL INFORMATION

Item 1.

Financial Statements.

Balance Sheets (Unaudited)

(In thousands of dollars, except per share amounts)

	Mar. 31, 2024			Dec. 31, 2023
ASSETS
UTILITY PLANT, at original cost	$	628,710		$	620,201
Plant acquisition adjustments		(9,364	)		(9,384	)
Accumulated depreciation		(116,918	)		(117,113	)
Net utility plant		502,428			493,704

OTHER PHYSICAL PROPERTY, net of accumulated depreciation of $511 in 2024 and $501 in 2023		1,559			1,569

CURRENT ASSETS:
Cash and cash equivalents		3,321			1
Accounts receivable, net of reserves of $1,055 in 2024 and $1,005 in 2023		7,086			7,837
Unbilled revenues		3,575			3,484
Recoverable income taxes		–			332
Materials and supplies inventories, at cost		3,525			3,109
Prepaid expenses		1,432			821
Total current assets		18,939			15,584

OTHER LONG-TERM ASSETS:
Prepaid pension cost		23,940			23,380
Note receivable		255			255
Deferred regulatory assets		50,257			48,949
Other assets		4,909			4,764
Total other long-term assets		79,361			77,348

Total Assets	$	602,287		$	588,205

The accompanying notes are an integral part of these statements.

	Mar. 31, 2024		Dec. 31, 2023
STOCKHOLDERS’ EQUITY AND LIABILITIES
COMMON STOCKHOLDERS’ EQUITY:
Common stock, no par value, authorized 46,500,000 shares, issued and outstanding 14,343,500 shares in 2024 and 14,332,245 shares in 2023	$	136,622	$	136,174
Retained earnings		86,309		85,004
Total common stockholders’ equity		222,931		221,178

PREFERRED STOCK, authorized 500,000 shares, no shares issued		–		–

LONG-TERM DEBT		189,613		180,007

COMMITMENTS		–		–

CURRENT LIABILITIES:
Accounts payable		11,785		10,873
Dividends payable		2,757		2,754
Accrued compensation and benefits		1,539		1,629
Accrued income taxes		54		–
Accrued interest		1,815		1,741
Deferred regulatory liabilities		662		644
Other accrued expenses		721		502
Total current liabilities		19,333		18,143

DEFERRED CREDITS:
Customers’ advances for construction		19,134		18,853
Deferred income taxes		56,282		55,235
Deferred employee benefits		3,818		3,847
Deferred regulatory liabilities		43,393		42,989
Other deferred credits		458		632
Total deferred credits		123,085		121,556

Contributions in aid of construction		47,325		47,321

Total Stockholders’ Equity and Liabilities	$	602,287	$	588,205

	Three Months Ended March 31
	2024			2023

OPERATING REVENUES:	$	17,628		$	15,401

OPERATING EXPENSES:
Operation and maintenance		4,812			4,112
Administrative and general		3,074			2,666
Depreciation and amortization		3,083			2,814
Taxes other than income taxes		444			391
		11,413			9,983

Operating income		6,215			5,418

OTHER INCOME (EXPENSES):
Interest on debt		(2,123	)		(1,513	)
Allowance for funds used during construction		1,134			749
Other pension costs		(230	)		(364	)
Other income (expenses), net		(67	)		(94	)
		(1,286	)		(1,222	)

Income before income taxes		4,929			4,196

Income tax expense		602			543

Net Income	$	4,327		$	3,653

Basic Earnings Per Share	$	0.30		$	0.26

Diluted Earnings Per Share	$	0.30		$	0.26

	Common Stock Shares			Common Stock Amount		Retained Earnings			Total

Balance, December 31, 2023		14,332,245		$	136,174	$	85,004		$	221,178
Net income		–			–		4,327			4,327
Cash dividends declared, $0.2108 per share		–			–		(3,022	)		(3,022	)
Issuance of common stock under dividend reinvestment, direct stock and employee stock purchase plans		11,768			405		–			405
Stock-based compensation		(513	)		43		–			43
Balance, March 31, 2024		14,343,500		$	136,622	$	86,309		$	222,931

	As of			As of
	Mar. 31, 2024			Dec. 31, 2023			Change

Accounts receivable – customers	$	7,602		$	8,250		$	(648	)
Other receivables		539			592			(53	)
		8,141			8,842			(701	)
Less: allowance for doubtful accounts		(1,055	)		(1,005	)		(50	)
Accounts receivable, net	$	7,086		$	7,837		$	(751	)

Unbilled revenue	$	3,575		$	3,484		$	91

	As of Mar. 31, 2024			As of Dec. 31, 2023

Variable Rate Pennsylvania Economic Development Financing Authority Exempt Facilities Revenue Refunding Bonds, Series 2008A, due 2029	$	12,000		$	12,000
3.00% Pennsylvania Economic Development Financing Authority Exempt Facilities Revenue Refunding Bonds, Series A of 2019, due 2036		10,500			10,500
3.10% Pennsylvania Economic Development Financing Authority Exempt Facilities Revenue Refunding Bonds, Series B of 2019, due 2038		14,870			14,870
3.23% Senior Notes, due 2040		15,000			15,000
4.00% - 4.50% York County Industrial Development Authority Exempt Facilities Revenue Bonds, Series 2015, due 2029 – 2045		10,000			10,000
4.54% Senior Notes, due 2049		20,000			20,000
3.24% Senior Notes, due 2050		30,000			30,000
5.50% Senior Notes, due 2053		40,000			40,000
5.67% Senior Notes, due 2054		40,000			–
Committed Line of Credit, due September 2025		–			30,273
Total long-term debt		192,370			182,643
Less discount on issuance of long-term debt		(144	)		(147	)
Less unamortized debt issuance costs		(2,613	)		(2,489	)
Long-term portion	$	189,613		$	180,007

Description		March 31, 2024		Fair Value Measurements at Reporting Date Using Significant Other Observable Inputs (Level 2)
Interest Rate Swap		$458		$458

Description		December 31, 2023		Fair Value Measurements at Reporting Date Using Significant Other Observable Inputs (Level 2)
Interest Rate Swap		$632		$632

	Number of Shares			Grant Date Weighted Average Fair Value

Nonvested at beginning of the period		8,944		$	42.32
Granted		—		$	–
Vested		(261	)	$	42.22
Forfeited		(513	)	$	42.21
Nonvested at end of the period		8,170		$	42.34

•	the amount and timing of rate changes and other regulatory matters including the recovery of costs recorded as regulatory assets;
•	expected profitability and results of operations;
•	trends;
•	goals, priorities and plans for, and cost of, growth and expansion;
•	strategic initiatives;
•	availability of water supply;
•	water usage by customers; and
•	the ability to pay dividends on common stock and the rate of those dividends.

•	changes in weather or climate, including drought conditions or extended periods of heavy precipitation;
•	natural disasters, including pandemics such as the outbreak of the novel strain of coronavirus known as “COVID-19” and its variants and the effectiveness of the Company’s pandemic plans;
•	levels of rate relief granted;
•	the level of commercial and industrial business activity within the Company’s service territory;
•	construction of new housing within the Company’s service territory and increases in population;
•	changes in government policies or regulations, including the tax code;
•	the ability to obtain permits for expansion projects;
•	material changes in demand from customers, including the impact of conservation efforts which may impact the demand of customers for water;
•	changes in economic and business conditions, including interest rates;
•	loss of customers;
•	changes in, or unanticipated, capital requirements;
•	the impact of acquisitions;
•	changes in accounting pronouncements;
•	changes in the Company’s credit rating or the market price of its common stock; and
•	the ability to obtain financing.

	Three Months Ended March 31
	2024		2023

Weighted average common shares, basic		14,324,879		14,275,866
Effect of dilutive securities:
Employee stock-based compensation		2,827		3,837
Weighted average common shares, diluted		14,327,706		14,279,703

	Three Months Ended March 31
	2024		2023
Water utility service:
Residential	$	9,844	$	8,888
Commercial and industrial		4,656		4,004
Fire protection		1,081		932
Wastewater utility service:
Residential		1,474		1,084
Commercial and industrial		316		221
Billing and revenue collection services		130		126
Collection services		6		7
Other revenue		7		11
Total Revenue from Contracts with Customers		17,514		15,273
Rents from regulated property		114		128
Total Operating Revenue	$	17,628	$	15,401

	Three Months Ended March 31
	2024			2023

Service cost	$	159		$	149
Interest cost		463			469
Expected return on plan assets		(791	)		(903	)
Amortization of prior service cost		(3	)		(3	)
Rate-regulated adjustment		561			801
Net periodic pension expense	$	389		$	513

	THE YORK WATER COMPANY


	/s/ Joseph T. Hand
Date: May 7, 2024	Joseph T. Hand Principal Executive Officer



	/s/ Matthew E. Poff
Date: May 7, 2024	Matthew E. Poff Principal Financial and Accounting Officer

Exhibit No.		Description

3		Amended and Restated Articles of Incorporation. Incorporated herein by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on May 4, 2010.

3.1		Amended and Restated By-Laws. Incorporated herein by reference to Exhibit 3.1 of the Company’s Current Report on Form 8-K filed with the Securities and Exchange Commission on January 26, 2012.

31.1		Certification of Chief Executive Officer, pursuant to Rule 13a-14(a)/15d-14(a) under the Securities Exchange Act of 1934.

31.2		Certification of Chief Financial Officer, pursuant to Rule 13a-14(a)/15d-14(a) under the Securities Exchange Act of 1934.

32.1		Certification of Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2		Certification of Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS		Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document).

101.SCH		Inline XBRL Taxonomy Extension Schema.

101.CAL		Inline XBRL Taxonomy Extension Calculation Linkbase.

101.DEF		Inline XBRL Taxonomy Extension Definition Linkbase.

101.LAB		Inline XBRL Taxonomy Extension Label Linkbase.

101.PRE		Inline XBRL Taxonomy Extension Presentation Linkbase.

104		Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101).

SEC Form 10-Q filed by York Water Company