# CALIFORNIA WATER SERVICE GROUP (CWT)

Informational only - not investment advice.

CIK: 0001035201
SIC: 4941 Water Supply
SIC breadcrumb: [Transportation, Communications, Electric, Gas, And Sanitary Services](/division/E/) > [Electric, Gas, And Sanitary Services](/major-group/49/) > [SIC 4941 Water Supply](/industry/4941/)
Latest 10-K filed: 2026-02-27
SEC page: https://www.sec.gov/edgar/browse/?CIK=1035201
Filing source: https://www.sec.gov/Archives/edgar/data/1035201/000162828026012444/cwt-20251231.htm

## At a glance

FY2025 · period end 2025-12-31 · filed 2026-02-27 · accession 0001628280-26-012444 · source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001035201.json

| Metric | Value | FY | Provenance |
| --- | ---: | ---: | --- |
| Revenue | 963,695,000 USD | 2025 | verified |
| Net income | 128,211,000 USD | 2025 | verified |
| Assets | 5,671,165,000 USD | 2025 | verified |
| Net margin | 13.30% | 2025 | computed |
| Operating margin | 17.68% | 2025 | computed |
| Revenue YoY | +6.41% | 2025 | computed |
| ROE | 7.58% | 2025 | computed |

Computed values are grepcent-computed from the verified facts above and may differ from ratios the company itself reports. Net margin = net income ÷ revenue. Operating margin = operating income ÷ revenue. Revenue YoY = FY2025 revenue ÷ FY2024 revenue − 1 (consecutive fiscal years only). ROE = net income ÷ period-end stockholders' equity.

No market price, no rating, no forecast on this site. Not investment advice.

### Peer percentile fingerprint

| Ratio | CWT | Peer median | Percentile | N |
| --- | ---: | ---: | ---: | ---: |
| Net margin | 13.3% | 20.7% | 22 | 10 |
| Operating margin | 17.7% | 28.7% | 22 | 10 |
| Revenue growth | 6.4% | 6.4% | 50 | 11 |
| ROE | 7.6% | 8.3% | 30 | 11 |
| ROA | 2.3% | 3.1% | 30 | 11 |
| Liabilities / equity | 2.35 | 1.84 | 80 | 11 |
| Current ratio | 0.85 | 0.80 | 60 | 11 |

Percentile = share of the N covered peers reporting that ratio whose value is lower (ties counted half); computed among grepcent-covered companies in SIC industry 4941 Water Supply, not the whole market. A higher percentile means a higher value of the ratio, not a better company. Ratios with fewer than 8 reporting peers are omitted. Latest reported values per company; fiscal periods may differ. Descriptive arithmetic - not a score, rating, or ranking.

## Selected Fundamentals
| Metric | Value | Unit | FY | Filed |
| --- | ---: | --- | ---: | --- |
| Revenue | 963695000 | USD | 2025 | 2026-02-27 |
| Net income | 128211000 | USD | 2025 | 2026-02-27 |
| Assets | 5671165000 | USD | 2025 | 2026-02-27 |

## Financials

Annual standardized facts from SEC companyfacts as of latest extracted filing date 2026-02-27. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001035201.json. Derived margins, ratios, and free cash flow are computed from the extracted annual SEC facts.

| Metric | 2011 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Revenue |  | 589,528,000 | 622,474,000 | 674,736,000 | 664,358,000 | 697,577,000 | 765,704,000 | 772,616,000 | 790,334,000 | 905,623,000 | 963,695,000 |
| Net income | 37,712,000 |  | 72,940,000 | 65,584,000 | 63,116,000 | 96,831,000 | 101,125,000 | 96,011,000 | 51,911,000 | 190,807,000 | 128,211,000 |
| Operating income |  | 82,636,000 | 107,083,000 | 110,540,000 | 99,412,000 | 136,666,000 | 126,770,000 | 127,660,000 | 77,135,000 | 225,054,000 | 170,369,000 |
| Diluted EPS |  | 1.01 | 1.52 | 1.36 | 1.31 | 1.97 | 1.96 | 1.77 | 0.91 | 3.25 | 2.15 |
| Operating cash flow |  | 160,444,000 | 147,842,000 | 179,019,000 | 168,794,000 | 117,924,000 | 231,718,000 | 243,772,000 | 217,817,000 | 290,867,000 | 302,561,000 |
| Dividends paid |  | 33,081,000 | 34,563,000 | 36,043,000 | 38,023,000 | 41,768,000 | 47,398,000 | 54,186,000 | 59,036,000 | 65,462,000 | 73,853,000 |
| Share buybacks |  | 744,000 | 1,505,000 | 1,645,000 | 2,497,000 | 1,679,000 | 1,767,000 | 2,013,000 | 1,844,000 | 1,435,000 | 1,433,000 |
| Assets |  | 2,411,745,000 | 2,744,710,000 | 2,837,704,000 | 3,111,308,000 | 3,394,248,000 | 3,623,271,000 | 4,264,813,000 | 4,595,533,000 | 5,180,283,000 | 5,671,165,000 |
| Stockholders' equity |  |  |  | 730,157,000 | 768,843,000 | 910,281,000 | 1,171,917,000 | 1,322,394,000 | 1,430,312,000 | 1,638,286,000 | 1,691,975,000 |
| Cash and cash equivalents |  | 25,492,000 | 94,776,000 | 47,176,000 | 42,653,000 | 44,555,000 | 78,380,000 | 62,100,000 | 39,591,000 | 50,121,000 | 51,820,000 |

### Ratios

ROE and ROA use period-end equity/assets. Liabilities / equity uses total liabilities divided by stockholders' equity. Current ratio uses current assets divided by current liabilities when both are reported.

| Metric | 2011 | 2016 | 2017 | 2018 | 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | 2025 |
| --- | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: | ---: |
| Net margin |  |  | 11.72% | 9.72% | 9.50% | 13.88% | 13.21% | 12.43% | 6.57% | 21.07% | 13.30% |
| Operating margin |  | 14.02% | 17.20% | 16.38% | 14.96% | 19.59% | 16.56% | 16.52% | 9.76% | 24.85% | 17.68% |
| Return on equity |  |  |  | 8.98% | 8.21% | 10.64% | 8.63% | 7.26% | 3.63% | 11.65% | 7.58% |
| Return on assets |  |  | 2.66% | 2.31% | 2.03% | 2.85% | 2.79% | 2.25% | 1.13% | 3.68% | 2.26% |
| Liabilities / equity |  |  |  | 2.89 | 3.05 | 2.73 | 2.09 | 2.23 | 2.21 | 2.16 | 2.35 |
| Current ratio |  | 0.57 | 0.46 | 0.59 | 0.51 | 0.45 | 1.10 | 1.00 | 0.69 | 0.60 | 0.85 |

## As-reported value updates

5 tracked differences above grepcent's stated thresholds were found between the earliest XBRL-filed value and the value currently on file for the same fiscal period.

Ledger: /company/CWT/revisions/


## Quarterly

Quarterly standardized facts from SEC companyfacts as of latest extracted filing date 2026-07-30. Source: https://data.sec.gov/api/xbrl/companyfacts/CIK0001035201.json.

Flow metrics use discrete quarter-length periods from 10-Q/10-Q/A filings. Q4 revenue and net income are derived only when annual FY and nine-month YTD facts exist for the same fiscal year; derived Q4 values are labeled. EPS Q4 is not derived.

| Quarter | End date | Revenue | Net income | Diluted EPS | Method |
| --- | --- | ---: | ---: | ---: | --- |
| 2022-Q3 | 2022-09-30 |  |  | 1.03 | reported discrete quarter |
| 2023-Q1 | 2023-03-31 |  |  | -0.40 | reported discrete quarter |
| 2023-Q2 | 2023-06-30 |  |  | 0.17 | reported discrete quarter |
| 2023-Q3 | 2023-09-30 | 253,337,000 | 34,438,000 | 0.60 | reported discrete quarter |
| 2023-Q4 | 2023-12-31 | 197,566,000 | 30,128,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2024-Q1 | 2024-03-31 | 154,900,000 | 69,917,000 | 1.21 | reported discrete quarter |
| 2024-Q2 | 2024-06-30 | 226,665,000 | 40,551,000 | 0.70 | reported discrete quarter |
| 2024-Q3 | 2024-09-30 | 306,237,000 | 60,680,000 | 1.03 | reported discrete quarter |
| 2024-Q4 | 2024-12-31 | 217,820,000 | 19,659,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2025-Q1 | 2025-03-31 | 182,701,000 | 13,331,000 | 0.22 | reported discrete quarter |
| 2025-Q2 | 2025-06-30 | 256,216,000 | 42,168,000 | 0.71 | reported discrete quarter |
| 2025-Q3 | 2025-09-30 | 314,096,000 | 61,230,000 | 1.03 | reported discrete quarter |
| 2025-Q4 | 2025-12-31 | 210,682,000 | 11,482,000 |  | derived Q4 = FY annual - nine-month YTD |
| 2026-Q1 | 2026-03-31 | 197,334,000 | 4,037,000 | 0.07 | reported discrete quarter |
| 2026-Q2 | 2026-06-30 | 278,035,000 | 56,465,000 | 0.93 | reported discrete quarter |

## Filed narrative (10-K & 10-Q)

## Business

Verbatim Item 1 Business section from CWT's latest 10-K: [/company/CWT/business/](/company/CWT/business/).

## Risk Factors

Verbatim Item 1A Risk Factors from CWT's latest 10-K: [/company/CWT/risk-factors/](/company/CWT/risk-factors/).

## Latest quarter (10-Q)

Latest 10-Q source: https://www.sec.gov/Archives/edgar/data/1035201/000162828026050990/cwt-20260630.htm

Extracted structurally from real Item 2 body heading to real Item 3/4 boundary.
Confidence: high
Filing date: 2026-07-30
Report date: 2026-06-30

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

(Dollar amounts in thousands unless otherwise stated)

FORWARD-LOOKING STATEMENTS

This quarterly report, including all documents incorporated by reference, contains forward-looking statements within the meaning established by the Private Securities Litigation Reform Act of 1995 (the 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 quarterly report 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,” “indicates,” or variations of these words or similar expressions are intended to identify forward-looking statements. Examples of forward-looking statements in this quarterly report include, but are not limited to, statements describing our intention, indication or expectation regarding our financial performance, dividends or targeted payout ratio, our expectations, anticipations or beliefs regarding governmental, legislative, judicial, administrative or regulatory timelines, regulatory compliance, decisions, approvals, authorizations, requirements or other actions, the anticipated closing and timing of acquisition of Nexus Water Group’s (Nexus) Nevada and Oregon systems, and the remaining membership interests in BVRT Utility Holding Company LLC (BVRT) and expected benefits resulting from such transactions, rate amounts, cost recovery or refunds, expected impact of certain per- and polyfluoroalkyl substances (PFAS) regulations, our expected or estimated revenue, our intentions regarding recovery billing, our expectations regarding regulatory asset and operating revenue recognition, estimates of, or expectations regarding, capital expenditures, funding needs or other capital requirements, obligations, contingencies or commitments, our expectations regarding water sources, our beliefs regarding adequacy of water supplies, our anticipation regarding renewing water supply contracts and estimated water prices, estimates and assumptions relating to our significant accounting policies, such as deferred revenue or assets or refund of advances, our expectations or assumptions regarding employee benefit plans and stock-based compensation and estimated contributions to our pension plans and other postretirement benefit plans, our estimated annual effective tax rate and expectations regarding tax benefits, our intentions regarding use of net proceeds from any future equity or debt issuances or borrowings, our expectations, intentions or anticipations regarding our sources of funding, capital structure, including authorized return on equity, cost of debt and rate of return, or capital allocation plans, our intentions regarding growth opportunities or our expectations regarding the amount, timing, and use of settlement proceeds relating to certain PFAS-contamination claims. The 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 which may cause actual results 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 Board) water quality standards;

•changes in environmental compliance and water quality requirements, such as the United States Environmental Protection Agency’s (EPA) finalization of and changes to a National Primary Drinking Water Regulation establishing legally enforceable maximum contaminant levels (MCL) for PFAS in drinking water in 2024 as well as legal challenges to such MCLs;

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•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;

•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 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 ongoing conflicts in 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

•the risks set forth in “Risk Factors” included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2025 (2025 Annual Report on Form 10-K).

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 quarterly report or as of the date of any document incorporated by reference in this quarterly report, as applicable. When considering forward-looking statements, investors should keep in mind the cautionary statements in this quarterly report and the documents incorporated by reference. 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.

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CRITICAL ACCOUNTING POLICIES AND ESTIMATES

We maintain our accounting records in accordance with accounting principles generally accepted in the United States of America and as directed by the Commissions to which our operations are subject. The process of preparing financial statements requires the use of estimates on the part of management. The estimates used by management are based on historic experience and an understanding of current facts and circumstances. Management believes that the following accounting policies are critical because they involve a higher degree of complexity and judgment, and can have a material impact on our results of operations, financial condition, and cash flows of the business. These policies and their key characteristics are discussed in detail in the 2025 Annual Report on Form 10-K. They include:

•regulated utility accounting;

•income taxes; and

•pensions, which include the supplemental executive retirement plan, and the postretirement health care benefit plan.

For the six months ended June 30, 2026, there were no material changes in the methodology for computing critical accounting estimates, no additional accounting estimates met the standards for critical accounting policies, and there were no material changes to the important assumptions underlying the critical accounting estimates.

RESULTS OF OPERATIONS

Net Income Attributable to California Water Service Group

Net income attributable to California Water Service Group for the three months ended June 30, 2026 was $56.5 million or $0.93 earnings per diluted common share, compared to net income of $42.2 million or $0.71 earnings per diluted common share for the three months ended June 30, 2025. The $14.3 million increase in net income was due to an increase in operating revenue of $43.6 million primarily as a result of the cumulative adjustment for the impacts of California Water Service Company’s (Cal Water) general rate case (GRC) filed on July 8, 2024 (2024 CA GRC), retroactive to January 1, 2026 and rate increases. The operating revenue increase was partially offset by an increase in operating expenses of $24.6 million. The operating expense increase was primarily due to increases in water production costs of $6.3 million, administrative and general expense of $2.9 million, other operations expense of $13.4 million, and income tax expense of $7.0 million. These operating expense increases were partially offset by a decrease in depreciation and amortization expenses of $6.5 million. Additionally, net other income decreased by $1.5 million and net interest expense increased by $3.2 million.

Net income attributable to California Water Service Group for the six months ended June 30, 2026 was $60.5 million or $1.01 earnings per diluted common share, compared to net income of $55.5 million or $0.93 earnings per diluted common share for the six months ended June 30, 2025. The $5.0 million increase in net income was due to an increase in operating revenue of $54.3 million primarily as a result of the cumulative adjustment for the impacts of the 2024 CA GRC, retroactive to January 1, 2026 and rate increases. The operating revenue increase was partially offset by an increase in operating expenses of $39.3 million. The operating expense increase was primarily due to increases in water production costs of $14.7 million, administrative an

[Excerpt truncated for page length; source filing is linked above.]

## Latest 10-K MD&A (excerpt)

Latest 10-K Item 7 source: https://www.sec.gov/Archives/edgar/data/1035201/000162828026012444/cwt-20251231.htm
Complete FY 2025 MD&A: /company/CWT/mda/fy2025/

Extracted structurally from real Item 7 body heading to real Item 7A/8 boundary.
Confidence: high
Filing date: 2026-02-27
Report date: 2025-12-31

Item 7.    Management’s Discussion and Analysis of Financial Condition and Results of Operations.

The following sections include a discussion of results for fiscal 2025 compared to fiscal 2024 as well as certain 2023 results. The comparative results for fiscal 2024 with fiscal 2023 generally have not been included in this Form 10-K, but may be found in “Part II - Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” of the Company’s Annual Report on Form 10-K for the year ended December 31, 2024.

Overview

Net Income Attributable to California Water Service Group

In 2025 and 2024, net income attributable to California Water Service Group was $128.2 million and $190.8 million, respectively. Earnings per diluted common share decreased $1.10 from $3.25 to $2.15, or 33.8%, in 2025.

The $62.6 million decrease in net income was primarily due to a decrease in operating revenue of $36.7 million primarily as a result of a decrease in customer usage of $12.7 million and the cumulative adjustment for the impacts of the 2021 CA GRC, retroactive to January 1, 2023, that was recorded in 2024, partially offset by an increase in rates of $69.6 million. Total operating expenses also increased by $18.0 million. The total operating expense increase was primarily due to an increase in water production costs of $11.5 million, an increase in administrative and general expenses of $2.1 million, an increase in other operations expenses of $11.6 million, an increase in depreciation and amortization expenses of $12.5 million, and an increase in property and other taxes of $3.7 million. These increases were partially offset by a decrease in income tax expense of $24.7 million. Additionally, net interest expense increased by $9.1 million due to higher average outstanding borrowings, partially offset by lower interest rates.

The net income benefit of the 2021 CA GRC from 2023 interim rate relief was approximately $64.0 million, or $1.09 earnings per diluted common share, that is included in 2024 results.

Critical Accounting Policies and Estimates

We maintain our accounting records in accordance with accounting principles generally accepted in the United States of America and as directed by the Commissions to which our operations are subject. The process of preparing financial statements requires the use of estimates on the part of management. The estimates used by management are based on historic experience and an understanding of current facts and circumstances. A summary of our significant accounting policies is listed in Note 2 of the Notes to Consolidated Financial Statements. The following sections describe those policies where the level of subjectivity, judgment, and variability of estimates could have a material impact on the financial condition, operating performance, and cash flows of the business.

Regulated Utility Accounting

Because our primary business is operating a regulated business, we are subject to the accounting rules and standards for regulated utilities. The Commissions in the states in which we operate establish rates that are designed to permit the recovery of the cost of service and a return on investment. We capitalize and record regulatory assets for costs that would otherwise be charged to expense if it is probable that the incurred costs will be recovered in future rates. Regulatory assets are amortized over the future periods that the costs are expected to be recovered. If costs expected to be incurred in the future are currently being recovered through rates, we record those expected future costs as regulatory liabilities. In addition, we record regulatory liabilities when it is probable the Commissions will require a refund to be made to our customers over future periods.

Determining probability requires significant judgment by management and includes, but is not limited to, consideration of testimony presented in regulatory hearings, proposed regulatory decisions, final regulatory orders, and the strength or status of applications for rehearing or state court appeals.

If we determine that a portion of our assets used in utility operations is not recoverable in customer rates, we would be required to recognize the loss of the disallowed assets.

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Income Taxes

We account for income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. We measure deferred tax assets and liabilities at enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. We recognize the effect on the deferred tax assets and liabilities of a change in tax rate in the period that includes the enactment date. We also assess the likelihood that deferred tax assets will be recovered in future taxable income and, to the extent recovery is not probable, a valuation allowance is recorded.

We anticipate that future rate actions by the regulatory commissions will reflect revenue requirements for the tax effects of temporary differences recognized, which have previously been passed through to customers. The regulatory commissions have granted the Company permission to reflect the normalization of the tax benefits of the federal accelerated methods and available Investment Tax Credits (ITCs) for all assets placed in service after 1980. ITCs are deferred and amortized over the lives of the related properties for book purposes. The CPUC requires flow through accounting for state deferred taxes.

On June 27, 2024, California Senate Bill 167 (SB 167) was enacted into law. SB 167 provides for a three-year suspension of net operating losses under the California Corporation tax. Among other things, this law temporarily disallows the use of state net operating losses for years beginning in 2024 through 2026.

On December 22, 2017, the U.S. government enacted expansive tax legislation commonly referred to as the Tax Cuts and Jobs Act (TCJA). Among other provisions, the TCJA reduces the federal income tax rate from 35 percent to 21 percent beginning on January 1, 2018 and eliminated bonus depreciation for utilities. The TCJA required the Company to re-measure all existing deferred income tax assets and liabilities to reflect the reduction in the federal tax rate.

As of December 31, 2025, the TCJA tax liability was $60.6 million. We continue working with state regulators to finalize the TCJA tax liability to confirm compliance with the federal normalization rules.

Pensions, which include the supplemental executive retirement plan (SERP), and Postretirement Benefits Other Than Pensions (PBOP)

We incur costs associated with our pensions and PBOP plans. To measure the expense of these benefits, our management must estimate compensation increases, mortality rates, future health cost increases and discount rates used to value related liabilities and to determine appropriate funding. Different estimates used by our management could result in significant variances in the cost recognized for pension and PBOP plans. The estimates used are based on historical experience, current facts, future expectations, and recommendations from independent advisors and actuaries. We use an investment advisor to provide advice in managing the plans’ investments. We anticipate any increases in funding for the pension, except for the SERP for Cal Water, and PBOP plans will be recovered in future rate filings, thereby mitigating the financial impact. We believe it is probable that future non-SERP costs will be recovered in future rates and therefore have recorded a regulatory asset in accordance with generally accepted accounting principles. As a result of the 2021 CA GRC decision that was issued in March of 2024, SERP expenses were disallowed to be recovered from our customers. At this time, we believe it is not probable that SERP costs will be recovered in rates for the three-year period in which the 2021 CA GRC is in effect. As a result, we record the changes in the funded status for the SERP for Cal Water to accumulated other comprehensive loss in accordance with generally accepted accounting principles.

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Changes to pension benefits actuarial assumptions can significantly affect pension costs, regulatory assets, and liabilities. The following table reflects the sensitivity of pension amounts reported for the year ended December 31, 2025, to changes in actuarial assumptions:

[[GREPCENT_TABLE]]
[["","Increase/(Decrease) in Pension Benefits Actuarial Assumption","","Increase/(Decrease) in 2025 Net Periodic Benefit Cost","","Increase/(Decrease) in Projected Benefit Obligation as of December 31, 2025"],["","","","Dollars in thousands"],["Discount rate","(0.5)","%","","$","3,023","","","$","59,245"],["Long-term rate of return on plan assets","(0.5)","%","","3,709","","","\u2014"],["Rate of compensation increases","(0.5)","%","","(2,501)","","","(14,006)"],["Cost of living adjustment (1)","(0.4)","%","","(4,737)","","","(30,763)"],["Discount rate","0.5","%","","(5,757)","","","(52,880)"],["Long-term rate of return on plan assets","0.5","%","","(3,709)","","","\u2014"],["Rate of compensation increases","0.5","%","","2,256","","","14,401"],["Cost of living adjustment","0.5","%","","4,318","","","40,890"]]
[[/GREPCENT_TABLE]]
______________________________________________________________________________

(1)     The cost of living adjustment was assumed at 2.40% and has a floor of 2.0%.

Results of Operations

Operating Revenue

Operating revenue in 2025 was $1,000.1 million, a decrease of $36.7 million, or 3.5%, over 2024. Operating revenue in 2024 was $1,036.8 million, an increase of $242.2 million, or 30.5%, over 2023. The sources of change in operating revenue were:

[[GREPCENT_TABLE]]
[["","2025","","2024"],["","Dollars in millions"],["Net change due to rate changes and other (1)","$","69.7","","","$","116.0"],["Customer usage","(12.7)","","","6.1"],["IRMA revenue (2)","(88.6)","","","88.6"],["MWRAM revenue (3)","(9.0)","","","35.3"],["Deferral of revenue (4)","3.9","","","(3.8)"],["Net change","$","(36.7)","","","$","242.2"]]
[[/GREPCENT_TABLE]]

_______________________________________________________________________________

(1)In 2025, the net change due to rate changes and other items in the above table was primarily due to rate increases of $69.6 million.

(2)Due to the delay in the resolution of the 2021 CA GRC, the CPUC authorized Cal Water to track in an IRMA the variances between actual customer billings and those that would have been billed assuming the 2021 CA GRC had been effective January 1, 2023. Such variances were recorded as regulatory balancing account revenue. The 2021 CA GRC was approved in March of 2024 and final rates for the 2021 CA GRC were implemented on May 31, 2024. As a result Cal Water recorded IRMA revenue of $88.6 million in 2024, of which $67.6 million is attributable to 2023. No IRMA revenue was recorded in 2025.

(3)MWRAM revenue is the variance between actual metered sales billed through the tiered volumetric rate and the revenue that would have been received with the same actual metered sales if a uniform rate had been in effect. In March of 2024, Cal Water received approval of the 2021 CA GRC which authorized the use of the MWRAM effective January 1, 2023. For 2025 and 2024, Cal Water recorded MWRAM revenue of $26.3 million and $35.3 million, respectively. Of the $35.3 million of MWRAM revenue recorded for 2024, $17.4 million is attributable to 2023.

(4)Deferred revenue consists of amounts that are expected to be collected from customers beyond 24 months following the end of the accounting period in which the sales transaction occurred. Deferred revenue for 2025 decreased due to a decrease in the balancing account re

[Excerpt truncated for page length; the complete text is on the linked full-MD&A page.]

Read the full FY 2025 MD&A: /company/CWT/mda/fy2025/
All MD&A years: /company/CWT/mda/


## MD&A history

Prior-year 10-K MD&A spans are extracted from SEC filings with the same bounded parser used for the latest filing. Each year's full verbatim text is on its own sub-page.

- [FY 2024 MD&A](/company/CWT/mda/fy2024/): filed 2025-02-27; accession 0001035201-25-000003 (https://www.sec.gov/Archives/edgar/data/1035201/000103520125000003/cwt-20241231.htm)
- [FY 2023 MD&A](/company/CWT/mda/fy2023/): filed 2024-02-29; accession 0001035201-24-000004 (https://www.sec.gov/Archives/edgar/data/1035201/000103520124000004/cwt-20231231.htm)
- [FY 2022 MD&A](/company/CWT/mda/fy2022/): filed 2023-03-01; accession 0001035201-23-000003 (https://www.sec.gov/Archives/edgar/data/1035201/000103520123000003/cwt-20221231.htm)
- [FY 2021 MD&A](/company/CWT/mda/fy2021/): filed 2022-02-24; accession 0001035201-22-000002 (https://www.sec.gov/Archives/edgar/data/1035201/000103520122000002/cwt-20211231.htm)




## Macro cross-references

Indicators mapped to this company's SIC classification (industry 4941 Water Supply) by grepcent's deterministic macro-sector crosswalk. A navigational mapping, not a statistical or causal claim.

- [INDPRO](/indicator/INDPRO/): Industrial Production: Total Index
- [TCU](/indicator/TCU/): Capacity Utilization: Total Index
- [DGS10](/indicator/DGS10/): Market Yield on U.S. Treasury Securities at 10-Year Constant Maturity
- [FEDFUNDS](/indicator/FEDFUNDS/): Federal Funds Effective Rate

Macro-to-micro threads including this sector: [Money & trade](/thread/money-trade/), [Trade & external](/thread/trade-external/).

All macro indicators: /indicators/


## For LLMs & downloads

Markdown twin: /company/CWT.md · JSON record: /company/CWT.json · verified financials: /company/CWT/financials.json / /company/CWT/financials.csv · machine TOC for the whole site: /llms.txt