ý
|
Annual Report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934 for the fiscal year ended
December 31, 2012
or
|
o
|
Transition report pursuant to section 13 or 15(d) of the Securities Exchange Act of 1934 for the transition period to
|
Connecticut
(State or other jurisdiction of
incorporation or organization)
|
06-0739839
(I.R.S. Employer Identification No.)
|
|
|
93 West Main Street, Clinton, CT
(Address of principal executive office)
|
06413
(Zip Code)
|
Title of each Class
Common Stock, without par value
|
Name of each exchange on which registered
The Nasdaq Stock Market, Inc.
|
Large Accelerated Filer
o
|
Accelerated Filer
x
|
Non-Accelerated Filer
o
|
Smaller Reporting Company
o
|
Document
|
|
Part of Form 10-K Into Which Document is Incorporated
|
|
|
|
Definitive Proxy Statement, to be filed on or about March 29, 2013, for Annual Meeting of Shareholders to be held on May 9, 2013.
|
|
Part III
|
•
|
projected capital expenditures and related funding requirements;
|
•
|
the availability and cost of capital;
|
•
|
developments, trends and consolidation in the water and wastewater utility industries;
|
•
|
dividend payment projections;
|
•
|
our ability to successfully acquire and integrate regulated water and wastewater systems, as well as unregulated businesses, that are complementary to our operations and the growth of our business;
|
•
|
the capacity of our water supplies, water facilities and wastewater facilities;
|
•
|
the impact of limited geographic diversity on our exposure to unusual weather;
|
•
|
the impact of conservation awareness of customers and more efficient plumbing fixtures and appliances on water usage per customer;
|
•
|
our capability to pursue timely rate increase requests;
|
•
|
our authority to carry on our business without unduly burdensome restrictions;
|
•
|
our ability to maintain our operating costs at the lowest possible level, while providing good quality water service;
|
•
|
our ability to obtain fair market value for condemned assets;
|
•
|
the impact of fines and penalties;
|
•
|
changes in laws, governmental regulations and policies, including environmental, health and water quality and public utility regulations and policies;
|
•
|
the decisions of governmental and regulatory bodies, including decisions to raise or lower rates;
|
•
|
our ability to successfully extend and expand our service contract work within our Service and Rentals Segment in both Connecticut and Maine;
|
•
|
the development of new services and technologies by us or our competitors;
|
•
|
the availability of qualified personnel;
|
•
|
the condition of our assets;
|
•
|
the impact of legal proceedings;
|
•
|
general economic conditions;
|
•
|
the profitability of our Real Estate Segment, which is subject to the amount of land we have available for sale and/or donation, the demand for any available land, the continuation of the current state tax benefits relating to the donation of land for open space purposes and regulatory approval for land dispositions; and
|
•
|
acquisition-related costs and synergies.
|
•
|
changes in general economic, business, credit and financial market conditions;
|
•
|
changes in environmental conditions, including those that result in water use restrictions;
|
•
|
abnormal weather conditions;
|
•
|
increases in energy and fuel costs;
|
•
|
unfavorable changes to the federal and/or state tax codes;
|
•
|
significant changes in, or unanticipated, capital requirements;
|
•
|
significant changes in our credit rating or the market price of our common stock;
|
•
|
our ability to integrate businesses, technologies or services which we may acquire, including the acquisition of The Maine Water Company in January 2012 and The Biddeford & Saco Water Company in December 2012;
|
•
|
our ability to manage the expansion of our business;
|
•
|
the extent to which we are able to develop and market new and improved services;
|
•
|
the continued demand by telecommunication companies for antenna site leases on our property;
|
•
|
the effect of the loss of major customers;
|
•
|
our ability to retain the services of key personnel and to hire qualified personnel as we expand;
|
•
|
labor disputes;
|
•
|
increasing difficulties in obtaining insurance and increased cost of insurance;
|
•
|
cost overruns relating to improvements or the expansion of our operations;
|
•
|
increases in the costs of goods and services;
|
•
|
civil disturbance or terroristic threats or acts; and
|
•
|
changes in accounting pronouncements.
|
•
|
Employee Code of Conduct
|
•
|
Audit Committee Charter
|
•
|
Board of Directors Code of Conduct
|
•
|
Compensation Committee Charter
|
•
|
Corporate Finance and Investment's Committee Charter
|
•
|
Corporate Governance Committee Charter
|
•
|
Bylaws of Connecticut Water Service, Inc.
|
|
2012
|
|
2011
|
|
2010
|
||||||
Customers:
|
|
|
|
|
|
||||||
Residential
|
108,154
|
|
|
80,256
|
|
|
79,604
|
|
|||
Commercial
|
8,539
|
|
|
5,679
|
|
|
5,692
|
|
|||
Industrial
|
501
|
|
|
425
|
|
|
422
|
|
|||
Public Authority
|
892
|
|
|
600
|
|
|
609
|
|
|||
Fire Protection
|
2,763
|
|
|
1,746
|
|
|
1,724
|
|
|||
Other (including non-metered accounts)
|
942
|
|
|
1,317
|
|
|
1,351
|
|
|||
Total
|
121,791
|
|
|
90,023
|
|
|
89,402
|
|
|||
Water Revenues
(in thousands):
|
|
|
|
|
|
|
|
|
|||
Residential
|
$
|
50,783
|
|
|
$
|
43,656
|
|
|
$
|
42,103
|
|
Commercial
|
10,138
|
|
|
8,621
|
|
|
7,725
|
|
|||
Industrial
|
3,080
|
|
|
1,817
|
|
|
1,755
|
|
|||
Public Authority
|
2,675
|
|
|
2,253
|
|
|
2,280
|
|
|||
Fire Protection
|
15,592
|
|
|
11,890
|
|
|
11,430
|
|
|||
Other (including non-metered accounts)
|
1,570
|
|
|
1,165
|
|
|
1,115
|
|
|||
Total
|
$
|
83,838
|
|
|
$
|
69,402
|
|
|
$
|
66,408
|
|
Customer Water Consumption
(millions of gallons):
|
|
|
|
|
|
|
|
|
|||
Residential
|
5,622
|
|
|
4,821
|
|
|
5,124
|
|
|||
Commercial
|
1,509
|
|
|
1,133
|
|
|
1,151
|
|
|||
Industrial
|
780
|
|
|
339
|
|
|
335
|
|
|||
Public Authority
|
421
|
|
|
323
|
|
|
348
|
|
|||
Total
|
8,332
|
|
|
6,616
|
|
|
6,958
|
|
Name
|
|
Age in 2013*
|
|
Offices
|
|
Period Held or Prior Position
|
|
Term of Office Expires
|
E. W. Thornburg
|
|
52
|
|
Chairman, President, and Chief Executive Officer
|
|
Held positions since March 2006
|
|
2013 Annual Meeting
|
D. C. Benoit
|
|
56
|
|
Vice President – Finance, Chief Financial Officer and Treasurer
|
|
Held current position or other executive position with the Company since April 1996
|
|
2013 Annual Meeting
|
T. P. O’Neill
|
|
58
|
|
Vice President – Service Delivery
|
|
Held current position or other engineering position with the Company since February 1980
|
|
2013 Annual Meeting
|
M. P. Westbrook
|
|
54
|
|
Vice President – Customer and Regulatory Affairs
|
|
Held current position or other management position with the Company since September 1988
|
|
2013 Annual Meeting
|
K. A. Johnson
|
|
46
|
|
Vice President – Human Resources and Corporate Secretary
|
|
Held current position or other human resources position with the Company since May 2007. Ms. Johnson previously served as the senior vice president, Human Resources and Organizational Development Officer for Rockville Bank.
|
|
2013 Annual Meeting
|
J. E. Wallingford
|
|
56
|
|
Division President – The Maine Water Company, Director
|
|
President of The Maine Water Company (and its predecessor companies) since 1993, Director since 2012
|
|
2013 Annual Meeting
|
•
|
the challenges of consolidating businesses, including workforces, processes and information systems;
|
•
|
the costs of consolidating BSWC and managing and enhancing its operations may be higher than we expect and may require more resources, capital investments and management attention than anticipated;
|
•
|
employees important to BSWC’s operations may decide not to continue employment with us; and
|
•
|
we may be unable to anticipate or manage risks that are unique to BSWC’s historical business, including those related to its workforce, customer base, local demographics and information systems.
|
•
|
dilutive issuances of our equity securities;
|
•
|
incurrence of debt and contingent liabilities;
|
•
|
failure to have effective internal control over financial reporting;
|
•
|
fluctuations in quarterly results; and
|
•
|
other acquisition-related expenses.
|
•
|
the number of years to depreciate certain assets;
|
•
|
amounts to set aside for uncollectible accounts receivable and uninsured losses;
|
•
|
our legal exposure and the appropriate accrual for claims, including medical and workers’ compensation claims;
|
•
|
future costs for pensions and other post-retirement benefit obligations; and
|
•
|
possible tax allowances.
|
|
Price
|
|
Dividends
|
||||||||
Period
|
High
|
|
Low
|
|
Paid
|
||||||
2012
|
|
|
|
|
|
||||||
First Quarter
|
$
|
32.84
|
|
|
$
|
26.15
|
|
|
$
|
0.2375
|
|
Second Quarter
|
29.98
|
|
|
26.69
|
|
|
0.2375
|
|
|||
Third Quarter
|
32.31
|
|
|
28.98
|
|
|
0.2425
|
|
|||
Fourth Quarter
|
32.24
|
|
|
28.36
|
|
|
0.2425
|
|
|||
2011
|
|
|
|
|
|
||||||
First Quarter
|
$
|
28.27
|
|
|
$
|
23.27
|
|
|
$
|
0.2325
|
|
Second Quarter
|
26.64
|
|
|
24.01
|
|
|
0.2325
|
|
|||
Third Quarter
|
28.15
|
|
|
24.77
|
|
|
0.2375
|
|
|||
Fourth Quarter
|
29.10
|
|
|
24.76
|
|
|
0.2375
|
|
SELECTED FINANCIAL DATA
|
|
|
|
|
|
|
|
|
|
||||||||||
Years Ended December 31, (thousands of dollars except per share amounts and where otherwise indicated)
|
|
|
|
|
|
|
|
|
|
||||||||||
|
2012
|
|
2011
|
|
2010
|
|
2009
|
|
2008
|
||||||||||
CONSOLIDATED STATEMENTS OF INCOME
|
|
|
|
|
|
|
|
|
|
||||||||||
Continuing Operations
|
|
|
|
|
|
|
|
|
|
||||||||||
Operating Revenues
|
$
|
83,838
|
|
|
$
|
69,402
|
|
|
$
|
66,408
|
|
|
$
|
59,391
|
|
|
$
|
61,270
|
|
Operating Expenses
|
$
|
64,229
|
|
|
$
|
53,842
|
|
|
$
|
52,573
|
|
|
$
|
47,003
|
|
|
$
|
47,874
|
|
Other Utility Income, Net of Taxes
|
$
|
812
|
|
|
$
|
847
|
|
|
$
|
742
|
|
|
$
|
704
|
|
|
$
|
579
|
|
Total Utility Operating Income
|
$
|
20,421
|
|
|
$
|
16,407
|
|
|
$
|
14,577
|
|
|
$
|
13,092
|
|
|
$
|
13,975
|
|
Interest and Debt Expense
|
$
|
8,581
|
|
|
$
|
5,674
|
|
|
$
|
5,853
|
|
|
$
|
4,744
|
|
|
$
|
5,198
|
|
Net Income
|
$
|
13,640
|
|
|
$
|
11,300
|
|
|
$
|
9,798
|
|
|
$
|
10,209
|
|
|
$
|
9,424
|
|
Cash Common Stock Dividends Paid
|
$
|
8,467
|
|
|
$
|
8,196
|
|
|
$
|
7,942
|
|
|
$
|
7,671
|
|
|
$
|
7,373
|
|
Dividend Payout Ratio from Continuing Operations
|
62
|
%
|
|
73
|
%
|
|
81
|
%
|
|
75
|
%
|
|
78
|
%
|
|||||
Weighted Average Common Shares Outstanding
|
8,763,418
|
|
|
8,610,070
|
|
|
8,531,741
|
|
|
8,447,950
|
|
|
8,377,428
|
|
|||||
Basic Earnings Per Common Share from Continuing Operations
|
$
|
1.55
|
|
|
$
|
1.31
|
|
|
$
|
1.14
|
|
|
$
|
1.20
|
|
|
$
|
1.12
|
|
Number of Shares Outstanding at Year End
|
10,939,486
|
|
|
8,755,398
|
|
|
8,676,849
|
|
|
8,573,744
|
|
|
8,463,269
|
|
|||||
ROE on Year End Common Equity
|
7.4
|
%
|
|
9.6
|
%
|
|
8.7
|
%
|
|
9.4
|
%
|
|
9.1
|
%
|
|||||
Declared Common Dividends Per Share
|
$
|
0.960
|
|
|
$
|
0.940
|
|
|
$
|
0.920
|
|
|
$
|
0.900
|
|
|
$
|
0.880
|
|
CONSOLIDATED BALANCE SHEET
|
|
|
|
|
|
|
|
|
|
||||||||||
Common Stockholders' Equity
|
$
|
185,349
|
|
|
$
|
118,189
|
|
|
$
|
113,191
|
|
|
$
|
108,569
|
|
|
$
|
103,476
|
|
Long-Term Debt (Consolidated, Excluding Current Maturities)
|
178,475
|
|
|
135,256
|
|
|
111,675
|
|
|
111,955
|
|
|
92,227
|
|
|||||
Preferred Stock
|
772
|
|
|
772
|
|
|
772
|
|
|
772
|
|
|
772
|
|
|||||
Total Capitalization
|
$
|
364,596
|
|
|
$
|
254,217
|
|
|
$
|
225,638
|
|
|
$
|
221,296
|
|
|
$
|
196,475
|
|
Stockholders' Equity (Includes Preferred Stock)
|
51
|
%
|
|
47
|
%
|
|
51
|
%
|
|
49
|
%
|
|
53
|
%
|
|||||
Long-Term Debt
|
49
|
%
|
|
53
|
%
|
|
49
|
%
|
|
51
|
%
|
|
47
|
%
|
|||||
Net Utility Plant
|
$
|
447,911
|
|
|
$
|
360,027
|
|
|
$
|
344,219
|
|
|
$
|
325,202
|
|
|
$
|
299,233
|
|
Total Assets
|
$
|
578,975
|
|
|
$
|
442,931
|
|
|
$
|
424,199
|
|
|
$
|
415,276
|
|
|
$
|
372,431
|
|
Book Value - Per Common Share
|
$
|
16.94
|
|
|
$
|
13.50
|
|
|
$
|
13.05
|
|
|
$
|
12.66
|
|
|
$
|
12.23
|
|
OPERATING REVENUES BY REVENUE CLASS
|
|
|
|
|
|
|
|
|
|||||||||||
Residential
|
$
|
50,783
|
|
|
$
|
43,656
|
|
|
$
|
42,103
|
|
|
$
|
36,471
|
|
|
$
|
37,963
|
|
Commercial
|
10,138
|
|
|
8,621
|
|
|
7,725
|
|
|
6,729
|
|
|
7,150
|
|
|||||
Industrial
|
3,080
|
|
|
1,817
|
|
|
1,755
|
|
|
1,459
|
|
|
1,822
|
|
|||||
Public Authority
|
2,675
|
|
|
2,253
|
|
|
2,280
|
|
|
1,926
|
|
|
2,027
|
|
|||||
Fire Protection
|
15,592
|
|
|
11,890
|
|
|
11,430
|
|
|
10,958
|
|
|
10,606
|
|
|||||
Other (Including Non-Metered Accounts)
|
1,570
|
|
|
1,165
|
|
|
1,115
|
|
|
1,848
|
|
|
1,702
|
|
|||||
Total Operating Revenues
|
$
|
83,838
|
|
|
$
|
69,402
|
|
|
$
|
66,408
|
|
|
$
|
59,391
|
|
|
$
|
61,270
|
|
Number of Customers (End of Year)
|
121,791
|
|
|
90,023
|
|
|
89,402
|
|
|
88,534
|
|
|
87,361
|
|
|||||
Billed Consumption (Millions of Gallons)
|
8,332
|
|
|
6,616
|
|
|
6,958
|
|
|
6,472
|
|
|
6,895
|
|
|||||
Number of Employees
|
259
|
|
|
198
|
|
|
204
|
|
|
225
|
|
|
226
|
|
|
Increase (Decrease) in Pension Expense
|
|
Increase (Decrease) in Postretirement Expense
|
||||
1% Increase in the discount rate
|
$
|
(972,000
|
)
|
|
$
|
(177,000
|
)
|
1% Decrease in the discount rate
|
$
|
1,181,000
|
|
|
$
|
207,000
|
|
|
Gross Construction Expenditures
|
|
Construction Funded by Developers & Others
|
|
Construction Funded by Company
|
||||||
2012
|
$
|
25,933,000
|
|
|
$
|
1,280,000
|
|
|
$
|
24,653,000
|
|
2011
|
$
|
24,012,000
|
|
|
$
|
1,154,000
|
|
|
$
|
22,858,000
|
|
2010
|
$
|
26,692,000
|
|
|
$
|
452,000
|
|
|
$
|
26,240,000
|
|
2013 (Projected)
|
$
|
31,100,000
|
|
|
**
|
|
|
$
|
31,100,000
|
|
Payments due by Periods
|
||||||||||||||||||||
(in thousands)
|
||||||||||||||||||||
Contractual Obligations
|
|
Total
|
|
Less
than 1
year
|
|
Years
2 and 3
|
|
Years
4 and 5
|
|
More
than 5
years
|
||||||||||
Long-Term Debt (LTD)
|
|
$
|
179,779
|
|
|
$
|
1,304
|
|
|
$
|
6,545
|
|
|
$
|
7,023
|
|
|
$
|
164,907
|
|
Interest on LTD
|
|
100,033
|
|
|
7,513
|
|
|
14,537
|
|
|
13,887
|
|
|
64,096
|
|
|||||
Operating Lease Obligations
|
|
146
|
|
|
96
|
|
|
28
|
|
|
20
|
|
|
2
|
|
|||||
Purchase Obligations (1) (2)
|
|
94,023
|
|
|
1,319
|
|
|
2,759
|
|
|
2,711
|
|
|
87,234
|
|
|||||
Long-Term Compensation Agreements (3)
|
|
58,017
|
|
|
4,259
|
|
|
12,215
|
|
|
12,125
|
|
|
29,418
|
|
|||||
Total (4) (5)
|
|
$
|
431,998
|
|
|
$
|
14,491
|
|
|
$
|
36,084
|
|
|
$
|
35,766
|
|
|
$
|
345,657
|
|
Business Segment
|
|
2012 Net Income
|
|
2011 Net Income
|
|
Increase (Decrease)
|
||||||
Water Activities
|
|
$
|
11,265
|
|
|
$
|
10,123
|
|
|
$
|
1,142
|
|
Real Estate
|
|
951
|
|
|
176
|
|
|
775
|
|
|||
Services and Rentals
|
|
1,424
|
|
|
1,001
|
|
|
423
|
|
|||
Total
|
|
$
|
13,640
|
|
|
$
|
11,300
|
|
|
$
|
2,340
|
|
|
Actual 2012
|
|
Actual 2011
|
|
Actual Increase (Decrease)
|
|
Maine Water and BSWC 2012
|
|
Adjusted Increase / (Decrease)
|
||||||||||
Operating Revenues
|
$
|
83,838
|
|
|
$
|
69,402
|
|
|
$
|
14,436
|
|
|
$
|
11,502
|
|
|
$
|
2,934
|
|
Operation and Maintenance
|
40,326
|
|
|
32,662
|
|
|
7,664
|
|
|
5,431
|
|
|
2,233
|
|
|||||
Depreciation
|
9,782
|
|
|
7,773
|
|
|
2,009
|
|
|
1,616
|
|
|
393
|
|
|||||
Income Taxes
|
6,422
|
|
|
6,966
|
|
|
(544
|
)
|
|
1,033
|
|
|
(1,577
|
)
|
|||||
Taxes Other than Income Taxes
|
7,699
|
|
|
6,441
|
|
|
1,258
|
|
|
937
|
|
|
321
|
|
|||||
Other Utility Income
|
812
|
|
|
847
|
|
|
(35
|
)
|
|
1
|
|
|
(36
|
)
|
|||||
Other Deductions
|
(813
|
)
|
|
(798
|
)
|
|
(15
|
)
|
|
(14
|
)
|
|
(1
|
)
|
|||||
Interest and Debt Expense (net of AFUDC)
|
8,343
|
|
|
5,486
|
|
|
2,857
|
|
|
998
|
|
|
1,859
|
|
|||||
Total Income from Water Activities
|
$
|
11,265
|
|
|
$
|
10,123
|
|
|
$
|
1,142
|
|
|
$
|
1,474
|
|
|
$
|
(332
|
)
|
Expense Components
|
|
Actual 2012
|
|
Actual 2011
|
|
Actual Increase (Decrease)
|
|
Maine Water and BSWC 2012
|
|
Adjusted Increase / (Decrease)
|
||||||||||
Pension
|
|
$
|
3,683
|
|
|
$
|
1,959
|
|
|
$
|
1,724
|
|
|
$
|
547
|
|
|
$
|
1,177
|
|
Other benefits
|
|
1,260
|
|
|
569
|
|
|
691
|
|
|
169
|
|
|
522
|
|
|||||
Labor
|
|
13,466
|
|
|
11,187
|
|
|
2,279
|
|
|
2,048
|
|
|
231
|
|
|||||
Maintenance
|
|
2,781
|
|
|
2,185
|
|
|
596
|
|
|
383
|
|
|
213
|
|
|||||
Vehicles
|
|
1,795
|
|
|
1,636
|
|
|
159
|
|
|
13
|
|
|
146
|
|
|||||
Amston Lake water quality monitoring costs (non-labor)
|
|
139
|
|
|
—
|
|
|
139
|
|
|
—
|
|
|
139
|
|
|||||
Regulatory commission expense
|
|
427
|
|
|
232
|
|
|
195
|
|
|
77
|
|
|
118
|
|
|||||
Purchased water
|
|
1,398
|
|
|
1,204
|
|
|
194
|
|
|
129
|
|
|
65
|
|
|||||
Investor relations
|
|
615
|
|
|
555
|
|
|
60
|
|
|
—
|
|
|
60
|
|
|||||
Outside services
|
|
1,531
|
|
|
1,028
|
|
|
503
|
|
|
451
|
|
|
52
|
|
|||||
Medical
|
|
2,453
|
|
|
2,040
|
|
|
413
|
|
|
384
|
|
|
29
|
|
|||||
Utility costs
|
|
3,605
|
|
|
3,269
|
|
|
336
|
|
|
356
|
|
|
(20
|
)
|
|||||
Property and liability insurance
|
|
1,020
|
|
|
977
|
|
|
43
|
|
|
108
|
|
|
(65
|
)
|
|||||
Customer
|
|
1,217
|
|
|
1,155
|
|
|
62
|
|
|
215
|
|
|
(153
|
)
|
|||||
Post retirement medical
|
|
851
|
|
|
1,129
|
|
|
(278
|
)
|
|
12
|
|
|
(290
|
)
|
|||||
Other
|
|
4,085
|
|
|
3,537
|
|
|
548
|
|
|
539
|
|
|
9
|
|
|||||
Total
|
|
$
|
40,326
|
|
|
$
|
32,662
|
|
|
$
|
7,664
|
|
|
$
|
5,431
|
|
|
$
|
2,233
|
|
▪
|
Pension costs increased over the prior year primarily due to a reduction to the discount rate in 2012;
|
▪
|
The increase in Other benefits was primarily attributable to an increase in costs associated with awards made under the Performance Stock Program and costs associated with the Company's non-officer incentive plan;
|
▪
|
Labor costs increased by approximately 2.1% primarily due to regular wage and salary increases;
|
▪
|
During the first quarter of 2012, the Company received notification of elevated copper levels observed in the homes of certain customers in our Amston Lake system. As a result, Connecticut Water incurred costs associated with the monitoring of water sources and customer homes. While copper levels have returned to normal, Connecticut Water continues to monitor the copper levels in the Amston Lake system; and
|
▪
|
Regulatory commission expense increased primarily due to higher statutory fees and costs associated with cases heard before PURA.
|
▪
|
Utility costs decreased primarily due to increased efficiency at our locations after conducting energy audits;
|
▪
|
The decrease in Customer costs was primarily driven by the reduction in bad debt expense in the year ended December 31, 2012 compared to the same period of 2011 due to the progress made in resolving issues related to the 2010 ERP implementation discussed above. Partially offsetting this decrease was an increase in collection costs; and
|
▪
|
Post-retirement medical costs decreased primarily due to changes to the plan made in May 2011 that limited life time benefits to $100,000.
|
Business Segment
|
|
2011 Net Income
|
|
2010 Net Income
|
|
Increase (Decrease)
|
||||||
Water Activities
|
|
$
|
10,123
|
|
|
$
|
8,669
|
|
|
$
|
1,454
|
|
Real Estate
|
|
176
|
|
|
230
|
|
|
(54
|
)
|
|||
Services and Rentals
|
|
1,001
|
|
|
899
|
|
|
102
|
|
|||
Total
|
|
$
|
11,300
|
|
|
$
|
9,798
|
|
|
$
|
1,502
|
|
|
2011
|
|
2010
|
|
Increase (Decrease)
|
||||||
Operating Revenues
|
$
|
69,402
|
|
|
$
|
66,408
|
|
|
$
|
2,994
|
|
Operation and Maintenance
|
32,662
|
|
|
33,105
|
|
|
(443
|
)
|
|||
Depreciation
|
7,773
|
|
|
7,088
|
|
|
685
|
|
|||
Income Taxes
|
6,966
|
|
|
5,323
|
|
|
1,643
|
|
|||
Taxes Other than Income Taxes
|
6,441
|
|
|
6,271
|
|
|
170
|
|
|||
Organizational Review Charge
|
—
|
|
|
786
|
|
|
(786
|
)
|
|||
Other Utility Income
|
847
|
|
|
742
|
|
|
105
|
|
|||
Other Deductions
|
(798
|
)
|
|
(226
|
)
|
|
(572
|
)
|
|||
Interest and Debt Expense (net of AFUDC)
|
5,486
|
|
|
5,682
|
|
|
(196
|
)
|
|||
Total Income from Water Activities
|
$
|
10,123
|
|
|
$
|
8,669
|
|
|
$
|
1,454
|
|
Components of O&M
|
|
2011
|
|
2010
|
|
Increase (Decrease)
|
||||||
Maintenance
|
|
$
|
2,185
|
|
|
$
|
1,783
|
|
|
$
|
402
|
|
Other employee benefit costs
|
|
645
|
|
|
351
|
|
|
294
|
|
|||
Medical expense
|
|
1,964
|
|
|
1,714
|
|
|
250
|
|
|||
Vehicle
|
|
1,636
|
|
|
1,481
|
|
|
155
|
|
|||
Post-retirement medical costs
|
|
1,128
|
|
|
983
|
|
|
145
|
|
|||
Investor relations
|
|
555
|
|
|
475
|
|
|
80
|
|
|||
Customer
|
|
1,154
|
|
|
1,075
|
|
|
79
|
|
|||
Regulatory commission expense
|
|
232
|
|
|
301
|
|
|
(69
|
)
|
|||
Property & liability insurance
|
|
978
|
|
|
1,071
|
|
|
(93
|
)
|
|||
Water treatment (including chemicals)
|
|
2,389
|
|
|
2,553
|
|
|
(164
|
)
|
|||
Utility costs
|
|
3,269
|
|
|
3,527
|
|
|
(258
|
)
|
|||
Outside services
|
|
1,028
|
|
|
1,404
|
|
|
(376
|
)
|
|||
Labor
|
|
11,187
|
|
|
12,093
|
|
|
(906
|
)
|
|||
Other
|
|
4,312
|
|
|
4,294
|
|
|
18
|
|
|||
Total O&M Expense
|
|
$
|
32,662
|
|
|
$
|
33,105
|
|
|
$
|
(443
|
)
|
▪
|
Labor costs decreased in 2011 primarily due to the workforce reduction as part of the Organizational Review conducted in the third quarter of 2010. The Company’s headcount decreased by approximately 25 people as compared to the beginning of 2010;
|
▪
|
Outside services decreased by $376,000 during 2011 due primarily to a reduction in consulting and legal fees. The reduction in consulting costs was primarily due to training services provided prior to the launch of the Company’s Enterprise Resource Planning (ERP) system in early 2010;
|
▪
|
Utility costs decreased by approximately 7% when compared to 2010 due to reduced electrical costs. In December 2010, the Company received lower rates on its electricity through new suppliers and improved efficiency at many of our facilities through the completion of energy audits; and
|
▪
|
Property and liability insurance expense decreased by $93,000 due to cost reductions in our package and workers’ compensation policies. Workers’ compensation decreased primarily due to the Organizational Review and the corresponding headcount reduction.
|
▪
|
Water treatment costs decreased by 6% primarily due to a decrease in water production in 2011 when compared to 2010; and
|
▪
|
Regulatory commission expense decreased by $69,000 due to the deferral of costs associated with a PURA docket examining the feasibility of uniform methodology for determining return on equity for water companies.
|
▪
|
Maintenance expense increased by $402,000 in 2011 when compared to 2010 primarily due to an increase in the cost to repair main breaks and increased computer maintenance costs, including the costs to maintain the ERP system implemented in 2010;
|
▪
|
Other employee benefit costs increased by $294,000 primarily due to the introduction of a non-officer incentive program offered to certain managers for enacting cost reducing measures that will return savings in future years. Additionally, costs related to certain stock based compensation increased during 2011;
|
▪
|
The Company saw an increase in its Medical expense primarily as a result of an increase in the cost of claims and the administration of the plan, offset by a decrease in dental claims and administration;
|
▪
|
The $145,000 increase in Post-retirement medical costs from 2010 to 2011 was primarily due to a decrease in the discount rate used to determine the future liabilities of the plans and the decline in the market value of the plans’ assets in prior years. During the second quarter of 2011, the Company made a change to its Post-retirement medical plan to limit the life-time benefits of the participants to $100,000;
|
▪
|
Investor relations costs increased by $80,000 primarily due to increases in directors’ fees and expenses and an increase in the cost to prepare and print the Company’s proxy statement; and
|
▪
|
Customer costs increased by 7% primarily due to an increase in uncollectible accounts. During 2011, the Company has seen progress towards resolving the collection issues, primarily through the ability to charge interest and shut off customers for non-payment and expects continued improvement throughout 2012.
|
(a)
|
|
1
|
|
|
Financial Statements:
|
|
|
|
|
|
|
|
The report of independent registered public accounting firm and the Company’s Consolidated Financial Statements listed in the Index to Consolidated Financial Statements on page F-1 hereof are filed as part of this report, commencing on page F-2
|
||
|
|
|
|
|
|
|
Page
|
|
|
|
|
|
Index to Consolidated Financial Statements and Schedule
|
|
39
|
|
|
|
|
|
Report of Independent Registered Public Accounting Firm
|
|
40
|
|
|
|
|
|
Consolidated Statements of Income for the years ended December 31, 2012, 2011 and 2010
|
|
41
|
|
|
|
|
|
Consolidated Statements of Comprehensive Income for the years ended December 31, 2012, 2011 and 2010
|
|
41
|
|
|
|
|
|
Consolidated Balance Sheets at December 31, 2012 and 2011
|
|
42
|
|
|
|
|
|
Consolidated Statements of Cash Flows for the years ended December 31, 2012, 2011 and 2010
|
|
43
|
|
|
|
|
|
Notes to Consolidated Financial Statements
|
|
44
|
|
|
2
|
|
|
Financial Statement Schedule:
|
|
|
|
|
|
|
|
The following schedule of the Company is included on the attached page as indicated
|
||
|
|
|
|
|
Schedule II Valuation and Qualifying Accounts and Reserves for the years ended December 31, 2012, 2011 and 2010
|
|
79
|
|
|
|
|
|
All other schedules provided for in the applicable regulations of the Securities and Exchange Commission have been omitted because of the absence of conditions under which they are required or because the required information is set forth in the financial statements or notes thereto.
|
|
|
(b)
|
|
|
|
|
Exhibits
|
|
|
|
|
|
|
|
Exhibits for Connecticut Water Service Inc., are in the Index to Exhibits
|
|
73
|
|
|
|
|
|
Exhibits heretofore filed with the Securities and Exchange Commission as indicated below are incorporated herein by reference and made a part hereof as if filed herewith. Exhibits marked by asterisk (* or **) are being filed or furnished herewith.
|
|
|
|
Page
|
|
|
Index to Consolidated Financial Statements and Schedule
|
|
39
|
|
|
|
|
|
Report of Independent Registered Public Accounting Firm
|
|
40
|
|
|
|
|
|
Consolidated Statements of Income for the years ended December 31, 2012, 2011 and 2010
|
|
41
|
|
|
|
|
|
Consolidated Statements of Comprehensive Income for the years ended December 31, 2012, 2011 and 2010
|
|
41
|
|
|
|
|
|
Consolidated Balance Sheets at December 31, 2012 and 2011
|
|
42
|
|
|
|
|
|
Consolidated Statements of Cash Flows for the years ended December 31, 2012, 2011 and 2010
|
|
43
|
|
|
|
|
|
Notes to Consolidated Financial Statements
|
|
44
|
|
|
|
|
|
Schedule II Valuation and Qualifying Accounts and Reserves for the years ended December 31, 2012, 2011 and 2010
|
|
79
|
|
CONSOLIDATED STATEMENTS OF INCOME
|
|
|
|
|
|
|
||||||
For the Years Ended December 31, (in thousands, except per share data)
|
|
2012
|
|
|
2011
|
|
|
2010
|
|
|||
Operating Revenues
|
|
$
|
83,838
|
|
|
$
|
69,402
|
|
|
$
|
66,408
|
|
Operating Expenses
|
|
|
|
|
|
|
|
|
|
|||
Operation and Maintenance
|
|
40,326
|
|
|
32,662
|
|
|
33,105
|
|
|||
Depreciation
|
|
9,782
|
|
|
7,773
|
|
|
7,088
|
|
|||
Income Taxes
|
|
6,422
|
|
|
6,966
|
|
|
5,323
|
|
|||
Taxes Other Than Income Taxes
|
|
7,699
|
|
|
6,441
|
|
|
6,271
|
|
|||
Organizational Review Charge
|
|
—
|
|
|
—
|
|
|
786
|
|
|||
Total Operating Expenses
|
|
64,229
|
|
|
53,842
|
|
|
52,573
|
|
|||
Net Operating Revenues
|
|
19,609
|
|
|
15,560
|
|
|
13,835
|
|
|||
Other Utility Income, Net of Taxes
|
|
812
|
|
|
847
|
|
|
742
|
|
|||
Total Utility Operating Income
|
|
20,421
|
|
|
16,407
|
|
|
14,577
|
|
|||
Other Income (Deductions), Net of Taxes
|
|
|
|
|
|
|
|
|
|
|||
Gain on Real Estate Transactions
|
|
951
|
|
|
176
|
|
|
230
|
|
|||
Non-Water Sales Earnings
|
|
1,424
|
|
|
1,001
|
|
|
899
|
|
|||
Allowance for Funds Used During Construction
|
|
238
|
|
|
188
|
|
|
171
|
|
|||
Other
|
|
(813
|
)
|
|
(798
|
)
|
|
(226
|
)
|
|||
Total Other Income (Deductions), Net of Taxes
|
|
1,800
|
|
|
567
|
|
|
1,074
|
|
|||
Interest and Debt Expenses
|
|
|
|
|
|
|
|
|
|
|||
Interest on Long-Term Debt
|
|
7,612
|
|
|
4,602
|
|
|
4,628
|
|
|||
Other Interest Charges
|
|
575
|
|
|
651
|
|
|
784
|
|
|||
Amortization of Debt Expense
|
|
394
|
|
|
421
|
|
|
441
|
|
|||
Total Interest and Debt Expenses
|
|
8,581
|
|
|
5,674
|
|
|
5,853
|
|
|||
Net Income
|
|
13,640
|
|
|
11,300
|
|
|
9,798
|
|
|||
Preferred Stock Dividend Requirement
|
|
38
|
|
|
38
|
|
|
38
|
|
|||
Total Net Income Applicable to Common Stock
|
|
$
|
13,602
|
|
|
$
|
11,262
|
|
|
$
|
9,760
|
|
Weighted Average Common Shares Outstanding:
|
|
|
|
|
|
|
|
|
|
|||
Basic
|
|
8,763
|
|
|
8,610
|
|
|
8,532
|
|
|||
Diluted
|
|
8,900
|
|
|
8,720
|
|
|
8,633
|
|
|||
Earnings Per Common Share:
|
|
|
|
|
|
|
|
|
|
|||
Basic
|
|
$
|
1.55
|
|
|
$
|
1.31
|
|
|
$
|
1.14
|
|
Diluted
|
|
$
|
1.53
|
|
|
$
|
1.29
|
|
|
$
|
1.13
|
|
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
|
|
|
|
|
|
|
|
|
|
|||
For the Years Ended December 31, (in thousands)
|
|
2012
|
|
|
2011
|
|
|
2010
|
|
|||
|
|
|
|
|
|
|
||||||
Net Income Applicable to Common Stock
|
|
$
|
13,602
|
|
|
$
|
11,262
|
|
|
$
|
9,760
|
|
Other Comprehensive Income, net of tax
|
|
|
|
|
|
|
|
|
|
|||
Qualified cash flow hedging instrument net of tax benefit of $1
|
|
|
|
|
|
|
|
|
|
|||
in 2012, 2011, and 2010, respectively
|
|
3
|
|
|
3
|
|
|
3
|
|
|||
Adjustment to post-retirement benefit plans, net of tax (benefit)
|
|
|
|
|
|
|
|
|
|
|||
expense of $(389), $(231), and $12 in 2012, 2011 and 2010, respectively
|
|
(566
|
)
|
|
(361
|
)
|
|
16
|
|
|||
Unrealized Investment gain (loss), net of tax expense of $40,
|
|
|
|
|
|
|
|
|
|
|||
$31 and $30 in 2012, 2011 and 2010, respectively
|
|
60
|
|
|
(31
|
)
|
|
47
|
|
|||
Other Comprehensive (Loss)/Income, net of tax
|
|
$
|
(503
|
)
|
|
$
|
(389
|
)
|
|
$
|
66
|
|
Comprehensive Income
|
|
$
|
13,099
|
|
|
$
|
10,873
|
|
|
$
|
9,826
|
|
|
|
|
|
|
|
|
||||||
The accompanying notes are an integral part of these consolidated financial statements.
|
CONSOLIDATED BALANCE SHEETS
|
|
|
|
|
||||
December 31, (in thousands, except share amounts)
|
|
2012
|
|
|
2011
|
|
||
ASSETS
|
|
|
|
|
||||
Utility Plant
|
|
$
|
611,787
|
|
|
$
|
487,540
|
|
Construction Work in Progress
|
|
7,734
|
|
|
6,160
|
|
||
|
|
619,521
|
|
|
493,700
|
|
||
Accumulated Provision for Depreciation
|
|
(171,610
|
)
|
|
(133,673
|
)
|
||
Net Utility Plant
|
|
447,911
|
|
|
360,027
|
|
||
Other Property and Investments
|
|
6,394
|
|
|
5,563
|
|
||
Cash and Cash Equivalents
|
|
13,150
|
|
|
1,012
|
|
||
Accounts Receivable (Less Allowance, 2012 - $1,058; 2011 - $1,088)
|
|
11,526
|
|
|
8,436
|
|
||
Accrued Unbilled Revenues
|
|
7,233
|
|
|
6,477
|
|
||
Materials and Supplies, at Average Cost
|
|
1,629
|
|
|
1,126
|
|
||
Prepayments and Other Current Assets
|
|
2,824
|
|
|
1,830
|
|
||
Total Current Assets
|
|
36,362
|
|
|
18,881
|
|
||
Restricted Cash
|
|
9,820
|
|
|
15,930
|
|
||
Unamortized Debt Issuance Expense
|
|
7,411
|
|
|
7,296
|
|
||
Unrecovered Income Taxes - Regulatory Asset
|
|
9,871
|
|
|
7,355
|
|
||
Pension Benefits - Regulatory Asset
|
|
18,319
|
|
|
13,862
|
|
||
Post-Retirement Benefits Other Than Pension - Regulatory Asset
|
|
3,022
|
|
|
3,967
|
|
||
Goodwill
|
|
31,685
|
|
|
3,608
|
|
||
Deferred Charges and Other Costs
|
|
8,180
|
|
|
6,442
|
|
||
Total Regulatory and Other Long-Term Assets
|
|
88,308
|
|
|
58,460
|
|
||
Total Assets
|
|
$
|
578,975
|
|
|
$
|
442,931
|
|
CAPITALIZATION AND LIABILITIES
|
|
|
|
|
|
|
||
Common Stockholders' Equity:
|
|
|
|
|
|
|
||
Common Stock Without Par Value:
|
|
|
|
|
|
|
||
Authorized - 25,000,000 Shares - Issued and Outstanding:
|
|
|
|
|||||
2012 - 10,939,486; 2011 - 8,755,398
|
|
$
|
134,873
|
|
|
$
|
72,345
|
|
Retained Earnings
|
|
51,804
|
|
|
46,669
|
|
||
Accumulated Other Comprehensive Loss
|
|
(1,328
|
)
|
|
(825
|
)
|
||
Common Stockholders' Equity
|
|
185,349
|
|
|
118,189
|
|
||
Preferred Stock
|
|
772
|
|
|
772
|
|
||
Long-Term Debt
|
|
178,475
|
|
|
135,256
|
|
||
Total Capitalization
|
|
364,596
|
|
|
254,217
|
|
||
Current Portion of Long-Term Debt
|
|
1,304
|
|
|
—
|
|
||
Interim Bank Loans Payable
|
|
1,660
|
|
|
21,372
|
|
||
Accounts Payable and Accrued Expenses
|
|
10,016
|
|
|
7,166
|
|
||
Accrued Taxes
|
|
—
|
|
|
302
|
|
||
Accrued Interest
|
|
889
|
|
|
1,002
|
|
||
Other Current Liabilities
|
|
2,008
|
|
|
586
|
|
||
Total Current Liabilities
|
|
15,877
|
|
|
30,428
|
|
||
Advances for Construction
|
|
31,030
|
|
|
32,517
|
|
||
Contributions in Aid of Construction
|
|
77,372
|
|
|
60,679
|
|
||
Deferred Federal and State Income Taxes
|
|
40,869
|
|
|
31,075
|
|
||
Unfunded Future Income Taxes
|
|
8,992
|
|
|
7,355
|
|
||
Long-Term Compensation Arrangements
|
|
36,430
|
|
|
25,232
|
|
||
Unamortized Investment Tax Credits
|
|
1,490
|
|
|
1,313
|
|
||
Other Long-Term Liabilities
|
|
2,319
|
|
|
115
|
|
||
Total Long-Term Liabilities
|
|
198,502
|
|
|
158,286
|
|
||
Commitments and Contingencies
|
|
|
|
|
|
|
||
Total Capitalization and Liabilities
|
|
$
|
578,975
|
|
|
$
|
442,931
|
|
|
|
|
|
|
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
|
|
|
|
|
|
||||||
For the Years Ended December 31, (in thousands)
|
|
2012
|
|
|
2011
|
|
|
2010
|
|
|||
Operating Activities:
|
|
|
|
|
|
|
||||||
Net Income
|
|
$
|
13,640
|
|
|
$
|
11,300
|
|
|
$
|
9,798
|
|
Adjustments to Reconcile Net Income to Net Cash
|
|
|
|
|
|
|
|
|
|
|||
Provided by Operating Activities:
|
|
|
|
|
|
|
|
|
|
|||
Deferred Revenues
|
|
239
|
|
|
239
|
|
|
239
|
|
|||
Allowance for Funds Used During Construction
|
|
(239
|
)
|
|
(188
|
)
|
|
(171
|
)
|
|||
Depreciation (including $270 in 2012, $812 in 2011, and $806 in 2010 charged to other accounts)
|
|
10,052
|
|
|
8,585
|
|
|
7,894
|
|
|||
Gain on Sale of Land
|
|
(951
|
)
|
|
(176
|
)
|
|
(230
|
)
|
|||
Change in Assets and Liabilities:
|
|
|
|
|
|
|
|
|
|
|||
(Increase) Decrease in Accounts Receivable and Accrued Unbilled Revenues
|
|
(1,333
|
)
|
|
1,566
|
|
|
(4,561
|
)
|
|||
(Increase) Decrease in Other Current Assets
|
|
(24
|
)
|
|
40
|
|
|
(380
|
)
|
|||
Decrease in Other Non-Current Items, net
|
|
5,645
|
|
|
2,681
|
|
|
968
|
|
|||
Increase in Accounts Payable, Accrued Expenses and Other Current Liabilities
|
|
166
|
|
|
138
|
|
|
1,272
|
|
|||
(Decrease) Increase in Deferred Income Taxes and Investment Tax Credits, Net
|
|
(826
|
)
|
|
2,164
|
|
|
1,938
|
|
|||
Total Adjustments
|
|
12,729
|
|
|
15,049
|
|
|
6,969
|
|
|||
Net Cash and Cash Equivalents Provided by Operating Activities
|
|
26,369
|
|
|
26,349
|
|
|
16,767
|
|
|||
Investing Activities:
|
|
|
|
|
|
|
|
|
|
|||
Company Financed Additions to Utility Plant
|
|
(24,653
|
)
|
|
(22,858
|
)
|
|
(26,240
|
)
|
|||
Advances from Others for Construction
|
|
(1,041
|
)
|
|
(966
|
)
|
|
(281
|
)
|
|||
Net Additions to Utility Plant Used in Continuing Operations
|
|
(25,694
|
)
|
|
(23,824
|
)
|
|
(26,521
|
)
|
|||
Purchase of water systems, net of cash acquired
|
|
(35,754
|
)
|
|
(216
|
)
|
|
(297
|
)
|
|||
Purchase of customer contracts
|
|
—
|
|
|
—
|
|
|
(900
|
)
|
|||
Proceeds on Real Estate Transactions
|
|
1,450
|
|
|
—
|
|
|
—
|
|
|||
Release of Restricted Cash
|
|
6,117
|
|
|
1,226
|
|
|
11,460
|
|
|||
Net Cash and Cash Equivalents Used in Investing Activities
|
|
(53,881
|
)
|
|
(22,814
|
)
|
|
(16,258
|
)
|
|||
Financing Activities:
|
|
|
|
|
|
|
|
|
|
|||
Net Proceeds from Interim Bank Loans
|
|
1,660
|
|
|
21,372
|
|
|
26,342
|
|
|||
Net Repayment of Interim Bank Loans
|
|
(21,372
|
)
|
|
(26,342
|
)
|
|
(25,000
|
)
|
|||
Repayment of Long-Term Debt Including Current Portion
|
|
(75,430
|
)
|
|
(410
|
)
|
|
(280
|
)
|
|||
Proceeds from Issuance of Long-Term Debt
|
|
92,840
|
|
|
8,061
|
|
|
—
|
|
|||
Proceeds from Issuance of Common Stock
|
|
51,101
|
|
|
1,346
|
|
|
1,358
|
|
|||
Proceeds from Exercise of Stock Options
|
|
631
|
|
|
146
|
|
|
287
|
|
|||
Costs Incurred to Issue Long-Term Debt and Common Stock
|
|
(2,316
|
)
|
|
(380
|
)
|
|
(2
|
)
|
|||
Advances from Others for Construction
|
|
1,041
|
|
|
966
|
|
|
281
|
|
|||
Cash Dividends Paid
|
|
(8,505
|
)
|
|
(8,234
|
)
|
|
(7,980
|
)
|
|||
Net Cash and Cash Equivalents Provided by (Used in) Financing Activities
|
|
39,650
|
|
|
(3,475
|
)
|
|
(4,994
|
)
|
|||
Net Increase (Decrease) in Cash and Cash Equivalents
|
|
12,138
|
|
|
60
|
|
|
(4,485
|
)
|
|||
Cash and Cash Equivalents at Beginning of Year
|
|
1,012
|
|
|
952
|
|
|
5,437
|
|
|||
Cash and Cash Equivalents at End of Year
|
|
$
|
13,150
|
|
|
$
|
1,012
|
|
|
$
|
952
|
|
Non-Cash Investing and Financing Activities:
|
|
|
|
|
|
|
|
|
|
|||
Stock for stock acquisition of Biddeford & Saco Water Company
|
|
$
|
12,012
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Non-Cash Contributed Utility Plant (see Note 1 for details)
|
|
$
|
1,089
|
|
|
$
|
334
|
|
|
$
|
707
|
|
Short-term Investment of Bond Proceeds Held in Trust
|
|
$
|
9,820
|
|
|
$
|
15,930
|
|
|
$
|
1,226
|
|
Supplemental Disclosures of Cash Flow Information:
|
|
|
|
|
|
|
|
|
|
|||
Cash Paid for Continuing Operations During the Year for:
|
|
|
|
|
|
|
|
|
|
|||
Interest
|
|
$
|
8,488
|
|
|
$
|
5,432
|
|
|
$
|
5,478
|
|
State and Federal Income Taxes
|
|
$
|
6,161
|
|
|
$
|
5,347
|
|
|
$
|
3,814
|
|
The accompanying notes are an integral part of these consolidated financial statements.
|
|
|
|
|
(in thousands)
|
December 31,
|
||||||
|
2012
|
|
2011
|
||||
Assets:
|
|
|
|
||||
Pension and postretirement benefits
|
$
|
21,341
|
|
|
$
|
17,829
|
|
Unrecovered income taxes and other
|
9,871
|
|
|
7,355
|
|
||
Deferred revenue (included in deferred charges)
|
3,644
|
|
|
3,883
|
|
||
Other (included in deferred charges)
|
3,151
|
|
|
2,464
|
|
||
Total regulatory assets
|
$
|
38,007
|
|
|
$
|
31,531
|
|
Liabilities:
|
|
|
|
|
|
||
Other (included in other current liabilities)
|
$
|
499
|
|
|
$
|
—
|
|
Unamortized Investment Tax Credits
|
1,490
|
|
|
1,313
|
|
||
Unfunded future income taxes and other
|
11,215
|
|
|
7,355
|
|
||
Total regulatory liabilities
|
$
|
13,204
|
|
|
$
|
8,668
|
|
(in thousands)
|
2012
|
|
2011
|
|
2010
|
||||||
Additions to Utility Plant:
|
|
|
|
|
|
||||||
Company Financed
|
$
|
24,653
|
|
|
$
|
22,858
|
|
|
$
|
26,240
|
|
Allowance for Funds Used During Construction
|
239
|
|
|
188
|
|
|
171
|
|
|||
Subtotal – Utility Plant Increase to Rate Base
|
24,892
|
|
|
23,046
|
|
|
26,411
|
|
|||
Advances from Others for Construction
|
1,041
|
|
|
966
|
|
|
281
|
|
|||
Net Additions to Utility Plant
|
$
|
25,933
|
|
|
$
|
24,012
|
|
|
$
|
26,692
|
|
Years ended December 31,
|
2012
|
|
2011
|
|
2010
|
||||||
Numerator (in thousands)
|
|
|
|
|
|
||||||
Basic Net Income Applicable to Common Stock
|
$
|
13,602
|
|
|
$
|
11,262
|
|
|
$
|
9,760
|
|
Diluted Net Income Applicable to Common Stock
|
$
|
13,602
|
|
|
$
|
11,262
|
|
|
$
|
9,760
|
|
Denominator (in thousands)
|
|
|
|
|
|
|
|
|
|||
Basic Weighted Average Shares Outstanding
|
8,763
|
|
|
8,610
|
|
|
8,532
|
|
|||
Dilutive Effect of Stock Awards
|
137
|
|
|
110
|
|
|
101
|
|
|||
Diluted Weighted Average Shares Outstanding
|
8,900
|
|
|
8,720
|
|
|
8,633
|
|
|||
Earnings per Share
|
|
|
|
|
|
|
|
|
|||
Basic Earnings per Share
|
$
|
1.55
|
|
|
$
|
1.31
|
|
|
$
|
1.14
|
|
Dilutive Effect of Stock Awards
|
0.02
|
|
|
0.02
|
|
|
0.01
|
|
|||
Diluted Earnings per Share
|
$
|
1.53
|
|
|
$
|
1.29
|
|
|
$
|
1.13
|
|
(in thousands)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Federal Classified as Operating Expense
|
|
$
|
6,103
|
|
|
$
|
6,709
|
|
|
$
|
5,513
|
|
Federal Classified as Other Utility Income
|
|
427
|
|
|
424
|
|
|
368
|
|
|||
Federal Classified as Other Income
|
|
|
|
|
|
|
|
|
|
|||
Land Sales and Donations
|
|
477
|
|
|
(176
|
)
|
|
(230
|
)
|
|||
Non-Water Sales
|
|
748
|
|
|
558
|
|
|
487
|
|
|||
Other
|
|
(900
|
)
|
|
(276
|
)
|
|
(257
|
)
|
|||
Total Federal Income Tax Expense
|
|
6,855
|
|
|
7,239
|
|
|
5,881
|
|
|||
State Classified as Operating Expense
|
|
319
|
|
|
257
|
|
|
(190
|
)
|
|||
State Classified as Other Utility Income
|
|
121
|
|
|
112
|
|
|
97
|
|
|||
State Classified as Other Income
|
|
|
|
|
|
|
|
|
|
|||
Land Sales and Donations
|
|
(97
|
)
|
|
—
|
|
|
—
|
|
|||
Non-Water Sales
|
|
180
|
|
|
143
|
|
|
120
|
|
|||
Other
|
|
(47
|
)
|
|
(75
|
)
|
|
(43
|
)
|
|||
Total State Income Tax Expense
|
|
476
|
|
|
437
|
|
|
(16
|
)
|
|||
Total Income Tax Expense
|
|
$
|
7,331
|
|
|
$
|
7,676
|
|
|
$
|
5,865
|
|
(in thousands)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Current Income Taxes
|
|
|
|
|
|
|
||||||
Federal
|
|
$
|
4,747
|
|
|
$
|
5,002
|
|
|
$
|
3,902
|
|
State
|
|
511
|
|
|
428
|
|
|
338
|
|
|||
Total Current
|
|
5,258
|
|
|
5,430
|
|
|
4,240
|
|
|||
Deferred Income Taxes, Net
|
|
|
|
|
|
|
|
|
|
|||
Federal
|
|
|
|
|
|
|
|
|
|
|||
Investment Tax Credit
|
|
(71
|
)
|
|
(63
|
)
|
|
(61
|
)
|
|||
Deferred Revenue
|
|
(77
|
)
|
|
(75
|
)
|
|
(75
|
)
|
|||
Land Donations
|
|
29
|
|
|
392
|
|
|
201
|
|
|||
Depreciation
|
|
2,411
|
|
|
1,990
|
|
|
1,909
|
|
|||
Other
|
|
(184
|
)
|
|
(7
|
)
|
|
5
|
|
|||
Total Federal
|
|
2,108
|
|
|
2,237
|
|
|
1,979
|
|
|||
State
|
|
|
|
|
|
|
|
|
|
|||
Land Donations
|
|
(83
|
)
|
|
—
|
|
|
—
|
|
|||
Other
|
|
48
|
|
|
9
|
|
|
(354
|
)
|
|||
Total State
|
|
(35
|
)
|
|
9
|
|
|
(354
|
)
|
|||
Total Deferred Income Taxes
|
|
2,073
|
|
|
2,246
|
|
|
1,625
|
|
|||
Total Income Tax
|
|
$
|
7,331
|
|
|
$
|
7,676
|
|
|
$
|
5,865
|
|
(in thousands)
|
|
2012
|
|
2011
|
||||
Unrecovered Income Taxes
|
|
$
|
(9,871
|
)
|
|
$
|
(7,355
|
)
|
Deferred Federal and State Income Taxes
|
|
40,869
|
|
|
31,075
|
|
||
Unfunded Future Income Taxes
|
|
8,992
|
|
|
7,355
|
|
||
Unamortized Investment Tax Credits
|
|
1,490
|
|
|
1,313
|
|
||
Other
|
|
(207
|
)
|
|
(185
|
)
|
||
Net Deferred Income Tax Liability
|
|
$
|
41,273
|
|
|
$
|
32,203
|
|
(in thousands)
|
|
2012
|
|
2011
|
||||
Tax Credit Carryforward (1)
|
|
$
|
(2,487
|
)
|
|
$
|
(2,533
|
)
|
Prepaid Income Taxes on CIAC
|
|
(66
|
)
|
|
4
|
|
||
Net Operating Loss Carryforwards (2)
|
|
(385
|
)
|
|
—
|
|
||
Other Comprehensive Income
|
|
(842
|
)
|
|
(486
|
)
|
||
Accelerated Depreciation
|
|
46,379
|
|
|
34,548
|
|
||
Unamortized Investment Tax Credits
|
|
1,490
|
|
|
1,313
|
|
||
Other
|
|
(2,816
|
)
|
|
(643
|
)
|
||
Net Deferred Income Tax Liability
|
|
$
|
41,273
|
|
|
$
|
32,203
|
|
(1)
|
State tax credit carry-forwards expire beginning in 2013 and ending in 2037.
|
(2)
|
Net operating loss carry-forwards expire beginning 2029 and ending in 2032.
|
(in thousands)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Pre-Tax Income
|
|
|
|
|
|
|
||||||
Net Income
|
|
$
|
13,640
|
|
|
$
|
11,300
|
|
|
$
|
9,798
|
|
Income Taxes
|
|
7,331
|
|
|
7,676
|
|
|
5,865
|
|
|||
Total Pre-Tax Income
|
|
$
|
20,971
|
|
|
$
|
18,976
|
|
|
$
|
15,663
|
|
|
|
2012
|
|
2011
|
|
2010
|
|||
Federal Statutory Tax Rate
|
|
35.0
|
%
|
|
34.0
|
%
|
|
34.0
|
%
|
Tax Effect Differences:
|
|
|
|
|
|
|
|
|
|
State Income Taxes Net of Federal Benefit
|
|
1.3
|
%
|
|
1.5
|
%
|
|
—
|
%
|
Property Related Items
|
|
(0.1
|
)%
|
|
1.0
|
%
|
|
—
|
%
|
Charitable Contributions – Land Donation (Net of Valuation Allowance)
|
|
(0.3
|
)%
|
|
(0.9
|
)%
|
|
(1.5
|
)%
|
Pension Costs
|
|
1.6
|
%
|
|
3.5
|
%
|
|
1.8
|
%
|
Unamortized Debt Expense
|
|
(2.6
|
)%
|
|
0.4
|
%
|
|
0.5
|
%
|
Other
|
|
0.1
|
%
|
|
1.0
|
%
|
|
2.6
|
%
|
Effective Income Tax Rate
|
|
35.0
|
%
|
|
40.5
|
%
|
|
37.4
|
%
|
(in thousands, except share data)
|
Shares
|
|
Issuance Amount
|
|
Expense
|
|
Total
|
|||||||
Balance, January 1, 2010
|
8,573,744
|
|
|
$
|
68,896
|
|
|
$
|
(1,610
|
)
|
|
$
|
67,286
|
|
Stock and equivalents issued through Performance Stock Program, Net of Forfeitures
|
31,282
|
|
|
1,077
|
|
|
—
|
|
|
1,077
|
|
|||
Dividend Reinvestment Plan
|
57,749
|
|
|
1,358
|
|
|
—
|
|
|
1,358
|
|
|||
Stock Options Exercised and Expensed
|
14,074
|
|
|
305
|
|
|
(2
|
)
|
|
303
|
|
|||
Balance, December 31, 2010
|
8,676,849
|
|
|
$
|
71,636
|
|
|
$
|
(1,612
|
)
|
|
$
|
70,024
|
|
Stock and equivalents issued through Performance Stock Program, Net of Forfeitures
|
20,210
|
|
|
824
|
|
|
—
|
|
|
824
|
|
|||
Dividend Reinvestment Plan
|
52,668
|
|
|
1,346
|
|
|
—
|
|
|
1,346
|
|
|||
Stock Options Exercised and Expensed
|
5,671
|
|
|
152
|
|
|
(1
|
)
|
|
151
|
|
|||
Balance, December 31, 2011
|
8,755,398
|
|
|
$
|
73,958
|
|
|
$
|
(1,613
|
)
|
|
$
|
72,345
|
|
Stock and equivalents issued through Performance Stock Program, Net of Forfeitures
|
34,301
|
|
|
1,213
|
|
|
—
|
|
|
1,213
|
|
|||
Dividend Reinvestment Plan
|
50,048
|
|
|
1,486
|
|
|
—
|
|
|
1,486
|
|
|||
Stock Options Exercised and Expensed
|
23,235
|
|
|
665
|
|
|
(3
|
)
|
|
662
|
|
|||
Shares issued to acquire BSWC
|
380,254
|
|
|
12,012
|
|
|
(154
|
)
|
|
11,858
|
|
|||
Shares issued in stock offering
|
1,696,250
|
|
|
49,615
|
|
|
(2,306
|
)
|
|
47,309
|
|
|||
Balance, December 31, 2012 (1)
|
10,939,486
|
|
|
$
|
138,949
|
|
|
$
|
(4,076
|
)
|
|
$
|
134,873
|
|
(1)
|
Includes
43,315
restricted shares and
140,235
common stock equivalent shares issued through the Performance Stock Programs through
December 31, 2012
.
|
(in thousands, except per share data)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Balance, beginning of year
|
|
$
|
46,669
|
|
|
$
|
43,603
|
|
|
$
|
41,785
|
|
Net Income
|
|
13,640
|
|
|
11,300
|
|
|
9,798
|
|
|||
Sub-total
|
|
60,309
|
|
|
54,903
|
|
|
51,583
|
|
|||
Dividends declared:
|
|
|
|
|
|
|
||||||
Cumulative Preferred Stock, Series A, $0.80 per share
|
|
12
|
|
|
12
|
|
|
12
|
|
|||
Cumulative Preferred Stock, Series $0.90, $0.90 per share
|
|
26
|
|
|
26
|
|
|
26
|
|
|||
Common Stock:
|
|
|
|
|
|
|
||||||
$0.96, $0.94 and $0.92 per Common Share in 2012, 2011 and 2010, respectively
|
|
8,467
|
|
|
8,196
|
|
|
7,942
|
|
|||
Total Dividends Declared
|
|
8,505
|
|
|
8,234
|
|
|
7,980
|
|
|||
Balance, end of year
|
|
$
|
51,804
|
|
|
$
|
46,669
|
|
|
$
|
43,603
|
|
Level 1 –
|
Quoted market prices in active markets for identical assets or liabilities.
|
Level 2 –
|
Inputs other than Level 1 that are either directly or indirectly observable.
|
Level 3 –
|
Unobservable inputs developed using the Company’s estimates and assumptions, which reflect those that the Company believes market participants would use.
|
(in thousands)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Asset Type:
|
|
|
|
|
|
|
|
||||||||
Company owned life insurance
|
$
|
—
|
|
|
$
|
2,538
|
|
|
$
|
—
|
|
|
$
|
2,538
|
|
Money Market Fund
|
28
|
|
|
—
|
|
|
—
|
|
|
28
|
|
||||
Mutual Funds:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Equity Funds (1)
|
1,046
|
|
|
—
|
|
|
—
|
|
|
1,046
|
|
||||
Total
|
$
|
1,074
|
|
|
$
|
2,538
|
|
|
$
|
—
|
|
|
$
|
3,612
|
|
(in thousands)
|
Level 1
|
|
Level 2
|
|
Level 3
|
|
Total
|
||||||||
Asset Type:
|
|
|
|
|
|
|
|
||||||||
Company owned life insurance
|
$
|
—
|
|
|
$
|
2,269
|
|
|
$
|
—
|
|
|
$
|
2,269
|
|
Money Market Fund
|
28
|
|
|
—
|
|
|
—
|
|
|
28
|
|
||||
Mutual Funds:
|
|
|
|
|
|
|
|
|
|
|
|
||||
Equity Funds (1)
|
852
|
|
|
—
|
|
|
—
|
|
|
852
|
|
||||
Total
|
$
|
880
|
|
|
$
|
2,269
|
|
|
$
|
—
|
|
|
$
|
3,149
|
|
(1)
|
Mutual funds consisting primarily of equity securities.
|
|
2012
|
|
2011
|
||||||
Connecticut Water Service, Inc.:
|
|
|
|
||||||
4.09%
|
|
Term Loan Note and Supplement A
|
$
|
17,337
|
|
|
$
|
—
|
|
The Connecticut Water Company:
|
|
|
|
||||||
Unsecured Water Facilities Revenue Bonds
|
|
|
|
||||||
5.05%
|
|
1998 Series A, Due 2028
|
—
|
|
|
9,550
|
|
||
5.125%
|
|
1998 Series B, Due 2028
|
—
|
|
|
7,495
|
|
||
4.40%
|
|
2003A Series, Due 2020
|
—
|
|
|
8,000
|
|
||
5.00%
|
|
2003C Series, Due 2022
|
—
|
|
|
14,795
|
|
||
Var.
|
|
2004 Series Variable Rate, Due 2029
|
12,500
|
|
|
12,500
|
|
||
Var.
|
|
2004 Series A, Due 2028
|
5,000
|
|
|
5,000
|
|
||
Var.
|
|
2004 Series B, Due 2028
|
4,550
|
|
|
4,550
|
|
||
5.00%
|
|
2005 A Series, Due 2040
|
—
|
|
|
14,805
|
|
||
5.00%
|
|
2007 A Series, Due 2037
|
14,550
|
|
|
14,570
|
|
||
5.10%
|
|
2009 A Series, Due 2039
|
19,950
|
|
|
20,000
|
|
||
5.00%
|
|
2011 A Series, Due 2021
|
23,797
|
|
|
23,991
|
|
||
3.16%
|
|
CoBank Note Payable, Due 2020
|
8,000
|
|
|
—
|
|
||
3.51%
|
|
CoBank Note Payable, Due 2022
|
14,795
|
|
|
—
|
|
||
4.29%
|
|
CoBank Note Payable, Due 2028
|
17,020
|
|
|
—
|
|
||
4.72%
|
|
CoBank Note Payable, Due 2032
|
14,795
|
|
|
—
|
|
||
Total The Connecticut Water Company
|
134,957
|
|
|
135,256
|
|
||||
The Maine Water Company:
|
|
|
|
||||||
8.95%
|
|
1994 Series G, Due 2024
|
9,000
|
|
|
—
|
|
||
2.68%
|
|
1999 Series J, Due 2019
|
524
|
|
|
—
|
|
||
0.00%
|
|
2001 Series K, Due 2031
|
780
|
|
|
—
|
|
||
2.58%
|
|
2002 Series L, Due 2022
|
98
|
|
|
—
|
|
||
1.53%
|
|
2003 Series M, Due 2023
|
421
|
|
|
—
|
|
||
1.73%
|
|
2004 Series N, Due 2024
|
471
|
|
|
—
|
|
||
0.00%
|
|
2004 Series O, Due 2034
|
147
|
|
|
—
|
|
||
1.76%
|
|
2006 Series P, Due 2026
|
471
|
|
|
—
|
|
||
1.57%
|
|
2009 Series R, Due 2029
|
247
|
|
|
—
|
|
||
0.00%
|
|
2009 Series S, Due 2029
|
762
|
|
|
—
|
|
||
0.00%
|
|
2009 Series T, Due 2029
|
2,137
|
|
|
—
|
|
||
0.00%
|
|
2012 Series U, Due 2042
|
177
|
|
|
—
|
|
||
2.52%
|
|
CoBank Note Payable, Due 2017
|
1,965
|
|
|
—
|
|
||
Total The Maine Water Company
|
17,200
|
|
|
—
|
|
||||
The Biddeford & Saco Water Company
|
|
|
|
||||||
6.45%
|
|
Series M, Due 2014
|
2,700
|
|
|
—
|
|
||
7.72%
|
|
Series L, Due 2018
|
2,250
|
|
|
—
|
|
||
2.40%
|
|
Series N, Due 2022
|
1,297
|
|
|
—
|
|
||
1.86%
|
|
Series O, Due 2025
|
862
|
|
|
—
|
|
||
2.23%
|
|
Series P, Due 2028
|
1,354
|
|
|
—
|
|
||
Various
|
|
Various Capital Leases
|
126
|
|
|
—
|
|
||
Total The Biddeford & Saco Water Company
|
8,589
|
|
|
—
|
|
||||
Add: Acquisition Fair Value Adjustment
|
1,696
|
|
|
—
|
|
||||
Less: Current Portion
|
(1,304
|
)
|
|
—
|
|
||||
Total Long-Term Debt
|
$
|
178,475
|
|
|
$
|
135,256
|
|
2013
|
|
$
|
1,304
|
|
2014
|
|
$
|
4,103
|
|
2015
|
|
$
|
2,442
|
|
2016
|
|
$
|
2,486
|
|
2017
|
|
$
|
4,501
|
|
(in thousands, except share data)
|
|
2012
|
|
2011
|
||||
Connecticut Water Service, Inc.
|
|
|
|
|
||||
Cumulative Series A Voting, $20 Par Value; Authorized, Issued and Outstanding 15,000 Shares
|
|
$
|
300
|
|
|
$
|
300
|
|
Cumulative Series $0.90 Non-Voting, $16 Par Value; Authorized 50,000 Shares, Issued and Outstanding 29,499
|
|
472
|
|
|
472
|
|
||
Total Preferred Stock
|
|
$
|
772
|
|
|
$
|
772
|
|
(in thousands)
|
2012
|
|
2011
|
||||
Land
|
$
|
12,512
|
|
|
$
|
10,623
|
|
Source of supply
|
33,627
|
|
|
29,687
|
|
||
Pumping
|
35,337
|
|
|
30,653
|
|
||
Water treatment
|
75,684
|
|
|
56,799
|
|
||
Transmission and distribution
|
411,923
|
|
|
325,174
|
|
||
General
|
47,444
|
|
|
39,619
|
|
||
Held for future use
|
437
|
|
|
472
|
|
||
Acquisition Adjustment
|
(5,177
|
)
|
|
(5,487
|
)
|
||
Total
|
$
|
611,787
|
|
|
$
|
487,540
|
|
(in thousands)
|
|
2012
|
|
2011
|
|
2010
|
||||||
Municipal Property Taxes
|
|
$
|
6,567
|
|
|
$
|
5,529
|
|
|
$
|
5,293
|
|
Payroll Taxes
|
|
1,132
|
|
|
912
|
|
|
978
|
|
|||
Total Taxes Other than Income Taxes
|
|
$
|
7,699
|
|
|
$
|
6,441
|
|
|
$
|
6,271
|
|
(in thousands)
|
2012
|
|
2011
|
||||
Defined Benefit Pension Plan
|
$
|
22,139
|
|
|
$
|
12,319
|
|
Post Retirement Benefit Other than Pension
|
6,243
|
|
|
6,431
|
|
||
Supplemental Executive Retirement Plan
|
6,224
|
|
|
4,843
|
|
||
Deferred Compensation
|
1,639
|
|
|
1,411
|
|
||
Other Long-Term Compensation
|
185
|
|
|
228
|
|
||
Total Long-Term Compensation Arrangements
|
$
|
36,430
|
|
|
$
|
25,232
|
|
|
2012
|
|
2011
|
||
Equity
|
65
|
%
|
|
65
|
%
|
Fixed Income
|
35
|
%
|
|
35
|
%
|
Total
|
100
|
%
|
|
100
|
%
|
Pension Benefits
(in thousands)
|
2012
|
|
2011
|
||||
Change in benefit obligation:
|
|
|
|
||||
Benefit obligation, beginning of year
|
$
|
49,102
|
|
|
$
|
40,758
|
|
Service cost
|
2,020
|
|
|
1,523
|
|
||
Interest cost
|
2,570
|
|
|
2,134
|
|
||
Actuarial loss (gain)
|
14,494
|
|
|
5,878
|
|
||
Benefits paid
|
(1,685
|
)
|
|
(1,191
|
)
|
||
Benefit obligation, end of year
|
$
|
66,501
|
|
|
$
|
49,102
|
|
Change in plan assets:
|
|
|
|
|
|
||
Fair value, beginning of year
|
$
|
36,783
|
|
|
$
|
36,990
|
|
Actual return on plan assets
|
9,723
|
|
|
(216
|
)
|
||
Employer contributions
|
585
|
|
|
1,200
|
|
||
Benefits paid
|
(1,685
|
)
|
|
(1,191
|
)
|
||
Fair value, end of year
|
$
|
45,406
|
|
|
$
|
36,783
|
|
Funded Status
|
$
|
(21,095
|
)
|
|
$
|
(12,319
|
)
|
Amount Recognized in Consolidated Balance Sheets Consisted of:
|
|
|
|
|
|
||
Non-current asset
|
$
|
—
|
|
|
$
|
—
|
|
Current liability
|
—
|
|
|
—
|
|
||
Non-current liability
|
(21,095
|
)
|
|
(12,319
|
)
|
||
Net amount recognized
|
$
|
(21,095
|
)
|
|
$
|
(12,319
|
)
|
Weighted-average assumptions used to determine benefit obligations at December 31:
|
2012
|
|
2011
|
||
Discount rate
|
4.05
|
%
|
|
4.60
|
%
|
Rate of compensation increase
|
3.50
|
%
|
|
3.50
|
%
|
Weighted-average assumptions used to determine net periodic cost for years ended December 31:
|
2012
|
|
2011
|
|
2010
|
|||
Discount rate
|
4.60
|
%
|
|
5.50
|
%
|
|
5.95
|
%
|
Expected long-term return on plan assets
|
7.25
|
%
|
|
7.25
|
%
|
|
8.00
|
%
|
Rate of compensation increase
|
3.50
|
%
|
|
3.50
|
%
|
|
4.50
|
%
|
Pension Benefits
(in thousands)
|
2012
|
|
2011
|
|
2010
|
||||||
Components of net periodic benefit costs
|
|
|
|
|
|
||||||
Service cost
|
$
|
2,020
|
|
|
$
|
1,523
|
|
|
$
|
1,668
|
|
Interest cost
|
2,570
|
|
|
2,134
|
|
|
2,175
|
|
|||
Expected return on plan assets
|
(2,693
|
)
|
|
(2,456
|
)
|
|
(2,507
|
)
|
|||
Amortization of:
|
|
|
|
|
|
|
|
|
|||
Net transition obligation
|
—
|
|
|
2
|
|
|
2
|
|
|||
Prior service cost
|
74
|
|
|
69
|
|
|
69
|
|
|||
Net loss
|
1,753
|
|
|
687
|
|
|
602
|
|
|||
Net Periodic Pension Benefit Costs
|
$
|
3,724
|
|
|
$
|
1,959
|
|
|
$
|
2,009
|
|
Pension Benefits
(in thousands)
|
2012
|
|
2011
|
||||
Change in net loss (gain)
|
$
|
6,254
|
|
|
$
|
8,550
|
|
Change in prior service cost
|
14
|
|
|
—
|
|
||
Amortization of transition obligation
|
—
|
|
|
(2
|
)
|
||
Amortization of prior service cost
|
(74
|
)
|
|
(69
|
)
|
||
Amortization of net loss
|
(1,753
|
)
|
|
(687
|
)
|
||
Total recognized to Regulatory Asset
|
$
|
4,441
|
|
|
$
|
7,792
|
|
Amounts Recognized as a Regulatory Asset at December 31:
(in thousands)
|
2012
|
|
2011
|
||||
Transition obligation
|
$
|
—
|
|
|
$
|
—
|
|
Prior service cost
|
249
|
|
|
309
|
|
||
Net loss
|
18,069
|
|
|
13,553
|
|
||
Total Recognized as a Regulatory Asset
|
$
|
18,318
|
|
|
$
|
13,862
|
|
Amounts Recognized in Other Comprehensive Income at December 31:
(in thousands)
|
2012
|
|
2011
|
|
2010
|
||||||
Transition obligation
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Prior service cost
|
—
|
|
|
—
|
|
|
—
|
|
|||
Net loss
|
538
|
|
|
554
|
|
|
327
|
|
|||
Total Recognized in Other Comprehensive Income
|
$
|
538
|
|
|
$
|
554
|
|
|
$
|
327
|
|
Estimated Net Periodic Benefit Cost Amortizations for the periods January 1 - December 31,:
(in thousands)
|
2013
|
||
Amortization of transition obligation
|
$
|
—
|
|
Amortization of prior service cost
|
74
|
|
|
Amortization of net loss
|
1,964
|
|
|
Total Estimated Net Periodic Benefit Cost Amortizations
|
$
|
2,038
|
|
|
2012
|
|
2011
|
||
Equity
|
64
|
%
|
|
66
|
%
|
Fixed Income
|
36
|
%
|
|
34
|
%
|
Total
|
100
|
%
|
|
100
|
%
|
(in thousands)
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||
Asset Type:
|
|
|
|
|
|
||||||
Money Market Fund
|
$
|
483
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Mutual Funds:
|
|
|
|
|
|
|
|
|
|||
Fixed Income Funds (1)
|
15,769
|
|
|
—
|
|
|
—
|
|
|||
Equity Funds (2)
|
29,154
|
|
|
—
|
|
|
—
|
|
|||
Total
|
$
|
45,406
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(in thousands)
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||
Asset Type:
|
|
|
|
|
|
||||||
Money Market Fund
|
$
|
172
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Mutual Funds:
|
|
|
|
|
|
|
|
|
|||
Fixed Income Funds (1)
|
12,491
|
|
|
—
|
|
|
—
|
|
|||
Equity Funds (2)
|
24,120
|
|
|
—
|
|
|
—
|
|
|||
Total
|
$
|
36,783
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(1)
|
Mutual funds consisting primarily of fixed income securities.
|
(2)
|
Mutual funds consisting primarily of equity securities.
|
(in thousands)
|
|
||
2013
|
$
|
2,701
|
|
2014
|
2,880
|
|
|
2015
|
3,383
|
|
|
2016
|
3,723
|
|
|
2017
|
3,831
|
|
|
Years 2018 – 2022
|
25,124
|
|
PBOP Benefits
(in thousands)
|
2012
|
|
2011
|
||||
Change in benefit obligation:
|
|
|
|
||||
Benefit obligation, beginning of year
|
$
|
12,842
|
|
|
$
|
13,443
|
|
Service cost
|
548
|
|
|
599
|
|
||
Interest cost
|
538
|
|
|
623
|
|
||
Plan participant contributions
|
93
|
|
|
85
|
|
||
Plan amendments
|
—
|
|
|
(2,433
|
)
|
||
Actuarial (gain) loss
|
(275
|
)
|
|
901
|
|
||
Benefits paid
|
(424
|
)
|
|
(376
|
)
|
||
Benefit obligation, end of year
|
$
|
13,322
|
|
|
$
|
12,842
|
|
Change in plan assets:
|
|
|
|
|
|
||
Fair value, beginning of year
|
$
|
6,465
|
|
|
$
|
6,475
|
|
Actual return on plan assets
|
977
|
|
|
46
|
|
||
Employer contributions
|
22
|
|
|
235
|
|
||
Plan participant contributions
|
93
|
|
|
85
|
|
||
Benefits paid
|
(424
|
)
|
|
(376
|
)
|
||
Fair value, end of year
|
$
|
7,133
|
|
|
$
|
6,465
|
|
Funded Status
|
$
|
(6,189
|
)
|
|
$
|
(6,377
|
)
|
Amount Recognized in Consolidated Balance Sheets Consisted of:
|
|
|
|
|
|
||
Non-current asset
|
$
|
—
|
|
|
$
|
—
|
|
Current liability
|
—
|
|
|
—
|
|
||
Non-current liability
|
(6,189
|
)
|
|
(6,377
|
)
|
||
Net amount recognized
|
$
|
(6,189
|
)
|
|
$
|
(6,377
|
)
|
Weighted-average assumptions used to determine benefit obligations at December 31:
|
2012
|
|
2011
|
||
Discount rate
|
3.80
|
%
|
|
4.40
|
%
|
Weighted-average assumptions used to determine net periodic cost for years ended December 31:
|
2012
|
|
2011
|
|
2010
|
|||
Discount rate
|
4.40
|
%
|
|
5.35
|
%
|
|
5.80
|
%
|
Expected long-term return on plan assets
|
4.50
|
%
|
|
4.50
|
%
|
|
5.00
|
%
|
PBOP Benefits
(in thousands)
|
2012
|
|
2011
|
|
2010
|
||||||
Components of net periodic benefit costs
|
|
|
|
|
|
||||||
Service cost
|
$
|
548
|
|
|
$
|
599
|
|
|
$
|
567
|
|
Interest cost
|
538
|
|
|
623
|
|
|
574
|
|
|||
Expected return on plan assets
|
(269
|
)
|
|
(267
|
)
|
|
(306
|
)
|
|||
Other
|
225
|
|
|
225
|
|
|
225
|
|
|||
Amortization of:
|
|
|
|
|
|
|
|
|
|||
Prior service cost
|
(806
|
)
|
|
(665
|
)
|
|
(406
|
)
|
|||
Recognized net loss
|
615
|
|
|
613
|
|
|
329
|
|
|||
Net Periodic Post Retirement Benefit Costs
|
$
|
851
|
|
|
$
|
1,128
|
|
|
$
|
983
|
|
PBOP Benefits
(in thousands)
|
2012
|
|
2011
|
||||
Change in net loss (gain)
|
$
|
(1,028
|
)
|
|
$
|
1,123
|
|
Change in transition credit
|
(10
|
)
|
|
(2,433
|
)
|
||
Amortization of transition obligation
|
—
|
|
|
—
|
|
||
Amortization of prior service credit
|
806
|
|
|
665
|
|
||
Amortization of net loss
|
(615
|
)
|
|
(613
|
)
|
||
Total recognized to Regulatory Asset
|
$
|
(847
|
)
|
|
$
|
(1,258
|
)
|
Amounts Recognized as a Regulatory Asset at December 31:
(in thousands)
|
2012
|
|
2011
|
||||
Transition obligation
|
$
|
—
|
|
|
$
|
—
|
|
Prior service cost
|
(2,766
|
)
|
|
(3,563
|
)
|
||
Net (gain) loss
|
4,590
|
|
|
6,234
|
|
||
Total Recognized as a Regulatory Asset
|
$
|
1,824
|
|
|
$
|
2,671
|
|
Estimated Benefit Cost Amortizations for the periods January 1 - December 31,:
(in thousands)
|
2013
|
||
Amortization of transition obligation
|
$
|
—
|
|
Amortization of prior service cost
|
(806
|
)
|
|
Amortization of net loss (gain)
|
394
|
|
|
Total Estimated Net Periodic Benefit Cost Amortizations
|
$
|
(412
|
)
|
Assumed health care cost trend rates at December 31:
|
2012
|
|
2011
|
||||||||
|
Medical
|
|
Dental
|
|
Medical
|
|
Dental
|
||||
Health care cost trend rate assumed for next year
(1)
|
10.0
|
%
|
|
10.0
|
%
|
|
10.0
|
%
|
|
10.0
|
%
|
Rate to which the cost trend rate is assumed to decline
|
5.0
|
%
|
|
5.0
|
%
|
|
5.0
|
%
|
|
5.0
|
%
|
Year that the rate reaches the ultimate trend rate
|
2023
|
|
|
2023
|
|
|
2022
|
|
|
2022
|
|
(in thousands)
|
1 Percentage-Point
|
||||||
|
Increase
|
|
Decrease
|
||||
Effect on total of service and interest cost components
|
$
|
70
|
|
|
$
|
(66
|
)
|
Effect on post-retirement benefit obligation
|
$
|
957
|
|
|
$
|
(893
|
)
|
|
2012
|
|
2011
|
||
Equity
|
65
|
%
|
|
63
|
%
|
Fixed Income
|
35
|
%
|
|
37
|
%
|
Total
|
100
|
%
|
|
100
|
%
|
(in thousands)
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||
Asset Type:
|
|
|
|
|
|
||||||
Money Market
|
$
|
116
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Mutual Funds:
|
|
|
|
|
|
|
|
|
|||
Fixed Income Funds (1)
|
2,379
|
|
|
—
|
|
|
—
|
|
|||
Equity Funds (2)
|
4,638
|
|
|
—
|
|
|
—
|
|
|||
Total
|
$
|
7,133
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(in thousands)
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||
Asset Type:
|
|
|
|
|
|
||||||
Money Market
|
$
|
160
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Mutual Funds:
|
|
|
|
|
|
|
|
|
|||
Fixed Income Funds (1)
|
2,234
|
|
|
—
|
|
|
—
|
|
|||
Equity Funds (2)
|
4,071
|
|
|
—
|
|
|
—
|
|
|||
Total
|
$
|
6,465
|
|
|
$
|
—
|
|
|
$
|
—
|
|
(1)
|
Mutual funds consisting primarily of fixed income securities.
|
(2)
|
Mutual funds consisting primarily of equity securities.
|
(in thousands)
|
|
||
2013
|
$
|
354
|
|
2014
|
382
|
|
|
2015
|
414
|
|
|
2016
|
44
|
|
|
2017
|
505
|
|
|
Years 2018 – 2022
|
3,363
|
|
|
2012
|
|
2011
|
|
2010
|
|||||||||||||||
|
Shares
|
|
Weighted Average Exercise Price
|
|
Shares
|
|
Weighted Average Exercise Price
|
|
Shares
|
|
Weighted Average Exercise Price
|
|||||||||
Options:
|
|
|
|
|
|
|
|
|
|
|
|
|||||||||
Outstanding, beginning of year
|
30,979
|
|
|
$
|
27.63
|
|
|
53,674
|
|
|
$
|
27.54
|
|
|
77,388
|
|
|
$
|
26.24
|
|
Forfeited
|
—
|
|
|
—
|
|
|
(17,024
|
)
|
|
27.95
|
|
|
(9,640
|
)
|
|
27.54
|
|
|||
Exercised
|
(23,235
|
)
|
|
27.16
|
|
|
(5,671
|
)
|
|
25.78
|
|
|
(14,074
|
)
|
|
20.42
|
|
|||
Outstanding, end of year
|
7,744
|
|
|
$
|
29.05
|
|
|
30,979
|
|
|
$
|
27.63
|
|
|
53,674
|
|
|
$
|
27.54
|
|
Exercisable, end of year
|
7,744
|
|
|
$
|
29.05
|
|
|
30,979
|
|
|
$
|
27.63
|
|
|
53,674
|
|
|
$
|
27.54
|
|
|
Options Outstanding and Exercisable
|
||||||||
|
Shares
|
|
Weighted Average Remaining Contractual Life (years)
|
|
Weighted Average Exercise Price
|
||||
Range of prices:
|
|
|
|
|
|
||||
$18.00 - $23.99
|
—
|
|
|
—
|
|
|
—
|
|
|
$24.00 - $26.99
|
—
|
|
|
—
|
|
|
—
|
|
|
$27.00 - $29.99
|
7,744
|
|
|
0.9
|
|
|
29.05
|
|
|
|
7,744
|
|
|
0.9
|
|
|
$
|
29.05
|
|
|
2012
|
|
2011
|
||||||||||
|
Number of Shares
|
|
Grant Date Weighted Average Fair Value
|
|
Number of Shares
|
|
Grant Date Weighted Average Fair Value
|
||||||
Non-vested at beginning of year
|
900
|
|
|
$
|
19.69
|
|
|
4,079
|
|
|
$
|
25.43
|
|
Granted
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Vested
|
(900
|
)
|
|
19.69
|
|
|
(3,179
|
)
|
|
27.70
|
|
||
Forfeited
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
Non-vested at end of year
|
—
|
|
|
$
|
—
|
|
|
900
|
|
|
$
|
19.69
|
|
|
2012
|
|
2011
|
||||||||||
|
Number of Shares
|
|
Grant Date Weighted Average Fair Value
|
|
Number of Shares
|
|
Grant Date Weighted Average Fair Value
|
||||||
Non-vested at beginning of year
|
36,105
|
|
|
$
|
25.59
|
|
|
48,074
|
|
|
$
|
23.57
|
|
Granted
|
27,703
|
|
|
29.22
|
|
|
23,391
|
|
|
25.65
|
|
||
Vested
|
(21,274
|
)
|
|
24.86
|
|
|
(24,323
|
)
|
|
22.95
|
|
||
Forfeited
|
(357
|
)
|
|
25.65
|
|
|
(11,037
|
)
|
|
22.75
|
|
||
Non-vested at end of year
|
42,177
|
|
|
$
|
28.34
|
|
|
36,105
|
|
|
$
|
25.59
|
|
(in thousands)
|
Revenues
|
|
Depreciation
|
|
Other Operating Expenses
|
|
Other Income (Deductions)
|
|
Interest Expense (net of AFUDC)
|
|
Income Taxes
|
|
Net Income (Loss)
|
||||||||||||||
For the year ended December 31, 2012
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Water Activities
|
$
|
85,325
|
|
|
$
|
9,782
|
|
|
$
|
48,153
|
|
|
$
|
(1,760
|
)
|
|
$
|
8,343
|
|
|
$
|
6,022
|
|
|
$
|
11,265
|
|
Real Estate Transactions
|
1,450
|
|
|
—
|
|
|
119
|
|
|
—
|
|
|
—
|
|
|
380
|
|
|
951
|
|
|||||||
Services and Rentals
|
5,786
|
|
|
7
|
|
|
3,439
|
|
|
—
|
|
|
(13
|
)
|
|
929
|
|
|
1,424
|
|
|||||||
Total
|
$
|
92,561
|
|
|
$
|
9,789
|
|
|
$
|
51,711
|
|
|
$
|
(1,760
|
)
|
|
$
|
8,330
|
|
|
$
|
7,331
|
|
|
$
|
13,640
|
|
For the year ended December 31, 2011
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Water Activities
|
$
|
70,892
|
|
|
$
|
7,773
|
|
|
$
|
39,211
|
|
|
$
|
(1,148
|
)
|
|
$
|
5,486
|
|
|
$
|
7,151
|
|
|
$
|
10,123
|
|
Real Estate Transactions
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(176
|
)
|
|
176
|
|
|||||||
Services and Rentals
|
4,682
|
|
|
7
|
|
|
3,014
|
|
|
—
|
|
|
(41
|
)
|
|
701
|
|
|
1,001
|
|
|||||||
Total
|
$
|
75,574
|
|
|
$
|
7,780
|
|
|
$
|
42,225
|
|
|
$
|
(1,148
|
)
|
|
$
|
5,445
|
|
|
$
|
7,676
|
|
|
$
|
11,300
|
|
For the year ended December 31, 2010
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||||
Water Activities
|
$
|
67,753
|
|
|
$
|
7,088
|
|
|
$
|
40,301
|
|
|
$
|
(525
|
)
|
|
$
|
5,682
|
|
|
$
|
5,488
|
|
|
$
|
8,669
|
|
Real Estate Transactions
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(230
|
)
|
|
230
|
|
|||||||
Services and Rentals
|
5,074
|
|
|
7
|
|
|
3,618
|
|
|
—
|
|
|
(57
|
)
|
|
607
|
|
|
899
|
|
|||||||
Total
|
$
|
72,827
|
|
|
$
|
7,095
|
|
|
$
|
43,919
|
|
|
$
|
(525
|
)
|
|
$
|
5,625
|
|
|
$
|
5,865
|
|
|
$
|
9,798
|
|
At December 31 (in thousands):
|
2012
|
|
2011
|
||||
Total Plant and Other Investments:
|
|
|
|
||||
Water
|
$
|
453,625
|
|
|
$
|
364,955
|
|
Non-Water
|
680
|
|
|
635
|
|
||
Total Plant and Other Investments
|
454,305
|
|
|
365,590
|
|
||
Other Assets:
|
|
|
|
|
|
||
Water
|
118,020
|
|
|
75,096
|
|
||
Non-Water
|
6,650
|
|
|
2,245
|
|
||
Total Other Assets
|
124,670
|
|
|
77,341
|
|
||
Total Assets
|
$
|
578,975
|
|
|
$
|
442,931
|
|
|
Maine Water
|
|
BSWC
|
||||
Net Utility Plant
|
$
|
50,877
|
|
|
$
|
19,411
|
|
Cash and Cash Equivalents
|
1,607
|
|
|
14
|
|
||
Accounts Receivable, net
|
974
|
|
|
628
|
|
||
Prepayments and Other Current Assets
|
1,819
|
|
|
545
|
|
||
Goodwill
|
20,369
|
|
|
7,708
|
|
||
Deferred Charges and Other Costs
|
4,498
|
|
|
554
|
|
||
Total Assets Acquired
|
$
|
80,144
|
|
|
$
|
28,860
|
|
|
|
|
|
|
|||
Long-Term Debt, including current portion
|
$
|
18,259
|
|
|
$
|
9,263
|
|
Accounts Payable and Accrued Expenses
|
1,137
|
|
|
254
|
|
||
Other Current Liabilities
|
1,453
|
|
|
1,076
|
|
||
Advances for Construction
|
1,186
|
|
|
714
|
|
||
Contributions in Aid of Construction
|
8,886
|
|
|
2,568
|
|
||
Deferred Federal and State Income Taxes
|
8,046
|
|
|
1,668
|
|
||
Other Long-Term Liabilities
|
4,152
|
|
|
1,305
|
|
||
Total Liabilities Assumed
|
$
|
43,119
|
|
|
$
|
16,848
|
|
|
|
|
|
|
|
||
Net Assets Acquired
|
$
|
37,025
|
|
|
$
|
12,012
|
|
|
Water Activities
|
|
Non-Water Activities
|
|
Total
|
||||||
December 31, 2011
|
$
|
3,608
|
|
|
$
|
—
|
|
|
$
|
3,608
|
|
Goodwill from purchase accounting transactions
|
28,077
|
|
|
—
|
|
|
28,077
|
|
|||
December 31, 2012
|
$
|
31,685
|
|
|
$
|
—
|
|
|
$
|
31,685
|
|
|
2011
|
||
Operating Revenues
|
$
|
84,896
|
|
Other Water Activities Revenues
|
1,490
|
|
|
Real Estate Revenues
|
—
|
|
|
Service and Rentals Revenues
|
5,382
|
|
|
Total Revenues
|
$
|
91,768
|
|
|
|
||
Net Income
|
$
|
13,275
|
|
|
|
|
|
Basic Earnings per Average Share Outstanding
|
$
|
1.54
|
|
Diluted Earnings per Average Share Outstanding
|
$
|
1.52
|
|
|
|
||
Operating Revenues
|
$
|
11,502
|
|
Other Water Activities Revenues
|
—
|
|
|
Real Estate Revenues
|
—
|
|
|
Service and Rentals Revenues
|
717
|
|
|
Total Revenues
|
$
|
12,219
|
|
|
|
|
|
Net Income
|
$
|
1,609
|
|
|
|
|
|
Basic Earnings per Average Share Outstanding
|
$
|
0.18
|
|
Diluted Earnings per Average Share Outstanding
|
$
|
0.18
|
|
|
First Quarter
|
|
Second Quarter
|
|
Third Quarter
|
|
Fourth Quarter
|
||||||||||||||||||||||||
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
|
2012
|
|
2011
|
||||||||||||||||
Operating Revenues
|
$
|
18,540
|
|
|
$
|
15,989
|
|
|
$
|
21,348
|
|
|
$
|
17,359
|
|
|
$
|
24,461
|
|
|
$
|
20,628
|
|
|
$
|
19,489
|
|
|
$
|
15,426
|
|
Total Utility Operating Income
|
3,727
|
|
|
3,538
|
|
|
5,199
|
|
|
4,580
|
|
|
7,961
|
|
|
5,054
|
|
|
3,534
|
|
|
3,235
|
|
||||||||
Net Income
|
1,910
|
|
|
2,268
|
|
|
4,163
|
|
|
3,470
|
|
|
5,974
|
|
|
3,734
|
|
|
1,593
|
|
|
1,828
|
|
||||||||
Basic Earnings per Common Share
|
0.22
|
|
|
0.26
|
|
|
0.48
|
|
|
0.41
|
|
|
0.69
|
|
|
0.43
|
|
|
0.16
|
|
|
0.21
|
|
||||||||
Diluted Earnings per Common Share
|
0.22
|
|
|
0.26
|
|
|
0.47
|
|
|
0.40
|
|
|
0.67
|
|
|
0.42
|
|
|
0.16
|
|
|
0.21
|
|
Exhibit
Number
|
Description
|
3.1
|
Certificate of Incorporation of Connecticut Water Service, Inc. amended and restated as of April, 1998. (Exhibit 3.1 to Form 10-K for the year ended 12/31/98).
|
3.2
|
By-Laws, as amended, of Connecticut Water Service, Inc. as amended and restated as of August 16, 2007. (Exhibit 3.1 to Form 8-K filed on August 21, 2007).
|
3.3
|
Certification of Incorporation of The Connecticut Water Company effective April, 1998. (Exhibit 3.3 to Form 10-K for the year ended 12/31/98).
|
3.4
|
Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Connecticut Water Service, Inc. dated August 6, 2001. (Exhibit 3.4 to Form 10-K for the year ended 12/31/01).
|
3.5
|
Certificate of Amendment to the Amended and Restated Certificate of Incorporation of Connecticut Water Service, Inc. dated April 23, 2004. (Exhibit 3.5 to Form 10-Q for the quarter ended 3/31/03).
|
4.1
|
Bond Purchase Agreement dated as of March 12, 2004, among The Connecticut Water Company and A.G. Edwards & Sons, Inc. (Exhibit 4.18 to Form 10-Q for the quarter ended 3/31/04).
|
4.2
|
Indenture of Trust, dated as of March 1, 2004, between The Connecticut Water Company and U.S. Bank National Association, as Trustee. (Exhibit 4.19 to Form 10-Q for the quarter ended 3/31/04).
|
4.3
|
Reimbursement and Credit Agreement, dated as of March 1, 2004, between The Connecticut Water Company and Citizen’s Bank of Rhode Island. (Exhibit 4.20 to Form 10-Q for the quarter ended 3/31/04).
|
4.4
|
Letter of Credit issued by Citizen’s Bank of Rhode Island, dated as of March 4, 2004. (Exhibit 4.21 to Form 10-Q for the quarter ended 3/31/04).
|
4.5
|
Agreement No. DWSRF 200103-C Project Loan Agreement between the State of Connecticut and Unionville Water Company under the Drinking Water State Revolving Fund (DWSRF) Program, dated as of April 19, 2004. (Exhibit 4.22 to Form 10-Q for the quarter ended 6/30/04).
|
4.6
|
Collateral Assignment of Water Service Charges and Right to Receive Water Service Expense Assessments and Security Agreement between Unionville Water Company and the State of Connecticut, dated as of June 3, 2004. (Exhibit 4.23 to Form 10-Q for the quarter ended 6/30/04).
|
4.7
|
Bond Purchase Agreement, dated September 1, 2004, among The Connecticut Water Company, Connecticut Development Authority, and A.G. Edwards & Sons, Inc. (Exhibit 4.24 to Form 10-Q for the quarter ended 9/30/04).
|
4.8
|
Indenture of Trust, dated August 1, 2004, between The Connecticut Water Company and U.S. Bank National Association, as Trustee, 2004A Series. (Exhibit 4.25 to Form 10-Q for the quarter ended 9/30/04).
|
4.9
|
Indenture of Trust, dated August 1, 2004, between The Connecticut Water Company and U.S. Bank National Association, as Trustee, 2004B Series. (Exhibit 4.26 to Form 10-Q for the quarter ended 9/30/04).
|
4.10
|
Loan Agreement, dated August 1, 2004, between The Connecticut Water Company and Connecticut Development Authority for 2004 Series. (Exhibit 4.27 to Form 10-Q for the quarter ended 9/30/04).
|
4.11
|
Loan Agreement, dated August 1, 2004, between The Connecticut Water Company and Connecticut Development Authority for 2004B Series. (Exhibit 4.28 to Form 10-Q for the quarter ended 9/30/04).
|
4.12
|
Reimbursement and Credit Agreement, dated as of August 1, 2004, between The Connecticut Water Company and Citizen’s Bank of Rhode Island, 2004A Series. (Exhibit 4.29 to Form 10-Q for the quarter ended 9/30/04).
|
4.13
|
Reimbursement and Credit Agreement, dated as of August 1, 2004, between The Connecticut Water Company and Citizen’s Bank of Rhode Island, 2004B Series. (Exhibit 4.30 to Form 10-Q for the quarter ended 9/30/04).
|
4.14
|
Letters of Credit, each dated September 2, 2004, between The Connecticut Water Company and Citizen’s Bank of Rhode Island, with respect to each of the 2004A and 2004B Series Bonds. (Exhibit 4.31 to Form 10-Q for the quarter ended 9/30/04).
|
4.15
|
First Amendment to Reimbursement and Credit Agreement, dated as of April 28, 2006, between The Connecticut Water Company and Citizen’s Bank of Rhode Island, 2004A Series. (Exhibit 10.1 to Form 10-Q for the period ending 3/31/06).
|
4.16
|
First Amendment to Reimbursement and Credit Agreement, dated as of April 28, 2006, between The Connecticut Water Company and Citizen’s Bank of Rhode Island, 2004B Series. (Exhibit 10.2 to Form 10-Q for the period ending 3/31/06).
|
4.17
|
First Amendment to Reimbursement and Credit Agreement, dated as of April 28, 2006, between The Connecticut Water Company and Citizen’s Bank of Rhode Island, 2004 Series Variable Rate, due 2029. (Exhibit 10.3 to Form 10-Q for the period ending 3/31/06).
|
4.18
|
Second Amendment to Reimbursement and Credit Agreement, dated as of August 23, 2007 between The Connecticut Water Company and Citizen’s Bank of Rhode Island 2004 A Series. (Exhibit 10.2 to the Form 10-Q for the period ending June 30, 2009)
|
|
4.19
|
Second Amendment to Reimbursement and Credit Agreement, dated as of August 23, 2007 between The Connecticut Water Company and Citizen’s Bank of Rhode Island 2004 B Series. (Exhibit 10.3 to the Form 10-Q for the period ending June 30, 2009)
|
|
4.2
|
Second Amendment to Reimbursement and Credit Agreement, dated as of August 23, 2007 between The Connecticut Water Company and Citizen’s Bank of Rhode Island 2004 Series Variable Rate, due 2009. (Exhibit 10.4 to the Form 10-Q for the period ending June 30, 2009)
|
|
4.21
|
Third Amendment to Reimbursement and Credit Agreement, dated as of August 23, 2007 between The Connecticut Water Company and Citizen’s Bank of Rhode Island 2004 A Series. (Exhibit 10.5 to the Form 10-Q for the period ending June 30, 2009)
|
|
4.22
|
Third Amendment to Reimbursement and Credit Agreement, dated as of August 23, 2007 between The Connecticut Water Company and Citizen’s Bank of Rhode Island 2004 B Series. (Exhibit 10.6 to the Form 10-Q for the period ending June 30, 2009)
|
|
4.23
|
Third Amendment to Reimbursement and Credit Agreement, dated as of August 23, 2007 between The Connecticut Water Company and Citizen’s Bank of Rhode Island 2004 Series Variable Rate, due 2009. (Exhibit 10.7 to the Form 10-Q for the period ending June 30, 2009)
|
|
4.24
|
Bond Purchase Agreement among The Connecticut Water Company, the Connecticut Development Authority and Edward D. Jones &Co., L.P., as underwriter dated December 2, 2009. (Exhibit 4.42 to Form 10-K for the year ended December 31, 2009).
|
|
4.25
|
Loan Agreement between The Connecticut Water Company and the Connecticut Development Authority, dated as of December 1, 2009. (Exhibit 4.43 to Form 10-K for the year ended December 31, 2009).
|
|
4.26
|
Indenture of Trust for the Bonds between the Connecticut Development Authority and U.S. Bank National Associations, as Trustee, dated December 1, 2009. (Exhibit 4.44 to Form 10-K for the year ended December 31, 2009).
|
|
4.27
|
Bond Purchase Agreement among CWC, the Connecticut Development Authority and Janney Montgomery Scott LLC, as underwriter, dated as of December 6, 2011. (Exhibit 4.45 to Form 10-K for the year ended December 31, 2011).
|
|
4.28
|
Loan Agreement between CWC and the Authority, dated as of December 1, 2011. (Exhibit 4.46 to Form 10-K for the year ended December 31, 2011).
|
|
4.29
|
Indenture of Trust for the Bonds between the Authority and U.S. Bank National Association, as Trustee, dated as of December 1, 2011. (Exhibit 4.47 to Form 10-K for the year ended December 31, 2011).
|
|
10.1
|
Pension Plan Fiduciary Liability Insurance for The Connecticut Water Company Employees' Retirement Plan and Trust, Savings Plan of The Connecticut Water Company and The Connecticut Water Company VEBA Trust Fund. (Exhibit 10.1 to Registration Statement No. 2‑74938).
|
|
10.2
|
Directors and Officers Liability and Corporation Reimbursement Insurance. (Exhibit 10.2 to Registration Statement No. 2‑74938).
|
|
10.3
|
Directors Deferred Compensation Plan, effective as of January 1, 1980, as amended as of January 1, 2008. (Exhibit 10.7 to Form 8-K filed on January 30, 2008).
|
|
10.4*
|
Nonstandardized Adoption Agreement Prototype Cash or Deferred Profit-Sharing Plan, effective as of January 1, 2012.
|
|
10.5
|
November 4, 1994 Amendment to Agreement dated December 11, 1957 between The Connecticut Water Company (successor to the Thomaston Water Company) and the City of Waterbury. (Exhibit 10.16 to Form 10-K for year ended 12/31/94).
|
|
10.6
|
Agreement dated August 13, 1986 between The Connecticut Water Company and the Metropolitan District. (Exhibit 10.14 to Form 10-K for the year ended 12/31/86).
|
|
10.7
|
Report of the Commission to Study the Feasibility of Expanding the Water Supply Services of the Metropolitan District. (Exhibit 14 to Registration Statement No. 2-61843).
|
|
10.8
|
Dividend Reinvestment and Common Stock Purchase Plan, as amended and restated as of January 1, 2012. (Exhibit 4 to Form S-3, Registration Statement No. 333-176867, filed on September 16, 2011).
|
|
10.9
|
Contract for Supplying Bradley International Airport. (Exhibit 10.21 to Form 10-K for the year ended 12/31/84).
|
|
10.10
|
Report of South Windsor Task Force. (Exhibit 10.23 to Form 10-K for the year ended 12/31/87).
|
|
10.11
|
Trust Agreement for The Connecticut Water Company Welfare Benefits Plan (VEBA) dated January 1, 1989. (Exhibit 10.21 to Form 10-K for year ended 12/31/89).
|
|
10.12
|
|
1994 Performance Stock Program, as amended and restated as of April 26, 2002. (Exhibit A to Proxy Statement dated 3/19/02).
|
10.12a
|
First Amendment to The Connecticut Water Service, Inc. Performance Stock Program Amended and Restated as of April 26, 2002 (the “Plan”) dated December 1, 2005. (Exhibit 10.22a to Form 10-K for the year ended 12/31/05).
|
|
10.12b
|
Second Amendment to The Connecticut Water Service, Inc. Performance Stock Program Amended and Restated as of April 26, 2002 (the “Plan”) dated January 1, 2008. (Exhibit 10.5 to 8-K filed on 1/30/08).
|
|
10.13
|
|
2004 Performance Stock Program, as of April 23, 2004. (Appendix A to Proxy Statement dated 3/12/04).
|
10.13a
|
First Amendment to The Connecticut Water Service, Inc. 2004 Performance Stock Program, dated January 7, 2004. (Exhibit 10.23f to Form 10-K for the year ended 12/31/05).
|
|
10.13b
|
Second Amendment to The Connecticut Water Service, Inc. 2004 Performance Stock Program, dated January 1, 2008. (Exhibit 10.6 to Form 8-K filed on 1/30/08).
|
|
10.13c
|
Connecticut Water Service, Inc. Performance Stock Program Incentive Stock Option Grant Form. (Exhibit 10.1 to Form 10-Q for the quarter ended 9/30/04).
|
|
10.13d
|
Connecticut Water Service, Inc. Performance Stock Program Non-Qualified Stock Option Grant Form. (Exhibit 10.2 to Form 10-Q for the quarter ended 9/30/04).
|
|
10.13e
|
Restricted Stock Agreement, standard form for officers, dated December 1, 2005 (Exhibit 10.1 to Form 8-K dated 1/13/06).
|
|
10.13f
|
Long-Term Performance Award Agreement, standard form for officers, dated January 11, 2006 (Exhibit 10.2 to Form 8-K dated 1/13/06).
|
|
10.13g
|
Performance Award Agreement, standard form for officers, dated January 11, 2006 (Exhibit 10.3 to Form 8-K dated 1/13/06).
|
|
10.14
|
Final Decision of the Connecticut PURA, Docket No. 09-12-11, dated July 14, 2010. (Exhibit 99.1 to Form 8-K dated 7/15/2010).
|
10.15
|
Form of Amended Restated Employment Agreement with the Company’s executive officers (Exhibit 10.19 to Form 10-K for year ended December 31, 2008), including:
a) Peter J. Bancroft
b) David C. Benoit
c) Terrance P. O’Neill
d) Eric W. Thornburg
e) Maureen P. Westbrook
|
10.16
|
Form of Amended Restated Employment Agreement with the Company’s executive officers (Exhibit 10.20 to Form 10-K for year ended December 31, 2008), including:
a) Kristen A. Johnson
b) Nicholas A. Rinaldi
|
10.17*
|
First Amendment to Amended and Restated Employment Agreement between the Company, The Connecticut Water Company and Kristen A. Johnson, dated March 8, 2013.
|
10.18*
|
First Amendment to Employment Agreement between the Company, the Maine Water Company and Judy E. Wallingford, dated March 8, 2013.
|
10.19
|
Form of Amended and Restated Supplemental Executive Retirement Agreement with the Company’s executive officers (Exhibit 10.21 to Form 10-K for year ended December 31, 2008), including:
a) Peter J. Bancroft
b) David C. Benoit
c) Kristen A. Johnson
d) Terrance P. O’Neill
e) Nicholas A. Rinaldi
f) Eric W. Thornburg
g) Maureen P. Westbrook
|
10.20
|
Form of Amended and Restated Deferred Compensation Agreement with the Company’s executive officers (effective January 1, 2011) (Exhibit 10.20 to Form 10-K for the year ended December 31, 2010), including:
a) Peter J. Bancroft
b) David C. Benoit
c) Kristen A. Johnson
d) Terrance P. O’Neill
e) Nicholas A. Rinaldi
f) Eric W. Thornburg
g) Maureen P. Westbrook
|
10.20a
|
Deferred Compensation Agreement between The Connecticut Water Company and Eric W. Thornburg, dated December 30, 2011 (Exhibit 10.4 to Form 8-K filed on 1/3/12).
|
10.20b
|
Form of amendment to Deferred Compensation Agreement, dated as of December 30, 2011, with the following Company officers (Exhibit 10.20b to Form 10-K for the year ended December 31, 2011):
a) David C. Benoit
b) Maureen P. Westbrook
c) Kristen A. Johnson
|
10.20c
|
Deferred Compensation Agreement between The Connecticut Water Company and Eric W. Thornburg, dated December 30, 2011. (Exhibit 10.4 to Form 8-K filed on January 3, 2012)
|
10.20d
|
Deferred Compensation Agreement between Connecticut Water Service, Inc. and Judy E. Wallinford, dated December 11, 2011, effective January 3, 2012. (Exhibit 20.d of the Form 10-K for the year ended December 31, 2011).
|
10.21
|
Master Loan Agreement and Promissory Note between Connecticut Water Service, Inc. and CoBank, ACB, dated June 29, 2009. (Exhibit 10.1 to Form 8-K filed on July 2, 2009)
|
10.21a
|
First Amendment to Promissory Note and Supplement, dated July 26, 2011, between Connecticut Water Service, Inc. and CoBank ACB (Exhibit 10.1 to Form 8-K filed on 7/29/11).
|
10.21b
|
Amendment to the Master Loan Agreement between Connecticut Water Service, Inc. and CoBank, ACB, dated January 1, 2012 (Exhibit 10.1 to Form 8-K filed on 1/3/12).
|
10.21c
|
Promissory Note and Single Advance Term Loan Supplement (Loan 1) between Connecticut Water Service, Inc. and CoBank, ACB, dated January 1, 2012 (Exhibit 10.2 to Form 8-K filed on 1/3/12).
|
10.21d
|
Promissory Note and Single Advance Term Loan Supplement (Loan 2) between Connecticut Water Service, Inc. and CoBank, ACB, dated January 1, 2012 (Exhibit 10.3 to Form 8-K filed on 1/3/12).
|
10.22
|
Line of credit agreement dated August 12, 2009 between RBS Citizens, National Association and Connecticut Water Service, Inc. (Exhibit 10.2 to Form 10-Q for the quarter ending September 30, 2009)
|
10.22a
|
Letter Amendment dated May 5, 2010 between RBS Citizen's, National Association and Connecticut Water Service, Inc. (Exhibit 10.2 to Form 10-Q filed on 5/7/10).
|
10.22b
|
Second Amendment to RBS Citizens Line of Credit Agreement, dated June 1, 2011. (Exhibit 10.22 of the Form 10-K for the year ended December 31, 2011)
|
10.23
|
Third Amendment to 2009 Promissory Note and Supplement, between Connecticut Water Service, Inc. and CoBank, dated September 4, 2012 (Exhibit 10.1 to current report on Form 8-K filed on Sept. 10, 2012).
|
10.24
|
First Amendment to 2012 Promissory Note and Supplement, between Connecticut Water Service, Inc. and CoBank, ACB, dated September 4, 2012 (Exhibit 10.2 to current report on Form 8-K filed on Sept. 10, 2012
|
10.25
|
Letter Agreement between Connecticut Water Service, Inc. and RBS Citizens, National Association, dated October 12, 2012 (Exhibit 10.1 to current report on Form 8-K dated Oct. 18, 2012).
|
10.26
|
Third Allonge to Demand Promissory Note, dated October 12, 2012 (Exhibit 10.2 to current report on Form 8-K dated Oct. 18, 2012).
|
10.27
|
Master Loan Agreement between The Connecticut Water Company and CoBank, ACB, dated October 29, 2012 (Exhibit 10.1 to current report on Form 8-K filed on Nov. 2, 2012).
|
10.28
|
Promissory Note and Single Advance Term Loan Supplement (Loan 1) between The Connecticut Water Company and CoBank, ACB, dated October 29, 2012 (Exhibit 10.2 to current report on Form 8-K filed on Nov. 2, 2012).
|
10.29
|
Promissory Note and Single Advance Term Loan Supplement (Loan 2) between The Connecticut Water Company and CoBank, ACB, dated October 29, 2012 (Exhibit 10.3 to current report on Form 8-K filed on Nov. 2, 2012).
|
10.30
|
Promissory Note and Single Advance Term Loan Supplement (Loan 3) between The Connecticut Water Company and CoBank, ACB, dated October 29, 2012 (Exhibit 10.4 to current report on Form 8-K filed on Nov. 2, 2012).
|
10.31
|
Promissory Note and Single Advance Term Loan Supplement (Loan 4) between The Connecticut Water Company and CoBank, ACB, dated October 29, 2012 (Exhibit 10.5 to current report on Form 8-K filed on Nov. 2, 2012).
|
10.32
|
Guarantee of Payment (Limited) by Connecticut Water Service, Inc., dated October 29, 2012 (Exhibit 10.6 to current report on Form 8-K filed on Nov. 2, 2012).
|
10.33
|
Amended and Restated Master Loan Agreement between the Maine Water Company and CoBank, ACB, dated December 1, 2012 and entered into on December 7, 2012 (Exhibit 10.1 to current report on Form 8-K filed on Dec. 7, 2012).
|
10.34
|
Promissory Note and Single Advance Term Loan Supplement between the Maine Water Company and CoBank, ACB, dated December 1, 2012 and entered into on December 7, 2012 (Exhibit 10.2 to current report on Form 8-K filed on Dec. 7, 2012).
|
10.35
|
Promissory Note and Single Advance Term Loan Supplement between The Connecticut Water Company and CoBank, ACB, dated March 5, 2013, is filed herewith (Exhibit 10.1 to current report on Form 8-K filed on March 6, 2013).
|
10.36
|
Amendment to Guarantee of Payment (Limited) by Connecticut Water Service, Inc., dated March 5, 2013(Exhibit 10.2 to current report on Form 8-K filed on March 6, 2013).
|
21*
|
Connecticut Water Service, Inc. Subsidiaries Listing.
|
23.1*
|
Consent of Independent Registered Public Accounting Firm.
|
31.1*
|
Rule 13a-14 Certification of Eric W. Thornburg, Chief Executive Officer.
|
31.2*
|
Rule 13a-14 Certification of David C. Benoit, Chief Financial Officer.
|
32.1**
|
Certification of Eric W. Thornburg, Chief Executive Officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
32.2**
|
Certification of David C. Benoit, Chief Financial Officer, pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
|
101.INS**
|
XBRL Instance Document
|
101.SCH**
|
XBRL Taxonomy Extension Schema
|
101.CAL**
|
XBRL Taxonomy Extension Calculation Linkbase
|
101.DEF**
|
XBRL Taxonomy Extension Definition Linkbase
|
101.LAB**
|
XBRL Taxonomy Extension Label Linkbase
|
101.PRE**
|
XBRL Taxonomy Extension Presentation Linkbase
|
Note:
|
Exhibits 10.1 through 10.5l, 10.13 through 10.15g, and 10.19 through 10.20d set forth each management contract or compensatory plan or arrangement required to be filed as an exhibit to this Form 10-K.
|
|
CONNECTICUT WATER SERVICE, INC.
Registrant
|
March 18, 2013
|
By
/s/ Eric W. Thornburg
Eric W. Thornburg
Chairman, President and Chief Executive Officer
|
Signature
|
|
Title
|
|
Date
|
/s/ Eric W. Thornburg
Eric W. Thornburg
|
|
Chairman, President, and Chief Executive Officer (Principal Executive Officer)
|
|
March 18, 2013
|
/s/ David C. Benoit
David C. Benoit
|
|
Vice President – Finance, Chief Financial Officer and Treasurer (Principal Financial Officer)
|
|
March 18, 2013
|
/s/ Nicholas A. Rinaldi
Nicholas A. Rinaldi
|
|
Controller (Principal Accounting Officer)
|
|
March 18, 2013
|
Signature
|
|
Title
|
|
Date
|
/s/ Mary Ann Hanley
Mary Ann Hanley
|
|
Director
|
|
March 13, 2013
|
/s/ Heather Hunt
Heather Hunt
|
|
Director
|
|
March 13, 2013
|
/s/ Mark G. Kachur
Mark G. Kachur
|
|
Director
|
|
March 13, 2013
|
/s/ David A. Lentini
David A. Lentini
|
|
Director
|
|
March 13, 2013
|
/s/ Arthur C. Reeds
Arthur C. Reeds
|
|
Director
|
|
March 13, 2013
|
/s/ Lisa J. Thibdaue
Lisa J. Thibdaue
|
|
Director
|
|
March 13, 2013
|
/s/ Carol P. Wallace
Carol P. Wallace
|
|
Director
|
|
March 13, 2013
|
/s/ Judith E. Wallingford
Judith E. Wallingford
|
|
Director
|
|
March 13, 2013
|
Description
|
Balance Beginning of Year
|
|
Beginning Balance Adjustments
(1)
|
|
Additions Charged to Income
|
|
Deductions From Reserves
(2)
|
|
Balance End of Year
|
||||||||||
Allowance for Uncollectible Accounts
|
|
|
|
|
|
|
|
|
|
||||||||||
Year Ended December 31, 2012
|
$
|
1,088
|
|
|
$
|
187
|
|
|
$
|
315
|
|
|
$
|
532
|
|
|
$
|
1,058
|
|
Year Ended December 31, 2011
|
$
|
1,061
|
|
|
$
|
—
|
|
|
$
|
660
|
|
|
$
|
633
|
|
|
$
|
1,088
|
|
Year Ended December 31, 2010
|
$
|
472
|
|
|
$
|
—
|
|
|
$
|
648
|
|
|
$
|
59
|
|
|
$
|
1,061
|
|
2.
|
The following new Paragraph 13A is added to the Agreement:
|
2.
|
The following new Paragraph 13A is added to the Agreement:
|
Name
|
State of Incorporation
|
Registrant:
|
|
Connecticut Water Service, Inc.
|
Connecticut
|
Subsidiaries:
|
|
The Connecticut Water Company
|
Connecticut
|
Chester Realty, Inc.
|
Connecticut
|
New England Water Utility Services, Inc.
|
Connecticut
|
The Barnstable Holding Company
|
Connecticut
|
The Maine Water Company
|
Maine
|
The Biddeford and Saco Water Company
|
Maine
|
1.
|
I have reviewed this annual report on Form 10-K of Connecticut Water Service, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d -15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
|
d.
|
Disclosed in the report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls over financial reporting.
|
1.
|
I have reviewed this annual report on Form 10-K of Connecticut Water Service, Inc.;
|
2.
|
Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
|
3.
|
Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;
|
4.
|
The registrant's other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d -15(f)) for the registrant and have:
|
a.
|
Designed such disclosure controls and procedures or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
|
b.
|
Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;
|
c.
|
Evaluated the effectiveness of the registrant's disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation;
|
d.
|
Disclosed in the report any change in the registrant's internal control over financial reporting that occurred during the registrant's most recent fiscal quarter (the registrant's fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant's internal control over financial reporting; and
|
5.
|
The registrant's other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant's auditors and the audit committee of the registrant's board of directors (or persons performing the equivalent functions):
|
a.
|
All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant's ability to record, process, summarize and report financial information; and
|
b.
|
Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant's internal controls over financial reporting.
|