California Water Service Group (CWT) reported a net income of $128.2 million for the fiscal year ending December 31, 2025, a decrease of 33.8% from the previous year's net income of $190.8 million. This decline was attributed to a $36.7 million drop in operating revenue, primarily due to reduced customer usage and the cumulative adjustment from the 2021 General Rate Case (GRC) that was recorded in 2024. Operating revenue for 2025 totaled $1,000.1 million, compared to $1,036.8 million in 2024. The company also experienced an increase in total operating expenses, which rose by $18 million, driven by higher water production costs and administrative expenses.
In terms of operational metrics, California Water Service Group served approximately 562,000 customer connections across its various subsidiaries, with California operations accounting for 91.2% of total consolidated operating revenue. The company’s customer base grew slightly from 560,100 in 2024, reflecting a stable demand for water services despite the overall decrease in revenue. The company’s employee headcount stood at 1,336 as of December 31, 2025, indicating a consistent workforce to support its operations.
Strategically, California Water Service Group is pursuing growth through acquisitions, with notable developments including an agreement to purchase Nexus Water Group’s Nevada and Oregon water and wastewater systems for approximately $218 million, expected to close by the end of 2026. Additionally, the company plans to acquire the remaining membership interests in BVRT Utility Holding Company for $45 million. These acquisitions are part of the company's strategy to expand its regulated and non-regulated water and wastewater activities, particularly in the western United States.
Looking ahead, California Water Service Group anticipates capital expenditures between $580 million and $640 million for 2026, driven by ongoing infrastructure improvements and compliance with new regulations, including those related to per- and polyfluoroalkyl substances (PFAS). The company has proposed significant investments in its infrastructure, including over $1.6 billion from 2025 to 2027, aimed at enhancing water supply reliability and addressing aging infrastructure. The company’s management remains optimistic about future growth opportunities, contingent on regulatory approvals and market conditions.
About CALIFORNIA WATER SERVICE GROUP
California Water Service Group operates regulated and non-regulated water and wastewater utilities primarily in California, Washington, New Mexico, Hawaii, and Texas. Its core business includes sourcing, treating, distributing, and selling water for domestic, industrial, public, and irrigation uses, alongside wastewater collection and treatment. The company serves approximately two million people, leveraging regulated rate structures and lease agreements to provide reliable, compliant utility services with a focus on infrastructure investment and water quality management.
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