American Water Works reports higher second quarter earnings.

VOORHEES, N.J.--(BUSINESS WIRE)--July 27, 1995--American Water Works Company Inc. Thursday reported second quarter 1995 net income to common stock of $26.4 million, a 22 percent increase over the $21.7 million in 1994.

Earnings per share for the quarter were up 18 percent to 80 cents from 68 cents last year. A one-time gain of $3.9 million or 12 cents per share was recorded in the quarter reflecting the conclusion of litigation relating to the taking of water system assets in Grafton, Mass.

Without this one-time gain, net income to common stock for the second quarter 1995 totaled $22.5 million. Revenues for the second quarter of $200.7 million were 3 percent above the same period in 1994.

George W. Johnstone, American Water's president and chief executive officer, said, "During the quarter the company resolved the litigation with the Grafton Water District in Massachusetts to recover the fair market value of the water utility assets taken through eminent domain by the District in 1988.

"In 1990, a jury awarded the company $5.6 million for these assets. Since that time, the District pursued various appeals, all of which resulted in reaffirmation of the jury award.

"In addition to the approximately $1.1 million paid by the District in 1988, the company received an additional $6.6 million which includes the remainder of the jury award and $2.1 million in interest. This produced a gain of $3.9 million after applicable income taxes."

Commenting on American Water's 1995 second quarter results, Johnstone said, "Even though water use by customers was 2 percent less than the same period in 1994, we are pleased to report net income to common stock, before the impact of the one-time gain, exceeded last year by 4 percent. Higher revenues, reflecting the impact of rates authorized since last year, offset a modest increase in the total business costs."

For the first six months of 1995, net income to common stock increased 25 percent to $39.0 million from $31.2 million the previous year. Earnings per share for the period were up 19 percent to $1.18 compared with 99 cents in 1994.

Without the one-time item, net income to common stock for the 1995 six-month period increased 13 percent to $35.1 million, and earnings per share were up 7 percent to $1.06. Revenues for the six-month period of $381.5 million were 2 percent above those recorded in the same period in 1994.

American Water Works Company is the largest regulated water utility business in the United States serving a population in excess of 6 million people in more than 700 communities in 21 states.

For the three, six and twelve month periods ended June 30, American Water Works Company Inc. reported unaudited consolidated revenues and income as follows: -0-

                     (Dollars in thousands, except per share amounts)
                          Three Months Ended      Six Months Ended
                              June 30,                June 30,
                          1995        1994        1995        1994
                          ----        ----        ----        ----
Operating revenues      $200,662    $195,136    $381,506    $372,795
Net income                27,425      22,729      40,972      33,159
Dividends on preferred
 stocks                      996         996       1,992       1,992
Net income to common
 stock                   $26,429     $21,733     $38,980     $31,167
Average shares of common
 stock outstanding
 (in thousands)           33,133      31,736      32,945      31,500
Earnings per common
 share on average
 shares outstanding         $.80        $.68       $1.18        $.99

-0-
                     (Dollars in thousands, except per share amounts)
                                    Twelve Months Ended
                                          June 30,
                                      1995        1994
                                      ----        ----
Operating revenues                  $778,952    $754,925
Net income                            86,465      76,528
Dividends on preferred
 stocks                                3,984       3,984
Net income to common
 stock                              $ 82,481    $ 72,544
Average shares of common
 stock outstanding
 (in thousands)                       32,632      31,341
Earnings per common
 share on average
 shares outstanding                    $2.53       $2.31

CONTACT: American Water Works Company Inc., Voorhees

George W. Johnstone, president/CEO, 609/346-8200