SJW Corp. Announces Second Quarter Financial Results

Net income was $4.4 million for the second quarter. Diluted earnings per common share were $0.23, compared to $0.34 per share for the second quarter in 2008.

Water production costs for the second quarter of 2009 were $23.9 million versus $25.6 million for the same period in 2008. The decrease of $1.7 million was primarily attributable to lower customer demand of $2.8 million and $744,000 in savings due to greater surface water supply, offset by $1.8 million in higher per unit costs for purchased water and groundwater extraction charges.

Non-water production costs for the second quarter of 2009 were $23.3 million versus $20.6 million for the same period in 2008, an increase of $2.7 million. This was attributable to increases of $1.2 million in administrative and general expenses, $751,000 in taxes other than income taxes, $478,000 in other operating expense and $198,000 in other expenses. Income tax expense decreased $1.3 million in the second quarter to $3.0 million in 2009 from $4.3 million in 2008 as a result of lower pre-tax income.

Year-to-date operating revenue decreased by $3.1 million to $98.2 million from $101.3 million in the first six months of 2008. The decrease was attributable to $7.5 million in lower customer water usage and $1.2 million lower revenue from real estate operations, partially offset by $5.5 million in cumulative rate increases and $125,000 from new customers.

Year-to-date net income was $4.5 million, compared to $9.0 million in 2008. Earnings per basic and diluted share respectively were $0.25 and $0.24 in the first six months of 2009, compared to $0.49 and $0.48 per basic and diluted share respectively for the same period in 2008.

Year-to-date water production costs decreased to $37.5 million from $39.1 million in 2008. The $1.6 million decrease was primarily attributable to lower customer demand of $4.0 million and savings due to greater surface water supply of $191,000, offset by higher per unit costs for purchased water and groundwater extraction charges of $2.6 million. Non-water production costs increased $5.3 million to $46.1 million from $40.8 million. Components of the increase included $2.5 million in administrative and general expenses, $1.5 million in taxes other than income taxes, $772,000 in other operating expenses, $742,000 in depreciation expense, partially offset by a decrease of $184,000 in maintenance expenses. Income tax expense decreased $3.0 million year-to-date due to lower pre-tax income.

The Directors of SJW Corp. today declared a quarterly dividend on common stock of $0.165 per share. The dividend is payable on September 1, 2009 to shareholders of record on August 10, 2009.

SJW Corp. is a publicly traded holding company headquartered in San Jose, California. SJW Corp. is the parent company of San Jose Water Company, SJWTX, Inc. and SJW Land Company. Together, San Jose Water Company and SJWTX, Inc. provide regulated and nonregulated water service to more than one million people in San Jose, California and nearby communities and in Canyon Lake, Texas and nearby communities. SJW Land Company owns and operates commercial buildings, has a majority interest in a real estate partnership, and has properties in the states of California, Florida, Connecticut, Texas, Arizona and Tennessee.

This press release may contain certain forward-looking statements including but not limited to statements relating to SJW Corp.'s plans, strategies, objectives, expectations and intentions, which are made pursuant to the safe harbor provisions of the U.S. Private Securities Litigation Reform Act of 1995. These forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of SJW Corp. to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. The results for a quarter are not indicative of results for a full year due to seasonality. Certain factors that may cause actual results, performance or achievements to materially differ are described in SJW Corp.'s most recent reports on Form 10-K, Form 10-Q and Form 8-K filed with the Securities and Exchange Commission. SJW Corp. undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise.

SJW Corp.
Condensed Consolidated Statements of Income and
Comprehensive Income (Loss)
(Unaudited)
(in thousands,
except per share data)
                                      THREE MONTHS ENDED       SIX MONTHS ENDED
                                      JUNE 30,                 JUNE 30,
                                      2009         2008        2009        2008
OPERATING REVENUE                     $58,194      60,058      98,215      101,311
OPERATING EXPENSE:
Operation:
Purchased water                       12,601       14,176      20,390      21,172
Power                                 1,817        2,010       2,577       3,076
Groundwater extraction charge         9,480        9,417       14,532      14,833
Total production costs                23,898       25,603      37,499      39,081
Administrative and general            6,897        5,648       14,027      11,487
Other                                 4,547        4,069       8,524       7,752
Maintenance                           3,216        3,272       6,132       6,316
Taxes, other than income              2,392        1,641       4,682       3,231
Depreciation & amortization           6,238        5,984       12,789      12,047
Income taxes                          2,975        4,309       3,076       6,095
Total operating expense               50,163       50,526      86,729      86,009
OPERATING INCOME                      8,031        9,532       11,486      15,302
Interest on long-term debt and other  (3,613  )    (3,254 )    (6,952 )    (6,306  )
NET INCOME                            $4,418       6,278       4,534       8,996
Other comprehensive loss, net         (3,258  )    (3,491 )    (6,224 )    (2,758  )
COMPREHENSIVE INCOME (LOSS)           $1,160       2,787       (1,690 )    6,238
Earnings per share
-Basic                                $0.24        0.34        0.25        0.49
-Diluted                              $0.23        0.34        0.24        0.48
Dividend per share                    $0.17        0.16        0.33        0.32
Weighted average shares outstanding
-Basic                                18,483       18,403      18,476      18,390
-Diluted                              18,670       18,596      18,664      18,594

SJW Corp.
Condensed Consolidated Balance Sheets
(Unaudited)
(thousands
of dollars)
                                                                    June 30   December 31
                                                                    2009      2008
ASSETS
UTILITY PLANT:
Land                                                                $8,404    8,134
Depreciable plant and equipment                                     878,703   855,427
Construction in progress                                            15,380    7,142
Intangible assets                                                   10,790    8,040
Total utility plant                                                 913,277   878,743
Less accumulated depreciation and amortization                      285,693   272,562
Net utility plant                                                   627,584   606,181
REAL ESTATE INVESTMENT:                                             88,000    88,000
Less accumulated depreciation and amortization                      6,350     5,511
Net real estate investment                                          81,650    82,489
CURRENT ASSETS:
Cash and equivalents                                                4,771     3,406
Accounts receivable and accrued unbilled utility revenue            34,297    26,329
Prepaid expenses and other                                          2,458     2,226
Total current assets                                                41,526    31,961
OTHER ASSETS:
Investment in California Water Service Group                        40,522    51,071
Debt issuance costs, net of accumulated amortization                3,195     3,162
Regulatory assets                                                   73,518    73,778
Other                                                               2,360     2,235
                                                                    119,595   130,246
                                                                    $870,355  850,877
CAPITALIZATION AND LIABILITIES
CAPITALIZATION:
Common stock                                                        $9,628    9,611
Additional paid-in capital                                          21,358    20,548
Retained earnings                                                   203,417   204,744
Accumulated other comprehensive income                              13,200    19,423
Total shareholders' equity                                          247,603   254,326
Long-term debt, less current portion                                246,221   216,613
Total capitalization                                                493,824   470,939
CURRENT LIABILITIES:
Line of credit                                                      3,000     18,400
Current portion of long-term debt                                   728       705
Accrued groundwater extraction charge and purchased water           8,112     5,256
Purchased power                                                     1,300     563
Accounts payable                                                    10,350    5,758
Accrued interest                                                    4,984     4,567
Other current liabilities                                           8,529     8,074
Total current liabilities                                           37,003    43,323
DEFERRED INCOME TAXES AND CREDITS                                   98,648    98,713
ADVANCES FOR CONSTRUCTION AND CONTRIBUTIONS IN AID OF CONSTRUCTION  189,926   188,869
POSTRETIREMENT BENEFIT PLANS                                        44,178    42,331
OTHER NONCURRENT LIABILITIES                                        6,776     6,702
                                                                    $870,355  850,877

SOURCE: SJW Corp.

SJW Corp. 
Suzy Papazian, 408-279-7961 
Corporate Secretary