Slides
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NYSE LISTED WTRG February 2024 Third Quarter 2025 November 5th, 2025
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2 Brian Dingerdissen Vice President Treasury, FP&A and Investor Relations
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This presentation contains in addition to historical information, forward looking statements based on assumptions made by management regarding future circumstances over which the company may have little or no control, that involve risks, uncertainties and other factors that may cause actual results to be materially different from any future results expressed or implied by such forward-looking statements. These factors include, among others, the following: general economic and business conditions; weather conditions affecting customers’ usage or the company’s cost of operations; costs arising from changes in regulations; regulatory treatment of rate increase requests; availability and cost of capital; the success of growth initiatives, including pending acquisitions; the ability to generate earnings from capital investment; and other factors discussed in our Form 10-K or 10-Q, which are on file with the SEC. We undertake no obligation to publicly update or revise any forward-looking statement. Non-GAAP Reconciliation For reconciliation of non-GAAP financial measures, see the Investor Relations section of the company’s Web site at www.essential.co Forward Looking Statement 3
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4 Christopher Franklin Chairman and Chief Executive Officer
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Unites two industry leaders with a shared mission to deliver safe, clean, reliable, and affordable water and wastewater services, while elevating customer experience through operational excellence Results in a Leading U.S. Water & Wastewater Utility Solidifies position as a premier public water & wastewater utility with an expanded footprint across 17 states and on 18 military installations, 4.7M water & wastewater connections, and increased ability to help solve water & wastewater challenges across the United States Strengthens Platform for Superior Customer Experience Leverages operational and financial expertise and efficiencies from complementary platforms to drive high quality, affordable service Presents Inorganic & Organic Growth Opportunities Retains American Water’s 7% - 9% long- term EPS and dividend per share growth rate targets, driven by both strategic acquisitions and core business expansion Enhances Financial Strength, Expands Low Risk Foundation Highly stable and supportive cash flows and strengthened balance sheet form foundation for continued infrastructure investments Essential Utilities and American Water Merger 5 Merger Unlocks Compelling Growth and Value Potential for Both Companies
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6 Delivering Top Quartile Total Shareholder Return Pro Forma EPS and Dividend Outlook Highly Durable, Low Risk Capital Investment Plan •Transaction EPS accretive in first year after transaction close •Expect to maintain American Water’s 7% - 9% long-term EPS and DPS growth targets •Expect to adopt American Water’s current dividend policy and 55% - 60% payout target, supporting reinvestment in accretive rate base growth •Decades of pipe replacement needed in aging water systems o March 2025 ASCE Infrastructure Report Card graded U.S. Drinking Water and Wastewater systems as a C– and D+, respectively •Significant water quality and resiliency investments needed, including PFAS and lead remediation •Regionalization of extremely fragmented water and wastewater systems in the U.S. offers unique opportunity to grow •Customer affordability remains a core focus, underpinning growth Total Return Comparison vs. Large Cap Regulated Utility Peers 6.0% 8.0% 7.0% 8.0% 6.0% 8.0% 8.0% 7.0% 6.0% 7.0% 7.0% 6.0% 7.0% 6.8% 6.0% 7.0% 9.0% 7.0% 6.0% 6.0% 6.0% 6.0% 6.0% 6.0% 5.0% 6.0% 3.1% 3.9% 2.5% 4.5% 2.5% 2.3% 3.1% 4.1% 3.0% 3.0% 4.0% 2.9% 3.1% 3.8% 2.8% 0.6% 2.6% 3.4% 3.4% 3.3% 3.2% 3.1% 3.0% 3.5% 12.0% 11.1% 10.9% 10.5% 10.5% 10.5% 10.3% 10.1% 10.1% 10.0% 10.0% 10.0% 9.9% 9.9% 9.8% 9.8% 9.6% 9.6% 9.4% 9.4% 9.3% 9.2% 9.1% 9.0% 8.5% S&P BBB- BBB + BBB BBB + BBB + A1 BBB + BBB + BBB + BBB + A- BBB + BBB + A- BBB + BBB + BB BBB + BBB + A- A- A- BBB + BBB + BBB + Moody’sBaa2 Baa2 Baa3 Baa2 Baa2 Baa11 Baa2 Baa2 Baa2 Baa2 Baa1 Baa2 Baa1 Baa1 Baa1 Baa1 Ba2 Baa2 Baa2 Baa2 Baa2 Baa1 Baa2 Baa2 Baa2 Source: Public disclosure, S&P Capital IQ as of 10/29/2025 1. Reflects current American Water credit ratings 2. Based on midpoint of management guidance Dividend Yield 1st Quartile 2nd Quartile 3rd Quartile 4th Quartile EPS Growth2
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Company Highlights 7 Q3 2025 EPS of $0.33 2025 EPS and Capex Guidance Reaffirmed 2024 Sustainability Report Published $26M Data Center Investment in Western PA Intelis Meter Installation Update Long-term Targets Reaffirmed
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Image Source: Pennsylvania state government’s Robena Redevelopment Plan document 8 Investment in Major Data Center in Western PA Project will bring our water and gas expertise together to support economic development in Pennsylvania Essential’s initial investment is $26M Expected revenues to commence FY 2029 Conversations ongoing for future regulated and non-regulated data center opportunities
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9 Consistently Delivering Growth $1.0 $1.1 $1.2 $1.3 2021 2022 2023 2024 2025 $1.4 - $1.5 $1.67 $1.77 $1.86 $1.97 2021 2022 2023 2024 2025 Diluted Income per Common Share $2.09 $1.038 $1.110 $1.188 $1.265 $1.336 2021 2022 2023 2024 2025E Dividends Paid per Share Dividend Payout Ratio of 60-65% 80th Consecutive Year of Dividend Payments Capital Expenditures ($Billion) (1) (1) 2024 GAAP Diluted Earnings per Share of $2.17. See reconciliation in Appendix. (2) Based on the midpoint of the guidance range. 2025-2029 Infrastructure Investments of ~$7.8B (2)
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10 Daniel Schuller EVP, Chief Financial Officer
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Q3 Financial Highlights 11 As of September 30th, 2025 ($ in millions, except per share data) Q3 2024 Q3 2025 Change Operating Revenues $435.3 $477.0 9.6% Increase Purchased Gas $19.1 $22.5 17.8% Increase Operations and Maintenance Expense $144.4 $153.1 6.0% Increase Operating Income $155.1 $169.8 9.5% Increase Net Income $69.4 $92.1 32.7% Increase Net Income per Share $0.25 $0.33 32.0% Increase
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Operating Revenues $435.3 $34.2 $3.4 $2.8 $1.4 $0.3 $(0.4) $477.0 Q3 2024 Rates & Surcharges Purchased Gas Other Growth - Water Volume - Water Volume - Gas Q3 2025 Change in Operating Revenues (millions) 12 Q3 2025 vs. Q3 2024 Figures may not total precisely due to rounding
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Operations & Maintenance Expenses $144.4 $7.2 $4.2 $2.4 $0.6 $0.4 ($6.2) $153.1 Q3 2024 Employee related costs Bad debt Production Costs - Water USP (rider) Offset Growth - Water Other Q3 2025 Change in Operations & Maintenance Expense (millions) 13 Q3 2025 vs. Q3 2024 Figures may not total precisely due to rounding
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Earnings per Common Share $0.25 $0.088 $0.003 $0.001 ($0.001) ($0.001) ($0.016) $0.33 Q3 2024 Rates & Surcharges Growth Volume - Water Volume - Gas Other Expenses Q3 2025 Change in Earnings Per Share 14 Q3 2025 vs. Q3 2024 Figures may not total precisely due to rounding
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Approximate Earnings Per Share by Quarter 15 20% 10% 10% 40% 30% 20% 20% 50% 4Q 3Q 2Q 1Q For 2025, expect to achieve GAAP earnings per share above the guidance range of $2.07-$2.11 due to non-recurring benefits. 1Q 2025 GAAP EPS: $1.03 Roadmap to Annual Guidance 2Q 2025 GAAP EPS: $0.38 Yearly Guidance $2.07-$2.11 3Q 2025 GAAP EPS: $0.33
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PENDING REGULATORY RECOVERIES Water segment base rate cases and/or surcharges in NC, OH, TX, and VA with requested annualized revenue increase of $96.5 million 2025 COMPLETED REGULATORY RECOVERIES Water segment base rate cases and/or surcharges in NC, NJ, OH, and PA with annualized revenue increase of $92.6 million Gas segment base rate cases and/or surcharges in KY and PA with annualized revenue increase of $8.9 million Regulatory Activity As of November 4, 2025 16 Gas segment surcharge in KY with requested annualized revenue increase of $2.9 million
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17 Christopher Franklin Chairman and Chief Executive Officer
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(1) Essential's estimate of the number of equivalent dwelling units. (2) Dril-Quip and Integra are privately owned utilities. - 20,000 40,000 60,000 80,000 100,000 120,000 140,000 2015 2017 2019 2021 2023 2025 Customers Continued Water and Wastewater Acquisition Success Over 200,000 1 Total Customers ~$301M Total Purchase Price Over 135,000 1 water and wastewater customers and approximately $550 Million in rate base acquired through M&A since 2015 Pending Transactions Cumulative Additions of Customers Through Acquisitions Since 2015 18 TX TX PAPA PA Transactions Closed in 2025 DELCORA • Wastewater • 198,000 customers(1) • $276.5M purchase price GREENVILLE • Water • 3,000 customers • $18.0M purchase price DRIL-QUIP(2) • Water/Wastewater • 380 customers • $1.1M purchase price BEAVER FALLS • Wastewater • 7,000 customers(1) • $37.8M purchase price INTEGRA(2) • Wastewater • 1,100 customers • $4.4M purchase price OH PA GREENVILLE • Wastewater • 2,300 customers • $18.0M purchase price MIDVALE • Water • 900 customers • $3.0M purchase price
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Guidance Outlook1 19 Corporate Growth Targets Aqua Targets Segment rate base CAGR of approximately 6% through 2029 Segment customer base annual growth rate of between 2 and 3% over the long-term Peoples Targets Segment rate base CAGR of approximately 11% through 2029 Segment customer base expected to be stable through 2027 1) Guidance includes signed municipal water and wastewater acquisitions for which the company has entered into signed purchase agreements as of the time the 2025 guidance was announced but does not include DELCORA or other potential municipal acquisitions from the company’s list of acquisition opportunities. The guidance is also based on the company’s expectation that it will continue to issue equity and debt on an as needed basis to support acquisitions and capital investment plans. 2) Includes $25M for the company’s recently announced Greene County data center project investment 2025 normalized net income per diluted common share target of $2.07- $2.11 Through 2027, EPS will grow at a CAGR of 5 – 7% Regulated utility rate base growth of 8% through 2029 $1.4 to $1.5B infrastructure investment for 2025 2025-2029 Infrastructure investments of ~$7.8B In 2025, we expect to raise ~$350M in equity2 Dividends & Capital Structure Dividend Payout Ratio Debt to Capital Ratio FFO to Net Debt Ratio 60 - 65% 50 - 55% 12 - 14%
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Brian Dingerdissen Vice President, Investor Relations, FP&A and Treasury (610) 645-1191 BJDingerdissen@Essential.co For More Information Contact: 20 Ed Vallejo Director, Investor Relations (267) 370-9717 EdVallejo@Essential.co
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21 Appendix
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YTD Financial Highlights 22 As of September 30th, 2025 ($ in millions, except per share data) YTD 2024 YTD 2025 Change Operating Revenues $1,481.7 $1,775.5 19.8% Increase Purchased Gas $182.5 $263.9 44.6% Increase Operations and Maintenance Expense $423.8 $439.4 3.7% Increase Operating Income $531.0 $693.9 30.7% Increase Net Income $410.6 $483.7 17.8% Increase Net Income per Share $1.50 $1.73 15.3% Increase
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Operating Revenues $1,481.7 $145.6 $81.4 $34.0 $33.2 $4.9 $(5.3) $1,775.5 YTD 2024 Rates & Surcharges Purchased Gas Volume - Gas Other Growth - Water Volume - Water YTD 2025 Change in Operating Revenues (millions) 23 YTD 2025 vs. YTD 2024 As of September 30th, 2025 Figures may not total precisely due to rounding
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Operations & Maintenance Expenses $423.8 $18.2 $9.8 $5.5 $1.0 ($17.9) ($1.0) $439.4 YTD 2024 Employee related costs USP (rider) Offset Production Costs - Water Growth - Water Other Bad Debt YTD 2025 Change in Operations & Maintenance Expense (millions) 24 YTD 2025 vs. YTD 2024 As of September 30th, 2025 Figures may not total precisely due to rounding
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Earnings per Common Share $0.38 $0.09 $0.01 ($0.22) ($0.02) ($0.01) $1.50 $1.73 YTD 2024 Rates & Surcharges Volume - Gas Growth - Water Other Volume - Water Expenses YTD 2025 Change in Earnings Per Share 25 YTD 2025 vs. YTD 2024 As of September 30th, 2025 Figures may not total precisely due to rounding
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2025 Regulatory Activity Completed As of November 4, 2025 26 State Docket Number Segment Type Annualized Revenue Increase ($ 000's) N/A Wastewater Rate Case 550 N/A Water Rate Case 889 N/A Water Rate Case 801 24-910-WW-SIC Water Surcharge 3,237 24-911-ST-SIC Wastewater Surcharge 45 New Jersey WR24010057 Water Surcharge 2,468 W-218, Sub 573 Water Rate Case - Year 3 2,242 W-218, Sub 573 Wastewater Rate Case - Year 3 1,153 W-218, Sub 573 Water Rate Case - Year 3 471 W-218, Sub 573 Water Rate Case - Year 3 108 W-218, Sub 573 Wastewater Rate Case - Year 3 157 R-2024-3047822 Water Rate Case 58,400 R-2024-3047824 Wastewater Rate Case 14,600 M-2024-3052594 Water Surcharge 7,235 M-2024-3052599 Wastewater Surcharge 291 M-2025-3053185 Gas Surcharge 638 2024-00332 Gas Surcharge 486 2025-00086 Gas Surcharge 56 2024-00346 Gas Rate Case 7,700 Total 101,526 Kentucky Ohio North Carolina Pennsylvania
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Regulatory Activity Pending As of November 4, 2025 27*Revenue increase over multi-year rate plan through December 2028 State Docket Number Segment Type Requested Annualized Revenue Increase ($ 000's) Texas 58124 Water Rate Case 29,148 Ohio 25-0594-WW-AIR Water Rate Case 14,653 North Carolina W-218, Sub 629 Water Rate Case * 44,763 Virginia CASE NO. PUR-2025-00071 Water Rate Case 7,927 Kentucky 2025-00333 Gas Surcharge 2,884 Total 99,374
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State by State Comparison of Services As of September 30, 2025 Water and Wastewater Gas Distribution State Rate Base (millions) Water Connections (thousands) Wastewater Connections (thousands) Total Customers (thousands) Rate Base (millions) Total Customers (thousands) PA $4,746 459.4 68.0 527.4 $4,295 701.2 IL $594 69.9 24.9 94.8 OH $537 155.0 11.2 166.2 TX $666 76.6 25.8 102.4 NC $416 87.9 23.6 111.5 NJ $316 56.4 7.0 63.4 KY $179 39.0 VA $139 27.7 8.5 36.2 IN $125 1.5 31.7 33.2 TOTAL $7,539 934.4 200.7 1,135.1 $4,474 740.3 28
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GAAP to Non-GAAP Reconciliation Year Ended December 31, 2024 29 (in millions, except per share data) FY 2024 Net income (GAAP financial measure) $595.3 Adjustments: Gain on sales of assets and related transaction activities (94.0) Adjustments for estimated effects of unfavorable weather 18.7 Income tax effect of non-GAAP adjustments 20.9 Adjusted income (Non-GAAP financial measure) $540.9 Net income per common share (GAAP financial measure): Basic $2.17 Diluted $2.17 Adjusted income per common share (Non-GAAP financial measure): Basic $1.97 Diluted $1.97 Average common shares outstanding: Basic 273.9 Diluted 274.4