Ladies and gentlemen, thank you for standing by. Welcome to the American States Water Company Conference Call, discussing the Company’s Fourth Quarter and Full Year 2016 Results. The call is being recorded. If you would like to listen to the replay of this call, it will begin this afternoon at approximately 5 PM Eastern Time and run through Friday, March 3, 2017 on the Company’s website, www.aswater.com. The slides that the Company will be referring to are also available on the website. All participants will be in listen-only mode. [Operator Instructions] After today's presentation, there will be an opportunity to ask questions. [Operator Instructions] This call will be limited to one hour. Presenting today from American States Water Company is Bob Sprowls, President and Chief Executive Officer; and Eva Tang, Senior Vice President of Finance and Chief Financial Officer. As a reminder, certain matters discussed during this conference call may be forward-looking statements intended to qualify for the Safe Harbor from liability established by the Private Securities Litigation Reform Act of 1995. Please review a description of the Company’s risks and uncertainties in our most recent Form 10-K and Form 10-Q on file with the Securities and Exchange Commission. In addition, this conference call will include a discussion of certain measures that are not prepared in accordance with Generally Accepted Accounting Principles or GAAP in the United States and constitute non-GAAP financial measures under SEC rules. These non-GAAP financial measures are derived from consolidated financial information, but are not presented in our financial statements that are prepared in accordance with GAAP. For more details, please refer to the press release. At this time, I will turn the conference over to Bob Sprowls, President and Chief Executive Officer of American States Water Company.

Thank you, Andrea, and welcome everyone and thank you for joining us today. I'll begin with some highlights for the year. Eva will then discuss some financial details and then I'll wrap it up with some updates on the general rate case of California drought, ASUS, dividend and our 2017 outlook then we will then take your questions. I'm pleased to report that the Company produced another year of solid financial performance from our two first year subsidiaries, Golden State Water Company, regulated water and electric utility and American State Utilities Services or ASUS for short, our contracted services business. We earned $1.62 per share and achieved a consolidated return on equity for the year of 12.4%, All while increasing our dividend by 8% continuing our record of 62 consecutive years of annual dividend increases. We also continue to invest in the reliability of our water and our electric systems. Golden State Water invested $121 million in company funded net facility infrastructure work during 2016, the highest in our company's history. In December 2016, the California Public Utilities Commission or CPUC approved for water general rate case for Golden State Water, which determined the rates for the years 2016 through 2018. The new rates approved by the CPUC are retroactive to January 1, 2016, and we will be discussing the effect of that in more detail later in the call. Continue with our highlights on the next slide, one of the key accomplishments for 2016 was the award of a 15-year contract by the U.S. government for ASUS as to operate, maintain and provide construction management services for the water and waste water system at Eglin Air Force Base. The initial value of this contract is $510 million over the 50 years and the contract is expected to contribute $0.02 to $0.03 per share on an annualized basis. Eglin is the largest Air Force installation in the Continental United States in terms of land area. With the Eglin addition, ASUS will be managing the water and waste water systems at 10 military bases throughout the country. We are very excited about this contract win and optimistic about additional growth opportunities moving forward. ASUS contributed $0.33 per share for 2016 and continue to earn a higher return on investment in our well performing regulated utilities. I will now turn the call over to Eva to review some of the details for the quarter and they year.

Thank you, Bob. Hello everyone. I’ll begin with an overview of our financial results on Slide 8. Consolidated earnings for the fourth quarter were $0.30 per share compared to $0.31 per share for the same period in 2015. Of the $0.30 earnings per share for the quarter, $0.13 was from our Water segment, $0.04 from our Electric segment and $0.13 from our Contracted Services business. As Bob mentioned, in December, the CPUC issued a decision on the water generate case for rates in year 2016 through 2018. Earnings for the quarter reflected retroactive impact of the new water rate on Golden State Water's first nine months of 2016. As a result, we recorded $0.08 per share downward adjustments to earnings in the fourth quarter of 2016 related to the first three quarters of the year. The adjustment was due to a decrease of approximately $5.2 million in the adopted water gross margins for the nine months ended September 30, 2016. As the result of the December decision compared to the recorded margin through September 16. I'll go over other major items that impacted our results for the quarter over the next two slides. As we have discussed in the previous earnings conference call and in our financial filings, the water revenues reported for the nine months of 2016 reflected a consumption activity that the CPUC would adopt Golden State Water's position in its entirely on two litigated issues, our capital expenditure request and compensation from a material level employee. The December decision accrued approximately 87% of our capital request. This allowed a portion of executive compensation and update expense inflation taxes for 2014 to 2016, all of which result in the recording in Q4 of the retroactive adjustment as I discussed earlier. Partially offsetting this revenue decrease was an increase…

Thank you, Eva. The CPUC's December decision in the water general rate case for Golden State Water is retroactive to January 1. 2016. However because of the delay in issuing a decision, the CPUC has ordered Golden State Water to bypass implementing 2016 rates and to implement 2017 rates once the CPUC has corrected some minor rate calculations in the December decision. Any revenue shortfall due to differences between the actual rates charged in 2016 while the decision was still pending and the final 2016 rates adopted in the December decision will be recovered in a rate surcharge. Once the CPUC approves the minor corrections, which is expected to occur next week on March 2nd, the adopted revenue in 2017 is expected to increase by $2.8 million as compared to 2016 adopted revenue. These rates retroactively effected January 1st 2017. As Eva mentioned earlier, based on the December decision the 2016 adopted revenues were lower than in 2015 due to reductions in supply cost caused by lower consumption, depreciation expense resulting from an updated depreciation study and other operating expenses due to our cost containment initiatives. The CPUC also authorize a sales adjusted mechanism for the 2017 and 2018 escalation years, which adjust adopted WRAM-related sales levels, if there is 10% or more variance positive or negative between actual and adopted usage. If actual WRAM-related sales in a given year differ by 10% or more of the adopted WRAM-related sales, the following years adopted WRAM-related sales are adjusted by one half of the difference. Based on 2016 actual sales, the sales adjusted mechanism was triggered in three of Golden State Water's nine rate making areas, resulting in a downward adjustment to those rate making areas adopted 2017 WRAM-related sales. As a reminder in early 2016, we've received CPUC approval to…

Got a few questions here. So Bob, what caused the $0.02 bump in ASUS's 2017 guidance? I know previously you said $0.32 to $0.36. Is it sustaining the higher construction margins that benefited 2016?

Yes, that's we're looking for doing, looking to do a little more construction than we had originally planned for.

So, more construction and better margins or just more construction?

Well, I would say it's a combination of those two more construction and then continued focused on improving our direct construction margin.

Okay. And then the comment about bypassing implementing the rate changes. Is that just a cash flow impact? Like another words, do your 2016 results fully reflect the GRC outcome?

The 2016 results do fully reflect the GRC outcome. But this is really more about when are we going to charge our customers for that. So, we will have a surcharge to collect the amounts that were under collected.

Right, so the $2.8 million is that presumably the 2017 step increase?

It is, yes.

Okay, have you disclosed what the step increase for 2018 is, that's contemplated? I know it's subject to the earnings tests.

No, we haven’t. Yes, it's really a subject to the earnings tests, Jonathan; and we would implement about, I would say 9.5 million to 10 million surcharges for 2016 rate retroactive to January 1.

Right, okay. And then were there any advice letter recovery projects included in the 250 million of CapEx approved, because it just seems like you're going to far exceed that 250 million, with the 2017 budget of 110 million to 120 million.

Yes, I think it's there a small portion of the 250 million is advice letter projects that were going to finish, so most of them are new capital projects.

Okay so then whatever you spend beyond the 250 million presumably, for this next rate case, you just have to seek recovery of those at that point?

Yes, we haven’t filed rate case in July as you know this year. So, we'll have to project what we are going to spend in 2018, 2019 and 2020. So, we're -- I mean, our asset management groups working on put those together in the rate case filings, but we'll have a better number comes to July.

Right no, I'm just saying the 250 million that was authorized for '15 through '17, if you spend 110 million to 120 million this year in '17, then you're going to exceed that 250 million by a pretty good margin. So whatever is above that 250 million has to try to get rolled into rate base as part of this next case; is that correct?

Yes.

And recognize that all being a small portion of the 110 million to 120 million is fair value electric. So, that's not part of the 250 million.

Right. And then on the effective tax rate, both the utility and consolidated were lower this year. Do you expect that to be the case next year? Or in 2017, or will it go to the more normal levels we've seen?

I think will be similar as while we're seeing for 2016, Jonathan.

Okay, and then last question, and I'll hop off. You've done a good job managing your operating expenses in recent years. Where do you see the non supply operating costs coming in for 2017? Are they going to be higher, lower or about the same as '16?

Well, we've been -- as you said very expected of that. I would say we might see bit of an increase, but not wouldn’t be substantial, do you agree that?

Yes, I mean we currently look at everything we can do to decrease our cost for our customers. So, that’s really one of the top priorities that's the management focus on.

[Operator Instructions] There appear to be no further question at this time. This will conclude our question-and-answer session. I would like to turn the conference back over to Bob Sprowls for any closing remarks.

Thank you, Andrea. I just want to close with thanking you all for your participation today and for continuing to invest in our company or advice folks on investments. And I look forward to speaking with you, Eva and I both do, next quarter. Thank you.

Thank you.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.