Release Details

SAN JOSE, CA, October 26, 2016 – SJW Corp. (NYSE: SJW) today reported financial results for the third quarter ended September 30, 2016. Net income was $19 million for the quarter ended September 30, 2016, compared to $9.5 million for the same period in 2015. Diluted earnings per share were $0.92 and $0.46 for the quarters ended September 30, 2016 and 2015, respectively.

Operating revenue was $112.3 million in the quarter compared to $83 million in 2015. The $29.3 million increase in revenue was primarily attributable to $12.4 million in cumulative rate increases, $9.5 million in higher customer usage, $6.6 million related to revenue tracked in our Water Conservation Memorandum Account and a $700,000 change in the net recognition of certain other balancing and memorandum accounts.

Water production expenses for the third quarter of 2016 were $45 million versus $35.5 million for the same period in 2015, an increase of $9.5 million. The increase in water production expenses was primarily attributable to $5.7 million in higher per unit costs for purchased water, groundwater extraction and energy charges, $3.5 million due to higher customer usage and $300,000 in higher expenses due to a decrease in the use of available surface water supply. Operating expenses, excluding water production costs, increased $1.8 million to $31 million from $29.2 million. The increase was primarily due to $931,000 of higher depreciation expenses due to assets placed in service in 2015, $348,000 of higher administrative and general expenses, $320,000 in property taxes and other non-income taxes and $242,000 in higher maintenance expenses due primarily to main repairs.

The effective consolidated income tax rates were approximately 40% and 37% for the quarters ended September 30, 2016 and 2015, respectively.

Year-to-date net income was $39.1 million, compared to $21.7 million in 2015. Diluted earnings per share were $1.90 in the first nine months of 2016, compared to $1.06 per diluted share for the same period in 2015.

Year-to-date 2016 operating revenue increased by $42.9 million to $260.4 million from $217.5 million in the first nine months of 2015. The increase was attributable to $20.5 million in cumulative rate increases, $13.1 million related to revenue tracked in our Water Conservation Memorandum Account, a net $6.8 million due to true-up revenue recognized as a part of the decision on our 2015 California General Rate Case application in the current year offset by true-up revenue recognized as part of the 2012 California General Rate Case decision in the prior year and a $1.6 million change in the net recognition of certain other balancing and memorandum accounts.

Year-to-date water production expenses increased to $93.3 million from $83.7 million in 2015. The $9.6 million increase was primarily attributable to $12.3 million in higher per unit costs for purchased water, groundwater extraction and energy charges, partially offset by $2.5 million in lower expenses due to an increase in the use of available surface water supply. Operating expenses, excluding water production costs, increased $4.9 million to $90.4 million from $85.5 million. The increase was primarily due to $2.9 million of higher depreciation expenses, $895,000 in higher maintenance expenses, $829,000 in higher administrative and general expenses and $237,000 in higher property taxes and other non-income taxes. The increase in administrative and general expenses was due to an increase in salaries, partially offset by a decrease in pension expense and a decrease in regulatory fees due to lower usage.

Year-to-date other expense and income for 2016 included a pre-tax gain on the sale of 159,151 shares of California Water Service Group stock for $3.2 million. No similar sale occurred in 2015.

The effective consolidated income tax rates were approximately 40% and 37% for the nine-month periods ended September 30, 2016 and 2015, respectively.

The Directors of SJW Corp. today declared a quarterly dividend on common stock of $0.2025 per share. The dividend is payable on December 1, 2016 to shareholders of record on November 7, 2016.

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., Texas Water Alliance Limited, SJW Land Company, and SJW Group, Inc. Together, San Jose Water Company and SJWTX, Inc. provide 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 real estate investments.

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. Results for a quarter are not indicative of results for a full year due to seasonality and other factors. Other 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.

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