How does the adjusted net income and adjusted EPS compare to the reported figures and what adjustments were made?

Answer

The press‑release from Chesapeake Utilities Corporation (ticker CPK) presents two sets of performance numbers for the second quarter of 2025 and for the six‑month period that ended June 30 2025:

In addition, the company also disclosed “Adjusted” figures – Adjusted net income and Adjusted EPS – that are meant to give investors a view of earnings excluding “transaction‑ and transition‑related” items.

1. How the adjusted figures compare to the reported (GAAP) figures

• Adjusted net income is higher than the reported net income for both periods.
  
• Adjusted EPS is also higher than the reported EPS for both periods.
  

The press‑release does not list the exact dollar amounts for the adjusted net income or the adjusted EPS in the excerpt you provided, but the language (“adjusted net income and adjusted EPS, which exclude transaction and transition‑related…”) makes clear that the adjustments are add‑backs (i.e., the company is removing certain costs or expenses). Because those costs are being taken out, the “adjusted” numbers rise relative to the GAAP (reported) numbers.

2. What specific adjustments were made

The only adjustment category that is identified in the release is:

By excluding these items, Chesapeake is presenting a “non‑GAAP” view that isolates the underlying profitability of its core utility operations, stripping out the noise of one‑off or non‑recurring events.

3. Why the company provides adjusted figures

• Clarity for investors: Utilities often undertake large, infrequent transactions (e.g., buying a new service area) or strategic transitions (e.g., modernizing infrastructure). Those events can dramatically swing net income in a given quarter, making it harder to gauge the ongoing performance of the regulated utility business.
  
• Benchmarking: Adjusted earnings are a common metric used by analysts to compare companies that may have different timing of transactions or restructuring activities.
  
• Management’s operating outlook: By showing earnings that exclude the “transaction‑ and transition‑related” costs, Chesapeake signals the cash‑generating strength of its core operations, which is especially relevant for a regulated utility that must fund capital projects and meet dividend expectations.

4. Bottom‑line take‑away

• Reported (GAAP) net income: $23.9 M (Q2) and $74.8 M (six‑month).
  
• Reported (GAAP) EPS: $1.02 (Q2) and $3.22 (six‑month).
  
• Adjusted net income & EPS: Not numerically disclosed in the excerpt, but they are higher because they exclude transaction‑related costs and transition‑related expenses.
  
• Adjustment rationale: The company is removing one‑off, non‑recurring items that do not reflect the ongoing profitability of its regulated utility business, thereby giving investors a “cleaner” view of operating performance.

If you need the exact adjusted dollar amounts, you would have to consult the full press‑release or the accompanying SEC filing (e.g., the Form 8‑K or 10‑Q) where Chesapeake typically presents a reconciliation table that lists:

In summary, the adjusted numbers are a “cleaned‑up” version of the reported results, higher because they strip out the impact of transaction‑ and transition‑related items, which are considered non‑recurring or outside the normal utility operations.