Consolidated Water Reports Full Year 2024 Results

GEORGE TOWN, Cayman Islands, March 17, 2025 (GLOBE NEWSWIRE) -- Consolidated Water Co. Ltd. (NASDAQ Global Select Market: CWCO), a leading designer, builder and operator of advanced water supply and treatment plants, reported results for the year ended December 31, 2024. All comparisons are to the prior year period unless otherwise noted. Consolidated Water will hold a conference call at 11:00 a.m. Eastern time tomorrow to discuss the results (see dial-in information below). 2024 Financial Highlights Total revenue declined 26% to $134 million, due to two large construction projects that were underway in 2023 but were completed in June 2024. The company’s $204 million design-build-operate desalination plant project in Hawaii continues to progress towards the higher-revenue construction phase.Retail revenue increased 5% to $31.7 million on higher sales volumes.Bulk revenue decreased 3% to $33.7 million.Manufacturing revenue increased by 1% to $17.6 million.Services revenue declined by 48% to $51 million, due to a $60 million decline in construction revenue that was partially offset by a $9.9 million increase in recurring operations and maintenance (O&M) revenue and a $2.7 million increase in design and consulting revenue.O&M recurring revenue increased 51% to $29.3 million. The increase was comprised of $6.1 million from REC, which was acquired in October 2023, and $3.9 million from PERC.Net income from continuing operations attributable to company stockholders totaled $17.9 million or $1.12 per diluted share, compared to $30.7 million or $1.93 per diluted share in 2023.Net income, including discontinued operations attributable to company stockholders, totaled $28.2 million or $1.77 per diluted share, compared to $29.6 million or $1.86 per diluted share in 2023.Cash and cash equivalents totaled $99.4 million and working capital was $132.8 million as of December 31, 2024. 2024 Operational Highlights Retail water sold by the company’s Grand Cayman water utility increased 4.5% to a record volume of 1.01 billion gallons. The increase was due to a record number of customer connections which were up 4.3% for the year.Advanced through the piloting, design and permitting stages of a project to design, construct, operate and maintain a seawater desalination plant in Hawaii for the Honolulu Board of Water Supply.Recognized $7.9 million in operations and maintenance revenue from the company’s REC subsidiary, which was acquired in October 2023 to provide a new channel for expansion in water-stressed regions of Colorado. Dividend Increase In August 2024, the company increased its quarterly dividend by 15.8% to $0.11 per share beginning in the fourth quarter of 2024. Management Commentary “Our revenue and operating income in 2024 from continuing operations were consistent with our expectations, particularly with the completion of the two major design-build projects early in the year,” commented Consolidated Water CEO, Rick McTaggart. “We saw an improvement in profitability across our retail and manufacturing segments. Our strong retail water sales in our exclusive utility service area on Grand Cayman reflect a record volume of water sold to a record number of customers. This was primarily due to the ongoing growth in population and business activity on the island. “Our bulk water segment revenue and gross profit remained relatively consistent from the previous year. Our services revenue declined due to the completion in the second quarter of the Liberty Utilities and Red Gate II construction projects which had a major impact on our 2023 revenue. The decline was partially offset by a 51% or nearly $10 million increase in recurring revenue from our operations and maintenance or O&M contracts. “Most of this additional O&M revenue was generated by REC, our new Colorado subsidiary, that has provided us a new channel to expand our design-build and O&M businesses into water-stressed regions of Colorado. Other U.S.-based O&M contracts managed by our PERC Water subsidiary also contributed meaningfully to the increase. “Our $204 million project to design, construct, operate and maintain a 1.7 million gallons per day seawater desalination plant for the Honolulu Board of Water Supply has been steadily advancing through the pilot, design and permitting stage. Due to delays unrelated to us, we now expect to begin the construction of this project early next year. We expect the construction phase to generate the largest portion of revenue from the project. “Also important to note, about 80% of the plant’s construction fee is subject to adjustments for inflation from the date the contract was executed to the date construction begins. This will help protect our gross margin and profitability against most increases in the cost of goods and services. “As announced last month, our wholly owned subsidiary, Cayman Water Company, received a new concession from the Cayman Islands government, granting it continued exclusive rights to produce and supply potable water within its service area on Grand Cayman. Discussions with the Cayman Islands utility regulator for the required license are anticipated to begin soon. Our existing operating license will remain in effect until the new one is received. “Looking ahead, we remain excited about the future of Consolidated Water for many reasons. This includes the continued growth in water sales in Grand Cayman; the long-term, stable recurring revenue from our Caribbean-based bulk water business; and the growth potential of our U.S.-based manufacturing, design-build and O&M businesses. “Supported by an exceptionally strong balance sheet, we will continue to invest in new infrastructure like the expansion of our West Bay plant to serve the growing water needs of our utility customers in Grand Cayman. We also plan to add additional manufacturing space for Aerex. We expect these investments to ultimately drive future retail and manufacturing revenue growth. Our strong balance sheet also enables us to move quickly and strategically on any potential acquisitions. “We expect our construction revenue to remain below the record level set in 2023 until we commence construction of the desalination project in Hawaii. However, we see this major construction phase substantially adding to our revenue and earnings growth in 2026 and 2027.” 2024 Financial Summary Revenue totaled $134 million, declining 26% from $180.2 million in 2023. The decrease was due to decreases of $47 million in the services segment and $922,000 in the bulk segment. The decreases were partially offset by increases of $1.6 million in the retail segment and $104,000 in the manufacturing segment. Retail revenue increased due to a 4.5% increase in the volume of water sold. The volume of water sold increased due to a 4.3% increase in the number of customer accounts in the company’s license area during the year. The decrease in bulk segment revenue was due to a decrease in the price of energy for CW-Bahamas which decreased the energy pass-through component of CW-Bahamas’ rates. The decrease in bulk segment revenue was partially offset by the revenue generated by the commencement on May 1, 2024, of the operations and maintenance contract for the new Red Gate desalination plant on Grand Cayman. The decrease also was partially offset by the additional revenue generated by the amendment of the company’s North Sound contract which also became effective on May 1, 2024. The decrease in services segment revenue was due to plant construction revenue decreasing from $77.3 million in 2023 to $17.6 million in 2024 as the result of two construction projects being completed in 2024. Revenue generated under operations and maintenance contracts totaled $29.3 million in 2024, an increase of 51% from 2023. Newly acquired REC contributed $6.1 million to the increase, with the remainder related to incremental PERC contracts. Manufacturing segment revenue increased by $104,000 to $17.6 million as compared to $17.5 million in 2023. Gross profit for 2024 was $45.6 million (34.1% of total revenue), as compared to $61.9 million (34.4% of total revenue) in 2023. Net income from continuing operations attributable to Consolidated Water stockholders for 2024 was $17.9 million or $1.12 per diluted share, compared to net income of $30.7 million or $1.93 per diluted share in 2023. Including discontinued operations, net income attributable to Consolidated Water stockholders for 2024 was $28.2 million or $1.77 per diluted share, compared to net income of $29.6 million or $1.86 per diluted share in 2023. Cash and cash equivalents totaled $99.4 million as of December 31, 2024, with working capital of $132.8 million, debt of $0.2 million, and stockholders’ equity of $210 million. Full Year Segment Results Year Ended December 31, 2024 Retail Bulk Services Manufacturing Corporate TotalRevenue $31,741,343 $33,673,387 $50,956,489 $17,595,414 $— $133,966,633 Cost of revenue 14,199,088 23,360,360 38,511,535 12,271,202 — 88,342,185 Gross profit 17,542,255 10,313,027 12,444,954 5,324,212 — 45,624,448 General and administrative expenses 3,263,593 1,564,975 6,055,409 2,456,807 14,196,652 27,537,436 Gain on asset dispositions and impairments, net 2,286 — 2,714 — 192,786 197,786 Income (loss) from operations 14,280,948 8,748,052 6,392,259 2,867,405 (14,003,866) 18,284,798 Interest income 198,180 865,584 458,732 4 571,690 2,094,190 Interest expense (93,368) — (8,409) — (70) (101,847)Income from affiliates — — — 16,701 252,754 269,455 Other 78,647 39,625 (5,634) 11,993 7,247 131,878 Other income, net 183,459 905,209 444,689 28,698 831,621 2,393,676 Income (loss) before income taxes 14,464,407 9,653,261 6,836,948 2,896,103 (13,172,245) 20,678,474 Provision for income taxes — — 1,528,398 672,040 18,076 2,218,514 Net income (loss) from continuing operations 14,464,407 9,653,261 5,308,550 2,224,063 (13,190,321) 18,459,960 Income from continuing operations attributable to non-controlling interests — 577,590 — — — 577,590 Net income (loss) from continuing operations attributable to Consolidated Water Co. Ltd. stockholders $14,464,407 $9,075,671 $5,308,550 $2,224,063 $(13,190,321) 17,882,370 Net income from discontinued operations 10,355,184 Net income attributable to Consolidated Water Co. Ltd. stockholders $28,237,554 Year Ended December 31, 2023 Retail Bulk Services Manufacturing Corporate TotalRevenue $30,158,051 $34,595,058 $97,966,650 $17,491,474 $— $180,211,233 Cost of revenue 13,891,229 24,128,132 66,797,762 13,467,005 — 118,284,128 Gross profit 16,266,822 10,466,926 31,168,888 4,024,469 — 61,927,105 General and administrative expenses 2,978,164 1,737,264 4,271,808 1,838,284 13,926,846 24,752,366 Gain (loss) on asset dispositions and impairments, net (21,716) 12,720 — 2,233 (349) (7,112)Income (loss) from operations 13,266,942 8,742,382 26,897,080 2,188,418 (13,927,195) 37,167,627 Interest income 181,468 362,422 151,706 4 808 696,408 Interest expense (123,867) — (21,417) — — (145,284)Income from affiliate — — — — 169,728 169,728 Other 93,795 10,793 1,024 2,020 (171) 107,461 Other income, net 151,396 373,215 131,313 2,024 170,365 828,313 Income (loss) before income taxes 13,418,338 9,115,597 27,028,393 2,190,442 (13,756,830) 37,995,940 Provision (benefit) for income taxes — — 6,388,457 440,111 (78,554) 6,750,014 Net income (loss) from continuing operations 13,418,338 9,115,597 20,639,936 1,750,331 (13,678,276) 31,245,926 Income from continuing operations attributable to non-controlling interests — 573,791 — — — 573,791 Net income (loss) from continuing operations attributable to Consolidated Water Co. Ltd. stockholders $13,418,338 $8,541,806 $20,639,936 $1,750,331 $(13,678,276) 30,672,135 Net loss from discontinued operations (1,086,744)Net income attributable to Consolidated Water Co. Ltd. stockholders $29,585,391 Revenue earned by major geographic region was: Year Ended December 31, 2024 2023 2022Cayman Islands $37,137,424 $41,728,340 $30,375,985The Bahamas 29,675,947 31,221,633 29,943,615United States 66,662,406 106,768,621 33,338,466Revenue earned from management services agreement with OC-BVI 490,856 492,639 446,906 $133,966,633 $180,211,233 $94,104,972 The following table presents the company’s revenue disaggregated by revenue source. Year Ended December 31, 2024 2023 2022Retail revenue $31,741,343 $30,158,051 $25,954,013Bulk revenue 33,673,387 34,595,058 32,991,066Services revenue 50,956,489 97,966,650 28,835,428Manufacturing revenue 17,595,414 17,491,474 6,324,465Total revenue $133,966,633 $180,211,233 $94,104,972 Services revenue consists of the following: Year Ended December 31, 2024 2023 2022Construction revenue $17,637,432 $77,306,704 $11,616,274Operations and maintenance revenue 29,307,405 19,368,365 14,152,158Design and consulting revenue 4,011,652 1,291,581 3,066,996Total services revenue $50,956,489 $97,966,650 $28,835,428 Annual General Meeting of Shareholders The company has set May 27, 2025 as the date of its Annual General Meeting of Shareholders to be held at 3:00 p.m. Cayman Islands time (4:00 p.m. EDT) at the Westin Grand Cayman Seven Mile Beach Resort & Spa, Seven Mile Beach, Grand Cayman, Cayman Islands. Holders of record of the company’s stock as of March 28, 2025 will be entitled to vote at the meeting. Conference CallConsolidated Water management will host a conference call tomorrow to discuss these results, followed by a question-and-answer period. Date: Tuesday, March 18, 2025Time: 11:00 a.m. Eastern time (8:00 a.m. Pacific time)Toll-free dial-in number: 1-844-875-6913International dial-in number: 1-412-317-6709Conference ID: 1237348 Please call the conference telephone number five minutes prior to the start time. An operator will register your name and organization. If you require any assistance connecting with the call, please contact CMA at 1-949-432-7566. A replay of the call will be available after 1:00 p.m. Eastern time on the same day through March 25, 2025, as well as available for replay via the Investors section of the Consolidated Water website at www.cwco.com. Toll-free replay number: 1-877-344-7529International replay number: 1-412-317-0088Replay ID: 1237348 About Consolidated Water Co. Ltd.Consolidated Water Co. Ltd. develops and operates advanced water supply and treatment plants and water distribution systems. The company designs, constructs and operates seawater desalination facilities in the Cayman Islands, The Bahamas and the British Virgin Islands, and designs, constructs and operates water treatment and reuse facilities in the United States. The company recently entered the U.S. desalination market with a contract to design, construct, operate and maintain a seawater desalination plant in Hawaii. The company also manufactures and services a wide range of products and provides design, engineering, management, operating and other services applicable to commercial and municipal water production, supply and treatment, and industrial water and wastewater treatment. For more information, visit cwco.com. Cautionary Note Regarding Forward-Looking Statements This press release includes statements that may constitute "forward-looking" statements, usually containing the words "believe", "estimate", "project", "intend", "expect", "should", "will" or similar expressions. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors that would cause or contribute to such differences include, but are not limited to (i) continued acceptance of the company's products and services in the marketplace; (ii) changes in its relationships with the governments of the jurisdictions in which it operates; (iii) the outcome of its negotiations with the Cayman government regarding a new retail license agreement; (iv) the collection of its delinquent accounts receivable in the Bahamas; and (v) various other risks such as economic, operational, and industry-specific risks, as detailed in the company's periodic report filings with the Securities and Exchange Commission (“SEC”). For more information about risks and uncertainties associated with the company’s business, please refer to the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” sections of the company’s SEC filings, including, but not limited to, its annual report on Form 10-K and quarterly reports on Form 10-Q, copies of which may be obtained by contacting the company’s Secretary at the company’s executive offices or at the “Investors – SEC Filings” page of the company’s website at ir.cwco.com/docs. Except as otherwise required by law, the company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise. Company Contact:David W. SasnettExecutive Vice President and CFOTel (954) 509-8200Email ContactInvestor & Media Contact:Ron Both or Grant StudeCMA Investor RelationsTel (949) 432-7566Email Contact CONSOLIDATED WATER CO. LTD. CONSOLIDATED BALANCE SHEETS December 31, 2024 2023ASSETS Current assets Cash and cash equivalents $99,350,121 $42,621,898Accounts receivable, net 39,580,982 38,226,891Inventory 8,960,350 6,044,642Prepaid expenses and other current assets 5,153,984 4,056,370Contract assets 4,470,243 21,553,057Current assets of discontinued operations 272,485 211,517Total current assets 157,788,165 112,714,375Property, plant and equipment, net 52,432,282 55,882,521Construction in progress 5,143,717 495,471Inventory, noncurrent 5,338,961 5,045,771Investment in affiliates 1,504,363 1,412,158Goodwill 12,861,404 12,861,404Intangible assets, net 2,696,815 3,353,185Operating lease right-of-use assets 3,190,985 2,135,446Other assets 2,356,489 3,407,973Long-term assets of discontinued operations — 21,129,288Total assets $243,313,181 $218,437,592 LIABILITIES AND EQUITY Current liabilities Accounts payable, accrued expenses and other current liabilities $9,057,179 $11,604,369Accrued compensation 3,336,946 3,160,030Dividends payable 1,780,841 1,572,655Current maturities of operating leases 634,947 456,865Current portion of long-term debt 126,318 192,034Contract liabilities 9,126,654 6,237,011Deferred revenue 365,879 317,017Current liabilities of discontinued operations 509,745 364,665Total current liabilities 24,938,509 23,904,646Long-term debt, noncurrent 70,320 191,190Deferred tax liabilities 210,893 530,780Noncurrent operating leases 2,630,812 1,827,302Other liabilities 153,000 153,000Total liabilities 28,003,534 26,606,918Commitments and contingencies Equity Consolidated Water Co. Ltd. stockholders' equity Redeemable preferred stock, $0.60 par value. Authorized 200,000 shares; issued and outstanding 44,004 and 44,297 shares, respectively 26,402 26,578Class A common stock, $0.60 par value. Authorized 24,655,000 shares; issued and outstanding 15,846,345 and 15,771,545 shares, respectively 9,507,807 9,462,927Class B common stock, $0.60 par value. Authorized 145,000 shares; none issued — —Additional paid-in capital 93,550,905 92,188,887Retained earnings 106,875,581 85,148,820Total Consolidated Water Co. Ltd. stockholders' equity 209,960,695 186,827,212Non-controlling interests 5,348,952 5,003,462Total equity 215,309,647 191,830,674Total liabilities and equity $243,313,181 $218,437,592 CONSOLIDATED WATER CO. LTD. CONSOLIDATED STATEMENTS OF INCOME Year Ended December 31, 2024 2023 2022Revenue $133,966,633 $180,211,233 $94,104,972 Cost of revenue 88,342,185 118,284,128 63,749,849 Gross profit 45,624,448 61,927,105 30,355,123 General and administrative expenses 27,537,436 24,752,366 21,070,234 Gain (loss) on asset dispositions and impairments, net 197,786 (7,112) (12,704)Income from operations 18,284,798 37,167,627 9,272,185 Other income (expense): Interest income 2,094,190 696,408 447,186 Interest expense (101,847) (145,284) (46,545)Equity in the earnings of affiliates 269,455 169,728 102,225 Loss on put/call options — — (128,000)Other 131,878 107,461 89,944 Other income, net 2,393,676 828,313 464,810 Income before income taxes 20,678,474 37,995,940 9,736,995 Provision for income taxes 2,218,514 6,750,014 396,739 Net income from continuing operations 18,459,960 31,245,926 9,340,256 Income from continuing operations attributable to non-controlling interests 577,590 573,791 1,112,913 Net income from continuing operations attributable to Consolidated Water Co. Ltd. stockholders 17,882,370 30,672,135 8,227,343 Net income (loss) from discontinued operations 10,355,184 (1,086,744) (2,371,049)Net income attributable to Consolidated Water Co. Ltd. stockholders $28,237,554 $29,585,391 $5,856,294 Basic earnings (loss) per common share attributable to Consolidated Water Co. Ltd. common stockholders Continuing operations $1.13 $1.95 $0.54 Discontinued operations 0.65 (0.07) (0.16)Basic earnings per share $1.78 $1.88 $0.38 Diluted earnings (loss) per common share attributable to Consolidated Water Co. Ltd. common stockholders Continuing operations $1.12 $1.93 $0.54 Discontinued operations 0.65 (0.07) (0.16)Diluted earnings per share $1.77 $1.86 $0.38 Dividends declared per common and redeemable preferred shares $0.41 $0.36 $0.34 Weighted average number of common shares used in the determination of: Basic earnings per share 15,832,328 15,739,056 15,290,509 Diluted earnings per share 15,935,962 15,865,897 15,401,653

Consolidated Water Reports Full Year 2024 Results

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