Consolidated Water Reports 27% Revenue Decline

By Bobby Samwell • Thursday, August 15 15:12 • Permanent Link

Consolidated Water Co. Ltd. (NASDAQ Global Select Market: CWCO) has reported its operating results for the second quarter ended June 30, 2024. The company reported a total revenue decline of 27% to $32.5 million compared to the same period in the prior year. However, retail revenue increased by 8% to $8.2 million, driven by higher sales volumes. Bulk revenue remained relatively consistent at $8.4 million, and manufacturing revenue was also relatively consistent at $3.9 million.

The services revenue declined by 51% to $11.9 million, primarily due to a $16.5 million decline in construction revenue, partially offset by an approximately $3 million increase in recurring operations and maintenance revenue. Net income from continuing operations attributable to company stockholders totaled $4.2 million or $0.26 per diluted share, compared to $7.5 million or $0.47 per diluted share in the second quarter of 2023.

The volume of retail water sold in the company’s utility service area in Grand Cayman increased by 10% compared with the same period in 2023. The company also completed the construction and commissioning of the new 2.6 million gallon per day Red Gate desalination plant for the Water Authority of the Cayman Islands. The company also recognized $1.9 million in operations and maintenance revenue from REC, which it acquired in October 2023.

Cash and cash equivalents totaled $96.7 million, and working capital was $131.2 million as of June 30, 2024. The company's gross profit for the second quarter of 2024 was $11.6 million (36% of total revenue), compared to $15.5 million (35% of total revenue) in the second quarter of 2023.

For the first half of 2024, the company reported a revenue decrease of 6% to $72.2 million compared to the same period in the prior year. Retail revenue increased primarily due to an 8% increase in the volume of water sold. The decrease in services segment revenue was due to a $16.5 million decrease in plant construction revenue, while revenue generated under operations and maintenance contracts totaled $14.2 million, up 83% compared to the same period in 2023.

The market has reacted to these announcements by moving the company's shares 2.4% to a price of $27.21. If you want to know more, read the company's complete 8-K report here.

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