On August 14, 2024, Consolidated Water Co Ltd (CWCO, Financial) released its 8-K filing for the second quarter ended June 30, 2024. Consolidated Water Co Ltd is a water utility company that develops and operates seawater desalination plants and water distribution systems. The company's business segments include retail, bulk, services, and manufacturing.
Performance Overview
Consolidated Water Co Ltd (CWCO, Financial) reported a revenue of $32.5 million for Q2 2024, a 27% decline from $44.2 million in the same period last year. This decrease was primarily driven by a significant reduction in the services segment revenue, which fell by $12.2 million due to the completion of major construction projects in Grand Cayman and Arizona. Despite this, the company managed to achieve a net income from continuing operations attributable to stockholders of $4.2 million or $0.26 per diluted share, compared to $7.5 million or $0.47 per diluted share in Q2 2023.
Key Financial Achievements
Despite the revenue decline, Consolidated Water Co Ltd (CWCO, Financial) demonstrated resilience through its diversified business model. The retail segment saw a 10% increase in water volume sold, driven by a 5.5% increase in customer accounts and less rainfall in Grand Cayman. Additionally, the company reported a substantial increase in revenue from operations and maintenance contracts, which rose by 75% to $7.1 million, with newly acquired REC contributing $1.9 million.
Income Statement Highlights
| Segment | Q2 2024 Revenue | Q2 2023 Revenue |
|---|---|---|
| Retail | $8.18 million | $7.57 million |
| Bulk | $8.45 million | $8.48 million |
| Services | $11.92 million | $24.09 million |
| Manufacturing | $3.93 million | $4.09 million |
Balance Sheet and Cash Flow
As of June 30, 2024, Consolidated Water Co Ltd (CWCO, Financial) reported cash and cash equivalents of $96.7 million, with working capital of $131.2 million and minimal debt of $0.3 million. The company's strong balance sheet supports its ongoing and future projects, including the $147 million seawater desalination plant in Hawaii.
Management Commentary
"Our second quarter results were fairly positive, especially considering the inherent variability in our service segment revenue and earnings due to the timing of our large design-build projects in Grand Cayman, Arizona, and Hawaii," stated company CEO, Rick McTaggart.
Analysis and Future Outlook
Consolidated Water Co Ltd (CWCO, Financial) faces challenges due to the completion of significant projects, impacting its services segment revenue. However, the company's diversified revenue streams and strong balance sheet position it well for future growth. The ongoing development of the Hawaii desalination plant and new projects in the Bahamas and Cayman Islands are expected to drive long-term revenue and profitability.
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Explore the complete 8-K earnings release (here) from Consolidated Water Co Ltd for further details.
