Market Overview

Consolidated Water Co. Ltd. Reports Second Quarter 2018 Results

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Consolidated Water Co. Ltd. Reports Second Quarter 2018 Results

Core Desalination Business Drives Steady Revenues and Earnings Further Progress Achieved on Rosarito Project

Second Quarter 2018 Total Revenues Increased 3.9% to $15.9 million; Gross Profit Was $6.6 Million, Up 2.2% Year-Over-Year

Net Income Attributable to Consolidated Water Stockholders Increased to $2.2 Million, or $0.14 per Fully Diluted Share

PR Newswire

GEORGE TOWN, Cayman Islands, Aug. 9, 2018 /PRNewswire/ -- Consolidated Water Co. Ltd. (NASDAQ:CWCO), a leading developer and operator of seawater desalination plants, reported financial and operating results for its second quarter ended June 30, 2018.

Management Commentary

President and CEO Rick McTaggart commented: "Our core desalination business continued to perform well in the second quarter, and revenues in our manufacturing segment nearly doubled on an unconsolidated basis. However, similar to the first quarter, a portion of our manufacturing segment's production, equivalent to $1.1 million in the second quarter and $1.8 million year-to-date, was allocated for our internal use in the refurbishment of our Windsor plant in the Bahamas and our Governor's Harbor plant in the Cayman Islands, and was not recognized as revenue. These internal projects have obscured the year-over-year improvement in our manufacturing segment. Looking forward, we expect manufacturing sales to continue to improve based on orders in hand for the remainder of this year."

"We made significant progress on our Rosarito project during the second quarter by achieving several important milestones. Specifically, (i) we signed an amended public private partnership agreement, which addressed foreign currency exchange and interest rate adjustment concerns related to the project; (ii) we obtained additional rights of way for the project's aqueduct and now have the majority of such rights of way required for the project; and (iii) we signed the turn-key engineering, procurement and construction contract with Suez for the desalination plant and aqueduct. These accomplishments have moved us forward in line with our expectations for completion of the conditions of the project," Mr. McTaggart noted.

Second Quarter 2018 Financial Results

Total revenues for the second quarter 2018 were $15.9 million, representing a 3.9% increase from $15.3 million in the second quarter of 2017. Gross profit amounted to $6.6 million, compared to $6.5 million in the year ago quarter. Inclusive of $0.7 million in Rosarito-related expenses, net income attributable to Consolidated Water stockholders was $2.2 million, or $0.14 per fully diluted share, compared to $0.6 million, or $0.04 per fully diluted share, reported in last year's comparable quarter. In the second quarter of 2017, the Company recorded an impairment loss of $1.0 million relating to its Bali operations, however this subsidiary did not have a material adverse impact on the Company's results of operations for the second quarter of 2018.

First Half 2018 Financial Results

Total revenues for the first six months of 2018 were $31.2 million, compared to the $31.0 million reported in last year's comparable period. Gross profit was $13.2 million, compared to $13.3 million for the first half of 2017. Net income attributable to Consolidated Water stockholders was $4.3 million ($0.28 per fully diluted share), an increase of 31.5% from the $3.3 million ($0.22 per fully diluted share), earned in the first six months of 2017. Net income and diluted EPS for the first half of 2018 and 2017 included operating expenses of $1.3 million and $1.6 million, respectively, related to development costs for the Rosarito desalination plant.

Segment Results



















Three Months Ended June 30, 2018 (Unaudited)



Retail


Bulk


Services


Manufacturing


Total

Revenues


$

6,268,023


$

8,488,850


$

122,912


$

992,430


$

15,872,215

Cost of revenues



2,722,650



5,793,704



104,069



655,679



9,276,102

Gross profit


$

3,545,373


$

2,695,146


$

18,843


$

336,751


$

6,596,113



















Three Months Ended June 30, 2017 (Unaudited)



Retail


Bulk


Services


Manufacturing


Total

Revenues


$

6,064,016


$

8,043,921


$

119,204


$

1,056,047


$

15,283,188

Cost of revenues



2,722,890



5,152,212



103,753



847,760



8,826,615

Gross profit


$

3,341,126


$

2,891,709


$

15,451


$

208,287


$

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