Consolidated Water Co. Ltd. (NASDAQ:CWCO) Q3 2024 Earnings Conference Call November 15, 2024 11:00 AM ET

Company Participants

Frederick McTaggart - CEO
David Sasnett - CFO

Conference Call Participants

Gerard Sweeney - ROTH Capital

Operator

Good morning. Thank you for joining us today to discuss the results for Consolidated Water's Third Quarter of 2024. Hosting the call today is the Chief Executive Officer of Consolidated Water Company, Rick McTaggart; and the Company's Chief Financial Officer, David Sasnett.

Following their remarks, we'll open the call to your questions. [Operator Instructions]

Before we conclude today's call, I'll provide some important cautions regarding the forward-looking statements made by management during the call. I'd like to remind everyone that today's call is being recorded and it will be made available for telecom replay for the instructions in yesterday's press release which is available in the Investor Relations section of the company's website.

Now I'd like to turn the call over to Consolidated Water Company's, CEO Rick McTaggart. Sir, Please go ahead.

Frederick McTaggart

Thank you, David. Good morning, everybody. Thank you for joining us today to discuss our financial and operating results for our third quarter of 2024. As you saw in our press release issued yesterday, we reported revenue of $33.4 million and net income from continuing operations of $5 million or $0.31 per diluted share for this past quarter. These results were consistent with our expectations given the completion of two large design-build projects earlier this year.

We were pleased to see the continuing trend of increasing retail water sales in our exclusive utility service area on Grand Cayman, which was due to business and population growth on the island. Our Bulk segment had relatively consistent revenue compared to last year. However, we saw an increase in gross margin due to the operations and maintenance contract for the new Red Gate II plant for the water authority in Grand Cayman, which became effective May 1st of this year.

I'll just note because we guarantee the energy consumption of our plants to our clients in this type of contract, which gives the client certainty of costs, our margins are typically better early in the contract lifecycle when the equipment, particularly the RO membranes, are new. Looking at services revenues, they declined by about half due to our anticipated reduction in construction revenue related to the conclusion of our Liberty Utilities and Red Gate II construction projects. These projects had a major impact on 2023 revenue but were completed prior to the start of the third quarter of this year.