NASDAQ Global Select Market-listed company Consolidated Water Co Ltd says its board of directors has approved a quarterly cash dividend of US$0.085 per share.
The Cayman Islands-based company will pay dividends on January 31, 2020, to shareholders on record at the close of business on January 2, 2020.
The company last month disclosed that for third-quarter 2019 revenue fell by 12 per cent to US$15.9 million. However, for the nine-month period revenue improved by seven per cent to reach US$51.2 million when compared with US$47.7 million in the same period last year.
“In the third quarter of 2019, we advanced our business in a number of areas; however, our lower financial performance reflects an unusual confluence of factors across our operating segments,” Consolidated Water CEO Rick McTaggart explained in a release.
“Our revenue from bulk water is lower due to new rates that came into effect earlier this year in Grand Cayman under new long-term operating and maintenance contracts that we won through competitive bidding processes. While our manufacturing and services revenues were lower, our related pipeline has been expanding. So, we don’t see Q3 as indicative of a trend, and we remain on course for a year of strong revenue growth and profitability as demonstrated by our nine-month results,” he added.
Consolidated Water Co Ltd designs, builds, operates, and in some cases funds seawater reverse osmosis (SWRO) desalination plants and water distribution systems in the Caribbean. In so doing the company supplies drinking water, a scarce commodity in the region, through the use of SWRO, which is more economically feasible.
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.
Founded in 1973 as a private water utility in Grand Cayman, Consolidated Water Co Ltd obtained its first public utility license in the Cayman Islands in 1979. In 1995 the company listed on the NASDAQ stock market and began trading its shares.
Today, the company operates water-production facilities in the Cayman Islands, The Bahamas, and the British Virgin Islands and operates water-treatment facilities in the United States.
“Over the past 20 years, the company has grown from a small Cayman Islands-based utility business with revenues of less than US$10 million dollars per year to a regional water provider with 2017 revenues in excess of US$62 million dollars,” a section of Consolidated Water Co states.
The company says that its third-quarter performance is an indication of the benefits that can be reaped from “diversifying revenue by adding complementary service and product offerings, as well as expanding our geographic presence and customer base”.
“We view PERC Water as highly complementary and synergistic to our existing business. PERC Water will expand our product and service offerings to include advanced water and wastewater-recycling plants while providing a platform to expand our core business…”— Consolidated Water CEO Rick McTaggart
Consolidated Water Co recently purchased the Costa Mesa, California-based PERC Water, engaged in designing, building and operating water and wastewater infrastructure projects in the United States, particularly in the water-challenged southwest.
“We view PERC Water as highly complementary and synergistic to our existing business. PERC Water will expand our product and service offerings to include advanced water and wastewater-recycling plants while providing a platform to expand our core business … into water-short regions of the US,” McTaggart noted.
For the third quarter of 2019, Consolidated Water Co’s manufacturing revenue rose as a result of an increase in orders and production activity. In addition, its retail revenue grew due to an increase in volumes of water consumed and climbing energy costs.
“The increase in retail revenue was also due to increased energy prices which increased the energy pass-through component of the company’s Cayman Water retail revenue by $400,000,” the CEO stated.
He revealed that he expects revenue and gross profit to stabilise in the comings, especially given increased demand due to winter tourist arrivals in the Cayman Islands.
For the nine months ended September 30, 2019, cash and cash equivalents reached US$42 million — US$10 million above the 2019 year-end figure.