8-K
Consolidated Water Co. Ltd. (CWCO)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
November 16, 2020
(Date of earliest event reported)
CONSOLIDATED WATER CO. LTD.
(Exact Name of Registrant as Specified in Charter)
| Cayman Islands, B.W.I. | 0-25248 | 98-0619652 |
|---|---|---|
| (State or Other Jurisdiction of | (Commission File No.) | (IRS Employer Identification No.) |
| Incorporation) |
Regatta Office Park
Windward Three, 4^th^ Floor
West Bay Road, P.O. Box 1114
Grand Cayman, KY1-1102
Cayman Islands
(Address of Principal Executive Offices)
(345) 945-4277
(Registrant’s telephone number, including area code)
Not Applicable
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):
| ☐ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
|---|---|
| ☐ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered |
|---|---|---|
| Class A common stock, $0.60 par value | CWCO | The Nasdaq Global Select Market |
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02. Results of Operations and Financial Condition.
On November 16, 2020, Consolidated Water Co. Ltd. (the “Company”) issued a press release announcing its results of operations for the third quarter ended September 30, 2020. A copy of the press release is attached as Exhibit 99.1 to this report.
The information in this report, including the exhibit hereto, is being “furnished” in accordance with General Instruction B.2 of Form 8-K. As such, this information is not deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and is not incorporated by reference into any filings with the Securities and Exchange Commission unless it is explicitly so incorporated in such filings.
Item 9.01. Financial Statements and Exhibits.
(d)Exhibits.
| Exhibit No. | Title | |
|---|---|---|
| 99.1<br><br><br><br> | Press release issued by the Company on November 16, 2020.<br><br><br><br> | |
| 104 | | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) |
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| CONSOLIDATED WATER CO. LTD. | ||
|---|---|---|
| By: | /s/ David W. Sasnett | |
| Name: | David W. Sasnett | |
| Title: | Executive Vice President & Chief Financial Officer | |
| Date: November 17, 2020 |
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Consolidated Water Reports Q3 2020 Results
Revenue up 11.2% to $17.7 Million; Net Income from Continuing Operations of $1.8 Million or $0.12 per Share
GEORGE TOWN, Grand Cayman, Cayman Islands, November 16, 2020 -- Consolidated Water Co. Ltd. (NASDAQ Global Select Market: CWCO), a leading developer and operator of advanced water supply and treatment plants, reported results for the three and nine months ended September 30, 2020. Quarterly and nine-month comparisons are to the year-ago period unless otherwise noted.
Financial Highlights
| ● | Revenue in the third quarter of 2020 increased 11.2% to $17.7 million. |
|---|---|
| ● | Revenue for the first nine months of 2020 increased 12.3% to $57.5 million. |
| --- | --- |
| ● | Net income from continuing operations attributable to Consolidated Water stockholders for the third quarter of 2020 was $1.8 million or $0.12 per basic and fully diluted share, as compared to $2.3 million or $0.15 per basic and fully diluted share in the year-ago quarter. |
| --- | --- |
| ● | For the first nine months of 2020, net income from continuing operations attributable to Consolidated Water stockholders was $7.6 million or $0.50 per fully diluted share, down from $8.6 million or $0.57 per fully diluted share in the same year-ago period. |
| --- | --- |
| ● | Cash and cash equivalents totaled $38.2 million as of September 30, 2020, as compared to $35.0 million as of June 30, 2020. |
| --- | --- |
| ● | Paid $1.3 million in dividends in Q3 2020. |
| --- | --- |
Management Commentary ****
“During the third quarter of 2020, Consolidated Water generated substantial revenue growth and returned to profitability from Q2,” said company president and CEO, Rick McTaggart. “Over the first nine months of the year, we were also profitable, generating nearly $11 million in cash from operations.
“Fortunately, we have not been as impacted by the adverse conditions created by the COVID-19 pandemic as much as others. Our teams have worked diligently throughout the pandemic to ensure that we are able to continue our operations and pursue additional projects that can strengthen our business.
“Our Q3 topline growth is largely due to the $3.2 million in revenue contributed by our new PERC Water subsidiary, which provides design, engineering, construction and management services for water treatment infrastructure in the U.S. PERC’s performance has met our expectations so far this year in spite of the pandemic, and we’ve seen no material impact on its day-to-day operations.
“The management team at PERC has been focused on increasing its recurring revenue through multi-year operating contracts and consequently, PERC was awarded four operating contract renewals and two new operating contracts during the first nine months of the year. We are especially encouraged by the prospects in this area of our business, as PERC continues to actively pursue various potential new projects and
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contracts. Several of these could have a substantial positive impact on its results of operations should it ultimately be successful in securing these opportunities.
“The addition of PERC has also been highly complementary to our existing business and overall mission, supporting our pursuit of water reuse projects and other emerging opportunities with a comprehensive suite of solutions for improving water infrastructure. PERC provides a solid platform upon which to expand to North America our core business of designing, constructing and operating desalination plants.
“During the third quarter, our retail segment experienced a decline in revenue compared to last year, mainly due to the continuing closure of the borders in the Cayman Islands to tourist travel in response to the pandemic, as well as to the much wetter weather conditions in the Cayman Islands during the third quarter.
“The seaport and airport in the Cayman Islands have been closed to tourists since March, which has reduced visitors and tourism to virtually nil. However, as of the first of October, residents and property owners have been allowed to return to the Cayman Islands subject to quarantining for 14 days after arrival. This has allowed flights from the UK and the USA to resume on a reduced schedule.
“To encourage more long-term visitors, the Cayman Islands government recently implemented a ‘Global Citizen Concierge’ program, whereby tourist visas are granted to individuals and families who wish to reside and work remotely on the islands for up to two years. The Cayman Islands have actually been very successful in keeping the country COVID-free and mitigating pandemic-related damage to its economy, and this is one of their strong selling points for this new program.
“These developments can help bring much needed economic activity back to the islands. We are also encouraged by recent announcements regarding COVID-19 vaccines and believe the Cayman Islands are well positioned to quickly rebound from the economic downturn created by the pandemic once a vaccine is available and regular tourism resumes. While these are all positive developments, we expect our retail segment will continue to be negatively affected until primarily the United States has recovered from the pandemic.
“Our bulk water operations in the Cayman Islands and the Bahamas have continued to operate without incident and have been much less affected by the pandemic than our retail business. However, our bulk segment revenue that is generated in the Bahamas and the Cayman Islands declined slightly period-over-period largely due to lower energy costs which reduced the energy pass-through charges to our Bahamian customer. Bulk water gross profit margin was lower due to higher scheduled maintenance costs for our Bahamas operations.
“While we grew services revenues, our net income from services was largely affected by the amortization expense from the acquisition. Without the amortization, services generated approximately $750,000 in net income in the third quarter.
“The pandemic has caused unprecedented complications across all industries and companies, and does not appear to be getting any closer to ending. However, we have gone through two full quarters of lock downs with the various companies that we operate, and we think our business has stabilized in the current environment.
“While the sales in our retail business remain lower than normal, our other businesses are operating status quo or are improving. Our a very strong balance sheet with $38 million in cash enables us to continue to execute on our growth strategies and further the key business development initiatives we’ve been working on.
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“Looking ahead, we believe our solid financial condition and ample liquidity provides us with the solid foundation necessary for dealing with the challenges of the current economic environment. Our core operations and mission of providing affordable quality drinking water through our highly-efficient desalination plants, as well as wastewater treatment services through advanced water treatment and recycling facilities, continues to be a public health and economic necessity for our customers in the Caribbean and U.S.
“We are well-positioned to take advantage of opportunities that may arise to address these needs and expand or enhance our operations, especially as conditions eventually improve. The strong growth drivers inherent in our markets will continue to persist over the long-term regardless of the pandemic, and this bodes well for Consolidated Water as we work to enhance shareholder value over the months and years to come.”
Q3 2020 Financial Summary
Revenue increased 11.2% to $17.7 million from $15.9 million in the third quarter of 2019, which was driven by increases of $3.3 million in the services segment and $0.2 million in the manufacturing segment. The increases were partially offset by decreases of $1.3 million in the retail segment and $0.4 million in the bulk segment.
The increase in services revenue was due to the addition of $3.2 million in revenue from PERC Water which was acquired by the company in late October 2019.
The increase in manufacturing revenue was due to a shift in the production mix to higher revenue projects.
The decrease in retail revenue was due to an 18% decrease in the volume of water sold. This sales volume decrease is due to the temporary cessation of tourism on Grand Cayman resulting from the closing of all Cayman Islands airports and seaports in March 2020 in response to the COVID-19 pandemic.
The decrease in bulk segment revenue is attributable to a decrease in CW-Bahamas’ revenue of approximately $431,000 for 2020 due to lower energy costs, which correspondingly decreased the energy pass-through component of CW-Bahamas’ rates.
Gross profit for the third quarter of 2020 was $6.2 million or 35.2% of total revenue, down 7.4% from $6.7 million or 42.2% of total revenue in the same year-ago quarter.
Net income from continued operations attributable to Consolidated Water stockholders for the third quarter of 2020 was $1.8 million or $0.12 per basic and fully diluted share, as compared to $2.3 million or $0.15 per basic and fully diluted share in the third quarter of 2019.
First nine months 2020 Financial Summary
Total revenue for the first nine months of 2020 was $57.5 million, up 12.3% compared to $51.2 million in the same year-ago period. The increase was primarily driven by an increase of $9.7 million in the services segment and an increase of $0.5 million in the manufacturing segment. The increase in total revenue was partially offset by decreases of $2.1 million in the bulk segment and $1.7 million in the retail segment.
The increase in services revenue was due to the addition of $9.6 million in revenue from PERC Water which was acquired by the company in late October 2019.
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Retail revenue decreased due to an 8% decrease in the volume of water sold. This sales volume decrease is due to the temporary cessation of tourism on Grand Cayman resulting from the closing of all Cayman Islands airports and seaports in March 2020 in response to the COVID-19 pandemic.
The decrease in bulk revenue was due to a decline in revenue in OC-Cayman of approximately $1.3 million for the third quarter as a result of the two new contracts under lower rates with the Water Authority-Cayman for water supplied from the Red Gate and North Sound plants, which commenced in February 2019, and the North Side Water Works plant, which commenced in July 2019. CW-Bahamas’ revenue dropped approximately $879,000 for 2020 due to lower energy costs, which correspondingly decreased the energy pass-through component of its rates.
The increase in manufacturing revenue was due to a shift in the production mix of higher revenue projects.
Gross profit for the first nine months of 2020 was $22.0 million or 38.2% of total revenue, up 3.5% from $21.2 million or 41.5% of total revenue in the same year-ago period.
Net income from continuing operations attributable to Consolidated Water stockholders for the first nine months of 2020 was $7.6 million or $0.50 per fully diluted share, down from $8.6 million or $0.57 per fully diluted share in the same year-ago period.
Third Quarter Segment Results
| | Three Months Ended September 30, 2020 | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | Retail | Bulk | Services | Manufacturing | Total | ||||||||||
| Revenue | | $ | 4,993,069 | | $ | 6,061,475 | | $ | 3,351,935 | | $ | 3,259,778 | $ | 17,666,257 | |
| Cost of revenue | | 2,586,901 | | 4,400,717 | | 2,513,272 | | 1,949,731 | | 11,450,621 | |||||
| Gross profit | | 2,406,168 | | 1,660,758 | | 838,663 | | 1,310,047 | | 6,215,636 | |||||
| General and administrative expenses | | 3,367,802 | | 382,662 | | 728,829 | | 330,723 | | 4,810,016 | |||||
| Loss on asset dispositions and impairments, net | | — | | — | | (984) | | — | | (984) | |||||
| Income (loss) from operations | | $ | (961,634) | | $ | 1,278,096 | | $ | 108,850 | | $ | 979,324 | | 1,404,636 | |
| Other income, net | | | | | | | 245,492 | ||||||||
| Income before income taxes | | | | | | 1,650,128 | |||||||||
| Benefit from income taxes | | | | | | (263,165) | |||||||||
| Net income from continuing operations | | | | | | 1,913,293 | |||||||||
| Income from continuing operations attributable to non-controlling interests | | | | | | 101,137 | |||||||||
| Net income from continuing operations attributable to Consolidated Water Co. Ltd. stockholders | | | | | | 1,812,156 | |||||||||
| Net loss from discontinued operations | | | | | | (377,321) | |||||||||
| Net income attributable to Consolidated Water Co. Ltd. stockholders | | | | | | $ | 1,434,835 |
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| | | | | | | | | | | | | | | | | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | Three Months Ended September 30, 2019 | |||||||||||||||
| | Retail | Bulk | Services | Manufacturing | Total | |||||||||||
| Revenue | | $ | 6,271,220 | | $ | 6,449,757 | | $ | 95,980 | | $ | 3,072,282 | | $ | 15,889,239 | |
| Cost of revenue | | 2,945,586 | | 4,269,739 | | 31,601 | | 1,933,333 | | 9,180,259 | ||||||
| Gross profit | | 3,325,634 | | 2,180,018 | | 64,379 | | 1,138,949 | | 6,708,980 | ||||||
| General and administrative expenses | | 3,497,320 | | 294,189 | | 549 | | 487,914 | | 4,279,972 | ||||||
| Gain on asset dispositions and impairments, net | | 6,518 | | 500 | | — | | — | | 7,018 | ||||||
| Income (loss) from operations | | $ | (165,168) | | $ | 1,886,329 | | $ | 63,830 | | $ | 651,035 | | 2,436,026 | ||
| Other income, net | | | | | | 216,896 | ||||||||||
| Income before income taxes | | | | | | 2,652,922 | ||||||||||
| Benefit from income taxes | | | | | | (40,075) | ||||||||||
| Net income from continuing operations | | | | | | 2,692,997 | ||||||||||
| Income attributable to non-controlling interests | | | | | | 433,235 | ||||||||||
| Net income from continuing operations attributable to Consolidated Water Co. Ltd. stockholders | | | | | | 2,259,762 | ||||||||||
| Net loss from discontinued operations | | | | | | (532,710) | ||||||||||
| Net income attributable to Consolidated Water Co. Ltd. stockholders | | | | | | $ | 1,727,052 |
First Nine Months Segment Results
| | | | | | | | | | | | | | | | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | Nine Months Ended September 30, 2020 | ||||||||||||||
| | Retail | Bulk | Services | Manufacturing | Total | ||||||||||
| Revenue | | $ | 18,216,797 | | $ | 18,368,156 | | $ | 9,942,748 | | $ | 10,951,524 | $ | 57,479,225 | |
| Cost of revenue | | 8,343,018 | | 12,906,606 | | 7,418,305 | | 6,852,196 | | 35,520,125 | |||||
| Gross profit | | 9,873,779 | | 5,461,550 | | 2,524,443 | | 4,099,328 | | 21,959,100 | |||||
| General and administrative expenses | | 10,008,423 | | 935,808 | | 2,112,869 | | 1,005,838 | | 14,062,938 | |||||
| Gain on asset dispositions and impairments, net | | — | | 200 | | 3,801 | | — | | 4,001 | |||||
| Income (loss) from operations | | $ | (134,644) | | $ | 4,525,942 | | $ | 415,375 | | $ | 3,093,490 | | 7,900,163 | |
| Other income, net | | | | | | | | 533,710 | |||||||
| Income before income taxes | | | | | | 8,433,873 | |||||||||
| Provision for income taxes | | | | | | 147,186 | |||||||||
| Net income from continuing operations | | | | | | 8,286,687 | |||||||||
| Income from continuing operations attributable to non-controlling interests | | | | | | 642,289 | |||||||||
| Net income from continuing operations attributable to Consolidated Water Co. Ltd. stockholders | | | | | | 7,644,398 | |||||||||
| Net loss from discontinued operations | | | | | | (4,448,798) | |||||||||
| Net income attributable to Consolidated Water Co. Ltd. stockholders | | | | | | $ | 3,195,600 |
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| | | | | | | | | | | | | | | | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | Nine Months Ended September 30, 2019 | ||||||||||||||
| | Retail | **** | Bulk | **** | Services | **** | Manufacturing | **** | Total | ||||||
| Revenue | | $ | 19,941,395 | | $ | 20,502,121 | | $ | 287,349 | | $ | 10,452,158 | | $ | 51,183,023 |
| Cost of revenue | | 8,753,948 | | 13,992,452 | | 198,614 | | 7,013,977 | | 29,958,991 | |||||
| Gross profit | | 11,187,447 | | 6,509,669 | | 88,735 | | 3,438,181 | | 21,224,032 | |||||
| General and administrative expenses | | 10,020,019 | | 900,572 | | 2,865 | | 1,466,091 | | 12,389,547 | |||||
| Gain on asset dispositions and impairments, net | | 401,088 | | 47,000 | | — | | — | | 448,088 | |||||
| Income from operations | | $ | 1,568,516 | | $ | 5,656,097 | | $ | 85,870 | | $ | 1,972,090 | | 9,282,573 | |
| Other income, net | | | | | | 518,031 | |||||||||
| Income before income taxes | | | | | | 9,800,604 | |||||||||
| Provision for income taxes | | | | | | | | | | | | | | | 73,117 |
| Net income from continuing operations | | | | | | 9,727,487 | |||||||||
| Income from continuing operations attributable to non-controlling interests | | | | | | 1,172,039 | |||||||||
| Net income from continuing operations attributable to Consolidated Water Co. Ltd. stockholders | | | | | | 8,555,448 | |||||||||
| Net income from discontinued operations | | | | | | 1,834,297 | |||||||||
| Net income attributable to Consolidated Water Co. Ltd. stockholders | | | | | | $ | 10,389,745 |
Conference Call
Consolidated Water management will host a conference call to discuss these results, followed by a question and answer period.
Date: Tuesday, November 17, 2020
Time: 11:00 a.m. Eastern time (8:00 a.m. Pacific time)
Toll-free dial-in number: 1-844-875-6913
International dial-in number: 1-412-317-6709
Conference ID: 10149638
Please call the conference telephone number five minutes prior to the start time. An operator will register your name and organization. If you have any difficulty connecting with the conference call, please contact CMA at 1-949-432-7566.
A replay of the call will be available after 1:00 p.m. Eastern time on the same day through November 24, 2020, as well as available for replay via the Investors section of the Consolidated Water website at www.cwco.com.
Toll-free replay number: 1-877-344-7529
International replay number: 1-412-317-0088
Replay ID: 10149638
About Consolidated Water Co. Ltd.
Consolidated Water Co. Ltd. develops and operates advanced water supply and treatment plants and water distribution systems. 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. 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. For more information, visit www.cwco.com.
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Cautionary Note Regarding Forward-Looking Statements
This press release includes statements that may constitute "forward-looking" statements, usually containing the words "believe", "estimate", "project", "intend", "expect", "should", "will" or similar expressions. These statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements inherently involve risks and uncertainties that could cause actual results to differ materially from the forward-looking statements. Factors that would cause or contribute to such differences include, but are not limited to (i) continued acceptance of the company's products and services in the marketplace; (ii) changes in its relationships with the governments of the jurisdictions in which it operates; (iii) the outcome of its negotiations with the Cayman government regarding a new retail license agreement; (iv) the future financial performance of its subsidiary that manufactures water treatment-related systems and products and provides design, engineering, management, operating and other services applicable to commercial, municipal and industrial water production; (v) the collection of its delinquent accounts receivable in the Bahamas; (vi) its ability to integrate and profitably operate recently acquired subsidiary PERC Water Corporation; (vii) the possible adverse impact of the COVID-19 virus on the company’s business; and (viii) various other risks, as detailed in the company's periodic report filings with the Securities and Exchange Commission (“SEC”). For more information about risks and uncertainties associated with the company’s business, please refer to the “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and “Risk Factors” sections of the company’s SEC filings, including, but not limited to, its annual report on Form 10-K and quarterly reports on Form 10-Q, copies of which may be obtained by contacting the company’s Secretary at the company’s executive offices or at the “Investors – SEC Filings” page of the company’s website at http://ir.cwco.com/docs. Except as otherwise required by law, the company undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.
Company Contact:
David W. Sasnett
Executive Vice President and CFO
Tel (954) 509-8200
dsasnett@cwco.com
Investor Relations ContactRon Both, CMA Tel (949) 432-7566 CWCO@cma.team
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CONSOLIDATED WATER CO. LTD.
CONDENSED CONSOLIDATED BALANCE SHEETS
| | | | | | | | |
|---|---|---|---|---|---|---|---|
| | | | September 30, | | | December 31, | |
| | | 2020 | | | 2019 | ||
| | | (Unaudited) | | | | | |
| ASSETS | | | | ||||
| Current assets | | | | ||||
| Cash and cash equivalents | | $ | 38,179,414 | | $ | 42,071,083 | |
| Accounts receivable, net | | 24,411,328 | | 23,229,689 | | ||
| Inventory | | 3,770,351 | | 3,287,555 | | ||
| Prepaid expenses and other current assets | | 2,967,605 | | 1,559,448 | | ||
| Costs and estimated earnings in excess of billings | | 1,188,875 | | 1,675,781 | | ||
| Current assets of discontinued operations | | 1,052,091 | | 1,619,056 | | ||
| Total current assets | | | 71,569,664 | | 73,442,612 | | |
| Property, plant and equipment, net | | 59,056,778 | | 61,238,752 | | ||
| Construction in progress | | 473,507 | | 1,335,597 | | ||
| Inventory, noncurrent | | 4,657,418 | | 4,404,378 | | ||
| Investment in OC-BVI | | 1,698,214 | | 1,903,602 | | ||
| Goodwill | | 13,325,013 | | 13,325,013 | | ||
| Intangible assets, net | | 4,360,833 | | 5,040,000 | | ||
| Operating lease right-of-use assets | | | 1,414,736 | | | 1,811,516 | |
| Other assets | | 1,916,123 | | 2,120,708 | | ||
| Long-term assets of discontinued operations | | 21,995,648 | | 27,669,966 | | ||
| Total assets | | $ | 180,467,934 | | $ | 192,292,144 | |
| | | | | | | | |
| LIABILITIES AND EQUITY | | | | ||||
| Current liabilities | | | | ||||
| Accounts payable, accrued expenses and other current liabilities | | $ | 3,083,762 | | $ | 3,560,971 | |
| Accrued compensation | | 1,835,594 | | 1,821,395 | | ||
| Dividends payable | | 1,298,311 | | 1,292,187 | | ||
| Current maturities of operating leases | | | 545,364 | | | 688,540 | |
| Current portion of long-term debt | | | 42,211 | | | 17,753 | |
| Billings in excess of costs and estimated earnings | | 818,765 | | 614,386 | | ||
| Current liabilities of discontinued operations | | 98,891 | | 178,382 | | ||
| Total current liabilities | | 7,722,898 | | 8,173,614 | | ||
| Long-term debt, noncurrent | | | 136,106 | | | 61,146 | |
| Deferred tax liabilities | | 1,364,393 | | 1,529,035 | | ||
| Noncurrent operating leases | | | 1,071,831 | | | 1,156,543 | |
| Net liability arising from put/call options | | | 706,000 | | | 664,000 | |
| Other liabilities | | 75,000 | | 75,000 | | ||
| Long-term liabilities of discontinued operations | | | 8,842 | | | 2,679,932 | |
| Total liabilities | | 11,085,070 | | 14,339,270 | | ||
| Commitments and contingencies | | | | ||||
| Equity | | | | ||||
| Consolidated Water Co. Ltd. stockholders' equity | | | | ||||
| Redeemable preferred stock, $0.60 par value. Authorized 200,000 shares; issued and outstanding 33,059 and 33,751 shares, respectively | | 19,835 | | 20,251 | | ||
| Class A common stock, $0.60 par value. Authorized 24,655,000 shares; issued and outstanding 15,122,049 and 15,049,608 shares, respectively | | 9,073,230 | | 9,029,765 | | ||
| Class B common stock, $0.60 par value. Authorized 145,000 shares; none issued | | — | | — | | ||
| Additional paid-in capital | | 86,590,057 | | 88,356,509 | | ||
| Retained earnings | | 65,683,955 | | 66,352,733 | | ||
| Total Consolidated Water Co. Ltd. stockholders' equity | | 161,367,077 | | 163,759,258 | | ||
| Non-controlling interests | | 8,015,787 | | 14,193,616 | | ||
| Total equity | | 169,382,864 | | 177,952,874 | | ||
| Total liabilities and equity | | $ | 180,467,934 | | $ | 192,292,144 | |
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CONSOLIDATED WATER CO. LTD.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
| | | | | | | | | | | | | |
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| | | Three Months Ended September 30, | **** | Nine Months Ended September 30, | ||||||||
| | 2020 | **** | 2019 | **** | 2020 | **** | 2019 | |||||
| Total revenue | | $ | 17,666,257 | | $ | 15,889,239 | | $ | 57,479,225 | | $ | 51,183,023 |
| Total cost of revenue | | 11,450,621 | | 9,180,259 | | 35,520,125 | | 29,958,991 | ||||
| Gross profit | | 6,215,636 | | 6,708,980 | | 21,959,100 | | 21,224,032 | ||||
| General and administrative expenses | | 4,810,016 | | 4,279,972 | | 14,062,938 | | 12,389,547 | ||||
| Gain (loss) on asset dispositions and impairments, net | | (984) | | 7,018 | | 4,001 | | 448,088 | ||||
| Income from operations | | 1,404,636 | | 2,436,026 | | 7,900,163 | | 9,282,573 | ||||
| | | | | | | | | | | | | |
| Other income (expense): | | | | | ||||||||
| Interest income | | 164,761 | | 154,175 | | 411,020 | | 444,827 | ||||
| Interest expense | | (2,069) | | (19) | | (7,413) | | (19) | ||||
| Profit-sharing income from OC-BVI | | 6,075 | | 2,025 | | 30,375 | | 10,125 | ||||
| Equity in the earnings of OC-BVI | | 22,411 | | 38,174 | | 82,387 | | 26,686 | ||||
| Net unrealized gain (loss) on put/call options | | 39,000 | | — | | (42,000) | | (24,000) | ||||
| Other | | 15,314 | | 22,541 | | 59,341 | | 60,412 | ||||
| Other income, net | | 245,492 | | 216,896 | | 533,710 | | 518,031 | ||||
| Income before income taxes | | 1,650,128 | | 2,652,922 | | 8,433,873 | | 9,800,604 | ||||
| Provision (benefit) for income taxes | | (263,165) | | (40,075) | | 147,186 | | 73,117 | ||||
| Net income from continuing operations | | 1,913,293 | | 2,692,997 | | 8,286,687 | | 9,727,487 | ||||
| Income from continuing operations attributable to non-controlling interests | | 101,137 | | 433,235 | | 642,289 | | 1,172,039 | ||||
| Net income from continuing operations attributable to Consolidated Water Co. Ltd. stockholders | | 1,812,156 | | 2,259,762 | | 7,644,398 | | 8,555,448 | ||||
| Gain on sale of discontinued operations | | | — | | | — | | | — | | | 3,621,170 |
| Net loss from discontinued operations | | (377,321) | | (532,710) | | (4,448,798) | | (1,786,873) | ||||
| Total income (loss) from discontinued operations | | | (377,321) | | | (532,710) | | | (4,448,798) | | | 1,834,297 |
| Net income attributable to Consolidated Water Co. Ltd. stockholders | | $ | 1,434,835 | | $ | 1,727,052 | | $ | 3,195,600 | | $ | 10,389,745 |
| | | | | | | | | | | | | |
| Basic earnings (loss) per common share attributable to Consolidated Water Co. Ltd. common stockholders | | | | | ||||||||
| Continuing operations | | $ | 0.12 | | $ | 0.15 | | $ | 0.51 | | $ | 0.57 |
| Discontinued operations | | | (0.03) | | | (0.04) | | | (0.30) | | | 0.12 |
| Basic earnings per share | | $ | 0.09 | | $ | 0.11 | | $ | 0.21 | | $ | 0.69 |
| | | | | | | | | | | | | |
| Diluted earnings (loss) per common share attributable to Consolidated Water Co. Ltd. common stockholders | | | | | ||||||||
| Continuing operations | | $ | 0.12 | | $ | 0.15 | | $ | 0.50 | | $ | 0.57 |
| Discontinued operations | | | (0.03) | | | (0.04) | | | (0.29) | | | 0.12 |
| Diluted earnings per share | | $ | 0.09 | | $ | 0.11 | | $ | 0.21 | | $ | 0.69 |
| | | | | | | | | | | | | |
| Dividends declared per common and redeemable preferred shares | | $ | 0.085 | | $ | 0.085 | | $ | 0.26 | | $ | 0.26 |
| | | | | | | | | | | | | |
| Weighted average number of common shares used in the determination of: | | | | | ||||||||
| Basic earnings per share | | 15,120,983 | | 15,026,710 | | 15,116,681 | | 15,022,489 | ||||
| Diluted earnings per share | | 15,273,529 | | 15,138,094 | | 15,270,494 | | 15,132,843 |
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