Consolidated Water Co. Ltd. Q3 FY2025 earnings call

• Diversified water business model delivered strong performance with increased revenue and earnings. - Retail water sales on Grand Cayman higher due to economic strength and drier weather. - Bulk segment had modest revenue decline but higher profitability via cost reduction. - Services segment grew from 2 ongoing construction projects and O&M contracts, with 2 new projects awarded (approx $15.6M value). - Manufacturing segment maintained momentum with revenue growth, improved gross margin, and new 17,500 sq ft facility expansion. - New directors appointed to strengthen corporate governance with expertise in various areas.

Retail water sales on Grand Cayman were higher due to economic strength and drier weather, increasing sales and volumes. Caribbean bulk segment had modest revenue decline but higher profitability due to cost reduction. Services segment grew from construction projects and O&M, offset by consulting revenue decrease. Manufacturing segment had revenue growth and improved gross margin, with new facility expansion. Revenue breakdown: Total revenue $35.1M, up 5% from $33.4M. Retail revenue up due to volume increase; bulk down due to lower fuel charges but higher profit; services up from construction and O&M; manufacturing up 7% to $4.7M. Gross profit $12.9M (37% of total revenue) vs $11.6M (35%) in prior year.

• Construction of Hawaii seawater desalination plant expected to commence early next year, substantially adding to revenue/earnings in 2026-2027. - Revenue from new construction projects (approx $15.6M) to be realized primarily in 2026. - Manufacturing facility expansion expected to enhance throughput and enable multiple projects, driving growth.

• Tourism and weather conditions in service areas. - Economic, political, and social conditions in countries of operation. - Regulatory matters, including renewal of retail license on Grand Cayman. - Ability to successfully enter new markets and various other risks detailed in SEC filings.

Q: Regarding Hawaii, the archeological permit is important, and other admin permits are more administrative.

A: The archeological permit is crucial; other permits are building-related but more administrative.

Q: On Arizona CDR increase, is it due to activity picking up?

A: It's a function of salespeople's familiarity in Arizona, with CDR product offering cost certainty and schedule guarantees.

Q: On manufacturing facility expansion, how does it help?

A: It improves workflow by separating fabrication and assembly areas, allowing bigger units and better flow, enhancing ability to handle multiple projects.