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Consolidated Water (CWCO) Q2 Earnings Surpass Estimates

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Consolidated Water Co. Ltd. (CWCO - Free Report) reported second-quarter 2020 earnings of 13 cents per share, which beat the Zacks Consensus Estimate of 12 cents by 8.3%.

Total Revenues

The company’s total second-quarter revenues came in at $19.1 million, up 4.4% from the year-ago figure of $18.3 million. The reported revenues also surpassed the Zacks Consensus Estimate of $18 million by 6.3%.

The year-over-year improvement can be attributed to strong contribution from its Services segment.

Consolidated Water Co. Ltd. Price, Consensus and EPS Surprise

Consolidated Water Co. Ltd. Price, Consensus and EPS Surprise

Consolidated Water Co. Ltd. price-consensus-eps-surprise-chart | Consolidated Water Co. Ltd. Quote

Segment Details

Retail revenues for the second quarter decreased 14.5% year over year to $6 million. This was due to a 16% decrease in the volume of water sold as a result of the temporary cessation of tourism on Grand Cayman in response to the COVID-19 pandemic.

Bulk revenues came in at $5.9 million, down 14.5% from the prior-year figure. The decrease in revenues was due lower energy costs in the Bahamas.

Manufacturing revenues amounted to $3.77 million, down 12.1% year over year. The year-over-year decline was due to a decrease in the number of active projects.

Services revenues were $3.47 million for the quarter, up 285.5% from $0.9 million in the year-ago period. The increase was due to the addition of $3.4 million revenues from PERC Water as a result of Consolidated Water’s acquisition of a 51% stake in the former in late October 2019.

Highlights of the Release

Gross profit for the second quarter was $7.3 million or 38.3% of total revenues, down 3% from $7.6 million or 41.3% in the year-ago period.

For the second quarter, total cost of revenues increased 9.3% year over year to $12.3 million.

General and administrative expenses increased 15.9% from the year-ago level to $11.8 million.

In the second quarter, all business segments of the company were adversely impacted by the COVID-19 pandemic. However, Consolidated Water is well positioned to successfully navigate this uncertain and turbulent time.

Financial Highlights

Cash and cash equivalents as of Jun 30, 2020 were $34.9 million, down from $42.9 million on Dec 31, 2019.

Long-term debt as of Jun 30, 2020 was $0.15 million compared with $0.06 million on Dec 31, 2019.

Cash used in operating activities in first-half 2020 was $9.2 million versus cash provided from operating activities of $6.1 million in the comparable year-ago period.

Zacks Rank

Currently, Consolidated Water carries a Zacks Rank #3 (Hold).

You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Other Releases

Here are some players from the water utility space that have reported second-quarter earnings:

American Water Works (AWK - Free Report) , Middlesex Water Company’s (MSEX - Free Report) and The York Water Company (YORW - Free Report) beat earnings estimates by 1.04%, 7.84% and 14.3%, respectively.

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