Consolidated Water Co. Beats Q2 Earnings Estimates, Flat Y/Y - Analyst Blog

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Consolidated Water Co. Ltd. ( CWCO ) reported second-quarter 2014 earnings per share of 19 cents, flat with the prior-year figure. Quarterly earnings significantly surpassed the Zacks Consensus Estimate of 7 cents.

Increases in both total cost of revenues as well as general and administrative expenses negatively impacted quarterly earnings.

Total Revenue

In the quarter under review, Consolidated Water's total revenues were $16.9 million, missing the Zacks Consensus Estimate of $17 million. Revenues however increased 2.2% year over year primarily due to increased services (up 105.3% year over year) and retail water (up 5.2% year over year) revenues. This was partially offset by lower bulk water revenues (down 1.9% year over year).

Operational Update

In the second quarter, total cost of revenues increased 3.8% year over year to $10.6 million primarily due to higher cost of revenues at its retail and services segments.

The company's quarterly gross profit was around $6.37 million, down 0.4% year over year primarily due to a minor decline in retail gross profit as the Bali retail operations ran in the red.

Consolidated Water incurred $3.8 million as general and administrative expenses, up 5.2% year over year primarily due to a rise in project development expenses by the company's Mexico subsidiary, N.S.C. Agua, S.A. de C.V.

Income from operations decreased 7.6% year over year to $2.6 million.

In the reported quarter, the company's interest expenses decreased 61.9% year over year to around $0.05 million.


As of Jun 30, 2014, Consolidated Water's cash and cash equivalents were $34.4 million versus $33.6 million as of Dec 31, 2013.

The company had no outstanding long-term debt (current portion) as of Jun 30, 2014 compared with $5.2 million at the end of 2013.

In the first half of 2014, Consolidated Water's net cash flow from operating activities was around $22 million versus $6.5 million in the prior-year period.

At the Peers

Aqua America Inc. ( WTR ) announced second-quarter 2014 earnings of 31 cents per share, beating the Zacks Consensus Estimate by a penny.

American Water Works Company, Inc. ( AWK ) posted second-quarter 2014 earnings of 62 cents per share, missing the Zacks Consensus Estimate of 65 cents.

Connecticut Water Service Inc. ( CTWS ) reported second-quarter 2014 earnings of 67 cents per share, surpassing the Zacks Consensus Estimate by 28.8%.

Zacks Rank

Consolidated Water currently has a Zacks Rank #3 (Hold).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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