Consolidated Water Co. Ltd. Q1 FY2025 earnings call

• Hawaii project: Honolulu Board of Water Supply approved pilot test reports, paving way for construction once permits are obtained; $204 million project to start construction early next year.
• Cayman Water: Received new concession, resuming license discussions with OfReg; expanding West Bay desalination plant and planning water storage tanks.
• Manufacturing: Revenue up 10% to $5.8 million, constructing additional space for Aerex to increase throughput.
• REC: Colorado subsidiary expanding design, build, and O&M businesses; pursuing O&M and design-build opportunities in Colorado.
• Smaller projects: Anticipating design-build revenues to improve in second half of 2025 with three smaller projects worth ~$20 million.

Services segment revenue and operating income declined in Q1 2025 due to completion of major projects, but recurring revenue from O&M contracts increased 9% ($626,000). Retail segment revenue was up $786,000 due to a 13% increase in water sales volume. Bulk water segment revenue was $8.4 million, consistent year over year. Manufacturing segment revenue increased by $509,000 to $5.8 million, with operating income up 44%.

• Expect to begin construction of Hawaii seawater desalination project early next year once permits are obtained.
• Design-build revenues expected to improve in the second half of 2025 with smaller projects underway.
• Confident in steady long-term growth driven by retail water sales, Caribbean bulk water operations, Hawaii project, and manufacturing segment.

• Permit delays for Hawaii project, as some permits are outside the company's control and could delay construction.
• Regulatory changes affecting Cayman Water's operating license renewal.
• Economic, political, and social risks in markets where the company operates.

Q: Regarding Hawaii project, how does construction revenue flow through and who is responsible for permitting?

A: Revenue recognition dependent on cost incurred; permitting is shared, with some permits on the company and some on the client.

Q: On retail, is the uptick in volumes permanent?

A: Yes, due to permanent population growth and business activity in Grand Cayman.

Q: Elaborate on permitting risks?

A: Some permits are outside the company's control, like certain government agency approvals which can move slowly, but no detrimental risks identified yet.