Global Water Resources, Inc. Q4 FY2024 earnings call

• Total active service connections increased 4.4% to 64,520 as of December 30, 2024.
• Invested $32.3 million in infrastructure improvements in 2024.
• 2024 had zero significant compliance events, continuing a strong compliance record.
• 2024 single-family dwelling building permits in Metro Phoenix increased 20.3% to 27,156 from 2023. In Maricopa, single-family permits increased 11.5% to 986. Multifamily permits in Maricopa jumped 88.7% to 1,200 in 2024.
• Industrial investment in Arizona was strong, with $50 billion invested in 2024, including a $100 billion TSMC expansion.
• Filed a rate case for Santa Cruz Water Company and Palo Verde Utilities Company based on a 2024 test year.
• From 2019 to 2024, active connections grew 40.8%, revenue 48.4%, and EPS 119%.

Total revenue for 2024 was $52.7 million, down 0.6% from 2023. The decrease was due to non-recurring Infra (ICFA) revenue not recurring in 2024, offset by a 4.4% increase in active service connections leading to a 4.9% increase in regulated revenue to $52.7 million. Operating expenses in 2024 were $43.3 million, up 6.3% from 2023. Net income in 2024 was $5.8 million ($0.24 per diluted share) compared to $8 million ($0.33 per diluted share) in 2023. Adjusted net income in 2024 was $6.3 million ($0.26 per diluted share), up slightly from 2023. Adjusted EBITDA in 2024 was $26.7 million, an increase of 5.2% from 2023.

• Aiming to close the acquisition of City of Tucson assets in the first half of 2025, which will increase customers in the region.
• Rate case for Santa Cruz Water Company and Palo Verde Utilities requests ~$6.5 million revenue increase, with a proposed rate base of ~$165 million.
• Expect continued growth from organic customer connections, acquisitions, and rate cases.

• Forward-looking statements involve risks and uncertainties that could cause actual results to differ materially.
• Regulatory risks related to rate case approvals and compliance with commission policies.

Q: Could you provide more details on the CSA or formula rates?

A: Chris Krygier explained that the CSA proposal is based on the FERC model, allowing annual rate updates, increased transparency, and elements to finalize certain rate case components in the formula over a five-year program.

Q: What does a notice to proceed from Procter and Gamble mean for the project?

A: Ron Fleming stated that a notice to proceed means Global Water will move into detailed design to plan and permit the infrastructure required for P&G's project, with a typical 2-3 year process from notice to proceed to construction.