“Enabled by an exceptionally strong balance sheet, we will continue to invest in new long-term projects. This includes the new desalination plants in the Bahamas on Cat Island, as well as new infrastructure for serving the growing water needs of our utility customers in the Cayman Islands which will ultimately drive future bulk and retail revenue growth.
“Our strong balance sheet also enables us to move quickly on any potential acquisitions. While we are currently in a period between large construction projects, we believe that our award-winning plant designs, our cost-efficient project delivery models, and our unmatched industry experience will help us secure new projects we are pursuing.
“The course we charted for our company several years ago, which involved diversifying our product offerings and market areas beyond seawater desalination in the Caribbean, has continued to prove successful and lays the path for strong growth ahead.
“As we complete 2024 and prepare for the new year, we anticipate that all of these positive factors will continue to support our long-term growth, enhance future profitability, and further strengthen shareholder value.”
Third Quarter 2024 Financial Summary
Revenue totaled $33.4 million, declining 33% from $49.9 million in the third quarter of 2023. The decrease was due to decreases of $16.7 million in the services segment and $362,000 in the manufacturing segment. The decreases were partially offset by increases of $369,000 in the retail segment and $279,000 in the bulk segment.
Retail revenue increased due to a 4.2% increase in the volume of water sold. The volume of water sold increased due to a 4.8% increase in the number of customer accounts in the company’s license area from September 30, 2023 to September 30, 2024.
The increase in bulk segment revenue was due to the commencement on May 1, 2024 of the operating and maintenance contract for the new Red Gate desalination plant for the Water Authority of the Cayman Island. The increase was also due to an amendment of the company’s North Sound contract, which became effective May 1, 2024.
The decrease in services segment revenue was due to plant construction revenue decreasing from $24.2 million in 2023 to $3.6 million in 2024 as the result of two construction projects being completed earlier this year. Revenue generated under operations and maintenance contracts totaled $7.5 million in the third quarter of 2024, an increase of 49% from the third quarter of 2023. Newly acquired REC contributed $2.1 million to the increase, with the remainder related to incremental PERC contracts.
Manufacturing segment revenue decreased by $362,000 to $4.4 million as compared to $4.7 million in the third quarter of 2023.
Gross profit for the third quarter of 2024 was $11.6 million (34.8% of total revenue), as compared to $16.6 million (33.3% of total revenue) in the third quarter of 2023.