Global Water Resources, Inc. (NASDAQ: GWRS), a pure-play water
resource management company, reported results for the full year
ended December 31, 2024. All comparisons are to the same
year-ago period unless otherwise noted. The company will hold a
conference call at 1:00 p.m. Eastern time tomorrow to discuss the
results (see dial-in information below).
Financial Highlights
- Regulated
revenue increased 4.9% to $52.7 million, primarily due to organic
connection growth.
- Total
revenue decreased 0.6% to $52.7 million, with the decline due to
$2.8 million in unregulated revenue related to infrastructure
coordination and financing agreements (ICFAs) in 2023 that did not
recur in 2024.
- Net
income decreased 27.5% to $5.8 million or $0.24 per share, compared
to $0.33 per share in 2023. The primary driver of the decrease was
ICFA revenue recognized in 2023 that did not recur in 2024.
- Adjusted
net income increased 2.0% to $6.3 million or $0.26 per share,
compared to $0.26 per share in 2023 (see definition of adjusted net
income and EPS, non-GAAP terms, and their reconciliations to GAAP,
below).
- Adjusted
EBITDA increased 5.2% to $26.7 million (see definition of adjusted
EBITDA, a non-GAAP term, and its reconciliation to GAAP,
below).
- Cash and
cash equivalents totaled $9.0 million at December 31,
2024.
- In
November 2024, announced an increase in dividend to $0.30396 per
share on an annualized basis. The first monthly dividend payment at
the new rate was paid on December 30, 2024 to holders of
record on December 16, 2024.
Operational Highlights
- Total
active service connections increased 4.4% to 64,520 at
December 31, 2024 as compared to year-end 2023.
- Water
consumption increased 3.3% to 4.16 billion gallons in 2024.
- Invested
$32.3 million in infrastructure projects to support existing
utilities and continued growth.
Subsequent Events
- On
January 10, 2025, the company filed a unanimous settlement
agreement related to the Global Water – Farmers Water Company, Inc.
(GW-Farmers) general rate case application that had been filed with
the Arizona Corporation Commission (ACC) on June 27, 2024. The
settlement agreement, if approved, would provide $1.1 million in
additional revenue on an annualized basis to support the company’s
infrastructure investment. It would be implemented in three stages:
50% on May 1, 2025, 25% on November 1, 2025, and 25% on May 1,
2026.
- In
January 2025, the company appointed water industry veteran, Robert
J. Kuta, as EVP of engineering and environmental resources. Kuta
will support the company’s ongoing efforts to further enhance its
water and wastewater services and prepare for greater regional
expansion.
- On
January 22, 2025, the company received a Certificate of Convenience
and Necessity permit from the ACC to provide water service to seven
isolated public water systems formerly receiving service from the
City of Tucson. The company expects to complete the acquisition in
the first half of 2025, subject to customary closing
conditions.
- On March
5, 2025, the company filed a general rate case application related
to the Global Water – Santa Cruz Water Company, Inc. and Global
Water – Palo Verde Utilities Company, Inc., requesting a net
increase to its annual revenues of $6.5 million with the proposed
first phase to be implemented in May 2026 and the second phase in
January 2027.
Management Commentary
“In 2024, we continued to grow our customer base
and regulated revenue at a notable pace when you consider the
ongoing interest rate environment,” commented Global Water
Resources president and CEO, Ron Fleming. “The increase in
regulated revenue for the year was primarily attributable to the
organic growth in active water and wastewater connections and
increased consumption. The increase was also due to our scheduled
rate increase related to GW-Saguaro that went into effect in the
second half of the year.
“We began 2025 welcoming to our team a respected
industry veteran and executive, Robert J. Kuta, who brings
extensive experience and strong record of achievement. We have
great confidence that Rob’s diverse skill set will enhance our
organizational performance. In coordination with our exceptional
existing team, Rob will develop and execute infrastructure and
environmental programs for the benefit of our growing regional
communities, while maintaining compliance as our top mandate.
“The anticipated approval of our GW-Farmers
general rate case represents the next step in our consolidation
plan to improve this utility for our customers and the broader
Sahuarita community. The proposed settlement agreement is under
advisement with the ACC administrative law judge, and we anticipate
a decision in the first half of 2025.
“In February, we notified the ACC of our
intention to file a rate case for both GW-Santa Cruz and GW-Palo
Verde, our largest utilities in Pinal County. We have begun
stakeholder outreach for the rate case, which was filed on March 5,
2025.
“Our extensive infrastructure investments in and
around the City of Maricopa have advanced our mission of providing
water security for area communities. Over the past 20 years, we
have developed robust water solutions for Arizona communities in
coordination with local, state and federal agencies, and we are now
preparing to implement what could be our largest capital
improvement program yet.
“We remain dedicated to bringing the benefits of
consolidation, regionalization and proactive environmental
stewardship to the communities we serve as well as others nearby.
In this regard, we anticipate completing our previously announced
plan to acquire seven water systems from the City of Tucson in the
first half of this year, subject to customary closing
conditions.
“The acquisition would expand our service area
in Pima County by approximately 2,200 water service connections.
Meanwhile, we continue to evaluate a number of other potential
acquisitions within the Arizona Sun Corridor.
“Our service areas in Arizona's Sun Corridor
showed signs of significant growth in 2024, with single-family
permits increasing by 102 or 11.5% in the City of Maricopa and up
4,574 or 20.3% across Greater Phoenix, as compared to 2023. It is
also worth noting that permits for multi-family dwelling units in
the City of Maricopa increased by 564 units or 88.7% in 2024 versus
2023.
“Driving organic growth remains our top
priority, which includes expanding connections within our existing
service areas. In addition, as you can see by all the activity, we
will also be focused on implementing strategic rate adjustments in
all our service areas.
“We anticipate continued growth in active
service connections in line with the projected increase in
single-family housing permits. According to the Greater Phoenix
Blue Chip Panel, single-family permits in the Phoenix metropolitan
area will increase by approximately 6.8% in 2025, rising from a
consensus estimate of 27,752 permits in 2024 to 29,652 permits in
2025.
“For 2025 and beyond, we will remain committed
to providing exceptional water service while advancing our mission
of expanding and consolidating water and wastewater utilities. We
believe this focus will generate meaningful benefits for our
communities and enhance long-term shareholder value.”
Financial Summary
Revenues
| |
Year Ended |
Favorable (Unfavorable) |
|
|
December 31, |
2024 vs. 2023 |
|
|
2024 |
2023 |
$ |
% |
|
Water service |
$ |
26,064 |
|
$ |
24,860 |
|
$ |
1,204 |
|
|
4.8 |
% |
| Wastewater and recycled water
service |
|
26,628 |
|
|
25,382 |
|
|
1,246 |
|
|
4.9 |
% |
| Total regulated revenue |
|
52,692 |
|
|
50,242 |
|
|
2,450 |
|
|
4.9 |
% |
| Unregulated revenue |
|
— |
|
|
2,786 |
|
|
(2,786 |
) |
|
(100.0 |
)% |
| Total revenue |
$ |
52,692 |
|
$ |
53,028 |
|
$ |
(336 |
) |
|
(0.6 |
)% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
The increase in regulated revenue in 2024 as
compared to 2023 was primarily attributable to the organic growth
in active water and wastewater connections, increased water and
recycled water consumption and higher rates for GW-Saguaro
resulting from the GW-Saguaro general rate case, effective in July
2024. The increased consumption was predominantly driven by the
increase in active connections.
Unregulated revenue in 2023 was related to ICFA
revenue, which did not recur in 2024. ICFAs are agreements the
company entered into with developers and homebuilders whereby
Global Water provides services to plan, coordinate and finance the
water and wastewater infrastructure that would otherwise be
required to be performed or subcontracted by the developer or
homebuilder. Revenue associated with these agreements is variable
and dependent on the timing of activities by individual developers
and homebuilders. For additional information on ICFAs, refer to the
company’s Annual Report on Form 10-K for the year ended December
31, 2024, which was filed with the SEC on March 5, 2025.
Operating Expenses
| |
Year Ended |
Favorable (Unfavorable) |
|
|
December 31, |
2024 vs. 2023 |
|
|
2024 |
2023 |
$ |
% |
|
Personnel costs - operations and maintenance |
$ |
5,014 |
|
$ |
4,411 |
|
$ |
(603 |
) |
|
(13.7 |
)% |
| Utilities, chemicals and
repairs |
|
3,927 |
|
|
3,767 |
|
|
(160 |
) |
|
(4.2 |
)% |
| Other operations and
maintenance expenses |
|
4,785 |
|
|
4,491 |
|
|
(294 |
) |
|
(6.5 |
)% |
|
Total operations and maintenance expense |
|
13,726 |
|
|
12,669 |
|
|
(1,057 |
) |
|
(8.3 |
)% |
| Personnel costs - general and
administrative |
|
9,173 |
|
|
8,684 |
|
|
(489 |
) |
|
(5.6 |
)% |
|
Professional fees |
|
1,687 |
|
|
2,018 |
|
|
331 |
|
|
16.4 |
% |
| Other general and
administrative expenses |
|
6,022 |
|
|
5,934 |
|
|
(88 |
) |
|
(1.5 |
)% |
|
Total general and administrative expense |
|
16,882 |
|
|
16,636 |
|
|
(246 |
) |
|
(1.5 |
)% |
| Depreciation and
amortization |
|
12,720 |
|
|
11,437 |
|
|
(1,283 |
) |
|
(11.2 |
)% |
|
Total operating expenses |
$ |
43,328 |
|
$ |
40,742 |
|
$ |
(2,586 |
) |
|
(6.3 |
)% |
| |
|
|
|
|
|
|
|
|
|
|
|
|
Operations and Maintenance
The increase in personnel costs was primarily
attributable to higher salary and wage costs of $0.3 million and
increased medical costs of $0.3 million.
Higher utilities, chemicals and repairs were primarily the
result of increased costs of power purchased to operate pumps and
other related equipment.
The increase in other operations and maintenance
expenses was primarily driven by higher phone, internet and IT
services of $0.3 million.
General and Administrative
Personnel costs included in general and
administrative expenses increased as a result of higher salary and
wages costs of $0.5 million, increased hiring and moving costs of
$0.4 million and escalated medical costs of $0.1 million. Partially
offsetting these personnel costs was a $0.2 million decrease in all
other personnel costs and a $0.2 million decrease in deferred
compensation.
The decrease in professional fees was primarily
attributable to a $0.2 million decrease in acquisition related fees
and a $0.2 million decrease in other legal fees, all of which was
partially offset by a $0.1 million increase in audit and tax
preparation fees.
Depreciation and Amortization
The increase for the year ended December 31,
2024 as compared to the year ended December 31, 2023 was
substantially attributable to a 10.0% increase in depreciable fixed
assets.
Other Expense
Other expense totaled $1.5 million for the year
ended December 31, 2024 compared to $1.4 million for the same
period in 2023. The increase of $0.1 million was substantially due
to a $0.3 million increase in interest expense, net of interest
income, primarily due to the issuance of 6.91% Senior Secured Notes
in January 2024, and losses on the disposal of assets resulting in
$0.4 million of additional expense. The increase in total other
expense was partially offset by higher income associated with
Buckeye growth premiums of $0.5 million that resulted from
additional new meter connections in the area.
Net Income
Net income decreased $2.2 million or 27.5% to
$5.8 million or $0.24 per share in 2024, compared to net income of
$8.0 million or $0.33 per share in the same period of 2023. The
primary driver of the decrease was ICFA revenue recognized in 2023
that did not recur in 2024.
Adjusted Net Income
Adjusted net income increased $0.1 million or
2.0% to $6.3 million or $0.26 per share in 2024, compared to
adjusted net income of $6.2 million or $0.26 per share in 2023.
Adjusted
EBITDA
Adjusted EBITDA increased $1.3 million or 5.2%
to $26.7 million in 2024, compared to $25.3 million in the same
period in 2023.
Dividend Policy
In November 2024, the company announced an
increase in dividend to $0.30396 per share on an annualized basis.
The company recently declared a monthly cash dividend of $0.02533
per common share (or $0.30396 per share on an annualized basis),
payable on March 31, 2025, to holders of record at the close of
business on March 17, 2025.
Business Strategy
Global Water's near-term growth strategy
involves increasing service connections, improving operating
efficiencies, and increasing utility rates as approved by the ACC.
The company plans to continue aggregating water and wastewater
utilities, which is expected to enable the company and its
customers to realize the benefits of consolidation,
regionalization, and environmental stewardship.
Connection Rates
As of December 31, 2024, active service
connections increased by 2,729 or 4.4% to 64,520 compared to 61,791
at December 31, 2023, with the increase primarily due to organic
growth in the company’s service areas.
Arizona’s Growth Corridor: Positive
Population and Economic Trends
Global Water continues to experience an
increasing rate of organic growth, evidenced by the company’s year
over year organic increase in active connections (i.e., exclusive
of acquisition related growth) of 4.4% as of December 31, 2024 as
compared to 2.6% for the same period in 2023. According to the most
recent U.S. Census estimates, the Phoenix metropolitan statistical
area (MSA) is the 10th largest MSA in the U.S. and has an estimated
population of 5.1 million, an increase of 4.6% over the
4.8 million people reported in the 2020 Census.
Metropolitan Phoenix continues to grow due to
its favorable employment opportunities, excellent weather, large
and growing universities, a diverse employment base, and low taxes.
The Employment and Population Statistics Department of the State of
Arizona predicts that the Phoenix metropolitan area will have a
population of 5.8 million people by 2030 and 6.5 million by 2040.
Arizona’s job growth increased by 1.7% in 2024, as compared to the
same period for the prior year, which ranks the state in the top 20
nationally as of December 31, 2024.
According to the W.P. Carey School of Business
Greater Phoenix Blue Chip Real Estate Consensus Panel (the “Greater
Phoenix Blue Chip Panel”), the single-family housing market in the
Phoenix metropolitan area has experienced a weakness in permits
since 2021; however, the outlook for single-family housing is
improving. The Greater Phoenix Blue Chip Panel anticipates
single-family permit increases in 2025. During 2024, multi-family
permits trended upwards.
Arizona is projected to add 478,000 jobs with an
annual growth rate of 1.4% through 2032, exceeding the national
average. According to the state’s commerce authority, Arizona also
received $50 billion in 2024, including contributions from major
industry players such as Taiwan Semiconductor, Intel and Procter
& Gamble.
Management believes that Global Water is
well-positioned to benefit from the growth expected in the Phoenix
metropolitan area due to the availability of lots, existing
infrastructure in place within the company’s service areas, and
increased activity related to multi-family developments.
Conference CallGlobal Water
Resources will hold a conference call tomorrow to discuss its full
year 2024 results, including a question-and-answer period.
Date: Thursday, March 6, 2025Time: 1:00 p.m.
Eastern time (10:00 a.m. Pacific time)Toll-free dial-in number:
1-833-816-1435International dial-in number:
1-412-317-0527Conference ID: 10196547Webcast (live and replay):
here
The conference call webcast is also available
via a link in the Investors section of the company’s website at
www.gwresources.com.
Please call the conference telephone number five
minutes prior to the start time. An operator will register your
name and organization. If you require any assistance connecting to
the call, please contact CMA at 1-949-432-7566.
A replay of the call will be available after
4:00 p.m. Eastern time on the same day through March 20, 2025.
Toll-free replay number:
1-844-512-2921International replay number: 1-412-317-6671Replay ID:
10196547
About Global Water
Resources
Global Water Resources, Inc. is a leading water
resource management company that owns and operates 32 systems which
provide water, wastewater, and recycled water service. The
company’s service areas are located primarily in growth corridors
around metropolitan Phoenix and Tucson. Global Water recycles over
1 billion gallons of water annually with 17.7 billion gallons
recycled since 2004.
The company has been recognized for its highly
effective implementation of Total Water Management (TWM). TWM is an
integrated approach to managing the entire water cycle that
involves owning and operating water, wastewater and recycled water
utilities within the same geographic area in order to maximize the
beneficial use of recycled water. It enables smart water management
programs such as remote metering infrastructure and other advanced
technologies, rate designs, and incentives that result in real
conservation. TWM helps protect water supplies in water-scarce
areas experiencing population growth.
Global Water has received numerous industry
awards, including national recognition as a ‘Utility of the Future
Today’ for its superior water reuse practices by a national
consortium of water and conservation organizations led by the Water
Environment Federation (WEF). The company also received Cityworks’
Excellence in Departmental Practice Award for demonstrating
leadership and creativity in applying public asset management
strategies to daily operations and long-term planning.
To learn more, visit www.gwresources.com.
Use of Non-GAAP Measures
This press release contains certain financial
measures that are not recognized measures under accounting
principles generally accepted in the United States of America
(“GAAP”), including EBITDA, adjusted EBITDA, adjusted net income,
and adjusted diluted earnings per common share. EBITDA is defined
for the purposes of this press release as net income before
interest, income taxes, depreciation, and amortization. Adjusted
EBITDA is defined as EBITDA excluding the gain or loss related to
(i) nonrecurring events; (ii) option expense related to awards made
to management; (iii) restricted stock expense related to awards
made to employees and the board of directors; (iv) disposal of
assets; and (v) ICFA revenue recognition, as applicable. Adjusted
net income and adjusted diluted earnings per common share reflect
net income and diluted earnings per common share excluding (i) ICFA
revenue; (ii) the amortization related to ICFA intangible assets;
and (iii) the tax effects of each of these items, as
applicable.
Management believes that EBITDA, adjusted
EBITDA, adjusted net income, and adjusted diluted earnings per
common share are useful supplemental measures of our operating
performance and provide our investors meaningful measures of
overall corporate performance. EBITDA is also presented because
management believes that it is frequently used by investment
analysts, investors, and other interested parties as a measure of
financial performance. Adjusted EBITDA, adjusted net income, and
adjusted diluted earnings per common share are also presented
because management believes that they provide our investors
additional measures of our recurring core business. However,
non-GAAP measures do not have a standardized meaning prescribed by
GAAP, and investors are cautioned that non-GAAP measures, such as
EBITDA, adjusted EBITDA, adjusted net income, and adjusted diluted
earnings per common share, should not be construed as an
alternative to net income or loss or other income statement data
(which are determined in accordance with GAAP) as an indicator of
our performance or as a measure of liquidity and cash flows.
Management's method of calculating EBITDA, adjusted EBITDA,
adjusted net income, and adjusted diluted earnings per common share
may differ materially from the method used by other companies and
accordingly, may not be comparable to similarly titled measures
used by other companies. A reconciliation of EBITDA, adjusted
EBITDA, and adjusted net income to net income, and a reconciliation
of adjusted diluted earnings per common share to diluted earnings
per common share, the most comparable GAAP measures, is included in
the schedules attached to this press release.
Cautionary Note Regarding
Forward-Looking Statements
Certain statements in this press release and the
related conference call include certain forward-looking statements
which reflect the company's expectations regarding future events.
The forward-looking statements involve a number of assumptions,
risks, uncertainties, and other factors that could cause actual
results to differ materially from those contained in the
forward-looking statements. These forward-looking statements
include, but are not limited to, statements about our strategies;
expectations about future business plans, prospective performance,
growth, and opportunities, including expected growth in and around
metropolitan Phoenix and Tucson and the resulting potential for new
service connections, as well as the anticipation of continued
growth in active service connections in line with the projected
increase in anticipated single-family housing permits; future
financial performance; regulatory and ACC proceedings, decisions,
and approvals, such as the anticipated benefits resulting from rate
decisions, including any collective revenue increases due to new
water and wastewater rates, as well as the outcome and timing of
our rate case and other applications with the ACC; our plans
relating to future filings of our rate cases with the ACC;
acquisition plans and our ability to complete additional
acquisitions, including the anticipated acquisition of seven public
water systems from the City of Tucson, the expected increase in
active water service connections, and the anticipated timing of the
consummation of such acquisition; population and growth
projections; technologies, including expected benefits from
implementing such technologies; revenues; metrics; operating
expenses; trends relating to our industry, market, population and
job growth, and housing permits; the adequacy of our water supply
to service our current demand and growth for the foreseeable
future; liquidity and capital resources; plans and expectations for
capital expenditures; cash flows and uses of cash; dividends;
depreciation and amortization; tax payments; our ability to repay
indebtedness and invest in initiatives; the anticipated impact and
resolutions of legal matters; the anticipated impact of new or
proposed laws, including regulatory requirements, tax changes, and
judicial decisions; the anticipated impact of accounting changes
and other pronouncements; and other statements that are not
historical facts, as well as statements identified by words such as
"expects", "anticipates", "intends", "plans", "believes", "seeks",
"estimates", or the negative of these terms, or other words of
similar meaning. These statements are based on our current beliefs
or expectations and are inherently subject to a number of risks,
uncertainties, and assumptions, most of which are difficult to
predict and many of which are beyond our control. Actual results
may differ materially from these expectations due to changes in
political, economic, business, market, regulatory, and other
factors. Additional risks and uncertainties include, but are not
limited to, whether all conditions precedent in the asset purchase
agreement to acquire the seven public water systems from the City
of Tucson will be satisfied and other risks to consummation of the
acquisition, including circumstances that could give rise to the
termination of the asset purchase agreement and the risk that the
transaction will not be consummated without undue delay, cost or
expense, or at all. Factors that may also affect future results are
disclosed under the headings “Risk Factors” and “Management’s
Discussion and Analysis of Financial Condition and Results of
Operations” in our filings with the Securities and Exchange
Commission (the "SEC"), which are available at the SEC's website at
www.sec.gov. This includes, but is not limited to, our most
recently filed periodic reports on Form 10-K and Form 10-Q and
subsequent filings with the SEC. Accordingly, investors are
cautioned not to place undue reliance on any forward-looking
statements, which reflect management’s views as of the date hereof.
We undertake no obligation to publicly update any forward-looking
statement, except as required by law, whether as a result of new
information, future developments or otherwise.
Company Contact:Michael J.
Liebman CFO and SVPTel (480) 999-5104 Email
Contact
Investor Relations:Ron Both or
Grant StudeCMA Investor RelationsTel (949) 432-7566Email
contact
|
|
|
|
|
GLOBAL WATER RESOURCES, INC.Consolidated
Balance Sheets (in thousands, except
share and per share amounts) |
|
|
|
|
|
|
December 31, 2024 |
December 31, 2023 |
|
ASSETS |
|
|
|
UTILITY PLANT: |
|
|
|
Utility plant |
$ |
512,993 |
|
$ |
465,688 |
|
|
Less accumulated depreciation |
|
(153,614 |
) |
|
(142,367 |
) |
|
Net utility plant |
|
359,379 |
|
|
323,321 |
|
|
CURRENT ASSETS: |
|
|
|
Cash and cash equivalents |
|
9,047 |
|
|
3,087 |
|
|
Accounts receivable, net of allowance for credit losses of $163 and
$122, respectively |
|
3,233 |
|
|
3,388 |
|
|
Unbilled revenue |
|
3,109 |
|
|
2,755 |
|
|
Taxes, prepaid expenses and other current assets |
|
4,080 |
|
|
2,494 |
|
|
Total current assets |
|
19,469 |
|
|
11,724 |
|
| OTHER
ASSETS: |
|
|
|
Goodwill |
|
9,486 |
|
|
10,820 |
|
|
Intangible assets, net |
|
8,427 |
|
|
8,841 |
|
|
Regulatory assets |
|
4,032 |
|
|
2,898 |
|
|
Restricted cash |
|
2,109 |
|
|
1,676 |
|
|
Right-of-use assets |
|
2,157 |
|
|
1,741 |
|
|
Other noncurrent assets |
|
78 |
|
|
74 |
|
|
Total other assets |
|
26,289 |
|
|
26,050 |
|
| TOTAL
ASSETS |
$ |
405,137 |
|
$ |
361,095 |
|
|
CAPITALIZATION AND LIABILITIES |
|
|
|
CAPITALIZATION |
|
|
|
Common stock, $0.01 par value, 60,000,000 shares authorized;
24,570,994 and 24,492,918 shares issued as of December 31, 2024 and
December 31, 2023, respectively. |
$ |
240 |
|
$ |
240 |
|
|
Treasury stock, 344,978 and 317,677 shares at December 31, 2024 and
December 31, 2023, respectively. |
|
(2 |
) |
|
(2 |
) |
|
Additional paid-in capital |
|
47,366 |
|
|
47,585 |
|
|
Retained earnings |
|
— |
|
|
797 |
|
|
Total shareholders’ equity |
|
47,604 |
|
|
48,620 |
|
|
Long-term debt, net |
|
118,518 |
|
|
101,341 |
|
|
Total Capitalization |
|
166,122 |
|
|
149,961 |
|
|
CURRENT LIABILITIES: |
|
|
|
Accounts payable |
|
2,051 |
|
|
1,027 |
|
|
Customer and meter deposits |
|
1,609 |
|
|
1,628 |
|
|
Long-term debt, current portion |
|
3,926 |
|
|
3,880 |
|
|
Leases, current portion |
|
871 |
|
|
553 |
|
|
Accrued expenses and other current liabilities |
|
13,801 |
|
|
7,129 |
|
|
Total current liabilities |
|
22,258 |
|
|
14,217 |
|
| OTHER
LIABILITIES: |
|
|
|
Line of credit |
|
— |
|
|
2,315 |
|
|
Long-term lease liabilities |
|
1,450 |
|
|
1,370 |
|
|
Deferred revenue - ICFA |
|
21,517 |
|
|
19,656 |
|
|
Regulatory liabilities |
|
5,386 |
|
|
6,076 |
|
|
Advances in aid of construction |
|
126,467 |
|
|
111,529 |
|
|
Contributions in aid of construction, net |
|
36,834 |
|
|
32,823 |
|
|
Deferred income tax liabilities, net |
|
9,698 |
|
|
8,284 |
|
|
Other noncurrent liabilities |
|
15,405 |
|
|
14,864 |
|
|
Total other liabilities |
|
216,757 |
|
|
196,917 |
|
| TOTAL
CAPITALIZATION AND LIABILITIES |
$ |
405,137 |
|
$ |
361,095 |
|
| |
|
|
|
|
|
|
|
GLOBAL WATER RESOURCES, INC.Consolidated
Statements of Operations (in thousands, except
share and per share amounts) |
|
|
|
|
|
Years Ended December 31, |
|
|
2024 |
2023 |
| REVENUE: |
|
|
|
Water service |
$ |
26,064 |
|
$ |
24,860 |
|
|
Wastewater and recycled water service |
|
26,628 |
|
|
25,382 |
|
|
Unregulated revenue |
|
— |
|
|
2,786 |
|
|
Total revenue |
|
52,692 |
|
|
53,028 |
|
| |
|
|
| OPERATING EXPENSES: |
|
|
|
Operations and maintenance |
|
13,726 |
|
|
12,669 |
|
|
General and administrative |
|
16,882 |
|
|
16,636 |
|
|
Depreciation and amortization |
|
12,720 |
|
|
11,437 |
|
|
Total operating expenses |
|
43,328 |
|
|
40,742 |
|
| OPERATING INCOME |
|
9,364 |
|
|
12,286 |
|
| |
|
|
| OTHER INCOME (EXPENSE): |
|
|
|
Interest income |
|
946 |
|
|
52 |
|
|
Interest expense |
|
(6,098 |
) |
|
(4,882 |
) |
|
Other, net |
|
3,650 |
|
|
3,398 |
|
|
Total other expense |
|
(1,502 |
) |
|
(1,432 |
) |
| |
|
|
| INCOME BEFORE INCOME
TAXES |
|
7,862 |
|
|
10,854 |
|
| INCOME TAX EXPENSE |
|
(2,073 |
) |
|
(2,872 |
) |
| NET INCOME |
$ |
5,789 |
|
$ |
7,982 |
|
| |
|
|
| Basic earnings per common
share |
$ |
0.24 |
|
$ |
0.33 |
|
| Diluted earnings per common
share |
$ |
0.24 |
|
$ |
0.33 |
|
| Dividends declared per common
share |
$ |
0.30 |
|
$ |
0.30 |
|
| |
|
|
| Weighted average number of
common shares used in the determination of: |
|
|
|
Basic |
|
24,204,706 |
|
|
24,044,950 |
|
|
Diluted |
|
24,303,340 |
|
|
24,129,542 |
|
|
|
|
|
|
|
|
|
|
GLOBAL WATER RESOURCES, INC.Consolidated
Statements of Cash Flows(in
thousands) |
|
|
|
|
|
Years Ended December 31, |
|
|
2024 |
2023 |
| Cash Flows from Operating
Activities: |
|
|
|
Net income |
$ |
5,789 |
|
$ |
7,982 |
|
|
Adjustments to reconcile net income to net cash provided by
operating activities: |
|
|
|
Depreciation and amortization |
|
12,720 |
|
$ |
11,437 |
|
|
Share-based compensation |
|
1,029 |
|
$ |
1,325 |
|
|
Deferred income tax expense |
|
1,473 |
|
$ |
2,394 |
|
|
(Gain) loss on disposal of fixed assets |
|
309 |
|
$ |
(63 |
) |
|
Right of use amortization |
|
384 |
|
$ |
324 |
|
|
Other adjustments |
|
(767 |
) |
$ |
112 |
|
|
Changes in assets and liabilities |
|
|
|
Accounts receivable and other current assets |
|
(1,986 |
) |
|
(994 |
) |
|
Accounts payable and other current liabilities |
|
(915 |
) |
|
(635 |
) |
|
Other noncurrent assets |
|
565 |
|
|
312 |
|
|
Other noncurrent liabilities |
|
3,184 |
|
|
3,199 |
|
|
Net cash provided by operating activities |
|
21,785 |
|
|
25,393 |
|
| Cash Flows from Investing
Activities: |
|
|
|
Capital expenditures |
|
(32,324 |
) |
|
(22,312 |
) |
|
Cash paid for acquisitions, net of cash acquired |
|
(150 |
) |
|
(6,246 |
) |
|
Other cash flows from investing activities |
|
(4 |
) |
|
(40 |
) |
|
Net cash used in investing activities |
|
(32,478 |
) |
|
(28,598 |
) |
| Cash Flows from Financing
Activities: |
|
|
|
Dividends paid |
|
(7,298 |
) |
|
(7,185 |
) |
|
Advances and contributions in aid of construction |
|
10,627 |
|
|
1,510 |
|
|
Refunds of advances for construction |
|
(1,355 |
) |
|
(1,171 |
) |
|
Payments for taxes related to net shares settlement of equity
awards |
|
(265 |
) |
|
(373 |
) |
|
Principal payments under finance lease |
|
(273 |
) |
|
(525 |
) |
|
Repayments of notes payable |
|
(3,923 |
) |
|
(3,833 |
) |
|
Line of credit borrowings |
|
— |
|
|
2,315 |
|
|
Line of credit repayments |
|
(2,315 |
) |
|
— |
|
|
Loan borrowings |
|
22,357 |
|
|
260 |
|
|
Debt issuance costs paid |
|
(418 |
) |
|
— |
|
|
Proceeds from sale of stock |
|
— |
|
|
2,748 |
|
|
Other contributions |
|
— |
|
|
6,700 |
|
|
Other financing activities |
|
(51 |
) |
|
(40 |
) |
|
Net cash provided by financing activities |
|
17,086 |
|
|
406 |
|
| Increase (Decrease) in cash,
cash equivalents, and restricted cash |
|
6,393 |
|
|
(2,799 |
) |
| Cash, cash equivalents, and
restricted cash — Beginning of period |
|
4,763 |
|
|
7,562 |
|
| Cash, cash equivalents, and
restricted cash — End of period |
$ |
11,156 |
|
$ |
4,763 |
|
| |
|
|
|
|
|
|
|
Supplemental disclosure of cash flow
information: |
| |
|
| |
Year ended December 31, |
| |
2024 |
2023 |
|
Cash and cash equivalents |
$ |
9,047 |
|
$ |
3,087 |
|
| Restricted cash |
|
2,109 |
|
|
1,676 |
|
|
Total cash, cash equivalents, and restricted cash |
$ |
11,156 |
|
$ |
4,763 |
|
| |
|
|
|
|
|
|
A reconciliation of net income to EBITDA and
Adjusted EBITDA for the years ended December 31, 2024 and 2023 is
as follows (in thousands):
| |
Years Ended December 31, |
| |
2024 |
2023 |
|
Net Income |
$ |
5,789 |
|
$ |
7,982 |
|
| Income tax expense |
|
2,073 |
|
|
2,872 |
|
| Interest income |
|
(946 |
) |
|
(52 |
) |
| Interest expense |
|
6,098 |
|
|
4,882 |
|
| Depreciation and
amortization |
|
12,720 |
|
|
11,437 |
|
| EBITDA |
|
25,734 |
|
|
27,121 |
|
| ICFA revenue |
|
— |
|
|
(2,786 |
) |
| Management option expense |
|
— |
|
|
92 |
|
| Loss (gain) on disposal of fixed
assets |
|
308 |
|
|
(63 |
) |
| Restricted stock expense |
|
767 |
|
|
972 |
|
| Acquisition gain resulting
from regulatory decision |
|
(37 |
) |
|
— |
|
| Gain on adjustment of
contingent consideration liability |
|
(119 |
) |
|
— |
|
| EBITDA adjustments |
|
919 |
|
|
(1,785 |
) |
| Adjusted
EBITDA |
$ |
26,653 |
|
$ |
25,336 |
|
| |
|
|
|
|
|
|
A reconciliation of net income to adjusted net
income for the years ended December 31, 2024 and 2023 is as follows
(in thousands):
| |
Years Ended December 31, |
| |
2024 |
2023 |
|
Net Income |
$ |
5,789 |
|
$ |
7,982 |
|
| ICFA revenue |
|
— |
|
|
(2,786 |
) |
| ICFA intangible amortization
expense |
|
280 |
|
|
414 |
|
| Loss on disposal of
assets1 |
|
308 |
|
|
— |
|
| Gain on adjustment of
contingent consideration liability |
|
(119 |
) |
|
— |
|
| Acquisition gain loss
resulting from regulatory decision |
|
(37 |
) |
|
| Income tax effect of items
above |
|
114 |
|
|
598 |
|
| Adjusted Net
Income |
$ |
6,335 |
|
$ |
6,208 |
|
| |
|
|
|
|
|
|
1The 2024 loss was related to disposal of
certain obsolete assets from the Southwest Plant.
A reconciliation of diluted earnings per share
to adjusted diluted earnings per share for the years ended December
31, 2024 and 2023 is as follows:
| |
Years Ended December 31, |
| |
2024 |
2023 |
|
Diluted earnings per common share |
$ |
0.24 |
|
$ |
0.33 |
|
| ICFA revenue |
|
— |
|
|
(0.12 |
) |
| ICFA intangible amortization
expense |
|
0.01 |
|
|
0.02 |
|
| Loss on disposal of assets1 |
|
0.01 |
|
|
— |
|
| Income tax effect of items
above |
|
— |
|
|
0.03 |
|
| Adjusted diluted earnings
per common share |
$ |
0.26 |
|
$ |
0.26 |
|
| Weighted average number of common
shares used in determination of: |
|
|
|
Diluted earnings per common share and Adjusted diluted earnings per
common share |
|
24,303,340 |
|
|
24,129,542 |
|
|
|
|
|
|
|
|
|
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