Matt's questions to Consolidated Water (CWCO) leadership • Q2 2025
Question
Matt from Western Standard highlighted the standout gross margin in the manufacturing segment and asked for the drivers behind it. He also inquired about the increase in O&M revenue, the remaining hurdles for the Hawaii project, the status of the Bahama receivable, and the company's capital allocation plans for its large cash balance.
Answer
CEO Frederick McTaggart and CFO David Sasnett attributed the strong manufacturing margin to a focus on higher-margin jobs, efficient facility operation near peak capacity, and favorable project pricing. McTaggart explained the O&M revenue increase was due to contract term changes and incremental cost pass-throughs. For the Hawaii project, he identified the archaeological permit and a final health department design approval as the key remaining steps. On capital allocation, McTaggart stated they are actively evaluating M&A targets, exploring P3 project opportunities, and will continue to assess returning cash to shareholders, referencing the recent dividend increase.