Armando V. Averhoff
About Armando V. Averhoff
Vice President of Information Technology at Consolidated Water Co. Ltd. (CWCO). Age 60 in the 2025 proxy; joined CWCO in November 2010 as Director of IT and was promoted to VP of IT in August 2014. He has 25+ years of IT experience spanning infrastructure design, networking, servers, application development, ERP systems, and computer operations; prior roles include IT Director at Arrow Cargo Airlines and Computer Operations Manager at LNR Property Corporation. Education: Bachelor of Science in Information Technology (Network and Systems Engineering) from Barry University. Company performance context during recent years: 2024 revenue excluding pass-through energy charges was $115.37M and net income was $28.24M; the company’s compensation “pay versus performance” framework references total shareholder return and core financial metrics (revenue, net income, EPS, operating cash flow).
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Consolidated Water Co. Ltd. | Director of Information Technology | Nov 2010–Aug 2014 | Led IT operations and infrastructure; foundation for subsequent elevation to VP IT |
| Consolidated Water Co. Ltd. | Vice President of Information Technology | Aug 2014–Present | Accountable for enterprise cybersecurity strategy, risk management, and IT operations; reports to Audit Committee on cyber risk |
| Arrow Cargo Airlines | Information Technology Director | Not disclosed | Managed airline IT operations; relevant to mission-critical systems and uptime |
| LNR Property Corporation | Computer Operations Manager | Not disclosed | Oversaw corporate computing operations at a large real estate firm |
Fixed Compensation
CWCO’s proxy discloses detailed compensation only for Named Executive Officers (NEOs), which does not include the VP of IT; therefore, Mr. Averhoff’s specific base salary and bonus amounts are not disclosed. The company’s philosophy emphasizes competitive base salaries, reviewed annually, and performance-based incentive compensation for executives.
Performance Compensation
CWCO’s executives (including non-NEO executive officers) are eligible for both annual cash incentives and long-term equity incentives aligned to company performance.
-
Short-term incentive plan: Annual cash bonuses tied to company net income, revenue (excluding pass-through energy charges), gross profit margin, plus individual performance weightings (for NEOs). Executives earn payouts at threshold/target/maximum based on results versus targets.
-
Long-term incentive plan: Annual grants on January 1 under a formula where 50% time-vest in equal one-third tranches over three years and 50% are performance-based on three-year cumulative metrics; all executive officers participate “with the same measures and weights,” but at different levels of opportunity.
CWCO 2024 short-term incentive metrics and outcome (company-level):
| Metric | Threshold (% of Target) | Target | Upper (% of Target) | 2024 Actual | Actual vs Target |
|---|---|---|---|---|---|
| Net Income ($) | 75% | 11,995,397 | 125% | 20,404,010 | 170.10% |
| Revenue excl. pass-through energy ($) | 90% | 104,435,301 | 110% | 115,370,773 | 110.47% |
| Gross Profit Margin (%) | 90% | 29.95% | 110% | 34.06% | 113.72% |
Long-term incentive performance measures (three-year period; weights applied uniformly to executive officers):
| Measure | Weight |
|---|---|
| Three-Year Cumulative Operating Cash Flow | 20% |
| Three-Year Cumulative Earnings Per Share | 40% |
| Three-Year Cumulative Revenue (excluding pass-through energy charges) | 40% |
Three-year performance (2022–2024) versus targets (company-level):
| Measure | Threshold (% of Target) | Target | Upper (% of Target) | Actual | Actual vs Target |
|---|---|---|---|---|---|
| Operating Cash Flows ($) | 70% | 41,923,337 | 130% | 65,818,099 | 157.0% |
| Earnings Per Share ($) | 86% | 1.37 | 140% | 4.10 | 300.2% |
| Revenue excl. pass-through energy ($) | 85% | 184,608,289 | 115% | 352,211,187 | 190.8% |
Equity Ownership & Alignment
- Eligibility and vesting: All executive officers are eligible for long-term equity grants; 50% time-based vesting in equal thirds over three years and 50% performance-based on three-year cumulative metrics (OCF, EPS, revenue), reinforcing retention and performance alignment.
- Hedging/shorts/pledging: Directors and officers are prohibited from hedging transactions (puts, calls, short sales) and pledging company stock; Rule 10b5-1 trading plans are permitted for diversification.
- Clawback policy: Adopted in 2024; company will recover “excess” incentive-based compensation from executive officers for the three-year period preceding a required accounting restatement. Applies to both cash and equity awards.
Employment Terms
Employment contracts, severance, and change-of-control economics are disclosed for CEO, CFO, COO, EVP Business Development, and VP Finance; specific terms for the VP of IT are not disclosed in the proxy or recent 8-K filings.
Performance & Track Record
- Cybersecurity leadership: As VP of IT, Averhoff is responsible for establishing and executing CWCO’s cybersecurity program and strategy, with quarterly reporting to the Audit Committee and annual strategy reviews; the program includes formal policies, training, vulnerability management, incident response, and alignment to NIST/AWWA frameworks.
- Controls remediation: The company’s auditor reported a material weakness in information technology general controls as of Dec 31, 2024, which the company remediated by Nov 1, 2024 (insufficient time to demonstrate effectiveness across all business process controls at year-end), underscoring the IT function’s remediation capability.
- Shareholder support on compensation: Say‑on‑pay received approximately 88% approval at the 2024 AGM; at the 2025 AGM, advisory votes on executive compensation were 9,132,313 For, 481,895 Against, 76,040 Abstain, reflecting ongoing support for the pay framework tied to company performance.
Company performance context (for pay-for-performance alignment):
| Metric | 2020 | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|---|
| Net Income ($) | 3,711,528 | 875,579 | 5,856,294 | 29,585,391 | 28,237,554 |
| Revenue excl. pass-through energy ($) | 63,143,379 | 55,182,474 | 76,196,354 | 160,644,059 | 115,370,773 |
| Total Shareholder Return (Value of $100) | 75.49 | 68.57 | 97.91 | 239.88 | 177.01 |
Board Governance (relevant to executive oversight)
- Compensation Committee composition: Butler, Ebanks, Flowers, Whittaker; all NASDAQ “independent.” Three meetings in 2024.
- Audit Committee oversight of cybersecurity and IT risk with regular updates from VP IT; board promptly informed of potentially material incidents per incident response plan.
Compensation Peer Group (Benchmarking context)
CWCO’s 2024 peer group comprises 12 comparably sized utilities and water-related companies; FW Cook advised on benchmarking and competitiveness. Peer parameters: 0.1x–4.3x CWCO revenue, 0.4x–4.3x market cap, 0.2x–8.0x EBITDA.
Investment Implications
- Alignment signals: Averhoff participates in an executive framework that bans hedging and pledging and includes a robust clawback, enhancing alignment and reducing adverse trading behavior risk. The long-term plan’s mix of time-vest and performance-based shares provides both retention and performance linkage.
- Retention risk: Specific severance or change-of-control protections for the VP IT are not disclosed, suggesting fewer contractual retention levers than for NEOs; retention relies on equity incentives and role criticality in cybersecurity and IT operations.
- Execution risk and opportunities: The remediation of IT general control weaknesses by Nov 1, 2024 indicates capability to address control gaps; ongoing Audit Committee oversight and VP IT leadership should mitigate cyber and control risks, which can be material for regulated utility-like operations and investor confidence.
- Trading signals: While 10b5-1 plans are permitted, hedging/shorts/pledging are prohibited, reducing potential misalignment signals from derivative activity; absence of Form 4 data here limits visibility into individual selling pressure.