Consolidated Water Co. (NASDAQ: CWCO) reported Q2 EPS of $0.16, in-line with the analyst estimate of $0.16. Revenue for the quarter came in at $18.3 million versus the consensus estimate of $16.8 million.

Q2 2019 Financial Highlights

• Total revenues increased 22% to $18.3 million.
• Manufacturing revenue increased 332% to $4.3 million.
• Gross profit up 22% to $7.6 million.
• Net income attributable to stockholders increased 13% to $2.5 million or $0.16 per diluted share.
• $1.3 million in dividends paid.

Q2 2019 Operational Highlights

• Appointed Jamie Bryan to the new position of Vice President of Manufacturing. Bryan brings to Consolidated Water more than 22 years of experience in engineering, manufacturing, plant integration and development, and product development and distribution.
• Continued to advance the development project in Rosarito, Baja California, Mexico involving the construction and operation of a major seawater desalination plant and distribution pipeline. Designed to produce 100 million gallons per day of potable water, the plant is expected to be the largest of its kind in the Western Hemisphere and a major, much-needed new source of drinking water for the coastal region of Baja California for at least 37 years.
• Completed the disposition of CW-Bali for total consideration of $390,000.

Management Commentary"In Q2, we realized double-digit revenue and gross profit growth that was driven primarily by increased production activity in our manufacturing business," commented Consolidated Water CEO, Rick McTaggart. "The growth in manufacturing was due to a renewed focus on industrial sales, strong execution by our sales team and increasing customer demand for our specialized products.

"Our retail revenue growth was in part attributed to the fact that it has been a very dry year so far, with rainfall in the second quarter down 76% compared to last year. For the first half of 2019, rainfall in our Cayman Islands service area was down 55% compared with rainfall in the first half of 2018 and was also 55% lower than the 30-year average.

"The prospects for the manufacturing segment continue to look favorable, given that we have specialized manufacturing capabilities and experience relating to markets with relatively high barriers to entry. In these markets, we qualify for projects that require unique quality controls and certification. We also fabricate water treatment equipment for a diverse number of industries involved in wastewater treatment infrastructure, and we believe the numerous municipal utilities in need of improvements in this area can also drive growth in our business.

"In anticipation of further manufacturing growth, we are expanding our production facility, with this expected to be completed within the next year. This project is being led by our new VP of Manufacturing, whose knowledge and experience will play an important role as we grow this business.

"With respect to our Rosarito project, we had two major positive developments earlier this year regarding legislative approval and funding that has allowed us to proceed to the next several important steps before we begin the construction phase. These steps include securing the major portions of the project's required debt financing and aqueduct rights of way.

"There remain many water-scarce countries in the Caribbean and other markets where we believe we can have a positive impact on their development by providing essential fresh water supplies. So, we are continuing to explore development opportunities where we can support the growth of regional economies and improve the quality of life in local communities.

"We plan to take advantage of the ample liquidity on our balance sheet to expand into new markets and complementary product lines, diversify revenue streams and widen our geographic footprint. Our strong performance in Q2 reflects the tremendous opportunities ahead."

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