GEORGE TOWN - Consolidated Water Co. Ltd. (NASDAQ:CWCO), known for its water supply and treatment solutions, announced a 15.8% increase in its quarterly cash dividend. The dividend, set at $0.11 per share for the fourth quarter of 2024, is a rise from the previous quarter's $0.095 per share.
The increased dividend is payable on October 31, 2024, to shareholders who are on record as of October 1, 2024. This decision comes on the heels of a successful period for the company, marked by a boost in sales from its Caribbean operations and the resolution of an arbitration in Mexico, which together have led to a stronger cash flow.
Rick McTaggart, the president and CEO of Consolidated Water, attributed the dividend increase to these improved financial results and a positive outlook for the company's future. The board's decision reflects their intent to provide greater returns to stockholders.
In addition to the dividend news, Consolidated Water reported revenue of $32.5 million and earnings per share of $0.99 for the second quarter of 2024. These figures underscore the company's financial health and its role in the water supply and treatment industry.
Consolidated Water operates across several countries, providing desalination and water treatment services in the Cayman Islands, The Bahamas, the British Virgin Islands, and the United States. The company has recently expanded its U.S. presence with a contract to design and maintain a seawater desalination plant in Hawaii.
The company's expertise spans the manufacturing and servicing of water-related products, along with offering design, engineering, management, and operational services for water production, supply, and treatment, as well as industrial water and wastewater treatment.
This announcement is based on a press release statement from Consolidated Water Co. Ltd. and reflects the company's current financial developments and strategic initiatives.
In other recent news, Consolidated Water Co. Ltd. has finalized a settlement with the United Mexican States over a terminated desalination project. The resolution, which concludes a four-year dispute, involves the sale of about 20.1 hectares of land and associated rights, along with project documentation, for a total of around US$36,351,000. The land, located in Playas de Rosarito, Baja California, was initially acquired by Consolidated Water's subsidiary for the construction of a desalination plant.
The dispute arose when the Mexican government terminated the partnership agreement and Consolidated Water's Dutch subsidiary, CW-Coöperatief, sought arbitration under a treaty between the Netherlands and Mexico. However, successful negotiations led to the discontinuation of the arbitration process. As part of the settlement, the Mexican infrastructure trust, Fondo Nacional de Infraestructura, agreed to buy the land from the subsidiary NSC Agua for approximately US$35,171,000.
Within ten days after the land sale's closing, the Mexican government is set to purchase the project documentation for at least US$1,180,000. This agreement releases both parties from any further obligations related to the original agreement, the dispute, and the arbitration, with no further legal proceedings to be initiated. These developments are recent and highlight a significant resolution for Consolidated Water Co. Ltd.
InvestingPro Insights
Consolidated Water Co. Ltd. (NASDAQ:CWCO) has recently caught the attention of investors with its dividend increase, reflecting a strong financial posture. The company's commitment to providing shareholder value is evident, with InvestingPro Tips noting that Consolidated Water has maintained dividend payments for 28 consecutive years. This consistency is a testament to the company's resilience and prudent financial management, even as analysts anticipate a sales decline in the current year.
On the financial metrics front, the company boasts a healthy market capitalization of $427.85 million, and its P/E ratio stands at an attractive 10.52. This valuation metric suggests that investors may find the stock reasonably priced relative to its earnings. Furthermore, the robust gross profit margin of 35.03% for the last twelve months as of Q2 2024 demonstrates the company's efficiency in maintaining profitability despite revenue fluctuations.
InvestingPro Data also highlights that Consolidated Water's return on assets for the same period reached 18.78%, showcasing the company's effectiveness in utilizing its assets to generate earnings. Moreover, the InvestingPro product offers additional insights, with 7 more InvestingPro Tips available, providing a deeper dive into the company's financial health and future prospects.
As Consolidated Water continues to navigate the dynamic water supply and treatment industry, these financial metrics and expert insights from InvestingPro underscore the company's solid foundation and potential for sustained growth.
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