The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

Improvements at the Water & Sewerage Corporation continue to be bad news for its BISX-listed supplier, which saw sales volumes drop by 12 per cent year-over-year for the nine months to end-September 2015.

Consolidated Water, unveiling its third quarter figures, revealed that bulk water revenues in the Bahamas were down by $1.444 million in the third quarter compared to 2014, due to the progress made by the Corporation in reducing water leaks and losses from its distribution system.

The resulting decline in water sales and revenues were responsible for most of the 20.2 per cent year-over-year fall in Consolidated Water’s third quarter total bulk water sales - which fell by $2 million, from $9.9 million to $7.9 million.

“Bulk water revenues were approximately $7.9 million in the third quarter of 2015, compared with approximately $9.9 million in the year-earlier period,” Consolidated Water said in last night’s results announcement.

“The decrease in bulk revenues was attributable to both the Bahamas and Cayman operations, where revenues decreased by approximately $1.444 million and $487,000, respectively, from the prior-year period.

“The 2015 revenue decrease for bulk operations resulted from declines of 14 per cent and 4 per cent in the volumes of water sold by the Bahamas and Cayman operations, respectively, as well as from significant decreases in the prices of diesel fuel and electricity from 2014 to 2015 that reduced the energy component of the company’s bulk water rates,” it added.

“Lower volumes of water sold in the Bahamas reflected continuing water conservation and loss mitigation efforts by the Water and Sewerage Corporation of the Bahamas.”

As for the nine months to end-September 2015, Consolidated Water added: “Bulk water revenues declined to approximately $24.5 million in the nine months ended September 30, 2015, compared with approximately $29.8 million in the year-earlier period.

“The decrease in bulk revenues was attributable to both the Bahamas and Cayman operations, where the volumes of water sold decreased 12 per cent and 3 per cent, respectively, from the prior-year period.

“Also, significant decreases in the prices of diesel fuel and electricity from 2014 to 2015 reduced the energy component of the company’s bulk water rates.”

Consolidated Water’s Bahamian sales revenues were down by $4.147 million for the nine months to end-September 2015 compared to the prior year period.

Bahamian maintenance and repair expenses were also $402,000 higher in 2015, reducing gross profit dollars.

Consolidated Water’s results also revealed that more than two years after its supply agreement expired in July 2013, the Christie administration has yet to decide whether to renew the company’s contract for a further five years or seek another operator for the Windsor reverse osmosis plant.

“At the request of the Government of the Bahamas, we continue to operate and maintain the Windsor plant on a month-to-month basis to provide the Government of the Bahamas with additional time to decide whether or not it will extend Consolidated Water (Bahamas) water supply agreement for the Windsor plant on a long-term basis,”the company said.

“Consolidated Water (Bahamas) generated revenues from the operation of this plant of approximately $1.5 million and $1.5 million during the three months ended September 30, 2015 and 2014, respectively, and $4.5 million and $4.8 million during the nine months ended September 30, 2015 and 2014, respectively.”