The Tribune

By NEIL HARTNELL

Tribune Business Editor

nhartnell@tribunemedia.net

The supplier that provides all the Water & Sewerage Corporation’s Nassau customers with their water has revealed the Government failed to meet pledges to “substantially” cut the $28.4m owed to it by end-2024.

Consolidated Water, the BISX-listed operator of the Blue Hills and Windsor reverse osmosis plants that supply New Providence, warned investors and the global capital markets that it “cannot provide assurances” on when the Government will make good on its promises to drastically pay down the sums due to it from the Water & Sewerage Corporation.

However, these liabilities were slashed by almost $6m or nearly 21 percent during the first two months of 2025, the company’s 10-K annual filing with the Securities & Exchange Commission (SEC) revealed, cutting the outstanding debt to $22.5m. Sum 77 percent, or more than three-quarters of this amount, is “delinquent” or more than 90 days past due - a slight improvement on the 84 percent delinquency as at year-end 2024.

“Consolidated Water (Bahamas) accounts receivable balance, which includes accrued interest due from the Water & Sewerage Corporation, amounted to $28.4m as of December 31, 2024,” Consolidated Water confirmed. “Approximately 81 percent of the December 31, 2024 accounts receivable balance was delinquent as of that date.

“As of February 28, 2025, this receivable amounted to $22.5m, of which 77 percent was delinquent. The delay in collecting these accounts receivable has adversely impacted the liquidity of this subsidiary. From time to time, including presently, Consolidated Water (Bahamas) has experienced delays in collecting its accounts receivable from the Water & Sewerage Corporation.

“When these delays occur, we hold discussions and meetings with representatives of the Water & Sewerage Corporation and The Bahamas government and, as a result, payment schedules are developed for Water & Sewerage Corporation’s delinquent accounts receivable,” the BISX-listed reverse osmosis provider said. 

“All previous delinquent accounts receivables from the Water & Sewerage Corporation, including accrued interest thereon, were eventually paid in full. Based upon this payment history, we have not provided for a material allowance for credit losses for Consolidated Water (Bahamas” accounts receivable from the Water & Sewerage Corporation as of December 31, 2024.”

However, Consolidated Water signalled that its faith in the Government’s pledges has been somewhat shaken after the latter failed to make any major inroads into the sums owed by the Water & Sewerage Corporation last year as planned.

“Consolidated Water (Bahamas) held discussions with the Water & Sewerage Corporation in March 2024, and with representatives of The Bahamas government in April 2024 during which Consolidated Water (Bahamas) was informed that the Government intended to substantially reduce Consolidated Water (Bahamas) accounts receivable from the Water & Sewerage Corporation before the end of 2024,” it added.

“This anticipated substantial reduction in Consolidated Water (Bahamas) accounts receivable did not occur over the course of 2024. We continue to be in frequent contact with officials of the Bahamas government, who continue to express their intention to significantly reduce Consolidated Water (Bahamas) accounts receivable balances in the near future. However, we cannot provide any assurance as to when such reduction will occur....

“If Consolidated Water (Bahamas) is unable to collect a sufficient portion of its delinquent accounts receivable, one or more of the following events may occur. Consolidated Water (Bahamas) may not have sufficient liquidity to meet its obligations; we may be required to cease the recognition of revenue on Consolidated Water (Bahamas) water supply agreements with the Water & Sewerage Corporation; and (we may be required to provide a material allowance for credit losses for Consolidated Water (Bahamas) accounts receivable. Any of these events could have a material adverse impact on our consolidated financial condition, results of operations and cash flows.”

Consolidated Water’s Bahamas operations sustained a 5 percent year-over-year decline in revenue for 2024, dropping to $29.676m from $31.222m. This means the sum owed by the Water & Sewerage Corporation t year-end 2024 was almost as large as the company’s annual revenues.

“One bulk water customer, the Water & Sewerage Corporation, accounted for approximately 22 percent of our consolidated revenue for 2024. If, for financial or other reasons, the Water & Sewerage Corporation does not comply with the terms of our water supply agreements our consolidated financial condition, results of operations, and cash flows could be materially adversely affected,” the reverse osmosis supplier added.

“We sell bulk water in The Bahamas through our majority-owned subsidiary, Consolidated Water (Bahamas), to the Water & Sewerage Corporation, which distributes the water through its own pipeline system to residential, commercial and tourist properties on the island of New Providence. We supply bulk water in The Bahamas from our Windsor and Blue Hills plants.

“Our water supply agreement with the Water & Sewerage Corporation for our Windsor plant, which has a capacity of 2.8 million gallons per day, expires in August 2033 and requires us to deliver and requires the Water & Sewerage Corporation to purchase a minimum of 16.8 million gallons per week,” Consolidated Water continued.

“We supply water from the Blue Hills plant, our largest seawater reverse osmosis desalination facility, with a capacity of 12 million gallons per day under the terms of a water supply agreement with the Water & Sewerage Corporation that expires in March 2032 that requires us to deliver, and requires the Water & Sewerage Corporation to purchase, a minimum of 63 million gallons of water each week.”