Global Water Resources Reports Third Quarter 2016 Results And Declares Increased Monthly Dividend

PHOENIX, Nov. 14, 2016 (GLOBE NEWSWIRE) -- Global Water Resources, Inc. (NASDAQ:GWRS) (TSX:GWR) (the "Company" or "Global Water"), a pure-play water resource management company that owns and operates regulated water, wastewater, and recycled water utilities in the metropolitan Phoenix area, today reported its financial results for the third quarter ended September 30, 2016.  All amounts are in U.S. dollars, unless otherwise indicated.  For information regarding today's conference call, see the Conference Call section below.

Third Quarter 2016 Highlights and Subsequent Event
  • Total active connections increased to 37,009 at September 30, 2016 from 36,272 at December 31, 2015 (after adjusting for the Willow Valley disposition).  This represents a 2.7% annualized growth rate;
  • Revenue increased $37,000 to $8.2 million in the quarter as compared to $8.1 million in the third quarter of 2015. The increase in revenue was partially offset by the divestitures of Valencia in the third quarter of 2015 and Willow Valley in the second quarter of 2016. Excluding the impact of the divestitures, total revenues grew by 8.2% or $623,000. 
  • Operating expenses decreased $572,000 or 9.4% to $5.5 million in the quarter as compared to $6.1 million in the third quarter of 2015. For the first nine months of 2016, operating expenses decreased $1.7 million or 8.6% versus the same period in 2015.
  • Net income of $1.1 million or $0.06 per share in the quarter.
  • Adjusted EBITDA increased $544,000 or 12.3% to $5.0 million in the quarter as compared to $4.4 million in the third quarter of 2015.
  • For the first nine months of 2016, water, wastewater and recycled water revenue (Utility Revenue) decreased 7.6% as a result of the Valencia and Willow Valley dispositions.  Excluding the impact of the dispositions, Utility Revenue grew by 8.3% for the first nine months of 2016.
  • In November, Global Water increased the dividend 2.3% to $0.270 per year from $0.264 per year.  This equates to a monthly dividend of $0.0225.  The first dividend at the new monthly rate will be paid on December 29, 2016 to holders of record on December 15, 2016.

Management Commentary"In Q3, normalized revenue and earnings growth were strong driven by increased rates, organic growth, and reduced operating expenses, as well as reduced quarterly interest expense as a result of a debt refinancing that we completed in June 2016," said Ron Fleming, President and CEO of Global Water. "Looking ahead, we expect to continue to benefit from these key drivers, which will allow us to frequently review our dividend policy. We also plan to continue to accelerate other strategic uses of our significant cash balance that can complement our growth plan and drive long-term value creation."

Summary of Financial Results

Consolidated Revenues Consolidated revenues (which consists of Utility Revenue and other non-utility revenue) for the three and nine months ended September 30, 2016 were $8.2 million and $22.6 million, respectively, compared to $8.1 million and $24.8 million for the same periods in 2015.  Specifically, year-over-year Utility Revenue was up $181,000 (or 2.3%) and down $1.9 million for the three and nine months ended September 30, 2016, respectively, while other non-utility revenue was down $144,000 (or 87.8%) and $406,000 (or 87.1%) for the three and nine months ended September 30, 2016, respectively.

Utility Revenue for the three and nine months ended September 30, 2015 included the results of the Company's Valencia and Willow Valley operations.  Utility Revenue for the nine months ended September 30, 2016 included the results of the Company's Willow Valley operations.  The Company disposed of Valencia in July 2015 and Willow Valley in May 2016.  Excluding Valencia and Willow Valley, for the three and nine months ended September 30, 2016, Utility Revenue increased by $767,000 (or 10.4%) and $1.7 million (or 8.3%), respectively, over the same periods in 2015.  The increases were primarily driven by a 2.7% annualized increase in active connections as of September 30, 2016 (adjusting for the Willow Valley disposition), increased rates pursuant to the 2014 rate order and an increase in water consumption.