Document And Entity Information
Document And Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | May. 04, 2016 | |
Document Information [Line Items] | ||
Entity Registrant Name | CONSOLIDATED WATER CO LTD | |
Entity Central Index Key | 928,340 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Accelerated Filer | |
Trading Symbol | CWCO | |
Entity Common Stock, Shares Outstanding | 14,785,922 | |
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Mar. 31, 2016 | |
Document Fiscal Period Focus | Q1 | |
Document Fiscal Year Focus | 2,016 |
CONDENSED CONSOLIDATED BALANCE
CONDENSED CONSOLIDATED BALANCE SHEETS - USD ($) | Mar. 31, 2016 | Dec. 31, 2015 |
Current assets | ||
Cash and cash equivalents | $ 35,550,623 | $ 44,792,734 |
Certificate of deposit | 5,637,538 | 5,637,538 |
Restricted cash | 0 | 428,203 |
Accounts receivable, net | 13,799,199 | 9,529,016 |
Inventory | 1,890,613 | 1,918,728 |
Prepaid expenses and other current assets | 800,063 | 1,282,660 |
Current portion of loans receivable | 1,871,925 | 1,841,851 |
Costs and estimated earnings in excess of billings | 393,096 | 0 |
Total current assets | 59,943,057 | 65,430,730 |
Property, plant and equipment, net | 54,817,803 | 53,743,170 |
Construction in progress | 2,769,970 | 1,928,610 |
Inventory, non-current | 4,594,425 | 4,558,374 |
Loans receivable | 3,289,604 | 3,769,016 |
Investment in OC-BVI | 4,578,060 | 4,548,271 |
Intangible assets, net | 6,452,727 | 771,811 |
Goodwill | 11,534,248 | 3,499,037 |
Land held for development | 20,558,424 | 20,558,424 |
Other assets | 2,784,901 | 2,767,583 |
Total assets | 171,323,219 | 161,575,026 |
Current liabilities | ||
Accounts payable and other current liabilities | 3,904,296 | 4,829,535 |
Dividends payable | 1,177,772 | 1,177,246 |
Note payable to related party | 490,000 | 0 |
Demand loan payable | 6,489,582 | 6,958,328 |
Billings in excess of costs and estimated earnings | 153,525 | 189,985 |
Total current liabilities | 12,215,175 | 13,155,094 |
Deferred tax liability | 2,378,029 | 0 |
Other liabilities | 607,827 | 224,827 |
Total liabilities | $ 15,201,031 | $ 13,379,921 |
Commitments and contingencies | ||
Consolidated Water Co. Ltd. stockholders' equity | ||
Redeemable preferred stock, $0.60 par value. Authorized 200,000 shares; issued and outstanding 38,004 and 38,804 shares, respectively | $ 22,802 | $ 23,282 |
Additional paid-in capital | 84,745,395 | 84,597,349 |
Retained earnings | 53,027,621 | 52,084,175 |
Cumulative translation adjustment | (536,381) | (533,365) |
Total Consolidated Water Co. Ltd. stockholders' equity | 146,130,990 | 145,040,162 |
Non-controlling interests | 9,991,198 | 3,154,943 |
Total equity | 156,122,188 | 148,195,105 |
Total liabilities and equity | 171,323,219 | 161,575,026 |
Class A common stock [Member] | ||
Consolidated Water Co. Ltd. stockholders' equity | ||
Common stock value | 8,871,553 | 8,868,721 |
Class B common stock [Member] | ||
Consolidated Water Co. Ltd. stockholders' equity | ||
Common stock value | $ 0 | $ 0 |
CONDENSED CONSOLIDATED BALANCE3
CONDENSED CONSOLIDATED BALANCE SHEETS [Parenthetical] - $ / shares | Mar. 31, 2016 | Dec. 31, 2015 |
Redeemable preferred stock, par value (in dollars per share) | $ 0.60 | $ 0.60 |
Redeemable preferred stock, authorized | 200,000 | 200,000 |
Redeemable preferred stock, issued | 38,004 | 38,804 |
Redeemable preferred stock, outstanding | 38,004 | 38,804 |
Class A common stock [Member] | ||
Common stock, par value (in dollars per share) | $ 0.60 | $ 0.60 |
Common stock, authorized | 24,655,000 | 24,655,000 |
Common stock, issued | 14,785,922 | 14,781,201 |
Common stock, outstanding | 14,785,922 | 14,781,201 |
Class B common stock [Member] | ||
Common stock, par value (in dollars per share) | $ 0.60 | $ 0.60 |
Common stock, authorized | 145,000 | 145,000 |
Common stock, issued | 0 | 0 |
CONDENSED CONSOLIDATED STATEMEN
CONDENSED CONSOLIDATED STATEMENTS OF INCOME - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Retail revenues | $ 5,970,238 | $ 6,135,638 |
Bulk revenues | 7,265,293 | 8,382,316 |
Services revenues | 799,241 | 148,158 |
Total revenues | 14,034,772 | 14,666,112 |
Cost of retail revenues | 2,629,674 | 2,766,863 |
Cost of bulk revenues | 4,610,324 | 5,466,060 |
Cost of services revenues | 617,743 | 284,887 |
Total cost of revenues | 7,857,741 | 8,517,810 |
Gross profit | 6,177,031 | 6,148,302 |
General and administrative expenses | 4,460,986 | 3,892,966 |
Income from operations | 1,716,045 | 2,255,336 |
Other income (expense): | ||
Interest income | 216,835 | 233,582 |
Interest expense | (64,046) | (69,532) |
Profit sharing income from OC-BVI | 34,425 | 26,325 |
Equity in earnings of OC-BVI | 45,364 | 75,155 |
Impairment of investment in OC-BVI | (50,000) | (310,000) |
Other | 206,979 | (175,087) |
Other income (expense), net | 389,557 | (219,557) |
Income before income taxes | 2,105,602 | 2,035,779 |
Provision for (benefit from) income taxes | (73,269) | 0 |
Net income | 2,178,871 | 2,035,779 |
Income attributable to non-controlling interests | 124,230 | 114,518 |
Net income attributable to Consolidated Water Co. Ltd. stockholders | $ 2,054,641 | $ 1,921,261 |
Basic earnings per common share attributable to Consolidated Water Co. Ltd. common stockholders (in dollars per share) | $ 0.14 | $ 0.13 |
Diluted earnings per common share attributable to Consolidated Water Co. Ltd. common stockholders (in dollars per share) | 0.14 | 0.13 |
Dividends declared per common share (in dollars per share) | $ 0.075 | $ 0.075 |
Weighted average number of common shares used in the determination of: | ||
Basic earnings per share (in shares) | 14,783,380 | 14,718,757 |
Diluted earnings per share (in shares) | 14,864,125 | 14,764,169 |
CONDENSED CONSOLIDATED STATEME5
CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (LOSS) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Net income | $ 2,178,871 | $ 2,035,779 |
Other comprehensive income (loss) | ||
Foreign currency translation adjustment | (3,175) | (35,549) |
Total other comprehensive income (loss) | (3,175) | (35,549) |
Comprehensive income | 2,175,696 | 2,000,230 |
Comprehensive income attributable to non-controlling interests | 124,071 | 112,741 |
Comprehensive income attributable to Consolidated Water Co. Ltd. stockholders | $ 2,051,625 | $ 1,887,489 |
CONDENSED CONSOLIDATED STATEME6
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Change in: | ||
Net cash provided by (used in) operating activities | $ (356,645) | $ 2,478,158 |
Cash flows from investing activities | ||
Additions to property, plant and equipment and construction in progress | (954,671) | (442,915) |
Proceeds from sale of equipment | 15,000 | 600 |
Acquisition of business, net of cash acquired | (7,742,853) | 0 |
Collections on loans receivable | 449,338 | 421,149 |
Release of restricted cash | 423,405 | 0 |
Net cash used in investing activities | (7,809,781) | (21,166) |
Cash flows from financing activities | ||
Dividends paid to CWCO common shareholders | (1,107,759) | (1,103,093) |
Dividends paid to CWCO preferred shareholders | (2,910) | (2,763) |
Repurchase of redeemable preferred stock | (6,083) | 0 |
Proceeds received from exercise of stock options | 50,420 | 145,147 |
Note payable to related party | 490,000 | 0 |
Repayments of demand loan payable | (500,000) | (500,000) |
Net cash used in financing activities | (1,076,332) | (1,460,709) |
Effect of exchange rate changes on cash | 647 | 44,956 |
Net increase (decrease) in cash and cash equivalents | (9,242,111) | 1,041,239 |
Cash and cash equivalents at beginning of period | 44,792,734 | 35,713,689 |
Cash and cash equivalents at end of period | 35,550,623 | 36,754,928 |
Interest paid in cash | 32,896 | 39,962 |
Non-cash investing and financing activities | ||
Dividends declared but not paid | 1,111,795 | 1,107,834 |
Transfers from (to) inventory to (from) property, plant and equipment and construction in progress | 69,920 | (647) |
Transfers from construction in progress to property, plant and equipment | $ 83,903 | $ 95,786 |
Principal activity
Principal activity | 3 Months Ended |
Mar. 31, 2016 | |
Organization, Consolidation and Presentation Of Financial Statements [Abstract] | |
Nature of Operations [Text Block] | Consolidated Water Co. Ltd., and its subsidiaries (collectively, the “Company”) use reverse osmosis technology to produce potable water from seawater. The Company processes and supplies water, and provides water-related products and services, to its customers in the Cayman Islands, Belize, The Bahamas, the British Virgin Islands, Indonesia and the United States. The Company sells water to a variety of customers, including public utilities, commercial and tourist properties, residential properties and government facilities. The base price of water supplied by the Company, and adjustments thereto, are determined by the terms of a retail license and bulk water supply contracts which provide for adjustments based upon the movement in the government price indices specified in the license and contracts as well as monthly adjustments for changes in the cost of energy. The Company also manufactures and services a wide range of products and provides design, engineering, management, operating and other services applicable to commercial and municipal water production, supply and treatment, and industrial water and wastewater treatment. |
Accounting policies
Accounting policies | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Significant Accounting Policies [Text Block] | 2. Accounting policies The accompanying condensed consolidated financial statements include the accounts of the Company’s (i) wholly-owned subsidiaries, Aquilex, Inc., Cayman Water Company Limited (“Cayman Water”), Consolidated Water (Belize) Limited (“CW-Belize”), Ocean Conversion (Cayman) Limited (“OC-Cayman”), DesalCo Limited (“DesalCo”), Consolidated Water Cooperatief, U.A. (“CW-Cooperatief”), Consolidated Water U.S. Holdings, Inc. (“CW-Holdings”); and (ii) majority-owned subsidiaries Consolidated Water (Bahamas) Ltd. (“CW-Bahamas”), Aerex Industries, Inc. (“Aerex”), Consolidated Water (Asia) Pte. Limited, PT Consolidated Water Bali (“CW-Bali”) and N.S.C. Agua, S.A. de C.V. (“NSC”). The Company’s investment in its affiliate, Ocean Conversion (BVI) Ltd. (“OC-BVI”), is accounted for using the equity method of accounting. All significant intercompany balances and transactions have been eliminated in consolidation. The accompanying interim condensed consolidated financial statements are unaudited. These condensed consolidated financial statements reflect all adjustments (which are of a normal recurring nature) that, in the opinion of management, are necessary to fairly present the Company’s financial position, results of operations and cash flows as of and for the periods presented. The results of operations for these interim periods are not necessarily indicative of the operating results for future periods, including the fiscal year ending December 31, 2016. These condensed consolidated financial statements and notes are presented in accordance with the rules and regulations of the United States Securities and Exchange Commission (“SEC”) relating to interim financial statements and in conformity with accounting principles generally accepted in the United States of America (“US GAAP”). Certain information and note disclosures normally included in annual financial statements prepared in accordance with US GAAP have been condensed or omitted in these condensed financial statements pursuant to SEC rules and regulations, although the Company believes that the disclosures made herein are adequate to make the information not misleading. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. The Company’s reporting currency is the United States dollar (“US$”). The functional currency of the Company and its foreign operating subsidiaries (other than NSC and CW-Cooperatief) is the currency for each respective country. The functional currency for NSC is the US$. The exchange rates between the Cayman Islands dollar, the Belize dollar, the Bahamian dollar are fixed to the US$. CW-Cooperatief conducts business in US$ and euros, CW-Bali conducts business in US$ and Indonesian rupiahs, and NSC conducts business in US$ and Mexican pesos. The exchange rates for conversion of euros, rupiahs and Mexican pesos into US$ vary based upon market conditions. Net foreign currency gains (losses) arising from transactions conducted in foreign currencies were $ 154,409 175,095 Comprehensive income (loss) is defined as the change in equity during a period from transactions and other events from non-owner sources. Comprehensive income (loss) is the total of net income and other comprehensive income (loss) which, for the Company, is comprised entirely of foreign currency translation adjustments related to CW-Bali. Cash and cash equivalents: 9.5 13.6 Transfers from the Company’s Bahamas and Belize bank accounts to Company bank accounts in other countries require the approval of the Central Bank of the Bahamas and Belize, respectively. As of March 31, 2016, the equivalent United States dollar cash balances for deposits held in the Bahamas and Belize were approximately $ 17.4 4.6 5.6 Certain amounts reported in the financial statements issued in prior periods have been reclassified herein to conform to the current period’s presentation. These reclassifications had no effect on consolidated net income. |
Purchase of interest in Aerex I
Purchase of interest in Aerex Industries, Inc. | 3 Months Ended |
Mar. 31, 2016 | |
Business Combinations [Abstract] | |
Business Combination Disclosure [Text Block] | On February 11, 2016 (the “Closing Date”), the Company, through its wholly-owned subsidiary, CW-Holdings, entered into a stock purchase agreement (the “Purchase Agreement”) with Aerex and Thomas Donnick, Jr. (“Donnick”), Aerex’s sole shareholder prior to the Closing Date. Pursuant to the terms of the Purchase Agreement, CW-Holdings purchased a 51 7.7 49 Aerex is an original equipment manufacturer and service provider of a wide range of products and services applicable to municipal water treatment and industrial water and wastewater treatment. Its products include membrane separation equipment, filtration equipment, piping systems, vessels and custom fabricated components. Aerex also offers engineering, design, consulting, inspection, training and equipment maintenance services to its customers. Aerex is an American Society of Mechanical Engineers (ASME) code accredited manufacturer and maintains the ASME U and S and the National Board NB and R Certificates of Authorization. Its corporate offices and manufacturing facilities are located in Fort Pierce, Florida. In connection with the Purchase Agreement, CW-Holdings, Aerex and Donnick entered into a shareholders agreement, pursuant to which CW-Holdings and Donnick agreed to certain rights and obligations with respect to the governance of Aerex. Immediately following the acquisition, Aerex’s prior sole stockholder and the Company loaned $ 490,000 510,000 August 10, 2016 1 The purchase price for Aerex is summarized as follows: February 11, 2016 Cash consideration Purchase price (excluding working capital) $ 7,140,000 Working capital adjustment 605,179 Cash acquired (2,326) Total cash consideration $ 7,742,853 The following table summarizes the estimated fair values of the assets and liabilities assumed at the acquisition date: February 11, 2016 Financial assets $ 456,664 Inventory 70,487 Costs and estimated earnings in excess of billings 784,465 Property, plant and equipment 2,159,401 Identifiable intangible assets 5,900,000 Deferred tax liability (2,451,298) Accounts payable and accrued liabilities (116,893) Net liability arising from put/call options (383,000) Total identifiable net assets 6,419,826 Non-controlling interest in Aerex (6,712,184) Goodwill 8,035,211 $ 7,742,853 February 11, 2016 Useful life Non-compete agreement $ 400,000 5 years Trade name 1,400,000 15 years Certifications/programs 2,000,000 3 years Customer backlog 100,000 1 year Customer relationships 2,000,000 4 years $ 5,900,000 The results of operations of Aerex are included in our consolidated financial statements from the date of acquisition. The total revenue and net income generated by Aerex for the period February 11, 2016 to March 31, 2016, were approximately $ 619,000 22,000 83,500 The following pro forma financial information presents the results of operations of the Company for the three months ended March 31, 2016 and 2015, as if the acquisition of Aerex had taken place on January 1, 2015. Three Months Ended March 31, 2016 2015 Revenues $ 14,566,024 $ 20,573,746 Cost of revenues 8,236,741 12,793,952 Gross profit 6,329,283 7,779,794 General and administrative expenses 4,736,257 4,325,631 Income from operations 1,593,026 3,454,163 Other income (expense), net 391,061 (215,945) Income before income taxes 1,984,087 3,238,218 Provision for (benefit from) income taxes (136,432) 438,035 Net income 2,120,519 2,800,183 Income attributable to non-controlling interests 85,924 562,280 Net income attributable to Consolidated Water Co. Ltd. stockholders $ 2,034,595 $ 2,237,903 Basic earnings per common share attributable to Consolidated Water Co. Ltd. common stockholders $ 0.14 $ 0.15 Diluted earnings per common share attributable to Consolidated Water Co. Ltd. common stockholders $ 0.14 $ 0.15 Weighted average number of common shares used in the determination of: Basic earnings per share 14,783,380 14,718,757 Diluted earnings per share 14,864,125 14,764,169 |
Fair value measurements
Fair value measurements | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value, Measurement Inputs, Disclosure [Text Block] | 4. Fair value measurements As of March 31, 2016 and December 31, 2015, the carrying amounts of cash and cash equivalents, accounts receivable, accounts payable and other current liabilities, the demand loan and dividends payable approximate their fair values due to the short term maturities of these instruments. Management considers that the carrying amounts for loans receivable and long term debt as of March 31, 2016 and December 31, 2015 approximate their fair value as the stated interest rates approximate market rates. Under US GAAP, fair value is defined as the exit price, or the amount that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants as of the measurement date. US GAAP guidance also establishes a hierarchy for inputs used in measuring fair value that maximizes the use of observable inputs and minimizes the use of unobservable inputs by requiring that the most observable inputs be used when available. Observable inputs are inputs market participants would use in valuing the asset or liability and are developed based on market data obtained from sources independent of the Company. Unobservable inputs are inputs that reflect the Company’s assumptions about the factors market participants would use in valuing the asset or liability. The guidance establishes three levels of inputs that may be used to measure fair value: Level 1 - Quoted prices in active markets for identical assets or liabilities. Level 2 - Inputs other than Level 1 that are observable, either directly or indirectly, such as quoted prices for similar assets or liabilities; quoted prices in markets that are not active; or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities. Level 3 - Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. Assets and liabilities are classified in their entirety based on the lowest level of input that is significant to the fair value measurements. The Company reviews its fair value hierarchy classifications on a quarterly basis. Changes in the observability of valuation inputs may result in a reclassification of levels for certain securities within the fair value hierarchy. March 31, 2016 Level 1 Level 2 Level 3 Total Assets Recurring Certificate of deposit $ - $ 5,637,538 $ - $ 5,637,538 Nonrecurring Investment in OC-BVI $ - $ - $ 4,578,060 $ 4,578,060 Liabilities Recurring Net liability arising from put/call options $ - $ - $ 383,000 $ 383,000 December 31, 2015 Level 1 Level 2 Level 3 Total Assets Recurring Restricted cash $ 428,203 $ - $ - $ 428,203 Certificate of deposit - 5,637,538 - 5,637,538 Total recurring $ 428,203 $ 5,637,538 $ - $ 6,065,741 Nonrecurring Investment in OC-BVI $ - $ - $ 4,548,271 $ 4,548,271 Investment in OC-BVI Balance as of December 31, 2015 $ 4,548,271 Profit sharing and equity from earnings of OC-BVI 79,789 Distributions received from OC-BVI - Impairment of investment in OC-BVI (See Note 7) (50,000) Balance as of March 31, 2016 $ 4,578,060 Net liability arising from put/call options (1) Balance as of December 31, 2015 $ - Net liability arising from put/call options 383,000 Balance as of March 31, 2016 $ 383,000 (1) The net liability arising from put/call options is included in the accompanying condensed consolidated balance sheets within other liabilities as of March 31, 2016. |
Segment information
Segment information | 3 Months Ended |
Mar. 31, 2016 | |
Segment Reporting [Abstract] | |
Segment Reporting Disclosure [Text Block] | 5. Segment information The Company has three reportable segments: retail, bulk and services. The retail segment primarily operates the water utility for the Seven Mile Beach and West Bay areas of Grand Cayman Island pursuant to an exclusive license granted by the Cayman Islands government. The bulk segment supplies potable water to government utilities in Grand Cayman, The Bahamas and Belize under long-term contracts. The services segment manufactures and services a wide range of products and provides design, engineering, management, operating and other services applicable to commercial and municipal water production, supply and treatment, and industrial water and wastewater treatment. The services segment includes the operations of Aerex beginning February 11, 2016. The accounting policies of the segments are consistent with those described in Note 2. The Company evaluates each segment’s performance based upon its income from operations. All intercompany transactions are eliminated for segment presentation purposes. Three Months Ended March 31, 2016 Retail Bulk Services Total Revenues $ 5,970,238 $ 7,265,293 $ 799,241 $ 14,034,772 Cost of revenues 2,629,674 4,610,324 617,743 7,857,741 Gross profit 3,340,564 2,654,969 181,498 6,177,031 General and administrative expenses 2,897,861 435,896 1,127,229 4,460,986 Income (loss) from operations $ 442,703 $ 2,219,073 $ (945,731) 1,716,045 Other income (expense), net 389,557 Income before income taxes 2,105,602 Provision for (benefit from) income taxes (73,269) Net income 2,178,871 Income attributable to non-controlling interests 124,230 Net income attributable to Consolidated Water Co. Ltd. stockholders $ 2,054,641 Depreciation and amortization expenses for the three months ended March 31, 2016 for the retail, bulk and services segments were $ 587,726 827,389 239,707 Three Months Ended March 31, 2015 Retail Bulk Services Total Revenues $ 6,135,638 $ 8,382,316 $ 148,158 $ 14,666,112 Cost of revenues 2,766,863 5,466,060 284,887 8,517,810 Gross profit (loss) 3,368,775 2,916,256 (136,729) 6,148,302 General and administrative expenses 2,898,415 417,364 577,187 3,892,966 Income (loss) from operations $ 470,360 $ 2,498,892 $ (713,916) 2,255,336 Other income, net (219,557) Net income 2,035,779 Income attributable to non-controlling interests 114,518 Net income attributable to Consolidated Water Co. Ltd. stockholders $ 1,921,261 Depreciation and amortization expenses for the three months ended March 31, 2015 for the retail, bulk and services segments were $ 590,040 794,725 22,474 As of March 31, 2016 Retail Bulk Services Total Accounts receivable, net $ 2,684,520 $ 9,567,044 $ 1,547,635 $ 13,799,199 Property plant and equipment, net $ 24,914,329 $ 27,661,157 $ 2,242,317 $ 54,817,803 Construction in progress $ 2,668,571 $ 101,399 $ - $ 2,769,970 Intangibles, net $ - $ 649,604 $ 5,803,123 $ 6,452,727 Goodwill $ 1,170,511 $ 2,328,526 $ 8,035,211 $ 11,534,248 Land held for development $ - $ - $ 20,558,424 $ 20,558,424 Total assets $ 54,291,232 $ 75,334,227 $ 41,697,760 $ 171,323,219 As of December 31, 2015 Retail Bulk Services Total Accounts receivable, net $ 2,261,141 $ 6,231,626 $ 1,036,249 $ 9,529,016 Property plant and equipment, net $ 25,204,226 $ 28,421,906 $ 117,038 $ 53,743,170 Construction in progress $ 1,860,050 $ 68,560 $ - $ 1,928,610 Intangibles, net $ - $ 666,152 $ 105,659 $ 771,811 Goodwill $ 1,170,511 $ 2,328,526 $ - $ 3,499,037 Land held for development $ - $ - $ 20,558,424 $ 20,558,424 Total assets $ 54,561,577 $ 83,284,439 $ 23,729,010 $ 161,575,026 |
Earnings per share
Earnings per share | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Earnings Per Share [Text Block] | 6. Earnings per share Earnings per share (“EPS”) are computed on a basic and diluted basis. Basic EPS is computed by dividing net income (less preferred stock dividends) available to common stockholders by the weighted average number of common shares outstanding during the period. The computation of diluted EPS assumes the issuance of common shares for all potential common shares outstanding during the reporting period and, if dilutive, the effect of stock options as computed under the treasury stock method. Three Months Ended March 31, 2016 2015 Net income attributable to Consolidated Water Co. Ltd. stockholders $ 2,054,641 $ 1,921,261 Less: preferred stock dividends (2,850) (2,763) Net income available to common shares in the determination of basic earnings per common share $ 2,051,791 $ 1,918,498 Weighted average number of common shares in the determination of basic earnings per common share attributable to Consolidated Water Co. Ltd. common stockholders 14,783,380 14,718,757 Plus: Weighted average number of preferred shares outstanding during the period 38,584 36,840 Potential dilutive effect of unexercised options 42,161 8,572 Weighted average number of shares used for determining diluted earnings per common share attributable to Consolidated Water Co. Ltd. common stockholders 14,864,125 14,764,169 |
Investment in OC-BVI
Investment in OC-BVI | 3 Months Ended |
Mar. 31, 2016 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Equity Method Investments Disclosure [Text Block] | 7. Investment in OC-BVI The Company owns 50 43.53 45 The Company’s equity investment in OC-BVI amounted to $ 4,578,060 4,548,271 March 31, 2016 Until 2009, substantially all of the water sold by OC-BVI to the Ministry was supplied by one desalination plant with a capacity of 1.7 Baughers Bay litigation” 720,000 600,000 March 31, December 31, 2016 2015 Current assets $ 4,759,727 $ 4,323,792 Non-current assets 4,524,902 4,682,650 Total assets $ 9,284,629 $ 9,006,442 March 31, December 31, 2016 2015 Current liabilities $ 717,052 $ 584,116 Non-current liabilities 1,672,650 1,650,252 Total liabilities $ 2,389,702 $ 2,234,368 Three Months Ended March 31, 2016 2015 Revenues $ 936,884 $ 1,068,901 Cost of revenues 484,639 581,644 Gross profit 452,245 487,257 General and administrative expenses 260,542 244,342 Income from operations 191,703 242,915 Other income (expense), net (68,850) (52,649) Net income 122,853 190,266 Income attributable to non-controlling interests 18,641 17,614 Net income attributable to controlling interests $ 104,212 $ 172,652 The Company recognized $ 45,364 75,155 34,425 26,325 For the three months ended March 31, 2016 and 2015, the Company recognized $ 138,756 128,775 . Amounts payable by OC-BVI to the Company were $ 40,784 23,803 83,123 105,659 Baughers Bay Litigation Under the terms of a water supply agreement dated May 1990 (the “1990 Agreement”) between OC-BVI and the Government of the British Islands (the “BVI government”) for the Baughers Bay plant upon the expiration of its initial seven-year term in May 1999, the 1990 Agreement would automatically be extended for another seven-year term unless the BVI government provided notice, at least eight months prior to such expiration, of its decision to purchase the plant from OC-BVI at the agreed upon amount under the 1990 Agreement of approximately $ 1.42 4.7 In 2006, the BVI government took the position that the seven-year extension of the 1990 Agreement had been completed and that it was entitled to ownership of the Baughers Bay plant. In response, OC-BVI disputed the BVI government’s contention that the original terms of the 1990 Agreement remained in effect. During 2007, the BVI government significantly reduced its payments for the water being supplied by OC-BVI and filed a lawsuit with the Eastern Caribbean Supreme Court (the “Court”) seeking ownership of the Baughers Bay plant. OC-BVI counterclaimed to the Court that it was entitled to continued possession and operation of the Baughers Bay plant until the BVI government paid OC-BVI approximately $ 4.7 The Court ruled on this litigation in 2009, determining that (i) the BVI government was entitled to immediate ownership and possession of the Baughers Bay plant; (ii) OC-BVI was not entitled to compensation for the expenditures made to expand the production capacity of the plant; (iii) OC-BVI was entitled to full payment of water invoices issued up to December 20, 2007, which had been calculated under the terms of the original 1990 Agreement; and (iv) OC-BVI was entitled to the amount of $10.4 million for water produced by OC-BVI from the Baughers Bay plant subsequent to December 20, 2007. OC-BVI filed an appeal with the Eastern Caribbean Court of Appeals (the “Appellate Court”) in October 2009 asking the Appellate Court to review the September 17, 2009 ruling by the Court as it related to OC-BVI’s claim for compensation for expenditures made to expand the production capacity of the Baughers Bay plant. In October 2009, the BVI government also filed an appeal with the Appellate Court requesting the Appellate Court to reduce the $ 10.4 In March 2010, OC-BVI vacated the Baughers Bay plant and the BVI government assumed direct responsibility for the plant’s operations. In June 2012, the Appellate Court issued the final ruling with respect to the Baughers Bay litigation. This ruling dismissed the BVI government’s appeal against the previous judgment of the Court awarding $10.4 million for the water supplied, and also awarded OC-BVI compensation for improvements made to the plant in the amount equal to the difference between (i) the value of the Baughers Bay plant at the date OC-BVI transferred possession of the plant to the BVI government and (ii) $ 1.42 OC-BVI and the BVI government have not reached an agreement on the value of the plant at the date it was transferred to the BVI government but have engaged a mutually approved appraiser to complete a valuation of the Baughers Bay plant in accordance with the Appellate Court ruling. Such valuation is presently in process. Valuation of Investment in OC-BVI The Company accounts for its investment in OC-BVI under the equity method of accounting for investments in common stock. This method requires recognition of a loss on an equity investment that is other than temporary, and indicates that a current fair value of an equity investment that is less than its carrying amount may indicate a loss in the value of the investment. As a quoted market price for OC-BVI’s stock is not available, to test for possible impairment of its investment in OC-BVI, the Company estimates its fair value through the use of the discounted cash flow method, which relies upon projections of OC-BVI’s operating results, working capital and capital expenditures. The use of this method requires the Company to estimate OC-BVI’s cash flows from (i) the Bar Bay agreement and (ii) the pending amount awarded by the Appellate Court for the value of the Baughers Bay plant transferred by OC-BVI to the BVI government. The Company estimates the cash flows OC-BVI will receive from its Bar Bay agreement by (i) identifying various possible future scenarios for this agreement, which include the cancellation of the agreement after its initial seven-year term and the exercise by the BVI government of the seven-year extension in the agreement; (ii) estimating the cash flows associated with each possible scenario; and (iii) assigning a probability to each scenario. The Company similarly estimates the cash flows OC-BVI will receive from the BVI government for the amount due under the ruling by the Appellate Court for the value of the Baughers Bay plant at the date it was transferred to the BVI government by assigning probabilities to different valuation scenarios. The resulting probability-weighted sum represents the expected cash flows, and the Company’s best estimate of future cash flows, to be derived by OC-BVI from its Bar Bay agreement and the pending Appellate Court award. The identification of the possible scenarios for the Bar Bay plant agreement and the Baughers Bay plant valuation, the projections of cash flows for each scenario, and the assignment of relative probabilities to each scenario all represent significant estimates made by the Company. While the Company uses its best judgment in identifying these possible scenarios, estimating the expected cash flows for these scenarios and assigning relative probabilities to each scenario, these estimates are by their nature highly subjective and are also subject to material change by the Company’s management over time based upon new information or changes in circumstances. As of March 31, 2016 and 2015, after updating its probability-weighted estimates of OC-BVI’s future cash flows and its resulting estimate of the fair value of its investment in OC-BVI, the Company determined that the carrying value of its investment in OC-BVI exceeded its fair value and recorded impairment charges of $ 50,000 310,000 The remaining carrying value of the Company’s investment in OC-BVI of approximately $ 4.6 The $ 4.6 850,000 4.3 |
N.S.C. Agua, S.A. de C.V.
N.S.C. Agua, S.A. de C.V. | 3 Months Ended |
Mar. 31, 2016 | |
Investments In and Advances To Affiliates, Schedule Of Investments [Abstract] | |
Investments in and Advances to Affiliates, Schedule of Investments [Text Block] | 8. N.S.C. Agua, S.A. de C.V. In May 2010, the Company acquired, through its wholly-owned Netherlands subsidiary, CW-Cooperatief, a 50 99.9 100 50 50 Since its inception, NSC has engaged engineering groups with extensive regional and/or technical experience to prepare preliminary designs and cost estimates for the desalination plant and the proposed pipeline and prepare the environmental impact studies for local, state and federal regulatory agencies, and has also acquired the land, performed pilot plant and feed water source testing, and evaluated financing alternatives for the Project. Through a series of transactions completed in 2012-2014, NSC purchased 20.1 hectares of land on which the proposed Project’s plant would be constructed for an aggregate price of $ 20.6 In 2012 and 2013, NSC conducted an equipment piloting plant and water data collection program at the proposed feed water source for the Project under a Memorandum of Understanding (the “EPC MOU”) with a global engineering, procurement and construction contractor for large seawater desalination plants. Under the EPC MOU, the contractor installed and operated an equipment piloting plant and collected water quality data from the proposed feed water source site in Rosarito Beach, Baja California, Mexico. The EPC MOU required that NSC negotiate exclusively with the contractor for the construction of the 100 500,000 350,000 In November 2012, NSC entered into a lease with an effective term of 20 5,000 20,000 In August 2014, the State enacted new legislation to regulate Public-Private Association projects which involve the type of long-term contract between a public sector authority and a private party that NSC is seeking to complete the Project. Pursuant to this new legislation, on January 4, 2015, NSC submitted an expression of interest for its project to the Secretary of Infrastructure and Urban Development of the State of Baja California (“SIDUE”). In January 2015, SIDUE accepted NSC’s expression of interest and requested that NSC submit a detailed proposal for the Project that complies with requirements of the new legislation. NSC submitted this detailed proposal (the “APP Proposal”) to SIDUE in late March 2015. The new legislation required that such proposal be evaluated by SIDUE and submitted to the Public-Private Association Projects State Committee (the “APP Committee”) for review and authorization. If the Project is authorized the State would be required to conduct a public tender for the Project. In response to its unsolicited APP Proposal, in September 2015 NSC received a letter dated June 30, 2015 from the Director General of the Comisión Estatal de Agua de Baja California (“CEA”), the State agency with responsibility for the Project, stating that (i) the Project is in the public interest with high social benefits and is consistent with the objectives of the State development plan and (ii) that the Project should proceed and the required public tender should be conducted. In November 2015, the State officially commenced the tender for the Project, the scope of which the State defined as a first phase to be operational in 2019 consisting of a 50 50 NSC submitted its tender for the Project on April 21, 2016. The Company cannot presently determine when the tender evaluation process will be completed by the State or the outcome of such evaluation process. The Company has acknowledged since the inception of the Project that, due to the amount of capital the Project requires, NSC will ultimately need an equity partner or partners for the Project. Consequently, NSC’s tender to the State for the Project is based upon the following: (i) NSC will sell or otherwise transfer the land and other Project assets to a new company (“Newco”) that would build and own the Project; (ii) NSC’s potential partners would provide the majority of the equity for the Project and thereby would own the majority interest in Newco; (iii) NSC would maintain a minority ownership position in Newco; and (iv) Newco would enter into a long-term management and technical services contract for the Project with an entity partially owned by NSC or another Company subsidiary. Included in the Company’s consolidated results of operations are general and administrative expenses from NSC, consisting of organizational, legal, accounting, engineering, consulting and other costs relating to NSC’s project development activities. Such expenses amounted to approximately $ 767,000 537,000 22.0 502,000 22.0 488,000 The Company expects to incur additional project development costs on behalf of NSC during the remainder of 2016. Despite the expenditures the Company has made and the activities it has completed to date, upon completion of the tender process the State may award the Project to a party other than NSC, or the State may cancel the tender process. If NSC is not awarded the Project, the land NSC has purchased may lose its strategic importance as the site for the Project and consequently may decline in value. If NSC is not awarded the Project, NSC may ultimately be unable to sell this land for an amount equal to or in excess of its current carrying value of $ 20.6 NSC Litigation Immediately following CW-Cooperatief’s acquisition of its initial 50% ownership in NSC, the remaining 50 300,000 1.0 25 5.7 99.9 In October 2015, the Company learned that EWG had filed a lawsuit against the individual shareholder, NSC, NSA, CW-Cooperatief, Ricardo del Monte Nunez, Carlos Eduardo Ahumada Arruit, Luis de Angitia Becerra, and the Public Registry of Commerce of Tijuana, Baja California in the Civil Court located in Tecate, Baja California, Mexico. In this lawsuit, EWG is challenging the capital investment transactions that increased the Company’s ownership interest in NSC to 99.9 Additionally, EWG is also seeking an order directing: (i) NSA, NSC and CW-Cooperatief to refrain from carrying out any transactions with respect to the Project; and (ii) NSA, NSC and CW-Cooperatief, and the partners thereof, to refrain from transferring any interests in NSA, NSC and CW-Cooperatief. On April 5, 2016, NSC filed a motion for reconsideration with the Tecate, Mexico Court asking, among other things, that the Court; (i) reverse its order to record the pendency of the lawsuit in the public records, (ii) cancel the appointment of the inspector, and (iii) allow NSC to provide a counter-guarantee to suspend the effects of the Court’s order regarding the challenged transactions. On April 26, 2016, the Tecate Court issued an interlocutory judgment (i) ordering the cancellation of the inscriptions on NSC’s public records and (ii) rejecting NSC’s motion for cancellation of the appointment of the inspector. The Court’s decision regarding NSC’s request to provide a counter-guarantee is pending. On April 26, 2016, NSC filed a full answer to EWG’s claims, rejecting every claim made by EWG. The Court’s response on this matter is pending. The Company believes that the claims made by EWG are baseless and without merit, will vigorously defend NSC and CW-Cooperatief in this litigation, and will seek dismissal of the orders entered by the court and all claims against NSC and CW-Cooperatief. Furthermore, in November 2015, NSC and CW-Cooperatief filed a complaint in the United States District Court, Southern District of New York against EWG and its Managing Partner, based upon the Company’s conclusion that lawsuit filed by EWG in Mexico directly breaches a contract dated April 12, 2012 between NSC and CW-Cooperatief, and EWG. The Company is vigorously pursuing its claims and seeking relief pursuant to this complaint. The Company incurred legal fees of approximately $ 196,000 The Company cannot presently determine the outcome of this litigation. However, such litigation could adversely impact the Company’s efforts to complete the Project. Mexico Tax Authority The Mexico tax authority, the Servicio de Administracion Tributaria (“SAT”), assessed NSC for taxes relating to payments to foreign vendors on which the SAT contended should have been subject to income tax withholdings during NSC’s 2011 tax year. As of December 31, 2015, the assessment and related penalties, surcharges, inflation adjustments and late fees totaled 7,367,875 428,203 NSC retained the assistance of Mexican tax advisers in this matter, as it believed the assumptions and related work performed by the SAT did not support their tax assessment. As a result, NSC elected to contest this assessment in Mexico federal tax court. NSC was required to provide an irrevocable letter of credit which amounted to 7,367,875 428,203 In November 2014, NSC received a favorable judgment from the tax court. Based on this outcome, the SAT filed an appeal shortly thereafter to contest the judgment. On February 15, 2016, NSC received a favorable judgment from the appellate tax court. |
Contingencies
Contingencies | 3 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies Disclosure [Text Block] | 9. Contingencies Retail License The Company sells water through its retail operations under a license issued in July 1990 by the Cayman Islands government that grants Cayman Water the exclusive right to provide potable water to customers within its licensed service area. As discussed below, this license was set to expire in July 2010 but has since been extended while negotiations for a new license take place. Pursuant to the license, Cayman Water has the exclusive right to produce potable water and distribute it by pipeline to its licensed service area which consists of two of the three most populated areas of Grand Cayman, the Seven Mile Beach and West Bay areas. For the three months ended March 31, 2016 and 2015, the Company generated approximately 42 41 56 57 Under the license, Cayman Water pays a royalty to the government of 7.5 The license was scheduled to expire in July 2010 but has been extended several times by the Cayman Islands government in order to provide the parties with additional time to negotiate the terms of a new license agreement. The most recent extension of the license expires on June 30, 2016. In February 2011, the Water (Production and Supply) Law, 2011 and the Water Authority (Amendment) Law, 2011 (the “New Laws”) were published and enacted. Under the New Laws, the WAC will issue any new license, and such new license could include a rate of return on invested capital model, as discussed in the following paragraph. Following the enactment of the New Laws, the Company was advised in correspondence from the Cayman Islands government and the WAC that: (i) the WAC is now the principal negotiator, and not the Cayman Islands government, in these license negotiations, and (ii) the WAC has determined that a rate of return on invested capital model (“RCAM”) for the retail license is in the best interest of the public and Cayman Water’s customers. RCAM is the rate model currently utilized in the electricity transmission and distribution license granted by the Cayman Islands government to the Caribbean Utilities Company, Ltd. The Company responded to the Cayman Islands government that it disagreed with the government’s position on these two matters and negotiations for a new license temporarily ceased. In July 2012, in an effort to resolve several issues relating to its retail license renewal negotiations, the Company filed an Application for Leave to Apply for Judicial Review (the “Application”) with the Grand Court of the Cayman Islands (the “Court”), seeking declarations that: (i) certain provisions of the New Laws appear to be incompatible and a determination as to how those provisions should be interpreted, (ii) the WAC’s roles as the principal license negotiator, statutory regulator and the Company’s competitor put the WAC in a position of hopeless conflict, and (iii) the WAC’s decision to replace the rate structure under the Company’s current exclusive license with RCAM was predetermined and unreasonable. In October 2012 the Company was notified that the Court agreed to consider the issues raised in the Application. The hearing for this judicial review was held on April 1, 2014. Prior to the commencement of the hearing, the parties agreed that the Court should solely be concerned with the interpretation of the statutory provisions. As part of this agreement, the WAC agreed to consider our submissions on the RCAM model and/or alternative models of pricing. In June 2014, the Court determined that: (i) the renewal of the license does not require a public bidding process; and (ii) the WAC is the proper entity to negotiate with the Company for the renewal of the license. The Company’s submissions on the RCAM model and/or alternative models of pricing were made to the WAC on June 9, 2014. The Company received a letter from the WAC dated September 11, 2014, which fully rejected the Company’s submissions and stated that they intend to provide the Company with a draft RCAM license in due course. On November 21, 2014, the Company wrote to the Minister of Works offering to recommence license negotiations on the basis of the RCAM model subject to certain conditions which are: (i) the Government would undertake to amend the current water legislation to provide for an independent regulator and a fair and balanced regulatory regime more consistent with that provided under the electrical utility regulatory regime, (ii) the Government and the Company would mutually appoint an independent referee and chairman of the negotiations, (iii) the Company’s new license would provide exclusivity for the production and provision of all piped water, both potable and non-potable, within its Cayman Islands license area, (iv) the Government would allow the Company to submit its counter proposal to the WAC’s June 2010 RCAM license draft, and (v) the principle of subsidization of residential customer rates by commercial customer rates would continue under a new license. On March 23 2015, the Company received a letter from the Minister of Works with the following responses to the Company’s November 21, 2014 letter: (1) while the Cayman government plans to create a new public utilities commission, the provision of the new retail license will not depend upon the formation of such a commission; (2) any consideration regarding inclusion of the exclusive right to sell non-potable water within the area covered by the retail license will not take place until after the draft license has proceeded through the review process of the negotiations; (3) rather than allow the Company to submit its counter proposal to the WAC’s June 2010 RCAM license draft, the WAC will draft the license with the understanding that the Company will be allowed to propose amendments thereto; (4) the principle of subsidization of residential customer rates by commercial customer rates would continue under the new license; and (5) a request that the Company consider eliminating its monthly minimum volume charge in the new license. The Company recommenced license negotiations with the WAC during the third quarter of 2015 based upon a draft RCAM license provided by the WAC. Such license negotiations remain on-going. The Company is presently unable to determine when such negotiations will be completed or the final outcome of such negotiations. The Cayman Islands government could ultimately offer a third party a license to service some or all of Cayman Water’s present service area. However, as set forth in the existing license, “ the Governor hereby agrees that upon the expiry of the term of this Licence or any extension thereof, he will not grant a licence or franchise to any other person or company for the processing, distribution, sale and supply of water within the Licence Area without having first offered such a licence or franchise to the Company on terms no less favourable than the terms offered to such other person or company.” The resolution of these license negotiations could result in a material reduction of the operating income and cash flows the Company has historically generated from its retail license and could require the Company to record an impairment charge to reduce the carrying value of its goodwill. Such impairment charge could have a material adverse impact on the Company’s results of operations. The Company is presently unable to determine what impact the resolution of this matter will have on its financial condition, results of operations or cash flows. CW-Belize By Statutory Instrument No. 81 of 2009, the Minister of Public Utilities of the government of Belize published an order, the Public Utility Provider Class Declaration Order, 2009 (the “Order”), which as of May 1, 2009 designated CW-Belize as a public utility provider under the laws of Belize. With this designation, the Public Utilities Commission of Belize (the “PUC”) has the authority to set the rates charged by CW-Belize and to otherwise regulate its activities. On November 1, 2010, CW-Belize received a formal complaint from the PUC alleging that CW-Belize was operating without a license under the terms of the Water Industry Act. CW-Belize applied for this license in December 2010. On July 29, 2011, the PUC issued the San Pedro Public Water Supply Quality and Security Complaint Order (the “Second Order”) which among other things requires that (i) CW-Belize and its customer jointly make a submission to the responsible Minister requesting that the area surrounding CW-Belize’s seawater abstraction wells be designated a forest reserve or national park and be designated a Controlled Area under section 58 of the Water Industry Act, (ii) CW-Belize submit an operations manual for CW-Belize’s desalination plant to the PUC for approval, (iii) CW-Belize and its customer modify the water supply agreement between the parties to (a) include new water quality parameters included in the Order and (b) cap the current exclusive water supply arrangement in the agreement at a maximum of 450,000 Windsor Plant Water Supply Agreement CW-Bahamas provides bulk water to the Water and Sewerage Corporation of The Bahamas (“WSC”), which distributes the water through its own pipeline system to residential, commercial and tourist properties on the Island of New Providence. Pursuant to a water supply agreement, CW-Bahamas was required to provide the WSC with at least 16.8 i. extend the agreement for an additional five years at a rate to be negotiated; ii. exercise a right of first refusal to purchase any materials, equipment and facilities that CW-Bahamas intends to remove from the site at a purchase price to be negotiated with CW-Bahamas; or iii. require CW-Bahamas to remove all materials, equipment and facilities from the site. At the request of the government of The Bahamas, CW-Bahamas continues 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 CW-Bahamas’ water supply agreement for the Windsor plant on a long-term basis. CW-Bahamas generated revenues from the operation of this plant of approximately $ 1.3 1.5 CW-Bali Through its subsidiary CW-Bali, the Company has built and presently operates a seawater reverse osmosis plant with a productive capacity of approximately 790,000 3.1 In 2015, the Indonesian government passed Regulation 121 which provides a mechanism for governmental regulatory oversight over the utilization of Indonesia’s water resources. Under this new regulation, the approval or cooperation of the local government water utility is required for any water supply contracts executed by non-governmental providers after the effective date of the regulation. Consequently CW-Bali will be required to enter into a cooperation agreement with Bali’s local government water utility, PDAM, or otherwise obtain PDAM’s approval, to supply any new customers. The Company is presently seeking a strategic partner to (i) purchase a major portion of its equity ownership in CW-Bali; (ii) lead CW-Bali’s sales and marketing efforts and liaise with PDAM; and (iii) assist with CW-Bali’s on-going funding requirements. The Company also plans to market the available productive capacity of CW-Bali’s Nusa Dua plant to PDAM. If the Company is not able to obtain a strategic partner for CW-Bali, sell water to PDAM or other new customers, or otherwise significantly increase the revenues generated by its Nusa Dua plant in the future, the Company will be required to record an impairment charge to reduce the carrying value of CW-Bali’s plant assets to their fair value. Such an impairment charge could have a material adverse impact on the Company’s results of operations. |
Impact of recent accounting sta
Impact of recent accounting standards | 3 Months Ended |
Mar. 31, 2016 | |
New Accounting Pronouncements and Changes In Accounting Principles [Abstract] | |
New Accounting Pronouncements and Changes in Accounting Principles [Text Block] | 10. Impact of recent accounting standards Adoption of New Accounting Standards: In February 2015, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2015-02, Consolidation (Topic 810) - Amendments to the Consolidation Analysis In April 2015, the FASB issued ASU 2015-03, Interest-Imputation of Interest (Subtopic 835-30): Simplifying the Presentation of Debt Issuance Costs In August 2015, the FASB issued ASU 2015-15, Presentation and Subsequent Measurement of Debt Issuance Costs Associated with Line-of-Credit Arrangements In September 2015, the FASB issued ASU 2015-16, Business Combinations: Simplifying the Accounting for Measurement-Period Adjustments Effect of newly issued but not yet effective accounting standards: In May 2014, the FASB issued ASU 2014-09, Revenue from Contracts with Customers Revenue from Contracts with Customers (Topic 606): Deferral of the Effective Date In March 2016, the FASB issued ASU 2016-08, Principal versus Agent Considerations (Reporting Revenue Gross versus Net In April 2016, the FASB issued ASU 2016-10, Identifying Performance Obligations and Licensing, In July 2015, the FASB issued ASU 2015-11, Inventory (Topic 330): Simplifying the Measurement of Inventory In November 2015, the FASB issued ASU 2015-17, Income Taxes (Topic 740), Balance Sheet Classification of Deferred Taxes In January 2016, the FASB issued ASU 2016-01, Financial Instruments - Overall (Subtopic 825-10): Recognition and Measurement of Financial Assets and Financial Liabilities, In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) In March 2016, the FASB issued ASU 2016-07, Investments- Equity Method and Joint Ventures (Topic 323): Simplifying the Transition to the Equity Method of Accounting, In March 2016, the FASB issued ASU 2016-09, C ompensation - Stock Compensation (Topic 718): Improvements to Employee Share-Based Payment Accounting, . |
Subsequent events
Subsequent events | 3 Months Ended |
Mar. 31, 2016 | |
Subsequent Events [Abstract] | |
Subsequent Events [Text Block] | 11. Subsequent events The Company’s management evaluated subsequent events through the time of the filing of this report on Form 10-Q. Other than as disclosed in these condensed consolidated financial statements, the Company’s management is not aware of any significant events that occurred subsequent to the balance sheet date but prior to the filing of this report that would have a material impact on its consolidated financial statements. |
Accounting policies (Policies)
Accounting policies (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
Accounting Policies [Abstract] | |
Basis of Accounting, Policy [Policy Text Block] | Basis of presentation: The accompanying condensed consolidated financial statements include the accounts of the Company’s (i) wholly-owned subsidiaries, Aquilex, Inc., Cayman Water Company Limited (“Cayman Water”), Consolidated Water (Belize) Limited (“CW-Belize”), Ocean Conversion (Cayman) Limited (“OC-Cayman”), DesalCo Limited (“DesalCo”), Consolidated Water Cooperatief, U.A. (“CW-Cooperatief”), Consolidated Water U.S. Holdings, Inc. (“CW-Holdings”); and (ii) majority-owned subsidiaries Consolidated Water (Bahamas) Ltd. (“CW-Bahamas”), Aerex Industries, Inc. (“Aerex”), Consolidated Water (Asia) Pte. Limited, PT Consolidated Water Bali (“CW-Bali”) and N.S.C. Agua, S.A. de C.V. (“NSC”). The Company’s investment in its affiliate, Ocean Conversion (BVI) Ltd. (“OC-BVI”), is accounted for using the equity method of accounting. All significant intercompany balances and transactions have been eliminated in consolidation. The accompanying interim condensed consolidated financial statements are unaudited. These condensed consolidated financial statements reflect all adjustments (which are of a normal recurring nature) that, in the opinion of management, are necessary to fairly present the Company’s financial position, results of operations and cash flows as of and for the periods presented. The results of operations for these interim periods are not necessarily indicative of the operating results for future periods, including the fiscal year ending December 31, 2016. These condensed consolidated financial statements and notes are presented in accordance with the rules and regulations of the United States Securities and Exchange Commission (“SEC”) relating to interim financial statements and in conformity with accounting principles generally accepted in the United States of America (“US GAAP”). Certain information and note disclosures normally included in annual financial statements prepared in accordance with US GAAP have been condensed or omitted in these condensed financial statements pursuant to SEC rules and regulations, although the Company believes that the disclosures made herein are adequate to make the information not misleading. These condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2015. |
Foreign Currency Transactions and Translations Policy [Policy Text Block] | Foreign currency: The Company’s reporting currency is the United States dollar (“US$”). The functional currency of the Company and its foreign operating subsidiaries (other than NSC and CW-Cooperatief) is the currency for each respective country. The functional currency for NSC is the US$. The exchange rates between the Cayman Islands dollar, the Belize dollar, the Bahamian dollar are fixed to the US$. CW-Cooperatief conducts business in US$ and euros, CW-Bali conducts business in US$ and Indonesian rupiahs, and NSC conducts business in US$ and Mexican pesos. The exchange rates for conversion of euros, rupiahs and Mexican pesos into US$ vary based upon market conditions. Net foreign currency gains (losses) arising from transactions conducted in foreign currencies were $ 154,409 175,095 |
Comprehensive Income, Policy [Policy Text Block] | Comprehensive income: Comprehensive income (loss) is defined as the change in equity during a period from transactions and other events from non-owner sources. Comprehensive income (loss) is the total of net income and other comprehensive income (loss) which, for the Company, is comprised entirely of foreign currency translation adjustments related to CW-Bali. |
Cash and Cash Equivalents, Policy [Policy Text Block] | Cash and cash equivalents: 9.5 13.6 Transfers from the Company’s Bahamas and Belize bank accounts to Company bank accounts in other countries require the approval of the Central Bank of the Bahamas and Belize, respectively. As of March 31, 2016, the equivalent United States dollar cash balances for deposits held in the Bahamas and Belize were approximately $ 17.4 4.6 5.6 |
Reclassification, Policy [Policy Text Block] | Comparative amounts: Certain amounts reported in the financial statements issued in prior periods have been reclassified herein to conform to the current period’s presentation. These reclassifications had no effect on consolidated net income. |
Purchase of interest in Aerex19
Purchase of interest in Aerex Industries, Inc. (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Business Combinations [Abstract] | |
Schedule of Business Acquisitions, by Acquisition [Table Text Block] | The purchase price for Aerex is summarized as follows: February 11, 2016 Cash consideration Purchase price (excluding working capital) $ 7,140,000 Working capital adjustment 605,179 Cash acquired (2,326) Total cash consideration $ 7,742,853 |
Schedule of Recognized Identified Assets Acquired and Liabilities Assumed [Table Text Block] | February 11, 2016 Financial assets $ 456,664 Inventory 70,487 Costs and estimated earnings in excess of billings 784,465 Property, plant and equipment 2,159,401 Identifiable intangible assets 5,900,000 Deferred tax liability (2,451,298) Accounts payable and accrued liabilities (116,893) Net liability arising from put/call options (383,000) Total identifiable net assets 6,419,826 Non-controlling interest in Aerex (6,712,184) Goodwill 8,035,211 $ 7,742,853 |
Schedule of Finite-Lived Intangible Assets Acquired as Part of Business Combination [Table Text Block] | The identifiable intangible assets consist of the following items with amortization calculated using a straight line method over the useful life of the asset: February 11, 2016 Useful life Non-compete agreement $ 400,000 5 years Trade name 1,400,000 15 years Certifications/programs 2,000,000 3 years Customer backlog 100,000 1 year Customer relationships 2,000,000 4 years $ 5,900,000 |
Business Acquisition, Pro Forma Information [Table Text Block] | The pro forma results have been prepared for comparative purposes only and do not purport to be indicative of the results of operations which would have actually occurred had the transaction taken place on January 1, 2015, or of future results of operations: Three Months Ended March 31, 2016 2015 Revenues $ 14,566,024 $ 20,573,746 Cost of revenues 8,236,741 12,793,952 Gross profit 6,329,283 7,779,794 General and administrative expenses 4,736,257 4,325,631 Income from operations 1,593,026 3,454,163 Other income (expense), net 391,061 (215,945) Income before income taxes 1,984,087 3,238,218 Provision for (benefit from) income taxes (136,432) 438,035 Net income 2,120,519 2,800,183 Income attributable to non-controlling interests 85,924 562,280 Net income attributable to Consolidated Water Co. Ltd. stockholders $ 2,034,595 $ 2,237,903 Basic earnings per common share attributable to Consolidated Water Co. Ltd. common stockholders $ 0.14 $ 0.15 Diluted earnings per common share attributable to Consolidated Water Co. Ltd. common stockholders $ 0.14 $ 0.15 Weighted average number of common shares used in the determination of: Basic earnings per share 14,783,380 14,718,757 Diluted earnings per share 14,864,125 14,764,169 |
Fair value measurements (Tables
Fair value measurements (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements, Recurring and Nonrecurring [Table Text Block] | The following table presents the Company’s fair value hierarchy for assets and liabilities measured at fair value as of March 31, 2016 and December 31, 2015: March 31, 2016 Level 1 Level 2 Level 3 Total Assets Recurring Certificate of deposit $ - $ 5,637,538 $ - $ 5,637,538 Nonrecurring Investment in OC-BVI $ - $ - $ 4,578,060 $ 4,578,060 Liabilities Recurring Net liability arising from put/call options $ - $ - $ 383,000 $ 383,000 December 31, 2015 Level 1 Level 2 Level 3 Total Assets Recurring Restricted cash $ 428,203 $ - $ - $ 428,203 Certificate of deposit - 5,637,538 - 5,637,538 Total recurring $ 428,203 $ 5,637,538 $ - $ 6,065,741 Nonrecurring Investment in OC-BVI $ - $ - $ 4,548,271 $ 4,548,271 |
Fair Value Measurements, Nonrecurring [Table Text Block] | The activity for Level 3 financial instruments for the three months ended March 31, 2016 was as follows: Investment in OC-BVI Balance as of December 31, 2015 $ 4,548,271 Profit sharing and equity from earnings of OC-BVI 79,789 Distributions received from OC-BVI - Impairment of investment in OC-BVI (See Note 7) (50,000) Balance as of March 31, 2016 $ 4,578,060 Net liability arising from put/call options (1) Balance as of December 31, 2015 $ - Net liability arising from put/call options 383,000 Balance as of March 31, 2016 $ 383,000 (1) The net liability arising from put/call options is included in the accompanying condensed consolidated balance sheets within other liabilities as of March 31, 2016. |
Segment information (Tables)
Segment information (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Segment Reporting [Abstract] | |
Schedule of Segment Reporting Information, by Segment [Table Text Block] | The Company’s segments are strategic business units that are managed separately because, while all segments derive their revenues from water-related activities, each segment sells different products and/or services, serves customers with distinctly different needs and generates different gross profit margins. Three Months Ended March 31, 2016 Retail Bulk Services Total Revenues $ 5,970,238 $ 7,265,293 $ 799,241 $ 14,034,772 Cost of revenues 2,629,674 4,610,324 617,743 7,857,741 Gross profit 3,340,564 2,654,969 181,498 6,177,031 General and administrative expenses 2,897,861 435,896 1,127,229 4,460,986 Income (loss) from operations $ 442,703 $ 2,219,073 $ (945,731) 1,716,045 Other income (expense), net 389,557 Income before income taxes 2,105,602 Provision for (benefit from) income taxes (73,269) Net income 2,178,871 Income attributable to non-controlling interests 124,230 Net income attributable to Consolidated Water Co. Ltd. stockholders $ 2,054,641 Depreciation and amortization expenses for the three months ended March 31, 2016 for the retail, bulk and services segments were $ 587,726 827,389 239,707 Three Months Ended March 31, 2015 Retail Bulk Services Total Revenues $ 6,135,638 $ 8,382,316 $ 148,158 $ 14,666,112 Cost of revenues 2,766,863 5,466,060 284,887 8,517,810 Gross profit (loss) 3,368,775 2,916,256 (136,729) 6,148,302 General and administrative expenses 2,898,415 417,364 577,187 3,892,966 Income (loss) from operations $ 470,360 $ 2,498,892 $ (713,916) 2,255,336 Other income, net (219,557) Net income 2,035,779 Income attributable to non-controlling interests 114,518 Net income attributable to Consolidated Water Co. Ltd. stockholders $ 1,921,261 Depreciation and amortization expenses for the three months ended March 31, 2015 for the retail, bulk and services segments were $ 590,040 794,725 22,474 As of March 31, 2016 Retail Bulk Services Total Accounts receivable, net $ 2,684,520 $ 9,567,044 $ 1,547,635 $ 13,799,199 Property plant and equipment, net $ 24,914,329 $ 27,661,157 $ 2,242,317 $ 54,817,803 Construction in progress $ 2,668,571 $ 101,399 $ - $ 2,769,970 Intangibles, net $ - $ 649,604 $ 5,803,123 $ 6,452,727 Goodwill $ 1,170,511 $ 2,328,526 $ 8,035,211 $ 11,534,248 Land held for development $ - $ - $ 20,558,424 $ 20,558,424 Total assets $ 54,291,232 $ 75,334,227 $ 41,697,760 $ 171,323,219 As of December 31, 2015 Retail Bulk Services Total Accounts receivable, net $ 2,261,141 $ 6,231,626 $ 1,036,249 $ 9,529,016 Property plant and equipment, net $ 25,204,226 $ 28,421,906 $ 117,038 $ 53,743,170 Construction in progress $ 1,860,050 $ 68,560 $ - $ 1,928,610 Intangibles, net $ - $ 666,152 $ 105,659 $ 771,811 Goodwill $ 1,170,511 $ 2,328,526 $ - $ 3,499,037 Land held for development $ - $ - $ 20,558,424 $ 20,558,424 Total assets $ 54,561,577 $ 83,284,439 $ 23,729,010 $ 161,575,026 |
Earnings per share (Tables)
Earnings per share (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share, Basic and Diluted [Table Text Block] | The following summarizes information related to the computation of basic and diluted EPS for the three months ended March 31, 2016 and 2015. Three Months Ended March 31, 2016 2015 Net income attributable to Consolidated Water Co. Ltd. stockholders $ 2,054,641 $ 1,921,261 Less: preferred stock dividends (2,850) (2,763) Net income available to common shares in the determination of basic earnings per common share $ 2,051,791 $ 1,918,498 Weighted average number of common shares in the determination of basic earnings per common share attributable to Consolidated Water Co. Ltd. common stockholders 14,783,380 14,718,757 Plus: Weighted average number of preferred shares outstanding during the period 38,584 36,840 Potential dilutive effect of unexercised options 42,161 8,572 Weighted average number of shares used for determining diluted earnings per common share attributable to Consolidated Water Co. Ltd. common stockholders 14,864,125 14,764,169 |
Investment in OC-BVI (Tables)
Investment in OC-BVI (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Summarized Financial Information of Unconsolidated Equity Method Investment [Table Text Block] | Summarized financial information of OC-BVI is presented as follows: March 31, December 31, 2016 2015 Current assets $ 4,759,727 $ 4,323,792 Non-current assets 4,524,902 4,682,650 Total assets $ 9,284,629 $ 9,006,442 March 31, December 31, 2016 2015 Current liabilities $ 717,052 $ 584,116 Non-current liabilities 1,672,650 1,650,252 Total liabilities $ 2,389,702 $ 2,234,368 Three Months Ended March 31, 2016 2015 Revenues $ 936,884 $ 1,068,901 Cost of revenues 484,639 581,644 Gross profit 452,245 487,257 General and administrative expenses 260,542 244,342 Income from operations 191,703 242,915 Other income (expense), net (68,850) (52,649) Net income 122,853 190,266 Income attributable to non-controlling interests 18,641 17,614 Net income attributable to controlling interests $ 104,212 $ 172,652 |
Accounting policies (Details Te
Accounting policies (Details Textual) - USD ($) | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Accounting Policies [Line Items] | |||
Foreign Currency Transaction Gain (Loss), before Tax | $ 154,409 | $ (175,095) | |
Certificates of Deposit, at Carrying Value | 5,637,538 | $ 5,637,538 | |
Certificates of Deposit [Member] | |||
Accounting Policies [Line Items] | |||
Cash Equivalents, at Carrying Value | 9,500,000 | $ 13,600,000 | |
BELIZE | |||
Accounting Policies [Line Items] | |||
Deposits held in foreign bank | 4,600,000 | ||
BAHAMAS | |||
Accounting Policies [Line Items] | |||
Deposits held in foreign bank | 17,400,000 | ||
Certificates of Deposit, at Carrying Value | $ 5,600,000 |
Purchase of interest in Aerex25
Purchase of interest in Aerex Industries, Inc. (Details) - USD ($) | Feb. 11, 2016 | Mar. 31, 2016 | Mar. 31, 2015 |
Cash consideration | |||
Total cash consideration | $ 7,742,853 | $ 0 | |
Aerex Industries Inc [Member] | |||
Cash consideration | |||
Purchase price (excluding working capital) | $ 7,140,000 | ||
Working capital adjustment | 605,179 | ||
Cash acquired | (2,326) | ||
Total cash consideration | $ 7,742,853 |
Purchase of interest in Aerex26
Purchase of interest in Aerex Industries, Inc. (Details 1) - USD ($) | Mar. 31, 2016 | Feb. 11, 2016 | Dec. 31, 2015 |
Financial assets | $ 456,664 | ||
Inventory | 70,487 | ||
Costs and estimated earnings in excess of billings | 784,465 | ||
Property, plant and equipment | 2,159,401 | ||
Identifiable intangible assets | 5,900,000 | ||
Deferred tax liability | (2,451,298) | ||
Accounts payable and accrued liabilities | (116,893) | ||
Net liability arising from put/call options | (383,000) | ||
Total identifiable net assets | 6,419,826 | ||
Non-controlling interest in Aerex | (6,712,184) | ||
Goodwill | $ 11,534,248 | 8,035,211 | $ 3,499,037 |
Total | $ 7,742,853 |
Purchase of interest in Aerex27
Purchase of interest in Aerex Industries, Inc. (Details 2) | Feb. 11, 2016USD ($) |
Business Acquisition [Line Items] | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 5,900,000 |
Trade Names [Member] | |
Business Acquisition [Line Items] | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 1,400,000 |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 15 years |
Noncompete Agreements [Member] | |
Business Acquisition [Line Items] | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 400,000 |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 5 years |
Certifications/programs [Member] | |
Business Acquisition [Line Items] | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 2,000,000 |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 3 years |
Customer backlog [Member] | |
Business Acquisition [Line Items] | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 100,000 |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 1 year |
Customer Relationships [Member] | |
Business Acquisition [Line Items] | |
Business Combination, Recognized Identifiable Assets Acquired and Liabilities Assumed, Finite-Lived Intangibles | $ 2,000,000 |
Acquired Finite-lived Intangible Assets, Weighted Average Useful Life | 4 years |
Purchase of interest in Aerex28
Purchase of interest in Aerex Industries, Inc. (Details 3) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Revenues | $ 14,566,024 | $ 20,573,746 |
Cost of revenues | 8,236,741 | 12,793,952 |
Gross profit | 6,329,283 | 7,779,794 |
General and administrative expenses | 4,736,257 | 4,325,631 |
Income from operations | 1,593,026 | 3,454,163 |
Other income (expense), net | 391,061 | (215,945) |
Income before income taxes | 1,984,087 | 3,238,218 |
Provision for (benefit from) income taxes | (136,432) | 438,035 |
Net income | 2,120,519 | 2,800,183 |
Income attributable to non-controlling interests | 85,924 | 562,280 |
Net income attributable to Consolidated Water Co. Ltd. stockholders | $ 2,034,595 | $ 2,237,903 |
Basic earnings per common share attributable to Consolidated Water Co. Ltd. common stockholders (in dollars per share) | $ 0.14 | $ 0.15 |
Diluted earnings per common share attributable to Consolidated Water Co. Ltd. common stockholders (in dollars per share) | $ 0.14 | $ 0.15 |
Weighted average number of common shares used in the determination of: | ||
Basic earnings per share (in shares) | 14,783,380 | 14,718,757 |
Diluted earnings per share (in shares) | 14,864,125 | 14,764,169 |
Purchase of interest in Aerex29
Purchase of interest in Aerex Industries, Inc. (Details Texual) - USD ($) | Feb. 11, 2016 | Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 |
Notes Payable, Related Parties, Current | $ 490,000 | $ 0 | ||
General and Administrative Expense, Total | $ 4,460,986 | $ 3,892,966 | ||
Shareholders Agreement [Member] | ||||
Debt Instrument, Maturity Date | Aug. 10, 2016 | |||
Debt Instrument, Interest Rate, Stated Percentage | 1.00% | |||
CW Holdings [Member] | Shareholders Agreement [Member] | ||||
Notes Payable, Related Parties, Current | $ 490,000 | |||
Donnick [Member] | Shareholders Agreement [Member] | ||||
Notes Payable, Related Parties, Current | 510,000 | |||
Aerex Industries Inc [Member] | ||||
Business Acquisition, Percentage of Voting Interests Acquired | 51.00% | |||
Business Combination, Consideration Transferred, Total | $ 7,700,000 | |||
Business Combination, Pro Forma Information, Revenue of Acquiree since Acquisition Date, Actual | 619,000 | |||
Business Combination, Pro Forma Information, Earnings or Loss of Acquiree since Acquisition Date, Actual | $ 22,000 | |||
General and Administrative Expense, Total | $ 83,500 | |||
Aerex Industries Inc [Member] | Thomas Donnick, Jr [Member] | ||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 49.00% |
Fair value measurements (Detail
Fair value measurements (Details) - USD ($) | Mar. 31, 2016 | Dec. 31, 2015 | |
Recurring | |||
Restricted cash | $ 0 | $ 428,203 | |
Certificate of deposit | 5,637,538 | 5,637,538 | |
Total recurring | 6,065,741 | ||
Nonrecurring | |||
Investment in OC-BVI | 4,578,060 | 4,548,271 | |
Recurring | |||
Net liability arising from put/call options | 383,000 | ||
Fair Value, Inputs, Level 1 [Member] | |||
Recurring | |||
Restricted cash | 428,203 | ||
Certificate of deposit | 0 | 0 | |
Total recurring | 428,203 | ||
Nonrecurring | |||
Investment in OC-BVI | 0 | 0 | |
Recurring | |||
Net liability arising from put/call options | 0 | ||
Fair Value, Inputs, Level 2 [Member] | |||
Recurring | |||
Restricted cash | 0 | ||
Certificate of deposit | 5,637,538 | 5,637,538 | |
Total recurring | 5,637,538 | ||
Nonrecurring | |||
Investment in OC-BVI | 0 | 0 | |
Recurring | |||
Net liability arising from put/call options | 0 | ||
Fair Value, Inputs, Level 3 [Member] | |||
Recurring | |||
Restricted cash | 0 | ||
Certificate of deposit | 0 | 0 | |
Total recurring | 0 | ||
Nonrecurring | |||
Investment in OC-BVI | 4,578,060 | 4,548,271 | |
Recurring | |||
Net liability arising from put/call options | [1] | $ 383,000 | $ 0 |
[1] | The net liability arising from put/call options is included in the accompanying condensed consolidated balance sheets within other liabilities as of March 31, 2016. |
Fair value measurements (Deta31
Fair value measurements (Details 1) - USD ($) | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | ||
Investment in OC-BVI | |||
Balance as of December 31, 2015 | $ 4,548,271 | ||
Impairment of investment in OC-BVI (See Note 7) | 50,000 | $ 310,000 | |
Balance as of March 31, 2016 | 4,578,060 | ||
Net liability arising from put/call options | |||
Balance as of March 31, 2016 | 383,000 | ||
Fair Value, Inputs, Level 3 [Member] | |||
Investment in OC-BVI | |||
Balance as of December 31, 2015 | 4,548,271 | ||
Profit sharing and equity from earnings of OC-BVI | 79,789 | ||
Distributions received from OC-BVI | 0 | ||
Impairment of investment in OC-BVI (See Note 7) | (50,000) | ||
Balance as of March 31, 2016 | 4,578,060 | ||
Net liability arising from put/call options | |||
Balance as of December 31, 2015 | [1] | 0 | |
Net liability arising from put/call options | [1] | 383,000 | |
Balance as of March 31, 2016 | [1] | $ 383,000 | |
[1] | The net liability arising from put/call options is included in the accompanying condensed consolidated balance sheets within other liabilities as of March 31, 2016. |
Segment information (Details)
Segment information (Details) - USD ($) | 3 Months Ended | |||
Mar. 31, 2016 | Mar. 31, 2015 | Feb. 11, 2016 | Dec. 31, 2015 | |
Segment Reporting Information [Line Items] | ||||
Revenues | $ 14,034,772 | $ 14,666,112 | ||
Cost of revenues | 7,857,741 | 8,517,810 | ||
Gross profit | 6,177,031 | 6,148,302 | ||
General and administrative expenses | 4,460,986 | 3,892,966 | ||
Income (loss) from operations | 1,716,045 | 2,255,336 | ||
Other income (expense), net | 389,557 | (219,557) | ||
Income before income taxes | 2,105,602 | 2,035,779 | ||
Provision for (benefit from) income taxes | (73,269) | 0 | ||
Net income | 2,178,871 | 2,035,779 | ||
Income attributable to non-controlling interests | 124,230 | 114,518 | ||
Net income attributable to Consolidated Water Co. Ltd. stockholders | 2,054,641 | 1,921,261 | ||
Accounts receivable, net | 13,799,199 | $ 9,529,016 | ||
Property plant and equipment, net | 54,817,803 | 53,743,170 | ||
Construction in progress | 2,769,970 | 1,928,610 | ||
Intangibles, net | 6,452,727 | 771,811 | ||
Goodwill | 11,534,248 | $ 8,035,211 | 3,499,037 | |
Land held for development | 20,558,424 | 20,558,424 | ||
Total assets | 171,323,219 | 161,575,026 | ||
Retail [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 5,970,238 | 6,135,638 | ||
Cost of revenues | 2,629,674 | 2,766,863 | ||
Gross profit | 3,340,564 | 3,368,775 | ||
General and administrative expenses | 2,897,861 | 2,898,415 | ||
Income (loss) from operations | 442,703 | 470,360 | ||
Accounts receivable, net | 2,684,520 | 2,261,141 | ||
Property plant and equipment, net | 24,914,329 | 25,204,226 | ||
Construction in progress | 2,668,571 | 1,860,050 | ||
Intangibles, net | 0 | 0 | ||
Goodwill | 1,170,511 | 1,170,511 | ||
Land held for development | 0 | 0 | ||
Total assets | 54,291,232 | 54,561,577 | ||
Bulk [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 7,265,293 | 8,382,316 | ||
Cost of revenues | 4,610,324 | 5,466,060 | ||
Gross profit | 2,654,969 | 2,916,256 | ||
General and administrative expenses | 435,896 | 417,364 | ||
Income (loss) from operations | 2,219,073 | 2,498,892 | ||
Accounts receivable, net | 9,567,044 | 6,231,626 | ||
Property plant and equipment, net | 27,661,157 | 28,421,906 | ||
Construction in progress | 101,399 | 68,560 | ||
Intangibles, net | 649,604 | 666,152 | ||
Goodwill | 2,328,526 | 2,328,526 | ||
Land held for development | 0 | 0 | ||
Total assets | 75,334,227 | 83,284,439 | ||
Services [Member] | ||||
Segment Reporting Information [Line Items] | ||||
Revenues | 799,241 | 148,158 | ||
Cost of revenues | 617,743 | 284,887 | ||
Gross profit | 181,498 | (136,729) | ||
General and administrative expenses | 1,127,229 | 577,187 | ||
Income (loss) from operations | (945,731) | $ (713,916) | ||
Accounts receivable, net | 1,547,635 | 1,036,249 | ||
Property plant and equipment, net | 2,242,317 | 117,038 | ||
Construction in progress | 0 | 0 | ||
Intangibles, net | 5,803,123 | 105,659 | ||
Goodwill | 8,035,211 | 0 | ||
Land held for development | 20,558,424 | 20,558,424 | ||
Total assets | $ 41,697,760 | $ 23,729,010 |
Segment information (Details Te
Segment information (Details Textual) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Retail [Member] | ||
Segment Reporting Information [Line Items] | ||
Depreciation, Depletion and Amortization | $ 587,726 | $ 590,040 |
Bulk [Member] | ||
Segment Reporting Information [Line Items] | ||
Depreciation, Depletion and Amortization | 827,389 | 794,725 |
Services [Member] | ||
Segment Reporting Information [Line Items] | ||
Depreciation, Depletion and Amortization | $ 239,707 | $ 22,474 |
Earnings per share (Details)
Earnings per share (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Earnings Per Share [Line Items] | ||
Net income attributable to Consolidated Water Co. Ltd. stockholders | $ 2,054,641 | $ 1,921,261 |
Less: preferred stock dividends | (2,850) | (2,763) |
Net income available to common shares in the determination of basic earnings per common share | $ 2,051,791 | $ 1,918,498 |
Weighted average number of common shares in the determination of basic earnings per common share attributable to Consolidated Water Co. Ltd. common stockholders Plus: | 14,783,380 | 14,718,757 |
Weighted average number of preferred shares outstanding during the period | 38,584 | 36,840 |
Potential dilutive effect of unexercised options | 42,161 | 8,572 |
Weighted average number of shares used for determining diluted earnings per common share attributable to Consolidated Water Co. Ltd. common stockholders | 14,864,125 | 14,764,169 |
Investment in OC-BVI (Details)
Investment in OC-BVI (Details) - Ocean Conversion (BVI) Ltd [Member] - USD ($) | Mar. 31, 2016 | Dec. 31, 2015 |
Condensed Balance Sheet Statements, Captions [Line Items] | ||
Current assets | $ 4,759,727 | $ 4,323,792 |
Non-current assets | 4,524,902 | 4,682,650 |
Total assets | 9,284,629 | 9,006,442 |
Current liabilities | 717,052 | 584,116 |
Non-current liabilities | 1,672,650 | 1,650,252 |
Total liabilities | $ 2,389,702 | $ 2,234,368 |
Investment in OC-BVI (Details 1
Investment in OC-BVI (Details 1) - Ocean Conversion (Bvi) Ltd [Member] - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Income attributable to non-controlling interests | ||
Revenues | $ 936,884 | $ 1,068,901 |
Cost of revenues | 484,639 | 581,644 |
Gross profit | 452,245 | 487,257 |
General and administrative expenses | 260,542 | 244,342 |
Income from operations | 191,703 | 242,915 |
Other income (expense), net | (68,850) | (52,649) |
Net income | 122,853 | 190,266 |
Income attributable to non-controlling interests | 18,641 | 17,614 |
Net income attributable to controlling interests | $ 104,212 | $ 172,652 |
Investment in OC-BVI (Details T
Investment in OC-BVI (Details Textual) | 3 Months Ended | 12 Months Ended | 108 Months Ended | |||||
Mar. 31, 2016USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2009USD ($)gal | Dec. 31, 2007USD ($)gal | Dec. 31, 2003USD ($) | Dec. 31, 2015USD ($) | Jun. 30, 2012USD ($) | Mar. 04, 2010gal | |
Schedule of Investments [Line Items] | ||||||||
Equity Method Investment, Ownership Percentage | 43.53% | |||||||
Equity Method Investments Voting Shares Percentage | 50.00% | |||||||
Equity Method Investment, Interest In Profit Percentage | 45.00% | |||||||
Equity Method Investment, Other than Temporary Impairment | $ 50,000 | $ 310,000 | ||||||
Equity Method Investments | 4,578,060 | $ 4,548,271 | ||||||
Intangible assets, net | 6,452,727 | 771,811 | ||||||
Income (Loss) from Equity Method Investments | 45,364 | 75,155 | ||||||
Profit Loss From Subsidiaries | 34,425 | 26,325 | ||||||
Sales Revenue, Services, Net | 799,241 | 148,158 | ||||||
Due from Related Parties | 40,784 | 23,803 | ||||||
Bar Bay plant [Member] | ||||||||
Schedule of Investments [Line Items] | ||||||||
Assets that comprise Bar Bay plant | 4,300,000 | |||||||
1990 Agreement [Member] | ||||||||
Schedule of Investments [Line Items] | ||||||||
Cost to Expand Production Capacity of Plant | $ 4,700,000 | |||||||
Bar Bay Agreement [Member] | ||||||||
Schedule of Investments [Line Items] | ||||||||
Delivery Terms, Volume of water per day | gal | 600,000 | |||||||
Ocean Conversion (BVI) Ltd [Member] | ||||||||
Schedule of Investments [Line Items] | ||||||||
Equity Method Investments | 4,578,060 | 4,548,271 | ||||||
Loss Contingency, Damages Awarded, Value | $ 10,400,000 | |||||||
Income (Loss) from Equity Method Investments | 45,364 | 75,155 | ||||||
Profit Loss From Subsidiaries | 34,425 | 26,325 | ||||||
Ocean Conversion (BVI) Ltd [Member] | Bar Bay plant [Member] | ||||||||
Schedule of Investments [Line Items] | ||||||||
Equity Method Investments | 4,600,000 | |||||||
Equity Method Investment, Difference Between Carrying Amount and Underlying Equity | 850,000 | |||||||
Ocean Conversion (BVI) Ltd [Member] | 1990 Agreement [Member] | ||||||||
Schedule of Investments [Line Items] | ||||||||
Loss Contingency, Damages Sought, Value | $ 4,700,000 | |||||||
Ocean Conversion (BVI) Ltd [Member] | Management Service [Member] | ||||||||
Schedule of Investments [Line Items] | ||||||||
Intangible assets, net | 83,123 | $ 105,659 | ||||||
Sales Revenue, Services, Net | 138,756 | $ 128,775 | ||||||
Baughers Bay [Member] | ||||||||
Schedule of Investments [Line Items] | ||||||||
Purchase Price Agreed for Plant Under Agreement | $ 1,420,000 | $ 1,420,000 | ||||||
Plant Capacity | gal | 1,700,000 | |||||||
Bar Bay [Member] | ||||||||
Schedule of Investments [Line Items] | ||||||||
Plant Capacity | gal | 720,000 |
N.S.C. Agua, S.A. de C.V. (Deta
N.S.C. Agua, S.A. de C.V. (Details Textual) gal in Millions | 1 Months Ended | 3 Months Ended | 12 Months Ended | 36 Months Ended | ||||||||||
Nov. 30, 2015gal | Feb. 28, 2014USD ($) | May. 31, 2013USD ($) | Nov. 30, 2012USD ($)m² | Feb. 29, 2012USD ($) | May. 31, 2010gal | Mar. 31, 2016USD ($) | Mar. 31, 2015USD ($) | Mar. 31, 2014USD ($) | Dec. 31, 2015USD ($)gal | Dec. 31, 2015MXNgal | Dec. 31, 2013USD ($)gal | Dec. 31, 2014USD ($) | Dec. 31, 2015MXN | |
Schedule of Investments [Line Items] | ||||||||||||||
General and administrative expenses | $ 4,460,986 | $ 3,892,966 | ||||||||||||
Assets, Total | 171,323,219 | $ 161,575,026 | ||||||||||||
Liabilities, Total | 15,201,031 | 13,379,921 | ||||||||||||
Legal Fees | 196,000 | |||||||||||||
Option agreement [Member] | ||||||||||||||
Schedule of Investments [Line Items] | ||||||||||||||
Payments To Enter Option Agreement | $ 300,000 | |||||||||||||
Mexican Tax Authority [Member] | ||||||||||||||
Schedule of Investments [Line Items] | ||||||||||||||
Income Tax Examination, Estimate of Possible Loss | 428,203 | MXN 7,367,875 | ||||||||||||
N S C Agua [Member] | ||||||||||||||
Schedule of Investments [Line Items] | ||||||||||||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 50.00% | |||||||||||||
Total Percentage Of Ownership Interest In An Acquired Company | 99.90% | |||||||||||||
Seawater Reverse Osmosis Desalination Plant Per Day Processing Capacity | gal | 100 | 100 | ||||||||||||
General and administrative expenses | 767,000 | $ 537,000 | ||||||||||||
Further Required Payment As Compensation For Operation and Maintenance | $ 500,000 | |||||||||||||
Lease Term | 20 years | |||||||||||||
Assets, Total | 22,000,000 | 22,000,000 | ||||||||||||
Liabilities, Total | $ 502,000 | $ 488,000 | ||||||||||||
Payments for Compensation for Operation and Maintenance | $ 350,000 | |||||||||||||
Operating Leases, Rent Expense per month | $ 20,000 | |||||||||||||
Area of Land | m² | 5,000 | |||||||||||||
Payments to Acquire Land | $ 20,600,000 | |||||||||||||
N S C Agua [Member] | First Phase [Member] | ||||||||||||||
Schedule of Investments [Line Items] | ||||||||||||||
Seawater Reverse Osmosis Desalination Plant Per Day Processing Capacity | gal | 50 | 50 | 50 | |||||||||||
N S C Agua [Member] | Second Phase [Member] | ||||||||||||||
Schedule of Investments [Line Items] | ||||||||||||||
Seawater Reverse Osmosis Desalination Plant Per Day Processing Capacity | gal | 50 | 50 | 50 | |||||||||||
N S C Agua [Member] | Option agreement [Member] | ||||||||||||||
Schedule of Investments [Line Items] | ||||||||||||||
Repayment of inter-company loan payable | $ 5,700,000 | |||||||||||||
Total Voting Interest Percentage After Conversion Of Loan | 99.90% | |||||||||||||
Percentage of Voting Interest Acquired through Option Agreement | 25.00% | |||||||||||||
Payments For Option Exercised | $ 1,000,000 | |||||||||||||
N S C Agua [Member] | Mexican Tax Authority [Member] | Letter of Credit [Member] | ||||||||||||||
Schedule of Investments [Line Items] | ||||||||||||||
Irrevocable letter of credit | $ 428,203 | MXN 7,367,875 | ||||||||||||
NSA [Member] | ||||||||||||||
Schedule of Investments [Line Items] | ||||||||||||||
Noncontrolling Interest, Ownership Percentage by Noncontrolling Owners | 50.00% |
Contingencies (Details Textual)
Contingencies (Details Textual) | 3 Months Ended | |||
Mar. 31, 2016USD ($)gal | Mar. 31, 2015USD ($) | Dec. 31, 2015USD ($) | Jul. 29, 2011gal | |
Commitments And Contingencies [Line Items] | ||||
Cayman Water Retail Operations, Percentage Of Gross Profit | 56.00% | 57.00% | ||
Cayman Water Retail Operations, Percentage Of Revenue | 42.00% | 41.00% | ||
Operating Income (Loss) | $ 1,716,045 | $ 2,255,336 | ||
Property, plant and equipment, net | $ 54,817,803 | $ 53,743,170 | ||
Royalty Percentage | 7.50% | |||
Cw Belize [Member] | ||||
Commitments And Contingencies [Line Items] | ||||
Delivery Terms, Volume of water per day | gal | 450,000 | |||
CW-Bahamas Windsor Plant [Member] | ||||
Commitments And Contingencies [Line Items] | ||||
Revenue, Net | $ 1,300,000 | 1,500,000 | ||
Delivery Terms Volume Of Water Per Week | gal | 16,800,000 | |||
CW Bali [Member] | ||||
Commitments And Contingencies [Line Items] | ||||
Plant Capacity | gal | 790,000 | |||
Operating Income (Loss) | $ (147,000) | $ (161,000) | ||
Property, plant and equipment, net | $ 3,100,000 |