GWRS - Earnings call transcript Q2 2019 | Global Water Resources, Inc.

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good morning, ladies and gentlemen. Thank you for standing by. Welcome to the Global Water Resources, Inc. 2019 Second Quarter Conference Call. At this time, all participants are in listen-only mode.

will question-and-answer we presentation, the conduct session. a Following that you to will be up for at provided Instructions queue time for questions. would recorded XXXX [Operator call I like everyone remind Instructions] that is being X:XX on at X, August p.m. to this Eastern Time.

conference like President Krupa, Please ahead. the Controller. to Heather I would turn over now go to Vice and

Heather Krupa

on by Yesterday our XXXX available second morning, thank for website you which issued Good our a joining us of financial we results press www.gwresources.com. everyone, and on release, copy today's call. at quarter is

Speaking Ron at Mr. Mike financial events the Mr. is will Liebman end summarize Mr. Fleming, today which Executive President for review and call. the of key Officer; Liebman, Fleming results be available and for and of the the Officer. following will Chief the the quarter, Chief questions quarter. Financial Liebman Fleming will Mr.

remind I events. other number current certain forward-looking risks and Such factors statements to the Before differ reflect may uncertainties, cause results materially in of and that we regarding to presented like forward-looking projections include those company's you from involve actual begin, estimates a today forward-looking estimates, statements contained assumptions statements. statements. that the assumptions, would could information These expectations, future

forward-looking not undue to investors of Accordingly cautioned are reflect reliance statements, on management's date and place future are of performance. any hereof which the as views not guarantees

at may results, within and filings read XX-K please included www.sec.gov. available that future with Form the Factors affect of regarding Financial of SEC. Analysis Discussion filed factors Condition and latest Such Risk For Management's additional and are information our the Operations, sections Results

today's be call. Certain included may within non-GAAP measures

otherwise our comparable available dollars. tables see earnings in a U.S. release, amounts which in Unless of are included the on GAAP measures, financial please measures stated, discussed the For reconciliation these yesterday's is website. all to

turn now Fleming. the Mr. Ron to call will over I

Ron Fleming

and for us Thank morning, Good today. you, joining you Heather. thank everyone,

will add Mike going XXXX. in first Those pleased include, the We operational further earnings financial highlights employee and streak. compliance second incident for the focus of I let are safety to very the to quarter we detail included non-recordable highlights. our Liebman on foremost, quarter, report I'm our extended on and regulatory the and in results the highlights release

our the over achieved yesterday XXX having staff has days our safety violation it mark a or two-year X,XXX recordable nearly Also Just years. past days, accident. now X.X last without consecutive been compliance since

These both exceptional and show health achievements deliver employees the dedication we safety, operationally. shown remarkable the financially our towards performance of and as and care public

area appointed it Pinal the Our Authority. and the County County development Director serves for interest. of occur PCWAA, growth the of benefit the of significant augmentation as the resource large as Pinal in Augmentation and Water known material was to of where all for Board Lenderking, a partner Pinal of Area, Global where portion users Management Water to and expected Water resources is Jake as has Active Resources, is the water known, utility a

X-year We organic with the June Further, highlight that remains of extension today -- And wanted up finally at $X growth. XX, to permit connections growth three total connections company's revolving secured X.X% credit X.X% a to year revolving strategy. to XX,XXX That credit. up support to sorry period. million a in XXXX of unused increased line the line active to I

to in dwelling single-family XX,XXX over or permits For Pinal up Maricopa and XXXX. XXXX, XX% counties units were

XX,XXX XXXX by see projected with dwelling approximately followed single-family permits to strong remains and in forecast XXXX. The XX,XXX unit

very be the Maricopa submarket continues for the strong. Importantly, of data to City

that market time year. a over in single since was the collapse in over reminder, in XXXX the XXXX As we single-family X,XXX with permit up issued. XXXX This was a XX% dwelling X,XXX permits housing realized growth unit permits first

supports in our that exists our the or new meet Today, throughout of and on This service if acceleration share growth is Metro-Phoenix, market the and we homes Maricopa sustained exceed on get capacity larger mark appears long-stated larger will area. in to that a position track based it again. amount XXXX, infrastructure lot continues this of

over year-to-date to the financial and while service and will approach reliable Mike our to our Before continue long-term disciplined call I a to sustainable provide out to and following review Water turning lay means. partners, primary second to growth value again to Global creation mandates through taking the primary quarter wanted and objectives. to meet our performance, customers safe,

work efficiencies earnings creating by growth, operational grow driving while to top line expenses. managing will We and revenue controllable

necessary. We will capital investments, if make prudent

accretive opportunities. new And We greenfield pursue our consolidation platform expand benefits. will finally, with we utility acquisitions will via

Accretive and to and pursue tuck-in big continue are position core similar such we to our of assets. small. as this strong both growth committed will regional opportunities, complement And the

Additionally, as by this whole to have as and our consolidation proven can help communities our a improve recent many privilege acquisitions, customers provide we and the industry serve. to benefits the

I will now turn to over call the Mike.

Mike Liebman

for Total revenue in $X.X were $X.X down to is ICFA revenues everyone. million, or recognized compared which was you, This XX.X% of million of was XXXX. XXXX that related QX Hello, quarter reoccurring. the Thank to the QX decrease Ron. primarily not

primarily addition XXXX Ranches connection in Regulated to Red million, an driven X% which of or second of acquisition increase the Turner were by and connection of This growth to the revenues compared XXXX. is the growth $X.X Rock. increase QX $XXX,XXX organic for quarter from is

Turner through $XX.X from regulated increase Similar reflects growth this organic Red XXXX by X.X%. driven of the connection to or compared Ranches the were This million, XXXX. to $XX.X million of the and connection primarily to is increase quarter revenues in addition Year-to-date $XXX,XXX, Rock. growth QX an both through acquisition

of XXXX, fixed $X.XX can include $XXXXXX. This the million $XXX,XXX expenses in with cost as the the compensation acquisitions cost increase of as which contract $XXX,XXX an ranches revenue or deferred assets G&A XXXX. by million in services and $XXX,XXX, capital associated in an in tax be of and property increase and operating the Red Red $XXX,XXX $XXX,XXX operating Rock in primarily to acquisition This QX Turner driven additional expenses X.X%. increased maintenance and Notable was as to well compared associated changes in reduction were is increased Turner expense; depreciation by: increase and $X.XX of Operating increases; in by with by expense well plan, the attributed Ranches. as due expenditure as reduction lastly, Rock increased increase which to QX, expense

the income a to in offset contract, relatively received XXXX, of decrease decrease for primarily due QX $X.X The from Loop Valencia in earn-out million $XXX,XXX. million, was the expense other $X QX Other XXX million by was to XXXX of XXXX. of QX in Year-to-date of $X $X.X the other XXXX million was which through was compared flat compared XXXX. of to expense

income. to Turning net

Adjusted which For proceeds which FATHOM of XXX as the of QX or in was adjust in such and QX of XXXX, revenue equity non-recurring adjusted events -- had XXXX investment million for also for a quarter, expense Water up or and Global $XXX,XXX per $X.X to Loop XX.X% QX net share. option of $X.XX ICFA income compared EBITDA, $XXX,XXX is our XXXX. in of

Ron our like as up April organic growth to XX $X until Rock Adjusted Red was we as were of to of EBITDA extend XXXX. as Ranches. X.X%, primarily able Turner that in and from due remind mentioned million line well everyone credit, to I'd the growth acquisition the increases of

April Previously sorry, was It I'm XX of on April to we of previously extended of said to XXXX. to XXXX. on it -- was expire expire set XX XX XXXX April

So on line This line years extended update the two an results. unused. this is of concludes and additional currently XXXX our QX

pass the call now I'll back to Ron.

Ron Fleming

our by reductions is one-time continue reduction recognition The be our caused It very the federal earn-out, revenue Valencia which events and control. revenue Mike. slowdown growth of to top strong. you, and line connection of corporate are Global rate the Water's both excluding clear, and tax reform Thank beyond rates and

economic We handle our growth areas in the at applying expertise your and truly grow of and achieving water we service potentially remain in efficiency the our issues Water involved. new and as of we the and utilities water and investment high As this believe advance resource expanding and beneficial that stakeholders regional important our us development of to into support mission address appreciate be forefront platform Arizona management We throughout to we utility, to industry Global intend will beyond. consolidation. all

remarks. I to now This are answer questions. available prepared Thank and highlight you. Mike our your concludes

Operator

you. Thank

question now session question-and-answer Instructions] will the Sweeney ahead. [Operator begin Gerry from of go first comes The We Partners. Please Capital Roth

Gerry Sweeney

Mike. for my and Thanks call. taking Ron morning, good Hey,

Ron Fleming

Good morning, Gerry.

Mike Liebman

morning, Gerry. Good

Gerry Sweeney

XXXX -- even slow have saw obviously, a XXXX around in XXXX but it in Just permit And past late track June Maricopa, activity specifically and upon significantly XXXX. up almost growth single-family since bit a you questions, accelerated couple just we to XXXX. appears May to little seemed that XXXX rates early a bit touched over I little in in I residences guess comments. and permits your

there, not region it that Maybe happening further, have of very buildings, single-family ground I'm and gone permits, lots on going growth. not what's if bit outside extrapolate obviously maybe little you moving support into that's give to some future some a the infrastructure even maybe just growth can but of may the of businesses out some even maybe things nuance, well possible.

Mike Liebman

Gerry. Yeah. is Mike. This Thanks,

be just I'll bit slowdown seeing back So is seemed that you as of a are compared XXXX. percentage we a up. on hit that to see little QX the acceleration. bringing But QX numbers. to And

additional So and and in even seeing even it's we're -- at June X.X% the we're going July acceleration.

Maricopa. same happening we in So permit City you are are the and the of seeing correct activity

the turn give it color side, there. I'll to we're you business over on seeing on little Ron And what a of bit to

Ron Fleming

When like of that Maricopa. remote spot and XX,XXX Thanks they exactly think what of kind summer time, saw residents. for as important interest to XX,XXX there's point increase a of you City for When census and an Gerry, north we're this they that's seeing. so just is occurring commercial get certainly -- below last officially the type over the city XX,XXX. such that's did sweet Yeah. That's now last Mike. to of were growth the I Maricopa suburbs

city the are continuing ever population growth. our commercial in seeing development really history that's than expect with more along we we've And more seen there XX-year that right occurring. in We

Gerry Sweeney

much that know not movement comment the other any that can things that, front, got you've That's working then I some on you're but Got but it. sure And or on helpful. possible? other on cases you acquisition like it, just comments on I potentially question. and also if any things rate one I'm mean how

Mike Liebman

this Gerry is Mike. Yeah.

And to down with of we we real those. look are have acquisition continue dialogue and are are continue case here still rate we is so looking say at we'll well of nothing this the just point I'll in meaning But and true. to dedicating chase dialogues active There's discuss to at resources conversations folks. as opportunities. some So active we the anything but that to

Gerry Sweeney

question. final, then final And it. Got

revolver? other On rates the the major years, or of two anything extended the any to associated involved any changes with

Mike Liebman

same. the still That's no. No,

the still X.XX%. -- is everything LIBOR terms So plus

of kind left. what to that's front. to be in So that rate only one going able year we it just to about a were it three-year got extend get We versus nothing changed -- run was

So to that good couple it's have additional years.

Gerry Sweeney

it, Got good.

Okay, great. Appreciate guys. taking the call. Thanks

Ron Fleming

Gerry. Thanks,

Operator

the Fleming for This Ron question-and-answer would concludes over back any closing to now conference Mr. session. like turn to I the remarks.

Ron Fleming

thank speaking with care. you call Thank I would in you you, Water. your Global in look operator. Thank to again. all Take for this those to and we interest participating like forward

Operator

This concludes today's call. conference

You Thank participating a you your day. may disconnect lines. pleasant have and for

Global Water Resources (GWRS) 9 Aug 192019 Q2 Earnings call transcript