GWRS - Earnings call transcript Q1 2024 | Global Water Resources, Inc.

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Operator

Greetings, ladies and gentlemen. Thank you for standing by. Welcome to the Global Resources, Inc. 2024 First Quarter Conference Call. [Operator Instructions] I would like to remind everyone that this call is being recorded on May 9, 2024 at 1 p.m. Time. Eastern

like President, conference ahead. Corporate now Ellsworth, to turn Vice Executive Affairs. to would over the Joanne I Please go

Joanne Ellsworth

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

events Chief today of the Financial Officer; Chief is Mike Officer; Liebman, summarize will Mike Ron Speaking quarter. will Chris the Fleming, Operating Krygier, review Executive key Ron President operational and Chief Officer. and the in Chris the financial at Corporation results quarter, quarter. will first for for Chris Ron, questions for end activity the of will be and review Mike available and the strategic initiatives call. Commission the Arizona

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

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

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

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

see the earnings in measures to on the For GAAP release, our a measures, available yesterday's comparable these included reconciliation please website. financial tables which is of

turn Ron. over to now will call the I

Ron Fleming

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

some for highlights. pleased very the report with XXXX. of are We I will start the first operational results quarter to

Total X.X%. quarter to annualized rate XX the connections the is growth increased XX,XXX The from of service prior. X.X% of end as months XXXX active

of higher trend face provide on regulated it's important in X.X%. organic to remained will up also regulated our our is rates growth higher So to growth even interest highlight and strong details the revenue continues drivers. while year-over-year growth the Mike that rates, revenue

Year-to-date, service. safe million $X.X improvements to reliable and invested we in into provide utilities existing have infrastructure

Finally, with we mandate, record. our are our and proud safety being health public top compliance very of

For significant the had quarter, streak X from events compliance and we our continuing XXXX prior.

these the growing welcoming resulting Per transaction from commission fact, this without on acquisition approval. with subsequent X Chris years city Tucson a to proud details of to announced X earlier also customers have water County. release compliance of transaction. and City was close. the around of We I we surpassed week, the event. companies Pima provide we the that family approximately look press now months we announce will X this the In with our forward means that city in utility significant the of of wanted reached to separate within Tucson and more was are the quarter Tucson, to X,XXX mention our partnership once to systems customers receive

and dwelling growth greater Phoenix in on core The area. customer ended further. what utilities unit metropolitan organic in discuss to single-family issued the is approximately want with I Now permits building XXXX going XX,XXX market our

permits. representing XXXX, issued Maricopa a from In realized single-family of For building XXX this X,XXX QX XXXX. XXXX, City permits, market building the XX% QX increase dwelling

this building a XXXX. represents For QX increase XXXX, this from market permits, realized and XXX% QX XXX

Maricopa. data So the City QX as you Phoenix permit XXXX in can strong see, of Metro both the and was

the the because inching back rates the is near housing in will of to it continued interest inflation significance term. hard up this fight, with on anticipate potential However, the have market

year rate shortage remains to approaching there keep an time, over Metro units with thus, retain that consensus in strong a Metro run Phoenix immigration per and will and job is growth. there pace a annual However, housing XX,XXX net Phoenix, housing

combination reported, large-scale businesses. a Maricopa This this more be be commercial single-family units and We and supplant and by dwelling complexes, the multifamily. believe as home note, retail the shift reduction City high-density dwelling is multifamily level, with On of a significant will there to growth. of at shift along demand met some single-family previously must occurring in in this notable

In in multifamily strong with City units unit QX data to permitted fact, XXXX. XXXX the the QX units was XXX Maricopa XXX housing in compared permitted of

XX%. an So XXX this represents or units of increase permitted

housing, requires number live, development. realize ahead, fact at in is of an pace Looking Metro projects Arizona play. stage some and to people continues continued immigration record is that Phoenix areas. projects The additional recreational multifamily booming for service more and net there a work of more commercial the to is This to and our in extremely and high multifamily places and at why large-scale accelerate economy

and was manufacturing year development been industrial an billion that with including This again, to expansions been will $XX.X in the $XX.X here. last and Intel TSMC eclipsed industry also all Additionally, the just at significant I additional state in the for the from best state planned say that explode single further made chip billion announcements the invested as there's boom has perspective, and last industrial economic just Previously, continues. continues invested year. was in XXXX time year. XXXX investment Arizona in XXXX,

things, and we acquired Nikola bullish the located Inland to or of potential in facilities these of future Corp service where continues land. remain Because & Procter Arizona unprecedented. Arizona occur what on Port area Gamble is Motor Frankly,

center City right Additionally, on large gave of the in to recently complex preparing Maricopa. Maricopa industrial very and announced a to they are of City public of the the presentation bring market

it of exciting the additional adjacent added railroad. the future, as with include a in In park corridor an acres come XXX there's information plans the to industrial to is on may rail that More an double industrial this be a project smart corridor. future. XXX acres Initial to

the multifamily considerable growth housing industrial and that these we years to all to that and commercial, strong this trends, to growth will organic come, large-scale all continues. on continue is Based believe the in in addition we see

and of we that elements these and growing in all environmental be we Global our and another challenging Tuning stewardship infrastructure. regulations water our of the customers aging the face and to incredible XXXX aggregating for regionalization will year realize benefits can utilities together, so wastewater mission scarcity, consolidation, advance of Water water as continue believe

with that, So the I will financial for turn highlights. over to Mike now call

Michael Liebman

decrease XXXX or in Hello, $X.X the was ICFA in XXXX. Ron. everyone. of Thanks, revenue QX to which attributable didn't to was Total in QX XX.X% revenue revenue first QX occur of XXXX. quarter down for $XX.X recognized was The that primarily million XXXX million, compared

QX XXXX, of wastewater compared was as X.X% Ron excludes by revenue, and X.X% were $X.X million or increased million XX.X%. for Operating to expenses $X well increase to is in as XXXX. the This or QX which Water approximately ICFA consumption. $XXX,XXX million compared connection $XX.X driven growth, organic QX QX an of XXXX for XXXX. increased revenue mentioned This

operating expense amortization is in in increased expense activation depreciation to and included of $XXX,XXX the attributable to Southwest open program, our the positions. which operating changes filling Notable $XXX,XXX, portion Increased to medical of plant. expense expenses and was of increase which tied expenditure related and a primarily cost by capital maintenance

grow. expense and higher increased utilities higher property we had we as which Additionally, taxes,

also open increased attributable filling higher had expense, which was increased to administrative medical by primarily of and regulatory We costs general positions $XXX,XXX, and expenses.

the QX lower at expense. of $XX discuss QX This in expense compared XXXX Buckeye to note was for we growth tied was Other $XXX,XXX, by Now which the million $XXX,XXX the income to offset executed higher expense and by reduction was XXXX. higher beginning interest from the income year. other expense the premium, driven of to

Net income was XXXX $X.XX per share. QX for $XXX,XXX diluted or

EBITDA, deferral adjusted our an as ratemaking stock as lastly, call, Southwest increase QX plant for mentioned such prematurely QX service noncash EBITDA to $X.X adjusts docket, previous plant compared of about talk purposes. Southwest included infrastructure which revenue as Adjusted part of $X.X million XXXX, was our nonrecurring items in as And we well $XXX,XXX million restricted or our XXXX, as as of that XXXX. ICFA to earnings I Now items for current was in plant discovered depreciation on as in such X.X% expense.

inadvertently in XXXX orders. these rates part as As XXXX XXXX costs were rate rate our result, a and as order included well our as of

to X monthly the revenues this Corporation then XX, staff an with Arizona requesting We reduce March $XX,XXX. filed Corporation and application met we a our bring by on April subsequently on Commission with would the Commission Arizona attention their that customer to approximately credit bill

resolving While this a it stakeholders, the issue believe to is resolution in outcome in we be positive all cannot shareholders. and exact be and our material, predicted amicably credit if is bill customers step of including first and a fair that way is could this approved,

review and call our XXXX the concludes financial results. strategic I'll for the initiatives update quarter. Chris on This now to quarter activity regulatory to our pass the first

Christopher Krygier

everyone. afternoon, good and Mike, you, Thank

front, of Arizona filings. the on different On a progress Corporation continued Commission number we

its turnaround we held held as and in weeks District week, settlement in law Saguaro this year, order First, the was after pretty hearing filing our before the The the XX. late our earlier as nearing recommended administrative on is April issued hearing went judge a conclusion, rate opinion expected, this their February approximately judge ago. case of agreement hearing a X fast

the before commission this heard and will January month. as X rates of be new next the case X judge's of next filed to If be on new Phase implemented X scheduled year rate is approves year. commission on the X the Phase July The of be rates would implemented recommendation

and XX-Q our there be final of outcome XX-K, case. no in the saw can you as of Lastly, assurance the

stakeholders the case, our into and Farmers with Next, this Farmers local and the for forthcoming case the work rate filing and case to We rate we underlying our preparing estimate the in Water summer. quarter, the continued system. discuss need also investment on testimony the meeting schedules continued the

our rate related, Lastly, our Palo largest our for undertaking are and Santa related filing utilities. ACC Cruz case efforts for companies, Verde XXXX we

Moving front. acquisition to the

and Tucson customers. the we the announced public you with acquisition X from As water from City press systems Ron which Tuesday's serve of X,XXX acquire a approximately release, will saw city, in heard new we whereby

proximity As saw the current in press Pima in these you our release, map located are County. in close to operations in the customers included

example, utility X Solindo customer crow from in less [ less flies than For Red our Rock community Rancho largest is than as from called the the Lyn-Lee miles X Del base, a utility. miles ] our

so that we will in evaluate Additionally, points X each are other to these area interconnecting certain future. the utilities close in utilities the

price. attractive us an additional This for completed, economies scale acquisition, of creates at if

to very are this speaks assets is as acquisition in very a acquisition municipal the relationships. Arizona, in excited our we To utility an community stakeholder by time. knowledge investor-owned of We long this first our believe

with month. later proud and file are approval application this that to we The the partner Arizona plan to We the regulatory to acquisition this by transition. is subject on Corporation city Commission,

additional the I'll update. to find my on This concludes pass can XX-Q. in Ron. now our back details You the acquisition call

Ron Fleming

Chris. you, Thank

certain headwinds. despite remains it are growth positioned well to So clear, we meaningful achieve

our As our expanding plan, Water execute remain of Management of industry and and water involved. and platform Total We to applying consolidation. and the be the all utilities new our intend expertise to stakeholders to our we forefront believe management efficiency growth advance our do we service will throughout regional areas beneficial mission at that achieving truly

of Water thrive. your Arizona We water Thank available Sun us remarks. resource important your economic the along investment address our We're to you. grow communities to appreciate concludes we answer matters Corridor, utility, now questions. and to support That Global highlight development prepared as and our allowing

Operator

first [Operator Capital. comes with Instructions] Sweeney ROTH Gerry question Our from

Gerard Sweeney

had a just Volume. I question.

weather organic a the X.X% was growth, or wetter or Volumes down growth, think, little So in during take X.X%, bit connection growth me X.X%. Phoenix actually, [indiscernible] I a and actually QX. I were, let thought there connection

dig there front of development, I mean, as more I great on that Just to more just I'm on in result, water off curious to is obviously, in anything but takes? something? a to degree. missing So terms want going if

Michael Liebman

a Yes. is It not Last wet was very Mike. was QX Gerry, 'XX wet. wet as pretty But QX. year this too. was but wet

that a increase of that's revenue occupancy partly was up that it as there as some X there so that a year attributing see to quarter, wasn't that. developments the come we of was nice pickup That's on maybe until pick some there little we We're are side. the multifamily to last what seeing to Farmers true So But this revenue in well. incremental be happening trickled continue multifamily. and month But built. really, is and included see is of result the as rates to in in in -- starting additional

Gerard Sweeney

to could And hit. helpful. curious [indiscernible] of much got this rate as at Super this rates potentially outline you gave point, to an us as you've Great. file, say can timing when then year. cases, believe, be cases. through And you the go how on and would those Palo later rate then Santa I Farmers long it this the Cruz, take Verde on year the What would next process

Christopher Krygier

Chris. is this Gerry, Yes,

through about the So to year filed. them process commission once we X estimate

but think commission. can of everything X accelerate obviously, about it we that, Now do as the turnaround to we we'll at year generally

this sometime filing file the we sometime approximately. then So Santa are in cases summer if Verde we Farmers Palo summer, Cruz, rates XXXX new XXXX. And

rate would approximately. XXXX And so mean you that

Gerard Sweeney

it. timing, then approved end. the nice the Got when that I acquisition, little a have with And potential Tucson is probably tuck-in Chris, ACC know them. could X Do on you for bit more why -- of timing purposes say, get on you should my little modeling there,

Christopher Krygier

Yes, good question, Gerry.

XX months commission for So we've been X approval. estimating to

means of commission. as but year, early so be And but at could probably the discretion this that ultimately year, as next the

as So an assumption we're here. X to what XX months using is

Gerard Sweeney

looked like was then And question. it. great the to Buckeye It Got premium along. quarter. it another continues chug last

into are insight that development in potentially? on or where any Just going and up things region comments

Michael Liebman

this strong. I strongest it's which to is to if year. And it we seen. from strong. about been quarter Gerry, $X about this north Mike. you're And we've come just sustainable. is our would had trend of that's in be million vantage continued I continues, point, It's stronger. continues get the talking probably for And mean, $XXX,XXX Yes. say quarter, the that

to seeing looking we're forward the So of rest year. out that how shakes the

Operator

to time, please over At I'd go now our session. like Fleming. this the Instructions] back this call [Operator to ahead. question-and-answer concludes Mr. Sir, turn

Ron Fleming

you, Thank operator.

soon. speaking thank and Global Just you Thanks. again for want participating to everybody forward on continued Resources. call to interest with in the Look your Water again

Operator

This call. concludes conference today's

day. disconnect your now you a lines. of may for and your have great participating, Thank rest You

Global Water Resources (GWRS) 9 May 242024 Q1 Earnings call transcript