Segment information

9 Months Ended

Sep. 30, 2020

Segment information

Segment information

3. Segment information

The Company has four reportable segments: retail, bulk, services and manufacturing. The retail segment 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 and The Bahamas under long-term contracts. The services segment designs, constructs and sells water infrastructure and provides management and operating services to third parties. The manufacturing segment manufactures and services a wide range of custom and specialized water-related products applicable to commercial, municipal and industrial water production, supply and treatment. Consistent with prior periods, the Company records all non-direct general and administrative expenses in its retail business segment and does not allocate any of these non-direct expenses to its other three business segments.

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 (or loss) from operations. All intercompany transactions are eliminated for segment presentation purposes.

The Company’s segments are strategic business units that are managed separately because each segment sells different products and/or services, serves customers with distinctly different needs and generates different gross profit margins.

	Three Months Ended September 30, 2020
	Retail		Bulk		Services		Manufacturing		Total
Revenue	$	4,993,069	$	6,061,475	$	3,351,935	$	3,259,778	$	17,666,257
Cost of revenue		2,586,901		4,400,717		2,513,272		1,949,731		11,450,621
Gross profit		2,406,168		1,660,758		838,663		1,310,047		6,215,636
General and administrative expenses		3,367,802		382,662		728,829		330,723		4,810,016
Loss on asset dispositions and impairments, net		—		—		(984)		—		(984)
Income (loss) from operations	$	(961,634)	$	1,278,096	$	108,850	$	979,324		1,404,636
Other income, net										245,492
Income before income taxes										1,650,128
Benefit from income taxes										(263,165)
Net income from continuing operations										1,913,293
Income from continuing operations attributable to non-controlling interests										101,137
Net income from continuing operations attributable to Consolidated Water Co. Ltd. stockholders										1,812,156
Net loss from discontinued operations										(377,321)
Net income attributable to Consolidated Water Co. Ltd. stockholders									$	1,434,835

Depreciation and amortization expenses for the three months ended September 30, 2020 for the retail, bulk, services and manufacturing segments were $596,528, $971,914, $191,419 and $88,452, respectively.

	Three Months Ended September 30, 2019
	Retail		Bulk		Services		Manufacturing		Total
Revenue	$	6,271,220	$	6,449,757	$	95,980	$	3,072,282	$	15,889,239
Cost of revenue		2,945,586		4,269,739		31,601		1,933,333		9,180,259
Gross profit		3,325,634		2,180,018		64,379		1,138,949		6,708,980
General and administrative expenses		3,497,320		294,189		549		487,914		4,279,972
Gain on asset dispositions and impairments, net		6,518		500		—		—		7,018
Income (loss) from operations	$	(165,168)	$	1,886,329	$	63,830	$	651,035		2,436,026
Other income, net										216,896
Income before income taxes										2,652,922
Benefit from income taxes										(40,075)
Net income from continuing operations										2,692,997
Income attributable to non-controlling interests										433,235
Net income from continuing operations attributable to Consolidated Water Co. Ltd. stockholders										2,259,762
Net loss from discontinued operations										(532,710)
Net income attributable to Consolidated Water Co. Ltd. stockholders									$	1,727,052

Depreciation and amortization expenses for the three months ended September 30, 2019 for the retail, bulk, services and manufacturing segments were $617,671, $933,955, $0 and $214,751, respectively.

	Nine Months Ended September 30, 2020
	Retail		Bulk		Services		Manufacturing		Total
Revenue	$	18,216,797	$	18,368,156	$	9,942,748	$	10,951,524	$	57,479,225
Cost of revenue		8,343,018		12,906,606		7,418,305		6,852,196		35,520,125
Gross profit		9,873,779		5,461,550		2,524,443		4,099,328		21,959,100
General and administrative expenses		10,008,423		935,808		2,112,869		1,005,838		14,062,938
Gain on asset dispositions and impairments, net		—		200		3,801		—		4,001
Income (loss) from operations	$	(134,644)	$	4,525,942	$	415,375	$	3,093,490		7,900,163
Other income, net										533,710
Income before income taxes										8,433,873
Provision for income taxes										147,186
Net income from continuing operations										8,286,687
Income from continuing operations attributable to non-controlling interests										642,289
Net income from continuing operations attributable to Consolidated Water Co. Ltd. stockholders										7,644,398
Net loss from discontinued operations										(4,448,798)
Net income attributable to Consolidated Water Co. Ltd. stockholders									$	3,195,600

Depreciation and amortization expenses for the nine months ended September 30, 2020 for the retail, bulk, services and manufacturing segments were $1,796,588, $2,906,213, $562,756 and $296,926, respectively.

	Nine Months Ended September 30, 2019
	Retail		Bulk		Services		Manufacturing		Total
Revenue	$	19,941,395	$	20,502,121	$	287,349	$	10,452,158	$	51,183,023
Cost of revenue		8,753,948		13,992,452		198,614		7,013,977		29,958,991
Gross profit		11,187,447		6,509,669		88,735		3,438,181		21,224,032
General and administrative expenses		10,020,019		900,572		2,865		1,466,091		12,389,547
Gain on asset dispositions and impairments, net		401,088		47,000		—		—		448,088
Income from operations	$	1,568,516	$	5,656,097	$	85,870	$	1,972,090		9,282,573
Other income, net										518,031
Income before income taxes										9,800,604
Provision for income taxes										73,117
Net income from continuing operations										9,727,487
Income from continuing operations attributable to non-controlling interests										1,172,039
Net income from continuing operations attributable to Consolidated Water Co. Ltd. stockholders										8,555,448
Net income from discontinued operations										1,834,297
Net income attributable to Consolidated Water Co. Ltd. stockholders									$	10,389,745

Depreciation and amortization expenses for the nine months ended September 30, 2019 for the retail, bulk, services and manufacturing segments were $1,751,048, $2,858,081, $0 and $707,517, respectively.

	As of September 30, 2020
	Retail		Bulk		Services		Manufacturing		Total
Accounts receivable, net	$	2,374,722	$	18,609,023	$	1,598,836	$	1,828,747	$	24,411,328
Inventory, current and non-current	$	2,811,852	$	4,006,117	$	—	$	1,609,800	$	8,427,769
Property, plant and equipment, net	$	28,355,776	$	28,537,623	$	487,555	$	1,675,824	$	59,056,778
Construction in progress	$	298,468	$	31,737	$	—	$	143,302	$	473,507
Intangibles, net	$	—	$	—	$	3,369,722	$	991,111	$	4,360,833
Goodwill	$	1,170,511	$	1,948,875	$	5,320,416	$	4,885,211	$	13,325,013
Total segment assets	$	50,782,152	$	73,845,479	$	14,023,605	$	18,768,959	$	157,420,195
Assets of discontinued operations									$	23,047,739
Total assets									$	180,467,934

	As of December 31, 2019
	Retail		Bulk		Services		Manufacturing		Total
Accounts receivable, net	$	2,891,165	$	18,883,493	$	954,149	$	500,882	$	23,229,689
Inventory, current and non-current	$	2,668,902	$	3,628,443	$	—	$	1,394,588	$	7,691,933
Property, plant and equipment, net	$	29,177,718	$	30,281,647	$	158,358	$	1,621,029	$	61,238,752
Construction in progress	$	396,214	$	869,792	$	—	$	69,591	$	1,335,597
Intangibles, net	$	—	$	—	$	3,877,222	$	1,162,778	$	5,040,000
Goodwill	$	1,170,511	$	1,948,875	$	5,320,416	$	4,885,211	$	13,325,013
Total segment assets	$	65,554,640	$	69,423,770	$	13,170,155	$	14,854,557	$	163,003,122
Assets of discontinued operations									$	29,289,022
Total assets									$	192,292,144