Global Water(US:GWRS)2025-11-13 19:00Financial Data and Key Metrics Changes - Total revenue for Q3 2025 was $15.5 million, an increase of $1.2 million or 8.4% compared to Q3 2024 [13] - Year-to-date revenue increased by $2.8 million or 7% to $42.2 million [13] - Operating expenses for Q3 2025 were $12.6 million, up $2.3 million or 21.9% from Q3 2024 [13] - Net income for Q3 2025 was $1.7 million or $0.06 per diluted share, down from $2.9 million or $0.12 per diluted share in Q3 2024 [16] - Adjusted EBITDA for Q3 2025 was $7.8 million, a decrease of $0.4 million or 5% from Q3 2024 [17] Business Line Data and Key Metrics Changes - Total active service connections increased by 6.6% to 68,130 as of September 30, 2025 [9] - The annualized total active service connection growth rate, excluding the Tucson acquisition, was 3.3% [9] - The single-family dwelling unit market in the Phoenix area saw a 29% decrease in building permits in Q3 2025 compared to Q3 2024 [10] Market Data and Key Metrics Changes - The City of Maricopa was ranked sixth among the fastest-growing large municipalities in the U.S., with a population growth of 7.4% in 2024 [8] - The Highway 347 expansion project is expected to begin construction in fiscal year 2026, which will support the growth of the City of Maricopa [6] Company Strategy and Development Direction - The company aims for long-term value creation and strong total returns to shareholders through strategic acquisitions and infrastructure investments [4] - The Tucson acquisition is expected to generate around $1.5 million in annual revenue and is seen as immediately accretive [5] - The company is focused on integrating the newly acquired Tucson water systems and executing capital investment strategies [18] Management's Comments on Operating Environment and Future Outlook - Management acknowledged challenges such as high inflation impacting earnings growth but remains optimistic about future growth drivers [11] - The company expects a fair outcome from the ongoing rate case, which is anticipated to conclude in mid-2026 [19] - Management believes the new water legislation will drive growth in service areas and improve aquifer sustainability [5] Other Important Information - Year-to-date capital investments totaled $49.6 million for infrastructure improvements [9] - The company is in the middle of the rate case process, with further steps including formal written testimony and a hearing [18] Q&A Session Summary Question: Rate case completion timeline - Management confirmed that the rates are expected to change by mid-2026, potentially around July 1 [24] Question: Ag to Urban program impact - Management explained that the program allows for the conversion of agricultural water rights to municipal water supply without the need to purchase or lease rights, benefiting aquifer sustainability [26][28] Question: Regulatory proposal differences - Management clarified that the significant difference in proposed rates is due to ongoing processes and the inclusion of post-test year plant [32][33] Question: Expected rate base figure - Management confirmed that the expected rate base figure is still valid but not reported in quarterly financials [34][35]