Watlington profits climb on lower rainfall
Profits rose at Watlington Waterworks Ltd in 2015 as less rain fell.
The company said profit attributable to shareholders was $2.19 million, up from $2.08 million in 2014.
Revenue rose by $182,000 to $10.21 million, while administrative and expenses climbed to $5.4 million from $5.3 million.
In its directors’ report to shareholders, Watlington said 2015 was “the company’s strongest year since the onset of the recession”.
However, the company warned that its customers were likely to face price increases during the next year.
“Water sales improvements were due to increases in both bottled water sales and piped water sales,” Watlington stated. “The Utility Division did have a decrease in customers last year, despite expansion in the West End because of a cull of inactive services and customers leaving residences that were previously served by pipeline.
“However, sales were boosted by a 17 per cent decrease in rainfall compared to the previous year.”
The company is in the process of a long-term redevelopment of its Parsons Lane site and has commissioned a new bottling plant and warehouse with the aim of improving production and storage capacity.
Watlington said its investments in new seawater reverse osmosis membranes and an improved brackish water reverse osmosis plant had increased efficiency.
“This operations model allowed the company to hold prices for its products and services unchanged through the year 2015, which was good news for customers,” the company stated.
“There is only so much that can be done to hold the line on operating costs and with increased taxes and accrued inflation pressures over the past two years it is unlikely the company will go through another year without having to make some price adjustments.”
The company announced a special divided of 14.5 cents per share, payable on June 29 to shareholders of record on June 15, 2016.
Watlington said it maintained a “substantial cash/investment reserve”, earmarked for land purchases and the construction of a reservoir in the west end.
The utility has agreed a memorandum of understanding with the Bermuda Government to acquire the government-owned water supply assets in the western parishes.
“Government has publicly invited proposals to value their assets,” Watlington stated. “The company awaits the outcome of the valuation.”