CUC Announces First Quarter Results for the Period Ended March 31, 2019
May 01, 2019, 21:04 ET
Caribbean Utilities Company, Ltd. is listed for trading in United States dollars on the Toronto Stock Exchange under the trading symbol "CUP.U".
GRAND CAYMAN, Cayman Islands, May 1, 2019 /CNW/ - Caribbean Utilities Company, Ltd. (TSX: CUP.U) ("CUC" or "the Company") announced today its consolidated unaudited results for the three months ended March 31, 2019 (all figures in United States dollars).
For the three months ended March 31, 2019 ("Q1 2019"), the Company recorded net earnings of $4.5 million, an increase of $1.8 million from $2.7 million for the three months ended March 31, 2018 ("Q1 2018"). The increase in net earnings is due primarily to a 4% increase in kilowatt hour ("kWh") sales, lower transmission and distribution costs and lower finance charges. The comparative earnings were also impacted by the $0.6 million demand rate implementation revenue shortfall in Q1 2018.
After the adjustment for dividends on the preference shares of the Company, earnings on Class A Ordinary Shares for Q1 2019 were $4.4 million or $0.13 per Class A Ordinary Share, compared to earnings on Class A Ordinary Shares of $2.6 million, or $0.08 per Class A Ordinary Share for Q1 2018.
Capital expenditures for Q1 2019 totaled $11.9 million, a $2 million increase when compared to $9.9 million for Q1 2018. Capital investments for Q1 2019 included the new Seven Mile Beach substation. This project will increase safety, system reliability and resiliency and will accommodate load growth within the popular Seven Mile Beach tourist area for decades to come.
The Cayman Islands Economics and Statistics Office ("ESO") issued the 2018 Third Quarter Economic Report in March 2019. The report indicated that the Gross Domestic Product ("GDP") expanded by an estimated 3.6% in the first nine months of 2018. This economic growth supported a 2% increase in the number of customers to 29,945 total customers as at March 31, 2019. The average kWh usage by residential and commercial customers also increased during the period.
A major focus for the Company during Q1 2019 has been on reliability of service to customers. The Average Service Availability Index (ASAI), the percentage of time power was available to customers, was 99.98% which was an improvement in average per customer reliability of 33% when compared to the same period last year. This can otherwise be expressed as average total interruption time per customer of less than thirty minutes for the period. This is in line with the Company's goal under its Reliability 2.0 initiative to attain 2 hours or less of total annual outage time per customer.
The Company also recorded growth of renewable energy on the CUC grid with 4.3 million kWh in Q1 2019 compared to 3.5 million kWh in Q1 2018. This growth is attributable to the roof top solar installed under the Company's Customer Owned Renewable Energy ("CORE") programme as well as an increase in production from the 5 MW Entropy Solar farm. Renewable energy represented 2.8% of the total energy on CUC's grid. The Company's aim is to have 25% of renewable energy on the grid by 2025.
In March 2019, the Company was recognized as a Top Employer in the Cayman Islands. Companies recognized as top employers are known to prioritize employees' career growth, corporate and social responsibility, to promote ethical values and, are transparent about the standards to which they hold themselves. Management is proud of this achievement and they continue to seek ways to improve the Company's talent pool and work environment to remain a Company where employees are proud to come to work each day.
President and CEO, Mr. Richard Hew, says, "The Company is off to a good start in 2019 with earnings growth, improvement in reliability of service to customers, progress on significant capital projects and an increase in the amount of renewable energy on the grid when compared to the same period last year. The acceptance of CUC's Integrated Resource Plan by the Cayman Islands Utility Regulation and Competition Office ("OfReg") during the period also bodes well for further integration of renewable energy. I am also very pleased that during First Quarter 2019 there were no lost-time injuries recorded. The safety of our employees, and that of the public, remains top priority and the Company continues to improve its work processes and increase employee training, safety management and leadership, to drive lost-time incidents to zero."
CUC's First Quarter results and related Management's Discussion and Analysis ("MD&A") for the period ended March 31 2019 are attached to this release and incorporated by reference and can be accessed by clicking the link at the end of this release.
The MD&A section of this report contains a discussion of CUC's unaudited 2019 First Quarter results, the Cayman Islands economy, liquidity and capital resources, capital expenditures and the business risks facing the Company. The release and First Quarter MD&A can be accessed at www.cuc-cayman.com (Investor Relations/Press Releases) and at www.sedar.com.
CUC provides electricity to Grand Cayman, Cayman Islands, under an Electricity Generation Licence expiring in 2039 and an exclusive Electricity Transmission and Distribution Licence expiring in 2028. Further information is available at www.cuc-cayman.com.
Certain statements in the MD&A, other than statements of historical fact, are forward-looking statements concerning anticipated future events, results, circumstances, performance or expectations with respect to the Company and its operations, including its strategy and financial performance and condition.
Forward looking statements include statements that are predictive in nature, depend upon future events or conditions, or include words such as "expects", "anticipates", "plans", "believes", "estimates", "intends", "targets", "projects", "forecasts", "schedules", or negative versions thereof and other similar expressions, or future or conditional verbs such as "may", "will", "should", "would" and "could". Forward looking statements are based on underlying assumptions and management's beliefs, estimates and opinions, and are subject to inherent risks and uncertainties surrounding future expectations generally that may cause actual results to vary from plans, targets and estimates. Some of the important risks and uncertainties that could affect forward looking statements are described in the MD&A in the section labeled "Business Risks" and include but are not limited to operational, general economic, market and business conditions, regulatory developments and weather. CUC cautions readers that actual results may vary significantly from those expected should certain risks or uncertainties materialize, or should underlying assumptions prove incorrect. Forward-looking statements are provided for the purpose of providing information about management's current expectations and plans relating to the future. Readers are cautioned that such information may not be appropriate for other purposes. The Company disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise except as required by law.
SOURCE Caribbean Utilities Company, Ltd.
For further information: Letitia Lawrence, Vice President Finance and Chief Financial Officer, Phone: (345) 914-1124, E-Mail: llawrence@cuc.ky
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