Caribbean Utilities Company, Ltd. is listed for trading in United States dollars on the Toronto Stock Exchange.
GRAND CAYMAN, Cayman Islands, Nov. 6, 2015 /CNW/ - Caribbean Utilities Company, Ltd. (TSX: CUP.U) ("CUC" or "the Company") announced today its unaudited results for the Third Quarter ended September 30 2015 (all figures in United States dollars).
Net earnings for the three months ended September 30, 2015 ("Third Quarter 2015") were $7.9 million, an increase of $1.7 million when compared to net earnings of $6.2 million for the three months ended September 30, 2014 ("Third Quarter 2014"). This increase was due mainly to higher electricity sales revenues, lower consumer services' costs, lower finance charges, and lower transmission and distribution costs. These items were partially offset by higher depreciation and maintenance costs in the Third Quarter 2015. Third Quarter 2014 consumer services' costs and transmission and distribution costs were negatively impacted by one-time provision adjustments.
After the adjustment for dividends on the preference shares of the Company, earnings on Class A Ordinary Shares for the Third Quarter 2015 were $7.8 million, or $0.25 per Class A Ordinary Share, compared to earnings on Class A Ordinary Shares of $6.1 million or $0.21 per Class A Ordinary Share for the Third Quarter 2014.
Net earnings for the nine months ended September 30, 2015 totalled $16.7 million, an increase of $1.3 million when compared to net earnings of $15.4 million for the nine months ended September 30, 2014. This increase was due mainly to higher electricity sales, lower finance charges, lower consumer services costs, and higher other income. These items were partially offset by higher depreciation costs and lower foreign exchange gain.
After the adjustment for dividends on the preference shares of the Company, earnings on Class A Ordinary Shares for the nine months ended September 30, 2015 were $16.4 million, or $0.53 per Class A Ordinary Share, compared to earnings on Class A Ordinary Shares of $15.1 million or $0.52 per Class A Ordinary Share for the nine months ended September 30, 2014.
Sales for the Third Quarter 2015 totalled 160.4 million kilowatt hours ("kWh"), an increase of 7.2 million kWh in comparison to 153.2 million kWh for the Third Quarter 2014 driven primarily by an increase in large commercial sales, warmer weather conditions, and higher overall customer numbers.
Sales for the nine months ended September 30, 2015 totalled 435.4 million kWh, an increase of 7.0 million kWh in comparison to 428.4 million kWh for the nine months ended September 30, 2014. Sales for the nine months ended September 30, 2015 were positively impacted by an increase in large commercial sales and higher overall customer numbers when compared to the same period last year.
Total customers at the end of the period were 28,035 representing a 2% increase when compared to the number of customers for the period ending September 30, 2014.
President and CEO, Mr. Richard Hew, says, "I am pleased with the positive results recorded during the Third Quarter 2015. The Company remains focused on providing a safe, reliable and efficient service to our customers across Grand Cayman while at the same time adopting technologies that are sustainable and more environmentally friendly."
Capital expenditures for the Third Quarter 2015 were $31.9 million, a $24.8 million, or a 349% increase from $7.1 million in capital expenditures for the Third Quarter 2014. This increase in capital expenditures is driven by costs associated with the new Generation Expansion Project at CUC's North Sound Road Power Plant.
Work on the Generation Expansion Project is progressing according to plan. When completed the new engine room will house two 18.5 MW diesel generating units, one 2.7 MW waste heat recovery steam turbine, and associated auxiliary equipment. The project cost is estimated at $85 million. It is expected that the units will be commissioned by June 2016.
Significant progress is also being made in the area of renewable energy options. The Company has recently completed negotiations on a Power Purchase Agreement ("PPA") with Entropy Cayman Solar Limited that will construct a 5 MW solar photovoltaic power plant in Bodden Town. It is anticipated that the solar plant will be completed and producing electricity to the grid by October 2016.
The Consumer Owned Renewable Energy ("CORE") programme continues to attract customers. During the Third Quarter 2015, 27 additional customers were approved to participate in the programme. The CORE programme allows customers to connect small scale solar systems or wind turbines to CUC's distribution system and to reduce their monthly energy bills by generating their own electricity while remaining connected to the CUC grid. Total capacity approved under the CORE programme is estimated at 3.3 MW. Under the Company's Transmission & Distribution ("T&D") Licence, the CORE programme and the 5 MW solar photovoltaic power plant are cost neutral to CUC.
Reliability of Service to customers as measured by the Average Service Availability Index was 99.97% for the Third Quarter 2015.
Electricity consumers also continue to enjoy the benefit of lower fuel costs. The Company's average price per Imperial Gallon of fuel for the Third Quarter 2015 decreased 37% to $2.93, compared to $4.65 for the Third Quarter 2014. This decrease resulted in an average Fuel Cost Charge rate billed to residential consumers for the Third Quarter 2015 of $0.19 per kWh, compared to the average Fuel Cost Charge rate of $0.28 per kWh for the Third Quarter 2014. The residential consumer who consistently uses 1,000 kWh per month would have seen their monthly bills decline by approximately $94.00 in the Third Quarter 2015 when compared to the Third Quarter 2014 as a result of the lower Fuel Cost Charge Rate. CUC passes through all fuel costs to consumers on a two-month lag basis with no mark-up.
CUC's Third Quarter results and related Management's Discussion and Analysis ("MD&A") for the period ended September 30, 2015 are attached to this release and incorporated by reference. They 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 2015 Third Quarter results, the Cayman Islands economy, liquidity and capital resources, capital expenditures and the business risks facing the Company. The release and Third 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", "plan", "believes", "estimates", "intends", "targets", "projects", "forecasts", "schedule", 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: [email protected]