Cayman Islands utilities provider announces decrease in earnings
CUC announces Second Quarter Results for the period ended June 30, 2015
Caribbean Utilities Company, Ltd. is listed for trading in United States dollars on the Toronto Stock Exchange.
GRAND CAYMAN, Cayman Islands, July 31, 2015 /CNW/ – Caribbean Utilities Company, Ltd. (TSX: CUP.U) (“CUC” or “the Company”) announced today its unaudited results for the Second Quarter ended June 30, 2015 (all figures in United States dollars).
Net earnings for the three months ended June 30, 2015 (“Second Quarter 2015”) totalled $5.5 million, a decrease of $0.2 million when compared to net earnings of $5.7 million for the three months ended June 30, 2014 (“Second Quarter 2014”).
Net earnings for the six months ended June 30, 2015 totalled $8.8 million, a decrease of $0.4 million when compared to net earnings of $9.2 million for the six months ended June 30, 2014.
These decreases in earnings were due mainly to higher depreciation, transmission and distribution and temporary generation rental costs, partially offset by higher electricity sales revenues and other income.
After the adjustment for dividends on the preference shares of the Company, earnings on Class A Ordinary Shares for the Second Quarter 2015 were $5.4 million, or $0.17 per Class A Ordinary Share, compared to earnings on Class A Ordinary Shares of $5.6 million or $0.20 per Class A Ordinary Share for the Second Quarter 2014.
After the adjustment for dividends on the preference shares of the Company, earnings on Class A Ordinary Shares for the six months ended June 30, 2015 were $8.6 million, or $0.28 per Class A Ordinary Share, compared to earnings on Class A Ordinary Shares of $9.0 million or $0.31 per Class A Ordinary Share for the six months ended June 30th 2014.
These decreases in earnings per Class A Ordinary Share were due to lower earnings and an increase in the weighted average number of Class A Ordinary Shares.
During the Second Quarter 2015, the Company successfully completed a Rights Offering raising gross proceeds of $31.6 million through the issuance of 2,930,700 Class A Ordinary Shares. The Rights Offering also increased the weighted average number of Class A Ordinary Shares used to calculate the earnings per Class A Ordinary Share for the Second Quarter 2015 to 30,283,909 when compared to 29,105,771 for the Second Quarter 2014. For the six months ended June 30th 2015, the weighted average number of Class A Ordinary Shares increased to 31,029,896 when compared to 29,120,811 for the six months ended June 30th 2014.
Sales for the Second Quarter 2015 totalled 146.0 million kilowatt hours (“kWh”), an increase of 1.5 million kWh in comparison to 144.5 million kWh for the Second Quarter 2014. This was driven primarily by growth in commercial customer sales.
Sales for the six months ended June 30, 2015 totalled 275.0 million kWh, a decrease of 0.2 million kWh in comparison to 275.2 million kWh for the six months ended June 30, 2014. The average monthly temperature for the first six months of 2015 was 81.3 degrees Fahrenheit as compared to an average monthly temperature of 81.5 degrees for the first six months of 2014. Cooler temperatures reduce air conditioning load which can negatively impact the Company’s sales.
Total customers as at June 30, 2015 were 28,008, an increase of 2%, compared to 27,462 customers as at June 30, 2014.
The Company’s reliability of service as measured by the Average Service Availability Index was recorded at 99.95% for the Second Quarter of 2015 with customers experiencing, on average, less than one outage for the quarter lasting approximately one hour.
Capital expenditures for the three months ended June 30, 2015 totalled $14.0 million, an 87% increase when compared to capital expenditures of $7.5 million for the three months ended June 30, 2014. This increase was driven primarily by the Company’s ongoing investment in its new generating plant.
Work on the Company’s new Power House building is progressing as planned. The project is on track for the handover of the first generating unit on May 1, 2016 and the second generating unit and steam turbine will be handed over on June 1, 2016. When completed, CUC will have an additional 39.7 megawatts (“MW”) of diesel power including a 2.7 MW waste heat recovery steam turbine. The project cost is estimated at US$85 million.
President and CEO, Mr. Richard Hew, says, “I am pleased with the overall results recorded during the Second Quarter 2015. The successful completion of the Rights Offering and the progress being made on the construction of our new power house are positive indications that we will have a strong financial base and a stable and efficient power supply to provide excellent customer service to our current and growing customer base in the summer of 2016 and beyond.”
The Consumer-Owned Renewable Energy Generation (“CORE”) programme which allows consumers to generate energy from renewable sources and be compensated through stable, long-term rates continues to attract participants. During the Second Quarter 2015, 26 customers were connected with 334 kilowatts (“kw”) of renewable capacity.
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 connected under the CORE programme is estimated at 2,910 kiloWatts.
CUC’s Second Quarter results and related Management’s Discussion and Analysis (“MD&A”) for the period ended June 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 Second Quarter results, the Cayman Islands economy, liquidity and capital resources, capital expenditures and the business risks facing the Company. The release and Second 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.
PDF available at: http://stream1.newswire.ca/media/2015/07/31/20150731_C5552_PDF_EN_468024.pdf
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Letitia Lawrence – Vice President Finance and Chief Financial Officer, Phone: (345) 914-1124, E-Mail: [email protected] CNW Group 2015
Canada Newswire
July 31, 2015 – 7:23 PM EDT
