Caribbean Utilities Company, Ltd. is listed for trading in
United States dollars on the
Toronto Stock Exchange.
GRAND CAYMAN, Cayman Islands, Feb.
18, 2016 /CNW/ - Caribbean Utilities Company, Ltd.
(TSX: CUP.U) ("CUC" or "the Company") announced today its unaudited
results for the Fourth Quarter and Twelve Months ended December 31, 2015 (all figures in United States dollars).
Net earnings for the three months ended December 31, 2015 ("Fourth Quarter 2015") were
$6.2 million, a $0.8 million increase when compared to
$5.4 million for the three months
ended December 31, 2014 ("Fourth
Quarter 2014"). This increase is attributable to an 8% growth
in kilowatt-hour ("kWh") sales and lower finance charges in the
Fourth Quarter 2015. These items were partially offset by
higher consumer services, general and administration, depreciation,
and maintenance costs for the Fourth Quarter 2015 when compared to
the Fourth Quarter 2014.
Net earnings for the twelve months ended December 31, 2015 were $22.8 million, a $2.0
million increase from net earnings of $20.8 million for the twelve months ended
December 31, 2014. This increase is
attributable to a 3% growth in kWh sales, 1.5% and 0.9% base rate
increases effective June 1, 2014 and
June 1, 2015 respectively, lower
finance charges and higher other income. These items were
partially offset by higher depreciation, maintenance and general
and administration costs.
With the market price of lubricating and fuel oil trending
downwards in 2015, customers have seen a significant reduction in
the Fuel Cost Charge rate per kWh on their electricity bills.
The average Fuel Cost Charge rate per kWh charged to consumers
for the Fourth Quarter 2015 was $0.17, a 39% decrease when compared to
$0.28 per kWh for the Fourth Quarter
2014.
The average Fuel Cost Charge rate per kWh charged to consumers
for the twelve months ended December 31,
2015 was $0.19 per kWh
compared to the Fuel Cost Charge rate of $0.27 per kWh for the twelve months ended
December 31, 2014. This decrease in
the average Fuel Cost Charge rate has resulted in savings of
$46.6 million to consumers for the
twelve months ended December 31,
2015.
Further reductions to the Fuel Cost Charge rate per kWh are
expected to occur in the first quarter of 2016 due to a decrease in
customs duties levied on fuel imports by the Government. The
Government has announced a decrease from $0.60 per Imperial Gallon ("IG") to $0.30 per IG for fuel imported as of January 1, 2016.
For the Fourth Quarter 2015, kWh sales were 146.5 million, an
increase of 10.7 million kWh or 8% when compared to 135.8 million
for the Fourth Quarter 2014. Sales were positively impacted by
warmer weather conditions which affected customer air conditioning
usage. The average monthly temperature for the Fourth Quarter 2015
was 83.0 degrees, 3.6 degrees Fahrenheit higher than the average
monthly temperature experienced during the Fourth Quarter 2014 of
79.4 degrees.
For the twelve months ended December 31,
2015, kWh sales were 582.0 million, an increase of 17.8
million kWh or 3% when compared to 564.2 million kWh for the twelve
months ended December 31, 2014.
Annual sales were positively impacted by large commercial
development, growth in customer numbers and warmer weather
conditions that affected customer air conditioning usage. The
average temperature for 2015 was 83 degrees Fahrenheit compared to
82 degrees for 2014.
Total customers as at December 31,
2015 were 28,204, an increase of 420, or 2%, compared to
27,784 customers as at December 31,
2014.
After the adjustment for dividends on the preference shares of
the Company, earnings on Class A Ordinary Shares for the Fourth
Quarter 2015 were $5.6 million, or
$0.18 per Class A Ordinary Share, as
compared to $4.8 million, or
$0.16 per Class A Ordinary Share for
the Fourth Quarter 2014.
After the adjustment for dividends on the preference shares of
the Company, earnings on Class A Ordinary Shares for the twelve
months ended December 31, 2015 were
$21.9 million, or $0.71 per Class A Ordinary Share as compared to
$19.9 million, or $0.68 per Class A Ordinary Share for the twelve
months ended December 31,
2014.
President and CEO, Mr. Richard
Hew, says, "The Fourth Quarter and the Financial Year 2015
were positive in terms of sales and earnings growth. We are also
pleased that during the year our customers received a significant
reduction in their per kWh electricity costs, benefitting from the
full pass through of lower fuel purchase costs. CUC continues to
operate successfully in a low growth environment with a focus on
delivering a safe and reliable electricity service at least cost.
The Company also continues to adopt renewable energy as a
sustainable technology path for the future."
During the Fourth Quarter 2015, the Electricity Regulatory
Authority ("ERA") approved a Power Purchase Agreement proposed by
CUC for a 5 megawatts ("MW") plant to be built by Entropy Cayman
Solar Limited in the district of Bodden Town.
This 5 MW Solar project, scheduled for completion in
October 2016, will provide energy to
power approximately 800 homes with clean renewable solar energy and
will significantly reduce emissions into the atmosphere through the
avoidance of diesel fuel consumption.
The Consumer-Owned Renewable Energy ("CORE") generation
programme which was proposed by CUC and started in 2011 has proven
popular with residential and commercial customers who are able to
connect their solar panels or wind turbines to the CUC grid.
The programme has attracted 226 participants and is nearing
its current capacity of 4 MW. CUC and the ERA are currently
reviewing the programme to determine if there should be a further
addition to the available capacity. It is anticipated that an
announcement on the terms for further extension of the CORE
programme will be made by March
1st, 2016.
During the Fourth Quarter, the Company's two 18.5 MWV48/60
medium-speed diesel generating units arrived and have been
installed in a newly constructed engine room. The new engines are
part of the Generation Expansion Project at our North Sound Road
Power Plant which is progressing according to plan. The new engine
room will also house a 2.7 MW waste heat recovery steam turbine for
a total output of 39.7 MW. The new plant, which will boast the most
fuel efficient generation ever installed by CUC, will bring
increased reliability, lower costs to our consumers and reduce the
level of emissions into the environment.
The total project cost is estimated at $85 million and it is expected that the units
will be commissioned in May and June this year to replace retiring
generating units and meet anticipated future growth by providing
firm capacity that intermittent renewables do not currently
deliver.
Capital expenditures for the Fourth Quarter 2015 were
$25.0 million, a $6.6 million, or 36% increase from $18.4 million in capital expenditures for the
Fourth Quarter 2014. Capital expenditures for the twelve months
ended December 31, 2015 were
$78.0 million, a $38.5 million, or 97% increase from $39.5 million in capital expenditures for the
same period of the previous year. During the twelve months ended
December 31, 2015, capital
expenditure related to the Generation Expansion project totalled
$47.9 million.
CUC's Fourth Quarter Report for the period ended December 31, 2015 is attached to this release and
incorporated by reference. It can be accessed by clicking the link
at the end of the release.
This report contains a detailed discussion of CUC's unaudited
2015 Fourth Quarter results, the Cayman
Islands economy, liquidity and capital resources, capital
expenditures and the business risks facing the Company. The release
and Fourth Quarter Report 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 report, 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 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.