Caribbean Utilities Company, Ltd Announces Unaudited First Quarter Results ended March 31st 2022
T.CUP.U | May 4, 2022
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 4, 2022 /CNW/ - Caribbean Utilities Company, Ltd. ("CUC" or "the Company") announced today its unaudited results for the three months ended March 31, 2022 ("First Quarter 2022" or "Q1 2022") (all figures in United States dollars).
Customers in Grand Cayman stand to benefit from major investments which the Company will make over the next five years. That's because the Utility Regulation and Competition Office ("OfReg ") has approved the proposed 2022-2026 Capital Investment Plan which the Company submitted last October.
The 2022-2026 Capital Investment Plan is in the amount of $373.2 million and includes $22.0 million for two grid resiliency projects which will involve the undergrounding of the Company's Transmission & Distribution infrastructure from the North Sound Plant to the Seven Mile Beach and South Sound substations. Undergrounding of these lines will provide resilience and improve power restoration times after a tropical storm or a hurricane.
The plan will also include the roll out of public electric vehicle charging locations which will be available in key locations around Grand Cayman. A 20 megawatt Battery Energy Storage Project which will allow the Company to improve the fuel efficiency of its diesel generating plant while also supporting further adoption of distributed renewable energy projects is also included in the plan among several other projects designed to improve service reliability, efficiency and environmental performance.
During First Quarter 2022, the Company recorded an increase in our customer base. Total customers as at March 31, 2022 were 32,365, an increase of 869 customers, or 3%, compared to 31,496 customers as at March 31, 2021.
Net earnings increased by $2.2 million from $3.3 million for the three months ended March 31, 2021 ("First Quarter 2021" or "Q1 2021") to $5.5 million for First Quarter 2022. The increase in net earnings is primarily attributable to higher operating income and lower finance charges.
After the adjustment for dividends on the preference shares of the Company, earnings on Class A Ordinary Shares for Q1 2022 were $5.4 million or $0.14 per Class A Ordinary Share, compared to earnings on Class A Ordinary Shares of $3.2 million, or $0.09 per Class A Ordinary Share for Q1 2021.
Electricity sales revenues were $22.1 million for Q1 2022, an increase of $0.7 million when compared to electricity sales revenues of $21.4 million for Q1 2021. Electricity sales revenues for Q1 2022 increased when compared to the same period last year due to a 4% increase in kilowatt hour ("kWh") sales.
President and CEO, Mr. Richard Hew, stated, "The growth in the tourism industry with the reopening of the island was positive for our large commercial electricity sales and the overall economic activity in Grand Cayman. The Company remained focused on controlling its operating costs during a period of rising costs and the uncertainty in the supply chain for materials and equipment. Also in the period, the Company recorded its best ever measurement of reliability of service to its customers. The average total outage time was 0.5 hours per customer. The Company has also arranged for the delivery of temporary generation to meet this summer's projected peak load while the regulator prepares to procure more solar energy for the grid. The Company looks forward to participating in this procurement process which is aligned with our ambition to have 60% of the energy on the grid from renewable sources by 2030 to lower and stabilize electricity costs and reduce greenhouse gases and other emissions."
During First Quarter 2022, approximately 3.36% of the total kilowatt- hour sales was generated from renewable energy. This is the combination of charges from the Customer Owned Renewable Energy ("CORE") and Distributed Energy Resources ("DER") programmes and the BMR Energy Limited ("BMR Energy") 5-MW solar farm in Bodden Town.
In April 2022, OfReg issued a Request for Qualification ("RFQ") for the Renewable Energy Auction Scheme ("REAS") Competition Round 1. The REAS Round 1 is intended to select a party, or parties, to operate and maintain Solar Photovoltaic Plants and Energy Storage up to 100MW, with 60MW Battery Energy Storage System Facility. OfReg also issued an RFQ for a 23MW Dispatchable Photovoltaic Generation plant paired with energy storage facility. CUC is preparing to participate on these bid invitations.
The Cayman Islands Government ("the Government") subsequently announced on April 27, 2022 a change in policy direction and its intention to hold a majority ownership stake in all future large scale renewable energy projects. CUC will engage in discussions with the Government and OfReg to determine whether the recently announced RFQs will be affected by this change in policy and what impact this announcement will have on future renewable energy plans.
CUC's First Quarter results and related Management's Discussion and Analysis ("MD&A") for the period ended March 31, 2022 are incorporated by reference. The MD&A section of this report contains a discussion of CUC's unaudited 2022 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 2022 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 2029 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.
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