Grand Cayman’s electricity provider reported an 11 per cent increase in net earnings in the second quarter of 2013, thanks to dry weather, increased sales and lower costs.
Caribbean Utilities Company’s net earnings for the quarter were US$5.7 million, compared to US$5.1 million for the second quarter of 2012.
“This increase was due primarily to a 3 per cent increase in kilowatt-hour sales (kWh) and lower financing costs. Maintenance costs also declined as a result of the focus on capital-related generation upgrades during the period. These items were partially offset by higher depreciation costs,” according to a CUC report on its unaudited results for the second quarter.
In the second quarter of 2013, sales totalled 144.3 million kWh, compared to 139.9 million kWh in the second quarter of 2012.
The number of customers grew 1 per cent from 26,830 last year to 27,171 this year.
According to the report, “The second quarter 2012 was negatively impacted by rainy weather conditions which reduced customer air conditioning load during that period. The average monthly rainfall for the second quarter 2013 was 4.4 inches as compared to average monthly rainfall of 9.3 inches for second quarter 2012.”
The adjusted earnings on the company’s Class A Ordinary Shares for the second quarter of 2013 were US$5.6 million, or $0.19 per share, compared to US$5.0 million, or US$0.18 per share in the second quarter of 2012.
CUC president and CEO Richard Hew said in a news release, “The second quarter 2013 financial and operating results were stable. The Cayman Islands economy remains a concern for the company and we continue to focus on costs and efficiencies while maintaining a safe and reliable service to our customers.”
In the second quarter of 2013, CUC’s per-gallon fuel cost declined by 3 per cent since last year. The company’s average price per imperial gallon of fuel was US$4.63 in the second quarter of 2013, compared to US$4.79 in the second quarter of 2012.
The company’s report also cites a 4 per cent increase in air arrivals to Grand Cayman in the second quarter of 2013 compared to the second quarter of 2012, accompanied by a 20 per cent decrease in cruise arrivals.
“Air arrivals have a direct impact on the Company’s sales growth as these visitors are stay-over visitors who occupy hotels. Cruise arrivals also have an indirect impact as they affect the opening hours of the establishments operating for that market,” according to the report.
Additionally, “The company has experienced delays in the Advanced Metering Infrastructure (AMI) project, after completing the installation of the first 7,000 meters. The installation of meters is expected to resume in the third quarter of 2013 and the programme should be substantially completed by the fourth quarter of 2014.”
Looking at the first six months of 2013, CUC’s net earnings are up 22 per cent compared to the first half of 2012. Sales are up 2 per cent.