Ascendant Group Limited (“Ascendant” or the “Company”) (BSX: AGL.BH), a publicly traded provider of energy and energy-related services, today announced results for the first three months of 2019.
- Capital plan progress with Battery Energy Storage System (BESS) brought online, North Power Station stack complete, engines en route and upgrades to transmission and distribution infrastructure ongoing.
- Core earnings stable with continued growth in non-utility businesses.
- Continued cost reductions through operational efficiencies and implementation of a voluntary early retirement programme.
- Progress on exploration of strategic alternatives including potential sale of the Company.
- Tariff application filed with Regulatory Authority (the “Authority”).
Executing Ascendant’s Strategic Plan
Ascendant President & CEO Sean Durfy said: “The Company continues to execute its strategic five-year plan with much progress made on the $250 million capital plan that is geared towards building a foundation for the future.
AG Holdings Limited continues to drive its growth plan with increases in project revenue in AIRCARE LTD. and design and build projects in IFM Limited. iEPC Limited was also successful in completing its portion of the King’s Wharf refurbishments project on time and on budget.
The Company has been progressing the evaluation of strategic alternatives. In April, 2019 the Board of Directors (“Board”) announced it had invited a select group of globally-respected firms to submit proposals for the purchase of the Company. The Board will ensure that any proposals will fully consider the interests of the Company’s customers, employees, shareholders, and the community.”
BELCO President Dennis Pimentel said: “The Bermuda Electric Light Company Limited (“BELCO”) submitted its tariff application to the Authority in April, 2019 which will determine the rates our
customers pay for electricity for 2020 and 2021. Construction of the $120 million North Power Station replacement generation continues and the battery storage project has been brought online. BELCO is also investing in much needed upgrades to its transmission and distribution grid that will reduce the risk of outages going forward. These projects are being carried out in anticipation of increased capacity from renewables as contemplated by the Integrated Resource Plan (“IRP”), with a view to reducing the cost of electricity for our customers in the future.”
Core earnings from operations, before corporate expenses, were $3.6 million compared to $3.4 million for the first quarter of 2018.
The increase in core earnings from operations was largely the result of continued growth in Ascendant’s non-utility businesses and decreased operational expenses across the Group, offset by lower revenues from decreasing electricity demand at BELCO.
For the first quarter of 2019 we reported loss of $0.5 million or $0.06 per share compared to net earnings of $0.2 million or $0.02 per share for the same period in 2018. Reported earnings were impacted by the changes to operations described above as well as $1.6 million in restructuring expenses related to our strategic review.
Cash flow and capital spending
Cash flow provided by operations, before changes in non-cash working capital balances, increased $1.4 million, to $5.4 million for the three month period ended 31 March 2019. This increase was primarily driven by lower post-retirement and share-based benefit payments.
Capital expenditures for the first three months of 2019 were $28.2 million compared to $5.5 million for the same period of 2018, reflecting execution of the Company’s capital plan including BELCO’S replacement generation, battery energy storage system and transmission and distribution modernisation projects.
The Board declared a quarterly dividend of 11.25 cents per common share.
|During the three month period ended 31 March 2019 the Company repurchased 139,395 shares at an average cost of $18.25. The share price closed at $22 on 31 March 2019. The share repurchase programme was suspended on 1 April 2019.
Ascendant uses financial measures that are not defined under IFRS and may not be comparable to similar measures presented by other issuers. Ascendant calculated the non-IFRS measures by adjusting for specific items that management believes are not reflective of the normal, ongoing operations of the business. Refer to the Non-IFRS Financial Measures section of the Company’s year-end Management’s Discussion and Analysis (“2018 MD&A”) in Ascendant’s 2018 Annual Report, which can be found on Ascendant’s website at www.ascendant.bm, for further discussion of these items.
|Forward Looking Information
This news release contains forward-looking statements that reflect management’s current beliefs with respect to the Company’s future growth, results of operations, performance, business prospects and opportunities. These statements are based on reasonable assumptions and information currently available to Ascendant’s management and are subject to risks, uncertainties and other factors that could cause actual results to differ materially from historical results or results anticipated by the forward-looking information. Additional information about these assumptions, risks and uncertainties is included in the “Primary Factors Affecting Ascendant’s Business” section in the 2018 MD&A, which can be found on Ascendant’s website at www.ascendant.bm.