Ascendant Group Limited’s (AGL) core earnings, excluding the impact of discontinued operations, was $9.5 million during the first six months of the year, a $3.4 million or 57% improvement relative to AGL’s comparable core earnings of $6.0 million in 2016. The increase in operating earnings realized was driven by a $3.4 million, or 41%, increase in Bermuda Electric Light Company Limited (BELCO) net earnings, stemming from higher electricity sales revenues more than offsetting higher net operating costs.

AGL’s consolidated net income for the first six months of 2017 was $10.2 million as compared to $18.6 in the comparable period in 2016. The decrease in net earnings is due primarily to the $12.5 million gain recognized from the sale of Bermuda Gas & Utility Company Ltd. in 2016.

BELCO’s basic tariff electricity sales revenue, net of discount (excluding fuel adjustment sales) increased $4.1 million, or 6.1%, when compared to the same period last year. This increase is primarily due to higher basic tariff rates for the current six month period than were in effect for the comparable six month period in 2016. In 2016, basic tariff rate increases were approved by the Energy Commission in March and came into effect on 1 June 2016.

 BELCO key highlights during this reporting period:

o Electricity sales volumes declined by 0.3% when compared to the first six months of 2016

o Average total cost per barrel of fuel was $90.14, up 3.7% year over year. This increase is in part due to a 38% increase in Custom Duty on fuel oil imports effective 1 April 2016 from $23.03 per barrel to $31.79 per barrel in the 2016/17 Bermuda Government Budget. Another contributing factor to this increase is a 2.5% decline in fuel efficiency caused by extended unit outages resulting in higher usage of less efficient gas turbines.

o Non-fuel related expenses increased $1.1 million or 2.4% due to a combination of factors including the introduction of regulatory fees, corporate restructuring costs, additional material and overtime costs and higher shared service charges. Partially offsetting the increase was a decrease in depreciation expense related to a change in the estimated useful life of transmission and distribution assets.

AG Holdings Limited’s (AG Holdings) core earnings for the first six months totaled $1.6 million, a 165% improvement as compared to 2016 core earnings of $598,000.

AG Holdings key highlights during this reporting period

o AIRCARE LTD.’s core earnings were $1.6M up 66% from same period in 2016. The improved earnings was driven by improved profitability in its HVAC, fire alarm, and fire suppression systems installation projects in Bermuda, as well as income recognition from its 34% interest in its Cayman Islands affiliate, Otis Air-Conditioning Ltd.

o In March 2017, AG Holdings purchased the 40% stake in IFM Limited (iFM) from its partner, Black & McDonald Group Limited for $607,000. During the period, iFM’s core earnings increased from $190,000 to $452,000 reflecting additional facility project work as well as AG Holdings’ additional ownership interest.

AGL prepared its 2016 condensed consolidated interim financial statements in accordance and compliance with International Financial Reporting Standards (IFRS), as issued by the International Accounting Standards Board (IASB).