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 – Caribbean Utilities Company, Ltd. (TSX: CUP.U) (“CUC” or “the Company”) announced today its audited results for the twelve-month period ended December 31, 2022 (all figures in United States dollars).

Despite the challenges of 2022, with rising inflationary pressures and fuel cost, the Cayman Islands economy proved to be resilient. New customers and developments in the construction sector was the driving factor for the Company’s 2% kWh sales growth and a 2% increase in the summer peak load.

There was also an increase in the Company’s customer base, the total customers as at December 31, 2022 were 33,119, an increase of 934 or 3% compared to 32,185 customers as at December 31, 2021.

During 2022, the Company and the community had to cope with rising fuel costs and the impact on customer bills. The Company’s average price per imperial gallon (“IG”) of fuel for the twelve months ended December 31, 2022 increased by 61% to $4.67 in comparison to $2.90 for the twelve months ended December 31, 2021.

In July 2022, the Cayman Islands Government initiated the Electricity Assistance Relief Programme to assist residential customers with the impact of high fuel prices through to the end of the year. In addition, in October 2022, the regulator approved the proposed CUC Fuel Relief Programme applicable to all customers to reduce the financial impact of the fuel cost spike to all customer from October 1, 2022 to December 31, 2022. This action by CUC reinforces its commitment to its Sustainability plan and speaks specifically to Energy Affordability, one of the Environmental, Social and Governance initiatives which has been prioritized by the Company.

The Company continues to reinvest in its infrastructure and upgrade its systems. The Company also continues to develop projects aimed at increased reliability, increased renewable energy penetration and lower costs to customers and provide value to its shareholders. During 2022, CUC recorded exceptional reliability performance, the Company’s 2022 reliability results surpassed that of the 2021 North American Average for electricity service interruption (2022 not yet available) while the Company continued to maintain a consistent standard in its safety performance overall.

In 2022, two new 13 kilovolt feeders were completed and put into service. These feeders will provide improved reliability for approximately 13,000 residential customers in the Prospect and Newlands areas.

In September 2022, the Company signed an agreement with the technology group Wärtsilä for the supply of two 10 MW energy storage systems. In November 2022, the Company also signed an agreement with MAN Energy Solutions SE for life-cycle upgrades for five existing engines with a total capacity of 68 MW. These upgrades will increase the fuel efficiency and extend the useful life of the engines and allow the use of alternate, cleaner fuel sources. These projects all form a part of CUC’s integrated resource plan as CUC seeks to reduce its reliance on fossil fuels and increase renewable energy penetration.

Reflecting on the past year, President and CEO Mr. Hew stated, “2022 was a positive year for the Company. Significant effort was made by CUC to innovate and progress major projects while continuing to offer operational excellence. The Company responded well in the aftermath of Tropical Storm Ian and not many customers were without electricity service for a long period of time. Most financial experts are predicting a global recession in 2023 and that means that the Cayman Islands may likely see some slowing in the economy. CUC will remain vigilant and focussed on being an efficient operation while providing an excellent service to its customers.”

Net earnings for the year ended December 31, 2022 (“Fiscal 2022”) were $33.2 million, a $2.9 million increase from net earnings of $30.3 million for the year ended December 31, 2021 (“Fiscal 2021”). This increase is primarily attributable to higher operating income and slightly lower finance charges.

After the adjustment for dividends on the preference shares of the Company, earnings on Class A Ordinary Shares for Fiscal 2022 were $32.2 million, or $0.86 per Class A Ordinary Share, as compared to $29.3 million, or $0.79 per Class A Ordinary Share, for Fiscal 2021. The Company calculates earnings per share on the weighted average number of Class A Ordinary Shares outstanding. The weighted average number of Class A Ordinary Shares outstanding were 37,481,959 and 37,199,456 for the years ended December 31, 2022 and December 31, 2021, respectively.

Sales in kWh for Fiscal 2022 were 674.1 million kWh, an increase of 13.6 million kWh or 2% compared to 660.5 million kWh for Fiscal 2021. The increase was driven by the 3% growth in overall customer numbers in Fiscal 2022 compared to Fiscal 2021 and the 2% increase in the average kWh consumption of commercial customers, partially offset by the 2% decrease in the average kWh consumption of residential customers. The average monthly temperature for 2022 was 82.9 degrees Fahrenheit when compared to 83.1 degrees Fahrenheit in 2021. The average rainfall for 2022 was 4.6 inches as compared to 3.7 inches in 2021. The new record peak load of 113.6 MW was experienced on September 11, 2022.

CUC’s 2022 results and related Management’s Discussion and Analysis (“MD&A”) for the twelve-month period ended December 31, 2022 are incorporated by reference. The release and 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 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 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”, “plans”, “believes”, “estimates”, “intends”, “targets”, “projects”, “forecasts”, “schedules”, 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.