The Ascendant Group Ltd.'s consolidated net earnings fell slightly, despite Bermuda Gas & Utility Company Ltd. seeing its profits increase three-fold during 2009.

The group of companies, which comprises Belco, Bermuda Gas, PureNERGY Renewables Ltd., and Belco Properties Ltd., as well as InVenture Ltd., returned net consolidated earnings of $19.5 million or $1.88 per share last year compared to $20 million or $1.95 per share in 2008.

Belco's profits dropped by approximately $393,000 to $19.7 million, from 2008 results of $20 million, adjusted for a change in accounting policy for major overhauls.

Sales of electricity, net of fuel adjustment revenue, increased $6.5 million in 2009 to $150.6 million, up from the $144.1 million achieved in 2008. Basic tariff rates and facility charges increased an overall average of 2.75 percent in 2009, providing additional revenue of $4 million.

The balance of the increase, $2.5 million, was the result of a 1.72 percent rise in the number of kilowatt hours (kWh) sold. Fuel adjustment revenue decreased $22.2 million to $76.4 million in 2009, from $98.5 million in 2008, as fuel costs declined dramatically.

The savings were passed on to the customer, as residential kWh sales increased 1.17 percent last year, following a decrease of 2.58 percent the previous year. Average consumption per customer increased marginally by 0.53 percent during the year to an average monthly consumption of 698.59 kWh.

Sales in the commercial sector were up 2.42 percent, or 7.7 million kWh, compared to an increase of 1.49 percent in 2008. Increased demand from active commercial customers, along with sales to new customers, offset lost commercial sales due to business closures and decreased operating activity by various other commercial businesses, most notably hotels.

Bermuda Gas reported a net income of $1.3 million in 2009 versus $419,383 the previous year.

PureNERGY experienced a challenging year in 2009, reporting an operating loss of $1.1 million versus a loss of $580,217 in 2008. Belco Properties Ltd. recognised a net income of $255,771 compared to $311,308 the year prior.

The market price of Ascendant's shares declined in 2009 from an opening value of $18 to a year-end price of $15.05, but management said it continued to believe that the share price was undervalued, as the book value per share at year end was $31.05, reflecting the long-term value of the organisation.

The 2009 cash dividend of 85 cents per share was unchanged from 2008, while the 2009 dividend yield was 5.64 percent compared to 4.73 percent in 2008.

Fuel costs were the most significant of Belco's energy supply expenses. In 2009, total fuel costs decreased $20.6 million, from $129.5 million in 2008 to $108.8 million, largely due to the lower cost of fuel.

Defined benefit pension plan costs increased $2 million in 2009, following significant declines in returns from pension fund investments, a direct result of the challenging investment market in 2008.

Also during 2009, $1.5 million in costs were incurred due to inventory write-offs of $1.1 million and property, plant and equipment write offs of $340,327, represented largely by parts specifically supporting engine D2, which was decommissioned during the year in advance of expectations, mainly as a result of having to run the older plant due to the failure of E7.

Belco invested $36.8 million in capital projects in 2009, compared to $23.4 million in 2008. Energy supply capital expenditures in 2009 totalled $15.8 million. Under the central plant development plan, $12 million was spent as construction commenced on installation of three gas turbines. A total of $406,881 went on extending the useful service lives of generation units D3, D8 and D10 to 2014, as part of the electricity provider's overall strategy to meet future demand requirements. Project costs incurred to date represented a portion of a redesigned two-year plan estimated to cost around $2.8 million and considered necessary to meet future demand in the absence of Government approval to proceed with a new diesel plant.