Belco’s parent company Ascendant Group Ltd posted $10.2 million of net income for the first six months of this year.

The company said core earnings were $9.5 million, up by $3.4 million, or 57 per cent, on the core earnings of $6 million in the same period of 2016.

The increase in operating earnings was driven by an increase in $3.4 million in Belco’s net earnings, stemming from higher electricity sales revenues more than offsetting higher operating costs.

Belco’s basic tariff electricity sales revenue, net of discounts and excluding fuel adjustment sales, rose $4.1 million, or 6.1 per cent, compared to the first half of last year.

The increase came despite a 0.3 per cent fall in electricity sales volume and was due to higher tariffs approved by the Energy Commission last year and which took effect on June 1, 2016.

The average cost of a barrel of fuel was $90.14, up 3.7 per cent from a year earlier. Part of the increase was down to an increase in Customs duty on fuel imports, which rose from $23.03 per barrel to $31.79 per barrel from the start of April last year.

Extended outages of some of the utility’s ageing fleet of heavy oil-burning engines caused less efficient gas turbines to be used, leading to a 2.5 per cent decline in fuel efficiency for the period.

Non-fuel related expenses increased $1.1 million, or 2.4 per cent, because of a combination of 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.

The group’s earnings also received a boost from air-conditioning firm Air Care, whose core earnings totalled $1.6 million — up 66 per cent from a year earlier.

“The improved earnings were 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 per cent interest in its Cayman Islands affiliate, Otis Air-Conditioning Ltd,” Ascendant stated.

In March this year, Ascendant bought the 40 per cent stake in IFM Ltd that had been owned by its partner Black and McDonald Group 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 the company’s additional ownership interest,” Ascendant stated.

In May 2017, Ascendant authorised a share repurchase programme to purchase up to 200,000 shares. No new shares were purchased under the new programme through June 30.