Utilities Ascendant Group Ltd and KeyTech Ltd are “significantly undervalued”, according to Michael Collier, chairman of local investment-focused Bermuda First Investment Company Limited (BFIC).

The companies are BFIC’s main investments and the fall in their share prices was a major factor in the company recording unrealised losses of $13.6 million in the value of its investment portfolio for the year ended June 30, 2014.

The total portfolio was valued at $31.5 million at the end of June and net debt of $5.6 million.

BFIC reported revenue of $2.7 million, up from $1.9 million in 2013, and profit of $1.5 million, up from last year’s $1 million, prior to the unrealised investment losses.

Mr Collier said in the company’s full-year earnings report: “The value of the company’s assets during the year has been adversely affected by the decrease in share prices of our two major investments, Ascendant and KeyTech.

“We continue to believe that both companies are significantly undervalued but recognise the difficult macroeconomic environment they currently operate in. We are supportive of the corporate transactions recently completed by KeyTech and we believe they will prove to be transformational.

“We are announcing a final dividend of 20 cents per share which is maintained from the prior year. We believe that the next 12 months will continue to be difficult in Bermuda but the opportunities for a company such as KeyTech are significant and we look forward to their growth over the next few years.”

KeyTech’s recent announcement that it had sold 100 percent of its interest in BTC to Barrie OpCo Ltd, and their acquisition of BOTCAT, that owns 100 percent of WestStar TV Ltd in Cayman and a 40 percent interest in CableVision Holding Ltd in Bermuda, was highlighted.

“As a result of this acquisition KeyTech will now have a controlling interest of 68 percent in Cablevision,” stated the report.

“Whilst recognising the significant risks, both financial through the increase of debt on it balance sheet and operational and management risks associated with a significant acquisition, we support these transactions as they are expected to be transformational for KeyTech.”