Ascendant Group Announces Q2 2014 Results

Hamilton, Bermuda – 19 September, 2014 – In a filing with the Bermuda Stock Exchange (“BSX”), Ascendant Group Limited (the "Ascendant Group" or “Company”; Ticker: AGL.BH) today released the six month financial results to 30 June, 2014. In a report to shareholders the Company said:

“Ascendant Group Limited’s consolidated net earnings for the first six months of 2014 decreased $640,688, or 35.2%, to $1.2 million, or $0.09 per share, versus $1.8 million, or $0.13 per share, for the same period in 2013. Although earnings improved at both Bermuda Gas & Utility Company Limited and AG Holdings Limited, as compared to the prior year, these results were offset by increased expenses incurred by the holding company and decreased operating results at Bermuda Electric Light Company Limited (BELCO), due to lower electricity sales and higher operating costs.

BELCO’s electric sales revenues, excluding the cost of fuel (i.e., fuel adjustment sales), decreased $1.1 million, or 1.6%, when compared to the same period last year. Total kilowatt hour (kWh) sales for the current period declined 2.9 million kWh, or 1.1%, when compared to 2013. Basic tariff rates remained unchanged in 2014; however, a Graduated Facilities Charge (GFC) was introduced on 1 June 2014 to reduce costs for lower-usage residential customers, while slightly increasing the overall cost for those who consume the highest number of kWh per month. The GFC was introduced with approval of the Energy Commission in response to the call to assist lower-income customers who struggle to meet monthly bills during these difficult economic times. The GFC gives BELCO no addition to or loss of revenue, allocating the least cost to those placing the lowest burden on the system, and also encouraging energy efficiency.

The overall decline in electricity sales is due directly to decreased residential kWh sales, which year-to-date, are down $1.8 million, with a decline of 6.4 million kWh sales, or 5.5%, as compared to those realized in the first six months of 2013. This is the fifth consecutive year that BELCO has reported significantly reduced kWh consumption, which is attributed primarily to the continued weakness of the local economy, accompanied by lower residential unit occupancy, which is related to increased business closures and downsizing. At the same time, some residential customers have increased their use of energy efficient lighting and appliances, converted to renewable energy installations and taken steps to increase energy conservation overall, contributing to lower demand. The decrease in residential sales was partially offset by a 2.4% improvement in demand customer sales, which increased by $558,000 over the comparative periods, representing a 2.8 million increase in kWh sold. This increase is attributed to several new projects coming online, especially the new Acute Care Wing at King Edward VII Memorial Hospital, as well as increased consumption by several existing customers. Commercial sales are largely unchanged in 2014 as compared to the same period in 2013.

BELCO’s fuel adjustment sales decreased $1.7 million, or 3.9%, as compared to 2013. The decrease in the average cost per barrel of fuel to $129.24 (which includes taxes, duty, shipping, storage, local pipeline transportation and working capital costs for the on-Island fuel reserves) in 2014 versus $131.66 for the first half of 2013, resulted in a total decrease in fuel adjustment sales of $1.0 million. Fuel adjustment sales decreased a further $1.5 million due to a decrease of 10.9 million in kWh sales volume between the 2014 and 2013 comparative periods. The fuel cost and kWh sales decreases were offset by a $783,000 increase in fuel adjustment sales due to a decrease in fuel efficiency. The decrease in fuel efficiency was due to unplanned generator outages experienced in 2014 that required BELCO to operate less efficient plant to meet demand. BELCO does not incur any profit or loss on the fuel adjustment; hence this portion of BELCO’s gross electric revenue is offset by identical fuel costs reflected in Operating and Administrative Expenses.

Bermuda Gas’ net income is up 31% for the first half of 2014, as compared to the same period in 2013. This is encouraging in light of the pressures of persistent economic recession, increased competition and rising gas prices. Increased service and parts sales have been major contributors to bottom line strength, as Bermuda Gas continues to cultivate a culture of service excellence.

iFM Limited, a joint venture company that is 60% owned and controlled by Ascendant Group and 40% by a Bermuda-registered, exempted subsidiary of Black & McDonald Limited, generated results that are tracking on plan to the

same period in 2013 with no material difference.

On 29 May 2012, the Company acquired a 57% controlling interest in Air Care Limited, beginning a phased acquisition that was completed on 30 July 2014, with the Company acquiring all remaining shares. The Air Care acquisition was

funded by debt scheduled to be repaid by cash flow from Air Care’s operations over eight years, commencing in the third quarter of 2014. Company net earnings, therefore, reflect a 71% interest in Air Care’s 2013 six-month comparative period results versus an 85% interest in results for the six-month period ended 30 June 2014. Air Care sales increased 22.3% in 2014, or $1.7 million, on a gross sales basis when compared to 2013 sales during the same period. Gross profit, however, declined 5.6% due to unforeseen challenges on a major project, as well as cancellations of several maintenance agreements and underperformance of other maintenance agreements, likely the result of local economic conditions.

Operating and administrative expenses for the period decreased $660,068, or 0.65%, as compared to the first six months of 2013, due to cost control measures taken by the Company, and decreased expenditure related to BELCO’s Defined Benefit Pension Plan, as compared to 2013. Ascendant Group did incur significant expenses for consulting fees related to the development of new projects, including an Integrated Resource Plan for Bermuda’s energy

infrastructure development, as well as information technology system enhancements. Increased expenses were also associated with health insurance costs; the Company is examining alternatives to help mitigate rising costs with

respect to health insurance.

At the Annual General Meeting on 6 June 2014, the entire Board of Directors was re-elected, except S. Reginald Minors who did not seek re-election. We thank Mr. Minors for 19 years of distinguished service, including two years as Chairman of the Board and eight years as Deputy Chairman. Peter C. Durhager and L. Anthony Joaquin were re-elected as Chairman of the Board and Deputy Chairman, respectively.

Ascendant Group’s share price as at 30 June 2014 was $6.50 versus $11.00 on 30 June 2013. Ascendant Group’s book value, attributable to Company shareholders, decreased $0.27 to $30.37 as at 30 June 2014 versus $30.64 as at 30 June 2013. The Board of Directors of Ascendant Group declared a dividend of 7.5 cents per share payable on 30 June 2014. The second quarter dividend declaration followed a thorough review of Ascendant Group’s dividend policy by the Board of Directors, as our Company moves to retain more capital to invest in Bermuda’s energy infrastructure, and to deal with the effects on the Company of Bermuda’s sustained economic recession. The Board of Directors

determined that the former dividend level was unsustainable, and that the reduced dividend is commensurate with earnings and in line with other comparable utilities.

The Company bid farewell in August to former Chief Financial Officer Chris Coelho, who left to pursue other opportunities. We thank him for his service.

Ascendant Group is making changes in order to fulfill our responsibility to deliver clean, affordable, reliable energy, which is fundamental to Bermuda’s quality of life and productivity, including business retention and development. Likewise, Ascendant Group’s success is directly linked to the Island’s growth, stability and prosperity. It is in the best interests of shareholders, employees, consumers and the community at large for Ascendant Group to invest in our business in order to secure a bright energy future for Bermuda.

WALTER M. HIGGINS

President & Chief Executive Officer”

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Ascendant Group Limited is a publicly traded investment holding company whose shares trade on the Bermuda Stock Exchange (AGL.BH). Ascendant Group’s Vision is to be Bermuda’s trusted, preferred provider of energy and infrastructure solutions. Ascendant Group is the parent company of Bermuda Electric Light Company Limited (BELCO), Bermuda Gas & Utility Company Limited and AG Holdings Limited, which includes Air Care Limited, iFM Limited, iEPC Limited, PureNERGY Renewables, Ltd. and Ascendant Properties Limited.  For further information about Ascendant Group Limited, visit www.ascendant.bm

Contact: Linda Smith,

SVP Corporate Relations

441-299-2814

lsmith@ascendant.bm