Final Results
Jersey Electricity Company Limited
17 December 2002
The Jersey Electricity Company
Preliminary announcement of Annual Unaudited Results
Year Ended 30 September 2002
At a meeting of the Board of Directors held on 16 December 2002, the final
accounts for the Group for the year to 30 September 2002 were approved, details
of which, are attached.
A final gross dividend of 45.5 pence (36.4p net of tax) on the Ordinary and 'A'
Ordinary shares in respect of the period ended 30 September 2002 was recommended
which, together with the interim gross dividend of 37.0p (29.6p net of tax),
makes a total gross dividend for the year of 82.5p (66p net of tax) on each £1
share.
The dividend will be paid on 31 March 2003 to those shareholders registered in
the books of the Company on 7 March 2003. A dividend on the 5% cumulative
participating preference shares of 1.5% (2001 1.5%) payable on 1 July 2003 was
also recommended.
The Annual General Meeting of the Company will be held on 10 March 2003.
P.J. Routier
Company Secretary
Direct telephone number : 01534 505253
Direct fax number : 01534 505553
Email : proutier@jec.co.uk
17th December 2002
The Powerhouse,
PO Box 45,
Queens Road,
St Helier,
Jersey JE4 8NY
THE JERSEY ELECTRICITY COMPANY LIMITED
Preliminary announcement of annual unaudited results
Year ended 30 September 2002
Key Financial Infomation 2002 2001 % rise/(reduction)
Turnover £60.4m £60.4m -
Profit before tax * £4.5m £3.5m 26%
Earnings per share * 214p 158p 35%
Gross Dividends per ordinary share 82.5p 75.0p 10%
Net Dividends per ordinary share 66.0p 60.0p 10%
Dividend cover * 3.2 times 2.6 times 23%
Net debt at year end £1.5m £10.4m (86%)
* before exceptional items
Group turnover for the year to 30 September 2002 at £60.4m was at the same level
as the year ended 30 September 2001. The Energy business contributed £41.0m of
the Group turnover which was £0.8m less than last year due to a marginal
reduction in units sold compared to 2001 with milder weather being the primary
reason. Tariffs were frozen at the same level as the previous year. Turnover in
the Electrical Retailing, Contracting and Property businesses all rose in the
year. Turnover in the Other Businesses segment fell marginally due to the impact
of our associate Newtel having been consolidated as a subsidiary for seven
months in the previous year.
An exceptional item of £1.8m (before tax) has been recognised in the year to 30
September 2002 relating to the costs of manpower reductions at the La Collette
oil fired power station in Jersey where environmental considerations have led to
their displacement by electricity imported from the increasingly liberalised
European electricity market. This has been facilitated by the Company's recent
investment in increased interconnector capacity. In addition the impairment of a
3% investment in GoPro Landsteinar, an IT services company, has been recognised
as an exceptional cost of £1.1m by writing down the book value to zero.
Profit on ordinary activities before interest and exceptional costs for the year
to 30 September 2002 rose by 16% to £4.7m. Profits in the Electricity business
fell by £0.6m to £4.2m with reduced unit sales, frozen prices, increased
depreciation on new assets and higher insurance charges being the main factors.
The Electrical Retailing business doubled profits to £0.2m due mainly to the
increased level of turnover. The profitability of the Contracting business
reduced to £0.1m from £0.2m in 2001 due to pressures on margins in a very
competitive industry. The Property division continued to grow profits to £0.9m
from £0.7m in the previous year due to higher occupancy rates. Other businesses,
mostly in their start up phase, including joint ventures and associates (before
minority interests), produced a loss of £0.7m being an improvement of £1.1m over
2001.
Profit on ordinary activities before taxation, excluding the impact of the
exceptional items, increased from £3.5m in 2001 to £4.5m for the year to 30
September 2002. The taxation charge for the year was £0.8m, net of the
exceptional tax credit of £0.4m in relation to reorganisation costs.
Group earnings per share, excluding the impact of exceptional costs rose 35% to
£2.14 compared to £1.58 in 2001. Earnings per share including the impact of the
exceptional costs were £0.49 compared to £1.58 in the previous year.
Dividends for the year rose by 10% from a gross level of 75p (60p net of tax) in
2001 to a recommended 82.5p (66p net of tax) for 2002 consistent with the aim to
deliver a sustained increase in real terms each year. Dividend cover, excluding
exceptional costs, increased from 2.6 to 3.2 times.
Note: The financial information set out in the announcement does not constitute
the Company's statutory accounts for the years ended 30 September 2002 or 2001.
The financial information for the year ended 30 September 2001 is derived from
the statutory accounts for that year which have been delivered to the Registrar.
The auditors reported on those accounts; their report was unqualified. The
statutory accounts for the year ended 30 September 2002 will be finalised on the
basis of the financial information presented by the Directors in this
preliminary announcement and will be delivered to the Registrar following the
Company's annual general meeting.
THE JERSEY ELECTRICITY COMPANY LIMITED
Consolidated Profit and Loss Account (unaudited)
For the year ended 30 September 2002
Notes 2002 2001
£ 000 £ 000
TURNOVER: (as restated)
Group and share of joint venture 60,812 60,525
Less: Share of joint venture turnover (461) (170)
GROUP TURNOVER 2 60,351 60,355
Cost of sales (37,510) (36,607)
Gross profit 22,841 23,748
Net operating expenses (16,999) (18,728)
Exceptional item - redundancy costs 3a (1,790) -
Exceptional item - impairment of investments 3b (1,098) -
GROUP OPERATING PROFIT 2,954 5,020
Share of operating loss in joint venture (661) (700)
Loss on disposal of subsidiary - (65)
Share of associate's operating loss (503) (238)
PROFIT ON ORDINARY ACTIVITIES BEFORE INTEREST PAYABLE 2 1,790 4,017
Interest payable and similar charges (217) (485)
PROFIT ON ORDINARY ACTIVITIES BEFORE TAXATION 1,573 3,532
Tax on profit on ordinary activities (782) (1,390)
PROFIT ON ORDINARY ACTIVITIES AFTER TAXATION 791 2,142
Minority Interest (41) 290
PROFIT ON ORDINARY ACTIVITIES AFTER TAXATION
AND MINORITY INTEREST 750 2,432
Dividends paid and proposed (1,020) (928)
RETAINED (LOSS)/PROFIT FOR THE GROUP AND SHARE
IN JOINT VENTURE (270) 1,504
EARNINGS PER ORDINARY SHARE (BASIC AND DILUTED) £0.49 £1.58
EARNINGS PER ORDINARY SHARE (BASIC AND DILUTED)
EXCLUDING EXCEPTIONAL ITEMS £2.14 £1.58
THE JERSEY ELECTRICITY COMPANY
Consolidated Statement of Total Recognised Gains and Losses (unaudited)
For the year ended 30 September 2002
Notes 2002 2001
£ 000 £ 000
Profit/(loss) for the financial year:
Group 233 1,742
Associate (503) (238)
Unrealised loss on investment - (1,128)
Unrealised surplus on revaluation of plant 91 145
Unrealised surplus on revaluation of investment properties 425 3,333
Total recognised gains relating to the period 246 3,854
Prior year adjustments 1 3,484 (10,263)
Total recognised gains/(losses) since last annual report and accounts 3,730 (6,409)
Consolidated Note of Historical Cost Profits and Losses (unaudited)
For the year ended 30 September 2002
2002 2001
£ 000 £ 000
Reported profit on ordinary activities before taxation (after minority interest) 1,532 3,822
Difference between the historical cost depreciation charge
and the actual depreciation charge for the period calculated
on the revalued amount 1,241 1,218
Historical cost profit on ordinary activities before taxation(after minority interest) 2,773 5,040
Historical cost profit for the period retained after taxation,
minority interest and dividends 971 2,722
THE JERSEY ELECTRICITY COMPANY
Balance Sheets (unaudited)
30 September 2002
Group Group Company Company
Notes 2002 2001 2002 2001
£ 000 £ 000 £ 000 £ 000
FIXED ASSETS (restated) (restated)
Intangible fixed assets 182 223 - -
Tangible fixed assets 119,905 122,536 119,901 122,527
Investments:
subsidiary - - 477 477
other investments 5 1,103 2,963 3,739
joint venture - - 1,389 859
Share of associate's net assets 566 747 - -
Joint venture share of gross assets 557 501
Joint venture share of gross liabilities (73) (134)
Net share of joint venture assets 484 367 - -
121,142 124,976 124,730 127,602
CURRENT ASSETS
Stocks and work in progress 2,708 2,957 2,646 2,880
Debtors due within one year 1 7,982 10,649 8,227 10,684
Debtors due after more than one year 596 577 720 577
Cash at bank and in hand 210 17 75 -
11,496 14,200 11,668 14,141
CREDITORS
Amounts falling due within one year 11,078 18,232 11,011 18,185
NET CURRENT ASSETS/(LIABILITIES) 418 (4,032) 657 (4,044)
Total assets less current liabilities 121,560 120,944 125,387 123,558
CREDITORS
Amounts falling due after more than one year 961 1,085 925 1,051
PROVISIONS FOR LIABILITIES AND CHARGES
Pensions and similar obligations 484 496 484 496
Deferred taxation 11,884 11,372 11,884 11,372
13,329 12,953 13,293 12,919
108,231 107,991 112,094 110,639
CAPITAL AND RESERVES
Called up share capital:
Equity 1,532 1,532 1,532 1,532
Non-Equity 235 235 235 235
Reserves - Equity 106,402 106,156 110,327 108,872
SHAREHOLDERS' FUNDS 108,169 107,923 112,094 110,639
Equity - Minority Interest 62 68 - -
108,231 107,991 112,094 110,639
THE JERSEY ELECTRICITY COMPANY LIMITED
Consolidated Cash Flow Statement (unaudited)
For the year ended 30 September 2002
2002 2001
£ 000 £ 000
RECONCILIATION OF OPERATING PROFIT TO
NET CASH INFLOW FROM OPERATING ACTIVITIES
Group operating profit 2,954 5,020
Depreciation charges 7,676 7,281
Decrease/(increase) in stocks & work in progress 249 (651)
Decrease/(increase) in debtors 2,204 (136)
Increase/(decrease) in creditors 1,707 (129)
Impairment of investment 1,098 -
NET CASH INFLOW FROM OPERATING ACTIVITIES 15,888 11,385
Returns on investments and servicing of finance (217) (485)
Taxation (284) (910)
Capital and investment expenditure (5,481) (17,288)
Dividends paid (952) (904)
INCREASE/(DECREASE) IN CASH 8,954 (8,202)
RECONCILIATION OF NET CASHFLOW
Increase/(decrease) in cash 8,954 (8,202)
Net debt - start of year (10,440) (2,238)
Net debt - end of year (1,486) (10,440)
Cash at bank and in hand 210 17
Overdraft (1,696) (10,457)
Net debt (1,486) (10,440)
THE JERSEY ELECTRICITY COMPANY LIMITED
Notes to the accounts
Year ended 30 September 2002
1. Basis of Preparation
The accounts have been prepared on the basis of the accounting policies set in the Group 2001 Annual Report and
Accounts with the exception that the accounts for the years to 30 September 2001 and 2002 reflects the changes in the
treatment of unbilled units of electricity supplied to match revenues with costs. The impact of this adjustment is to
increase the level of balance sheet debtors and net assets by £3,047,000 in 2002 and £3,484,000 in 2001.
2. Turnover and profit
The contributions of the various activities of the Group to turnover and profit are listed below:
Turnover Operating profit/(loss)
2002 2001 2002 2001
Principal activities: £000 £000 £000 £000
Energy 40,954 41,792 4,238 4,846
Contracting 7,557 7,307 78 228
Retail appliance sales 6,467 5,654 176 85
Property 1,845 1,410 891 703
Other 3,528 4,192 (705) (1,845)
60,351 60,355 4,678 4,017
Exceptional item - redundancy costs (1,790) -
Exceptional item - impairment of investments (1,098) -
Profit on ordinary activities before interest payable 1,790 4,017
The information currently available to report the net assets of each business
class as each reportable segment is limited as each business operates as a
division of the Group and therefore in certain instances there is no reasonable
basis to allocate the Group net assets to each business class. On a geographical
basis, the Company's material operations are conducted within the Channel
Islands area.
3. Exceptional Items
a. Redundancy costs
The 2002 exceptional item of £1,790,000 relates to the costs of manpower
reductions of La Collette power station in Jersey. The tax benefit arising from
this exceptional item is £358,000 giving a net cost for the current year of
£1,432,000.
b. Impairment of investments
The exceptional charge of £1,098,000 relates to the write-down of the Group
investment in shares to zero in GoPro Landsteinar Ehf. following an impairment
review.
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