Final Results

RNS Number : 9987T

Jersey Electricity PLC

15 December 2011

 



 

    Jersey Electricity plc                            

 Preliminary Announcement of Annual Results

Year Ended 30 September 2011

At a meeting of the Board of Directors held on 14 December 2011, the final accounts for the Group for the year to 30 September 2011 were approved, details of which are attached.

The financial information set out in the announcement does not constitute the Company's statutory accounts for the year ended 30 September 2011 or 2010, but is derived from those accounts. Statutory accounts for 2010 have been delivered to the Jersey Registrar of Companies and those for 2011 will be delivered in early 2012. The auditors have reported on those accounts and their reports were unqualified. 

A final dividend of 6.50p on the Ordinary and 'A' Ordinary shares in respect of the year ended 30 September 2011 was recommended compared to 6.20p for 2010 (re-stated following the 20 for 1 share split of the Ordinary and 'A' Ordinary shares approved at the 2011 AGM). Together with the interim dividend of 4.25p the proposed total dividend declared for the year was 10.75p on each share.

The final dividend will be paid on 30 March 2012 to those shareholders registered in the books of the Company on 24 February 2012. A dividend on the 5% cumulative participating preference shares of 1.5% (2010:1.5%) payable on 2 July 2012 was also recommended.

The Annual General Meeting of the Company will be held on 6 March 2012.

M.P. Magee                                                                           P.J. Routier

Finance Director                                                                    Company Secretary

Direct telephone number : 01534 505321                                 Direct telephone number : 01534 505253

Direct fax number : 01534 505466                                           Direct fax number : 01534 505515

Email : [e-mail]                                                       Email : [e-mail]

15 December 2011     

The Powerhouse,

PO Box 45,

Queens Road,

St Helier,

Jersey JE4 8NY

JERSEY ELECTRICITY plc                       

Preliminary Announcement of Annual Results

Year ended 30 September 2011                                                                                                       

The Chairman, Geoffrey Grime, comments :

"Jersey Electricity produced a solid performance in 2011 with our turnover breaking through the £100m barrier for the first time. Profits fell to £11.1m but this was due to our 2010 figures including a material upside from the revaluation of our investment property portfolio and a windfall receipt from asset sales by our ex-associate Newtel. The return on fixed assets in the Energy business remained at a level needed to support our investment programme going forward. We successfully commissioned the £9m South Hill Switching Station in a year when our overall capital expenditure rose by over 70% to £15m. Volatility in our imported power prices still remains but following our 5% reduction in customer tariffs in 2010 and a freeze in prices during 2011 we intend to retain prices at existing levels until at least April 2012. This is in the context of UK electricity prices having risen by an average of 17% in the last year and we are pleased to report that our tariffs have remained competitive with, and in many cases cheaper than, other jurisdictions for most customers. Finally we agreed a new €1bn, 10 year agreement with EDF during this year and are already hedging power for 2013 and beyond using this new framework".

Financial Summary	2011	2010	% change
Turnover	£100.49m	£98.89m	2%
Profit before tax	£11.07m	£14.56m	(24)%
Profit in Energy business	£  7.68m	£7.74m	(1)%
Earnings per share	28.05p	40.20p*	(30)%
Dividend paid per ordinary share	10.45p	9.95p*	5%
Special dividend paid per ordinary share	3.25p*	-	-

*Earnings and dividends per share have been re-stated to reflect the 20 for 1 share split approved at the 2011 AGM

Group turnover for the year to 30 September 2011 at £100.5m was 2% higher than in the year ended 30 September 2010. Unit sales volumes in our Energy business were 1% higher than last year but revenues in our Energy business remained at the same level as 2010, at £74.5m, as a result of the 5% decrease in prices to our customers from January 2010.

Profit before tax for the year to 30 September 2011 fell to £11.1m from £14.6m but the underlying position remained relatively constant as the movement from the 2010 figures included £2.5m attributable to the revaluation of our investment property portfolio and £0.8m from the distribution of proceeds by our ex-associate Newtel from the sale of assets. 

Profits in our Energy business, at £7.7m, remained on a par with last year. Tariffs to our customers were reduced by 5% in January 2010 and remained frozen throughout this full financial year. We have publicly indicated that tariffs will remain at current levels until at least April 2012 and have hedged around 90% and 60% of both power and foreign exchange for 2012 and 2013 respectively. We again imported most of our power requirements from France (96% against 93% in the previous year).

Profits in our Property division, excluding movement from property revaluations, fell to £1.7m from £1.9m last year primarily as a result of a back-dated rent review settlement that crystallised in the last financial year. Our investment property portfolio was revalued downwards marginally by £0.1m to £14.9m this year due mainly to movements in stamp duty in Jersey being reflected in the external assessment.   

Despite the tough trading conditions currently prevailing in markets theRetailing business saw profits remain at £0.5m with turnover up 14% to £16.5m. The Building Services business produced a £0.2m profit, being on a par with last year, even though pressure on margins continued to exist in a very competitive marketplace. In addition our other business units - Jersey Energy, Jendev and Jersey Deep Freeze all had a profitable year. We also received £0.2m in proceeds from the sale of our remaining shares/loans in our ex-associate Newtel. Foreshore, our data centre joint venture, had a turnover of £4.9m being £0.1m less than in 2010 with profitability moving from a small profit last year to a £0.1m loss in 2011. 

Interest received on deposits in 2011 was £0.3m being at the same level as in the previous year. The taxation charge at £2.4m was higher than in 2010 because although profits last year were above those in 2011 much of the year-on-year difference was due to non-taxable items such as upside from revaluation of investment properties.  

Group earnings per share fell to 28.05p compared to 40.20p in 2010 (re-stated to reflect the 20 for 1 share split approved at the 2011 AGM) due mainly to the lower profits as a sizeable element of the profit in the previous year was due to non-recurring 'windfall' revenues and a material upside from the revaluation of investment property.

Dividends paid in the year, net of tax, rose by 5% from 9.95p in 2010, to 10.45p. In addition, a special dividend of 3.25p per share, which was proposed last year, was paid in the year. Dividends declared last year have been re-stated due to the aforementioned share split. The proposed final dividend for this year is 6.50p, being a 5% rise on the previous year. Dividend cover fell from 4.0 times in 2010 to 2.1 times due primarily to the lower level of profit.

Net cash inflow from operating activities at £20.8m was £3.6m higher than 2010. Capital expenditure, at £15.0m rose from £8.7m last year with the completion of the £9.3m South Hill switching station capital project, including associated cabling works, to reinforce the electricity network in Jersey being the primary driver. Cash at bank, including short-term investments, at the year end was £24.5m being £1.9m higher than last year.

Our defined benefits pension scheme, which showed a £1.4m surplus, net of deferred tax, at the 2010 year end showed a £3.5m deficit as at 30 September 2011. This movement was due mainly to a decrease in scheme assets associated with volatility in financial markets.

Consolidated Income Statement
for the year ended 30 September 2011
				2011				2010
				£000				£000
Revenue				100,494				98,889
Cost of sales				(69,989)				(69,071)
Gross profit				30,505				29,818
Revaluation of investment properties				(115)				2,391
Operating expenses				(19,553)				(18,000)
Group operating profit before joint venture				10,837				14,209
Share of (loss)/profit of joint venture				(86)				26
Group operating profit				10,751				14,235
Interest receivable				327				338
Finance costs				(11)				(13)
Profit from operations before taxation				11,067				14,560
Taxation				(2,423)				(2,185)
Profit from operations after taxation				8,644				12,375
Attributable to:
Owners of the Company				8,593				12,315
Non-controlling interests				51				60
				8,644				12,375
Earnings per share
- basic and diluted				28.05p				40.20p
Statement of Comprehensive Income
for the year ended 30 September 2011
				2011				2010
				£000				£000
Profit for the  year				8,644				12,375
Other comprehensive income
Actuarial (loss)/gain on defined benefit scheme				(6,640)				5,158
Fair value loss on cash flow hedges				100				(1,212)
Tax related components relating to other comprehensive income				1,308				(860)
Total comprehensive income  for the year				3,412				15,461
Attributable to:
Owners of the Company				3,361				15,401
Non-controlling interests				51				60
				3,412				15,461

	Balance Sheets at 30 September 2011			Group				Company
				2011		2010		2011	2010
				£ 000		£ 000		£ 000	£ 000
	NON-CURRENT ASSETS
	Intangible assets			60		29		60	29
	Property, plant and equipment			128,330		120,944		128,327	120,944
	Investment properties			14,813		14,928		14,813	14,928
	Other investments			1,557		1,677		2,291	3,115
	Long-term loans			-		-		400	450
	Retirement benefit surplus			-		1,795		-	1,795
	Total non-current assets			144,760		139,373		145,891	141,261
	CURRENT ASSETS
	Inventories			6,451		7,573		6,384	7,507
	Trade and other receivables			15,361		15,958		15,162	15,763
	Derivative financial instruments			486		387		486	387
	Short-term investments - cash deposits			17,745		17,920		17,745	17,920
	Cash and cash equivalents			6,787		4,756		6,701	4,612
	Total current assets			46,830		46,594		46,478	46,189
	Total assets			191,590		185,967		192,369	187,450
	LIABILITIES
	Trade and other payables			15,878		14,116		15,811	14,040
	Current tax payable			1,820		2,066		1,820	2,066
	Total current liabilities			17,698		16,182		17,631	16,106
	NET CURRENT ASSETS			29,132		30,412		28,847	30,083
	NON-CURRENT LIABILITIES
	Trade and other payables			17,152		15,907		17,152	15,907
	Retirement benefit deficit			4,420		-		4,420	-
	Financial liabilities - preference shares			235		235		235	235
	Deferred tax liabilities			11,226		11,932		11,226	11,932
	Total non-current liabilities			33,033		28,074		33,033	28,074
	Total liabilities			50,731		44,256		50,664	44,180
	Net assets			140,859		141,711		141,705	143,270
	EQUITY
	Share capital			1,532		1,532		1,532	1,532
	Other reserves			836		756		836	756
	Retained earnings			138,477		139,396		139,337	140,982
	Equity attributable to owners of the company			140,845		141,684		141,705	143,270
	Non-controlling interests			14		27		-	-
	Total equity			140,859		141,711		141,705	143,270

Cash Flow Statement
for the year ended 30 September 2011
		Group		Company
		2011	2010	2011	2010
		£ 000	£ 000	£ 000	£ 000
Cash flows from operating  activities
Operating profit		10,837	14,209	10,799	14,127
Adjustment for disposal of shares in associate		(59)	-	(59)	-
Adjustment for repayment of long-term loan by associate		(136)	(280)	(136)	(280)
Depreciation and amortisation charges		8,212	7,997	8,212	7,997
Loss/(gain) on revaluation of investment properties		115	(2,391)	115	(2,391)
Pension contributions paid less expense in Income Statement		(438)	(348)	(438)	(348)
Profit on sale of fixed assets		6	-	6	-
Operating cash flows before movement in working capital		18,537	19,187	18,499	19,105
Decrease/(increase) in inventories		1,122	(1,502)	1,123	(1,506)
(Increase)/decrease in trade and other receivables		617	(1,065)	632	(1,076)
Increase in trade and other payables		2,326	1,809	2,334	1,776
Interest received		309	312	309	312
Preference dividends paid		(9)	(9)	(9)	(9)
Income taxes paid		(2,067)	(1,572)	(2,067)	(1,572)
Net cash flows generated from operating activities		20,835	17,160	20,821	17,030
Cash flows from investing activities
Purchase of property, plant and equipment		(14,940)	(8,669)	(14,940)	(8,669)
Investment in intangible assets		(31)	-	(31)	-
Net proceeds from disposal of  fixed assets		17	21	17	21
Repayment of long-term loans by joint venture and associate		186	430	186	430
Disposal of shares in associate		59	-	59	-
Movement in short-term investments		175	(9,720)	175	(9,720)
Net cash flows used in investing activities		(14,534)	(17,938)	(14,534)	(17,938)
Cash flows from financing  activities
Equity dividends paid		(4,270)	(3,102)	(4,198)	(3,049)
Net cash flows used in financing activities		(4,270)	(3,102)	(4,198)	(3,049)
Net inrease/(decrease) in cash and cash equivalents		2,031	(3,880)	2,089	(3,957)
Cash and cash equivalents at 1 October		4,756	8,636	4,612	8,569
Net cash and cash equivalents at 30 September		6,787	4,756	6,701	4,612

Consolidated  Statement of Changes in Equity
for the year ended 30 September 2011
		Share capital	Other  reserves	Retained earnings	Total reserves
Group:		£ 000	£ 000	£ 000	£ 000
At 1 October 2010		1,532	756	139,396	141,684
Total recognised income and expense for the year		-	-	8,593	8,593
Unrealised gain on hedges (net of tax)		-	80	-	80
Actuarial loss on defined benefit scheme (net of tax)		-	-	(5,314)	(5,314)
Equity dividends		-	-	(4,198)	(4,198)
At 30 September 2011		1,532	836	138,477	140,845
At 1 October 2009		1,532	1,726	126,074	129,332
Total recognised income and expense for the year		-	-	12,315	12,315
Unrealised loss on hedges (net of tax)		-	(970)	-	(970)
Actuarial gain on defined benefit scheme (net of tax)		-	-	4,056	4,056
Equity dividends		-	-	(3,049)	(3,049)
At 30 September 2010		1,532	756	139,396	141,684
Company:
At 1 October 2010		1,532	756	140,982	143,270
Total recognised income and expense for the year		-	-	7,867	7,867
Unrealised gain on hedges (net of tax)		-	80	-	80
Actuarial loss on defined benefit scheme (net of tax)		-	-	(5,314)	(5,314)
Equity dividends		-	-	(4,198)	(4,198)
At 30 September 2011		1,532	836	139,337	141,705
At 1 October 2009		1,532	1,726	127,988	131,246
Total recognised income and expense for the year		-	-	11,987	11,987
Unrealised loss on hedges (net of tax)		-	(970)	-	(970)
Actuarial gain on defined benefit scheme (net of tax)		-	-	4,056	4,056
Equity dividends		-	-	(3,049)	(3,049)
At 30 September 2010		1,532	756	140,982	143,270

Notes to the accounts

Year ended 30 September 2011

1.   Basis of Preparation

The consolidated financial statements of Jersey Electricity plc, for the year ended 30 September 2011 have been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union (EU), including International Accounting Standards (IAS) and Interpretations issued by the International Financial Reporting Interpretations Committee (IFRIC). 

While the financial information included in this preliminary announcement has been prepared in accordance with the appropriate recognition and measurement criteria, this announcement does not itself contain sufficient information to comply with IFRS.  The Company expects to publish full financial statements that comply with IFRS in early 2012.

The Company has considerable financial resources and as a consequence, the directors believe that the Company is well placed to manage its business risks successfully despite the current uncertain economic outlook. The directors have a reasonable expectation that the Company has adequate resources to continue in operational existence for the foreseeable future. Thus they continue to adopt the going concern basis of accounting in preparing the annual financial statements.

2    Segmental information
Revenue and profit information are analysed between the businesses as follows:
	2011	2011	2011		2010	2010	2010
	External	Internal	Total		External	Internal	Total
	£000	£000	£000		£000	£000	£000
Revenue			)9
Energy	74,486	326	74,812		74,475	281	74,756
Building Services	4,716	232	4,948		4,283	237	4,520
Retail	16,499	67	16,566		14,410	50	14,460
Property	2,216	688	2,904		2,619	696	3,315
Other	2,577	654	3,231		3,102	655	3,757
	100,494	1,967	102,461		98,889	1,919	100,808
Inter-Segment elimination			(1,967)				(1,919)
Revenue			100,494				98,889
Operating profit
Energy			7,678				7,742
Building Services			220				240
Retail			476				465
Property			1,652				1,858
Other			840				1,539
Operating profit before property revaluation			10,866				11,844
(Loss)/gain on revaluation of investment properties			(115)				2,391
Group operating profit			10,751				14,235

 

END

 

 

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