CO 2 and responsibility

Transcription

1 performance investment KWh CO 2 and responsibility Interim Report months ended 31 March 2007

2 Inside front cover (blank)

3 Contents Directors, Officers and Professional Advisers 1 Directors Statement 2 Investor Timetable for Group Income Statement (Unaudited) 4 Group Statement of Recognised Income and Expense (Unaudited) 4 Group Balance Sheet (Unaudited) 5 Group Cash Flow Statement (Unaudited) 6 Notes to the Interim Accounts 7 Directors, Officers and Professional Advisers Non-Executive Directors Executive Directors Secretary Derek Ryder Maltwood (Chairman) Jean Amy Le Maistre Arthur Jeremy Arnold, F.C.A. Christopher Charles Evans Geoffrey John Grime, F.C.A. Clive Aubrey Charles Chaplin, B.A. Michael Joseph Liston (Chief Executive), F.R.Eng., B.Sc., C.Eng., F.I.E.E., C.I.Mgt. Martin Paul Magee (Finance), C.A. David Brian Padfield (Operations), B.Sc., C.Eng., F.I.E.E., M.C.M.I. Richard Alan Plaster (Commercial & Human Resources), F.C.I.P.D. Peter John Routier, B.Sc., F.C.I.S. Registered Office Auditors Queens Road, St. Helier, Jersey Deloitte & Touche LLP, Esplanade, St. Helier, Jersey Bankers Brokers Registrar Royal Bank of Scotland International Limited, 16 Library Place, St. Helier, Jersey Collins Stewart (CI) Limited, Esplanade, St. Helier, Jersey Computershare Investor Services (CI) Limited, 31 Pier Road, St. Helier, Jersey Interim Report

4 Directors Statement Financial Summary 6 months 6 months % increase/ (decrease) Electricity Sales kwh (000) 335, ,949 (6)% Turnover 40.0m 35.8m 12% Profit before tax 4.9m 5.1m (5)% Profit in Energy business 3.0m 3.9m (23)% Earnings per share % Net dividend proposed per ordinary share 49p 44p 11% Group profit before tax in the first half of 2007 was 4.9m being 5% lower than in the same period last year, despite a 12% increase in turnover. This was principally due to a lower level of electricity sales and our decision to absorb, rather than pass on to customers, some of the increased cost of power imported from Europe. Our earnings per share rose by 11% due to a reduction in the effective tax rate for the 2007 and 2008 financial years. Note 3 to the Interim Accounts explains the rationale for this tax change. Power prices to our customers were increased by an average just above 19% from 1 January Having hedged our position in the forward power markets, we were able to pledge that prices would remain unchanged for at least two years. Our aim remains to restore during the 2008 financial year, the profitability upon which planned investment in the continuing reliability of our electricity network depends. Unit sales in the first half of 2007 were 6% lower than in 2006 due to milder weather experienced throughout Europe, offset by continuing strong growth from our dominant share of the new energy market presented by Jersey s ongoing property development boom. Imported electricity met 82% of our requirements during the half year, which was lower than normal because we took advantage of lower oil prices in the global marketplace to generate locally during peak periods when import costs are at their highest. Our Retailing business continued last year s trend of strong growth, with year-on-year turnover rising 40% and profits moving up from 0.3m to 0.4m. Profits from our Property portfolio rose from 0.4m to 0.7m due mainly to the sale of a residential property used previously to house employees, for a capital gain of 0.3m. The Building Services business produced an increase in turnover of 12% with profits up slightly at 0.2m. Losses at our data centre joint venture, Foreshore Limited, reduced to 0.1m with turnover up 40% against last year. Our consultancy businesses Jersey Energy and Jendev produced profits slightly up at 0.1m. Cash at bank, including short-term investments, fell 1.1m to 14.0m during the last six months, with operating cash produced from trading activity offset by 3.5m of capital investment expenditure and the 1.1m final 2006 dividend. Your Board proposes to pay an interim net dividend of 49p (2006: 44p) on the Ordinary and A Ordinary Shares payable on 31 August 2007 in addition to the final dividend for 2006 of 68p (2005: 62p) paid on 30 March D.R. MALTWOOD Chairman M.J. LISTON Chief Executive 17 May Interim Report 2007

5 performance investment and responsibility Interim Report 2007 Investor Timetable for May Announcement of interim results 30 June Payment date for preference share dividends 17 August Record date for interim ordinary dividend 31 August Interim ordinary dividend for year ending 30 September December Preliminary announcement of full year results Interim Report

6 Group Income Statement (Unaudited) Six months ended Six months ended Year ended Note Revenue 2 40,048 35,759 65,617 Cost of sales (27,268) (22,812) (42,873) Gross profit 12,780 12,947 22,744 Revaluation of investment properties - - 1,219 Operating expenses (8,195) (8,095) (17,107) Group operating profit before joint venture 4,585 4,852 6,856 Share of loss of joint venture (116) (169) (343) Group operating profit 2 4,469 4,683 6,513 Interest receivable Finance costs (5) (4) (9) Profit from operations before taxation 4,877 5,131 7,322 Taxation 3 (519) (1,219) (1,351) Profit from operations after taxation 4,358 3,912 5,971 Minority interest (2) (5) (29) Profit for the period attributable to the equity holders of the parent company 4,356 3,907 5,942 EARNINGS PER SHARE - basic and diluted DIVIDENDS PER SHARE - paid final/interim paid special proposed Group Statement of Recognised Income and Expense (Unaudited) Six months ended Six months ended Year ended Profit for the financial period 4,356 3,907 5,942 Actuarial gain on defined benefit scheme (net of tax) - - 2,910 Fair value gain/(loss) on cash flow hedges (570) Total recognised income and expense for the period attributable to the equity holders of the parent 4,717 4,453 8,282 4 Interim Report 2007

7 performance investment and responsibility Interim Report 2007 Group Balance Sheet (Unaudited) Note NON-CURRENT ASSETS Intangible assets Property, plant and equipment 107, , ,289 Investment property 10,990 9,753 10,990 Other investments 2, ,884 Total non-current assets 120, , ,294 CURRENT ASSETS Inventories 4,228 3,505 4,196 Trade and other receivables 17,226 11,747 13,046 Derivative financial instruments Short-term investments - cash deposits - 1,500 3,765 Cash and cash equivalents 14,026 11,641 11,346 Total current assets 35,480 28,411 32,353 Total assets 156, , ,647 LIABILITIES Trade and other payables 8,803 7,792 9,590 Derivative financial instruments 737-1,098 Current tax payable 1,173 1,195 1,190 Total current liabilities 10,713 8,987 11,878 NON-CURRENT LIABILITIES Trade and other payables 12,905 13,680 13,245 Tax liabilities 1,305 1, Financial liabilities - preference shares Retirement benefit obligations Deferred tax liabilities 11,833 10,705 11,734 Total non-current liabilities 26,278 26,138 26,027 Total liabilities 36,991 35,125 37,905 Net assets 119, , ,742 EQUITY Share capital 1,532 1,532 1,532 Other reserves (737) 18 (1,098) Retained earnings 118, , ,274 Shareholders funds 5 119, , ,708 Minority interest Total equity 119, , ,742 Interim Report

8 Group Cash Flow Statement (Unaudited) Note Six months ended Six months ended Year ended Restated CASH FLOWS FROM OPERATING ACTIVITIES Group operating profit before joint venture 4,585 4,852 6,856 Depreciation and amortisation charges 3,544 3,505 6,948 Revaluation of investment property - - (1,219) Pension operating charge less contributions paid (391) (324) (877) Profit on sale of fixed assets (309) - - Operating cash flows before movement in working capital 7,429 8,033 11,708 (Increase)/decrease in inventories (32) 423 (269) (Increase) in trade and other receivables (3,813) (3,767) (2,515) (Decrease)/increase in trade and other payables (577) 1,017 3,387 Interest received Preference dividends paid (4) (4) (9) Income taxes paid - - (1,233) Net cash flows from operating activities 3,423 6,125 11,825 CASH FLOWS FROM INVESTING ACTIVITIES Purchase of property, plant and equipment (3,506) (2,290) (4,995) Investment in intangible assets (7) - (76) Net proceeds from disposal of investment property 318 6,550 6,550 Investment in joint venture (263) (350) (613) Short-term investments 3,765 (1,500) (3,765) Net cash flows used in investing activities 307 2,410 (2,899) CASH FLOWS FROM FINANCING ACTIVITIES Equity dividends paid 4 (1,050) (7,764) (8,450) Net cash flows used in financing activities (1,050) 7,764 (8,450) Net increase in cash and cash equivalents 2, Cash and cash equivalents at beginning of period 11,346 10,870 10,870 Cash and cash equivalents at end of period 14,026 11,641 11,346 6 Interim Report 2007

9 performance investment and responsibility Interim Report 2007 Notes to the Interim Accounts for the period ended 31 March Accounting policies Basis of preparation The interim accounts for the six months ended 31 March 2007 have been prepared on the basis of the accounting policies set out in the 30 September 2006 annual report and accounts. 2. Turnover and profit The contributions of the various activities of the Group to turnover and profit are listed below: External Internal Total External Internal Total External Internal Total Revenue Energy 30, ,640 28, ,099 50, ,607 Building Services 1, ,829 1, ,609 3, ,299 Retail 6, ,377 4, ,543 8, ,818 Property , , ,842 Other , ,189 1, ,488 40,048 1,039 41,087 35, ,383 65,617 1,437 67,054 Inter-group elimination (1,039) (624) (1,437) 40,048 35,759 65,617 Group operating profit Energy 3,036 3,919 4,277 Building Services Retail Property Other 68 (53) (49) 4,469 4,683 5,294 Revaluation of investment properties - - 1,219 4,469 4,683 6,513 Materially, all the Group s operations are conducted within the Channel Islands. All transfers between divisions are at arms-length basis. 3. Income tax Six months ended Six months ended Year ended Current income tax (420) (1,022) (849) Deferred income tax (99) (197) (502) Total income tax (519) (1,219) (1,351) On 30 January 2007 the draft zero-ten legislation was approved by the States of Jersey and has now gone to the Privy Council in the UK for approval. The vast majority of the legislation will come into effect from 1 January 2009 but transitional rules apply to any company currently taxed on a prior year basis, so that they become taxed on a current year basis. Due to Transitional rules this results in Jersey tax paying companies being taxed in the 2008 year of assessment at 20% on the average of the profits which they generate in the financial year ended in 2007 and The effective tax rate for those two years is therefore around half that experienced up to 2006 due to the migration from a prior to current year basis but will revert to 20% for Island utilities from 2009 onwards. Interim Report

10 Notes to the Interim Accounts continued for the period ended 31 March Dividends Six months ended Six months ended Year ended Distributions to equity holders and by subsidiaries in the period 1,050 7,764 8,450 The distribution to equity holders in the period consisted of 1,041,760 (68p net of tax per share) in respect of the final dividend for In addition 8,400 was paid by subsidiaries to minority interests. The Directors have declared an interim dividend of 49p per share, net of tax ( p) for the six months ended 31 March 2007 to shareholders on the register at the close of business on 17 August This dividend was approved by the Board on 16 May 2007 and has not been included as a liability at 31 March In March 2006 a special dividend of 4.44 per share, net of tax, was made to distribute the proceeds from the sale of an investment property. 5. Reconciliation of movements in equity Share capital Other reserves Retained earnings Total At 1 October ,532 (1,098) 115, ,708 Total recognised income and expense for the year - - 4,356 4,356 Other recognised gains/(losses) Equity dividends - - (1,042) (1,042) As at 31 March ,532 (737) 118, ,383 At 1 October ,532 (528) 114, ,852 Total recognised income and expense for the year - - 5,942 5,942 Other recognised gains/(losses) - (570) 2,910 2,340 Equity dividends - - (8,426) (8,426) As at 30 September ,532 (1,098) 115, ,708 At 1 October ,532 (528) 114, ,852 Total recognised income and expense for the year - - 3,907 3,907 Other recognised gains/(losses) Equity dividends - - (7,752) (7,752) As at 31 March , , ,553 8 Interim Report 2007

11 Inside back cover (blank)

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