TIDMJEL
RNS Number : 1155A
Jersey Electricity PLC
18 December 2014
JERSEY ELECTRICITY plc
Preliminary Announcement of Annual Results
Year Ended 30 September 2014
At a meeting of the Board of Directors held on 17 December 2014,
the final accounts for the Group for the year to 30 September 2014
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 2014 or 2013, but is derived from those accounts.
Statutory accounts for 2013 have been delivered to the Jersey
Registrar of Companies and those for 2014 will be delivered in
early 2015. The auditor has reported on those accounts and their
reports were unmodified.
A final dividend of 7.20p on the Ordinary and 'A' Ordinary
shares in respect of the year ended 30 September 2014 was
recommended (2013: 6.80p). Together with the interim dividend of
5.00p the proposed total dividend declared for the year was 12.20p
on each share.
The final dividend will be paid on 27 March 2015 to those
shareholders registered in the books of the Company on 20 February
2015. A dividend on the 5% cumulative participating preference
shares of 1.5% (2013: 1.5%) payable on 1 July 2015 was also
recommended.
The Annual General Meeting of the Company will be held on 5
March 2015.
John Stares, who has served as a non-executive director for the
last five years will be retiring at our next Annual General Meeting
on 5 March 2015.
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 : mmagee@jec.co.uk Email : proutier@jec.co.uk
17 December 2014
The Powerhouse
PO Box 45
Queens Road
St Helier
Jersey JE4 8NY
JERSEY ELECTRICITY plc
Preliminary Announcement of Annual Results
Year ended 30 September 2014
The Chairman, Geoffrey Grime, comments :
"2014 was the Company's 90th anniversary and there could be no
better way to mark this celebration than with the landmark
achievement of the successful installation of our third
interconnector to France, Normandie 3 (N3) - under budget and ahead
of its 2015 schedule. The N3 project, co-invested under our joint
venture with Guernsey Electricity, our partners in the Channel
Islands Electricity Grid, has been 10 years in the making and more
than doubles our importation capacity which had been severely
restricted since June 2012 when our oldest interconnector, EDF1,
failed and was removed from service. I said that last year we
delivered a foundation for recovery. This year we have built
further on this with an expected upward movement in Energy profit,
which reached the level of GBP8.0m on an operating basis, restoring
it to pre-2012 levels. Importantly, this profitability reflects the
return necessary to support continued investment."
Financial Summary 2014 2013 % change
(restated)
----------------------------- --------- ------------- ----------
Revenue GBP98.4m GBP102.3m (4)%
Profit before tax GBP 6.5m GBP 5.4m 21%
Earnings per share 16.10p 13.27p 21%
Dividends paid per ordinary
share 11.80p 11.25p 5%
The 2013 profit figure was restated downwards by GBP1.2m to
reflect the adoption of a new accounting policy to comply with
changes to the revised International Accounting Standard 19,
"Employee Benefits", in respect of pension costs as highlighted in
our 2013 Annual Report. The original charge of GBP1.2m in 2013 was
restated as GBP2.4m.
Group revenue for the year to 30 September 2014 at GBP98.4m was
4% lower than in the previous financial year. Unit sales volumes of
electricity were 6% lower than last year due to mild weather with
revenues falling 3% to GBP79.5m as tariff rises reduced the impact
of the units shortfall. Turnover in our Retail business decreased
by 6% from GBP12.1m to GBP11.4m. The floor space utilised by the
business was reduced as a substantial proportion was let to an
external tenant from May 2014. Revenue in the Property business,
including internal sales, fell from GBP2.9m to GBP2.6m mainly
linked to changes in tenancy arrangements during the year including
our disposal of Foreshore. Revenue in Building Services, including
internal sales, rose 3% from levels experienced in 2013 to GBP4.2m.
Turnover in our Other Businesses, including internal sales,
remained at GBP3.2m.
Profit before tax for the year to 30 September 2014 rose 21% to
GBP6.5m from GBP5.4m reflecting a recovery in our Energy business.
As anticipated at the half year we incurred exceptional costs of
around GBP0.6m and GBP1.2m in restructuring our Retail business and
exiting our investment in Foreshore Ltd respectively. In addition,
a GBP1.8m provision was made for our share of a preventative repair
to the interconnector between Guernsey and Jersey which is
scheduled to take place in January 2015. The cable, which was
repaired in 2012, has been showing similar issues to those
experienced two years ago and Guernsey Electricity is also
currently seeking permissions to lay a replacement cable as soon as
possible. Profit before tax pre-exceptional items, and post the
restatement of the 2013 pension costs, rose from GBP5.9m last year
to GBP10.0m in 2014.
Our Energy business unit sales saw volumes down 6%, falling from
663m to 621m kWh, due to a combination of the temperatures being
above the seasonal norm last winter and the corresponding period in
the 2013 financial year being particularly cold. Each of the six
winter months in this financial year experienced higher
temperatures than its corresponding month in 2012/13 and were at,
or above, the long-term average level. Despite lower unit sales in
our Energy business, profits recovered substantially to GBP8.0m, a
level commensurate with the recognized rate of return required to
advance sustainable investment in infrastructure assets.
Two main factors contributed to this increase in performance -
lower generation and the impact of tariff rises. As reported
previously, until the new interconnector to France was
commissioned,
which occurred at the end of this financial year, we have been
capacity constrained on importation and reliant on a heavier mix of
more expensive on-island oil-fired generation, particularly in
winter, when volumes are higher.
In the financial year we generated 15% of our electricity
on-island (compared to 21% last year) and imported 80% of our
requirements from France (up from 75% in 2013). The remaining 5% of
our electricity came from the local Energy from Waste plant against
4% in the same period in 2013. The Energy revenue, and
profitability, was also aided by an average 1.5% increase in
customer tariffs from 1 April 2014 and the full year impact of the
tariff increase in January 2013. In spite of these price rises, our
tariffs continue to remain competitive with other
jurisdictions.
Profits in our Property division, excluding the impact of
investment property revaluation, fell from GBP1.6m to GBP1.4m with
movements in tenancy arrangements being the main driver. It has
been a positive year with 11k square feet of space previously used
by our internal Retail business now being let to a UK retailer with
a good covenant (SportsDirect.com). In addition, with the sale of
our shareholding in Foreshore, we now have the local telecom
operator, Sure (Jersey) Ltd, as tenants with a larger footprint
than previously let. Our investment property portfolio was revalued
upwards by GBP0.1m to GBP20.5m this year. Our Retailing business
had a challenging year with turnover falling from GBP12.1m to
GBP11.4m albeit the space utilised has reduced. A profit of GBP0.2m
last year moved to a loss of GBP0.1m. As reported at the half year
an exceptional cost of GBP0.6m was incurred in restructuring the
Retail operation as the business has been facing increasing
pressure on margins from UK on-line sales into Jersey. The Building
Services business produced a marginal loss, being GBP0.1m behind
last year due to competitive pressures on margin. Our other
business units - Jersey Energy, Jendev and Jersey Deep Freeze all
had a profitable year. Our shareholding in Foreshore, a data centre
joint venture in which we have been involved since 2000, was sold
in July and, as reported at the half year, an exceptional cost of
GBP1.2m was associated with this exit.
Interest paid in 2014 was negligible as most of this cost was
capitalised up to the date of commissioning of our new
interconnector. The taxation charge at GBP1.5m was higher than in
2013 due to higher profits. Group earnings per share increased 21%
to 16.10p (24.26p pre-exceptional costs) compared to restated
13.27p in 2013 due mainly to an increase in profitability.
Dividends paid in the year, net of tax, rose by 5%, from 11.25p
in 2013 to 11.80p in 2014. The proposed final dividend for this
year is 7.20p, a 6% rise on the previous year. Dividend cover rose
from 1.2 times in 2013 to 1.4 times (and to 2.1 times if
exceptional costs are excluded) due to a higher level of
profits.
Net cash inflow from operating activities, at GBP20.1m, was
GBP9.2m higher than in 2013 with increased profitability, and a
working capital benefit from a lower level of oil stocks, being the
main reasons. Capital expenditure, at GBP33.06m rose from GBP26.9m
last year with Normandie 3 project spend at GBP24.0m, being the
most material. Proceeds of GBP1.8m were received from the sale of
assets associated with our Foreshore disposal. Net debt, at the
year-end was GBP20.2m being GBP15.0m higher than last year.
Our defined benefits pension scheme, which had a GBP0.8m
deficit, net of deferred tax, at the 2013 year end marginally
increased to a GBP1.1m deficit as at 30 September 2014. Although
the year-on-year movement was relatively small there were material
swings in both assets and liabilities which largely offset each
other. Scheme assets rose 11% since the last year end but
liabilities increased 12% due to a reduction in the discount rate
applied reflecting sentiments in financial markets.
Consolidated Income Statement
for the year ended 30
September 2014
2014 2013
GBP000 GBP000
(restated)
Revenue 98,443 102,338
Cost of sales (68,468) (75,922)
Gross profit 29,975 26,416
Revaluation of investment
properties 145 155
Operating expenses (20,079) (20,663)
----------- ---------------------
Group operating profit
before exceptional items 10,041 5,908
Exceptional item - disposal
of investment (1,178) (600)
- provision (1,800) -
for subsea
cable
repair
- restructuring (570) -
costs
in Retail
business
Group operating profit 6,493 5,308
Interest (payable)/receivable (26) 53
Finance costs (11) (11)
----------- ---------------------
Profit from operations
before taxation 6,456 5,350
Taxation (1,478) (1,243)
----------- ---------------------
Profit from operations
after taxation 4,978 4,107
=========== =====================
Attributable to:
Owners of the Company 4,932 4,067
Non-controlling interests 46 40
----------- ---------------------
4,978 4,107
=========== =====================
Earnings per share
- basic and diluted 16.10p 13.27p
Consolidated Statement of Comprehensive
Income
for the year ended 30 September
2014
2014 2013
GBP000 GBP000
(restated)
Profit for the year 4,978 4,107
Items that will not be
reclassified subsequently
to profit or loss
Actuarial (loss)/gain on
defined benefit scheme (392) 5,498
Reclassification of investment
properties - 4,822
Income tax relating to
items not reclassified 78 (1,249)
----------- ---------------------
(314) 9,071
Items that will be reclassified
subsequently to profit
or loss
Fair value (loss)/gain
on cash flow hedges (4,567) 3,809
Income tax relating to
items that may be reclassified 913 (842)
----------- ---------------------
(3,654) 2,967
Total comprehensive income
for the year 1,010 16,145
Attributable to:
Owners of the Company 964 16,105
Non-controlling interests 46 40
----------- ---------------------
1,010 16,145
=========== =====================
Balance Sheets at 30
September 2014 Group Company
2014 2013 2014 2013
GBP
GBP 000 000 GBP 000 GBP 000
NON-CURRENT ASSETS (restated) (restated)
Intangible assets 20 26 20 26
Property, plant and
equipment 184,846 155,191 184,841 155,177
Investment properties 20,505 20,360 20,505 20,360
Other investments 5 5 482 482
Total non-current assets 205,376 175,582 205,848 176,045
------------------------------------------------ ------------------------- --------------------- ------------------- -------------------
CURRENT ASSETS
Inventories 7,334 9,434 7,268 9,365
Trade and other receivables 16,750 16,498 16,576 16,360
Derivative financial
instruments - 1,273 - 1,273
Cash and cash equivalents 9,776 4,798 9,659 4,621
Total current assets 33,860 32,003 33,503 31,619
------------------------- --------------------- ------------------- -------------------
Total assets 239,236 207,585 239,351 207,664
------------------------------------------------- ------------------------- --------------------- ------------------- -------------------
LIABILITIES
Trade and other payables 24,113 14,332 24,049 14,272
Derivative financial
instruments 4,246 952 4,246 952
Total current liabilities 28,359 15,284 28,295 15,224
NET CURRENT ASSETS 5,501 16,719 5,208 16,395
------------------------- --------------------- ------------------- -------------------
NON-CURRENT LIABILITIES
Trade and other payables 18,279 17,851 18,279 17,851
Retirement benefit deficit 1,372 1,018 1,372 1,018
Financial liabilities
- preference shares 235 235 235 235
Borrowings 30,000 10,000 30,000 10,000
Deferred tax liabilities 14,852 14,365 14,852 14,365
Total non-current liabilities 64,738 43,469 64,738 43,469
------------------------- --------------------- ------------------- -------------------
Total liabilities 93,097 58,753 93,033 58,693
------------------------- --------------------- ------------------- -------------------
Net assets 146,139 148,832 146,318 148,971
------------------------------------------------- ------------------------- --------------------- ------------------- -------------------
EQUITY
Share capital 1,532 1,532 1,532 1,532
Revaluation reserve 5,270 5,270 5,270 5,270
ESOP reserves (36) (58) (36) (58)
Other reserves (3,515) 139 (3,515) 139
Retained earnings 142,878 141,925 143,067 142,088
------------------------- --------------------- ------------------- -------------------
Equity attributable
to owners of the company 146,129 148,808 146,318 148,971
Non-controlling interests 10 24 - -
------------------------- --------------------- ------------------- -------------------
Total equity 146,139 148,832 146,318 148,971
------------------------------------------------- ------------------------- --------------------- ------------------- -------------------
Cash Flow Statements
for the year ended 30 September 2014
Group Company
2014 2013 2014 2013
GBP GBP GBP
000 GBP 000 000 000
Cash flows from operating
activities (restated) (restated)
Operating profit 10,041 5,908 9,989 5,901
Depreciation and amortisation
charges 8,259 8,166 8,256 8,163
Gain on revaluation of investment
properties (145) (155) (145) (155)
Pension contributions paid
less expense in Income Statement (38) 448 (38) 448
Adjustment for foreign exchange
hedges 63 (513) 63 (513)
Loss on sale of fixed assets (11) (21) (11) (21)
--------- ----------- --------- -----------
Operating cash flows before
movement in working capital 18,169 13,833 18,114 13,823
Decrease/(increase) in inventories 2,100 (2,189) 2,097 (2,199)
(Increase)/decrease in trade
and other receivables (252) 1,472 (216) 1,377
Increase/(decrease) in trade
and other payables 513 (1,545) 507 (1,559)
Interest (paid)/received (28) 97 (28) 97
Preference dividends paid (9) (9) (9) (9)
Cash amounts relating to
exceptional item (353) - (353) -
Income taxes paid - (762) - (762)
Net cash flows generated
from operating activities 20,140 10,897 20,112 10,768
--------- ----------- --------- -----------
Cash flows from investing
activities
Purchase of property, plant
and equipment (33,048) (26,910) (33,048) (26,898)
Investment in intangible
assets (6) (8) (6) (8)
Net proceeds from disposal
of investment 1,579 - 1,579 -
Net proceeds from disposal
of fixed assets 16 14 16 14
Short-term investments - 9,020 - 9,020
Net cash flows used in investing
activities (31,459) (17,884) (31,459) (17,872)
--------- ----------- --------- -----------
Cash flows from financing
activities
Equity dividends paid (3,703) (3,526) (3,615) (3,446)
Repayment of borrowings (10,000) - (10,000) -
Proceeds from borrowings 30,000 10,000 30,000 10,000
Net cash flows generated
from financing activities 16,297 6,474 16,385 6,554
--------- ----------- --------- -----------
Net increase/(decrease) in
cash and cash equivalents 4,978 (513) 5,038 (550)
Cash and cash equivalents
at beginning of period 4,798 5,311 4,621 5,171
--------- ----------- --------- -----------
Net cash and cash equivalents
at end of period 9,776 4,798 9,659 4,621
--------- ----------- --------- -----------
Consolidated Statement of Changes in Equity
for the year ended 30 September 2014
Revaluation ESOP Other Retained
Share capital reserve reserve reserves earnings Total
GBP GBP GBP GBP
Group: GBP 000 GBP 000 000 000 000 000
At 1 October 2013 1,532 5,270 (58) 139 141,925 148,808
Profit from operations
after taxation - - - - 4,932 4,932
Amortisation of employee
share scheme - - 22 - (22) -
Unrealised loss on hedges
(net of tax) - - - (3,654) - (3,654)
Actuarial loss on defined
benefit scheme (net of
tax) - - - - (314) (314)
Equity dividends - - - - (3,643) (3,643)
-------------- ------------ --------- ---------- ----------- -----------
At 30 September 2014 1,532 5,270 (36) (3,515) 142,878 146,129
(restated) (restated)
At 1 October 2012 1,532 - (100) (2,381) 137,097 136,148
Reclassification of reserves - 448 - (448) - -
Profit from operations
after taxation - - - - 5,022 5,022
Retrospective application
of IAS 19R (955) (955)
Amortisation of employee
share scheme - - 42 - (42) -
Unrealised gain on hedges
(net of tax) - - - 2,968 - 2,968
Actuarial gain on defined
benefit scheme (net of
tax) - - - - 4,249 4,249
Reclassification of investment
properties - 4,822 - - - 4,822
Equity dividends - - - - (3,446) (3,446)
-------------- ------------ --------- ---------- ----------- -----------
At 30 September 2013 1,532 5,270 (58) 139 141,925 148,808
Revaluation ESOP Other Retained
Share capital reserve reserve reserves earnings Total
Company:
At 1 October 2013 1,532 5,270 (58) 139 142,088 148,971
Profit from operations
after taxation - - - - 4,930 4,930
Amortisation of employee
share scheme - - 22 - (22) -
Unrealised gain on hedges
(net of tax) - - - (3,654) - (3,654)
Actuarial gain on defined
benefit scheme (net of
tax) - - - - (314) (314)
Equity dividends - - - - (3,615) (3,615)
-------------- ------------ --------- ---------- ----------- -----------
At 30 September 2014 1,532 5,270 (36) (3,515) 143,067 146,318
-------------- ------------ --------- ---------- ----------- -----------
(restated) (restated)
At 1 October 2012 1,532 - (100) (2,381) 137,227 136,278
Reclassification of reserves - 448 - (448) - -
Profit from operations
after taxation - - - - 5,055 5,055
Retrospective application
of IAS 19R (955) (955)
Amortisation of employee
share scheme - - 42 - (42) -
Unrealised gain on hedges
(net of tax) - - - 2,968 - 2,968
Actuarial gain on defined
benefit scheme (net of
tax) - - - 4,249 4,249
Reclassification of investment
properties - 4,822 - - - 4,822
Equity dividends - - - - (3,446) (3,446)
-------------- ------------ --------- ---------- ----------- -----------
At 30 September 2013 1,532 5,270 (58) 139 142,088 148,971
-------------- ------------ --------- ---------- ----------- -----------
Notes to the accounts
Year ended 30 September 2014
1. Basis of Preparation
The consolidated financial statements of Jersey Electricity plc,
for the year ended 30 September 2014 have been prepared in
accordance with International Financial Reporting Standards (IFRS)
as adopted by the European Union (EU), including International
Accounting Standards 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
Group expects to publish full financial statements that comply with
IFRS in early 2015.
The Group has considerable financial resources and as a
consequence, the directors believe that the Group is well placed to
manage its business risks successfully despite the current
uncertain economic outlook. The directors have a reasonable
expectation that the Group 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:
2014 2014 2014 2013 2013 2013
External Internal Total External Internal Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
Revenue
Energy 79,459 141 79,600 81,962 166 82,128
Building Services 3,294 907 4,201 3,606 476 4,082
Retail 11,414 33 11,447 12,145 39 12,184
Property 1,957 616 2,573 2,191 687 2,878
Other 2,319 878 3,197 2,434 751 3,185
------------- ---------------- ---------------- ------------- ---------------- ----------------
98,443 2,575 101,018 102,338 2,119 104,457
Intergroup elimination (2,575) (2,119)
---------------- ----------------
Revenue 98,443 102,338
---------------- ----------------
Operating profit
Energy 7,952 3,229
Building Services (44) 104
Retail (86) 188
Property 1,415 1,609
Other 659 623
---------------- ----------------
Operating profit before
property revaluation 9,896 5,753
Revaluation of investment
properties 145 155
Exceptional items - disposal
of investment (1,178) (600)
- provision
for subsea
cable repair (1,800) -
-
restructuring
costs
in Retail
business (570) -
Group operating profit 6,493 5,308
---------------- ----------------
This information is provided by RNS
The company news service from the London Stock Exchange
END
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