Final Results

Jersey Electricity Company Limited 16 December 2003 The Jersey Electricity Company Preliminary Announcement of Annual Results Year Ended 30 September 2003 At a meeting of the Board of Directors held on 15 December 2003, the preliminary announcement of the annual results for the Group for the year to 30 September 2003 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 years ended 30 September 2002 or 2003. The financial information for the year ended 30 September 2002 is derived from the statutory accounts for that year which have been delivered to the Jersey Registrar of Companies. The auditors reported on those accounts and their report was unqualified. The statutory accounts for the year ended 30 September 2003 will be finalised on the basis of the financial information presented by the Directors in this preliminary announcement and will be delivered to the Jersey Registrar of Companies following the Company's Annual General Meeting. A final gross dividend of 50.0p (40.0p net of tax) on the Ordinary and 'A' Ordinary shares in respect of the year ended 30 September 2003 was recommended which, together with the interim gross dividend of 41.0p (32.8p net of tax), makes a total gross dividend for the year of 91.0p (72.8p net of tax) on each £1 share. The dividend will be paid on 31 March 2004 to those shareholders registered in the books of the Company on 5 March 2004. A dividend on the 5% cumulative participating preference shares of 1.5% (2002 1.5%) payable on 1 July 2004 was also recommended. The Annual General Meeting of the Company will be held on 8 March 2004. P.J. Routier Company Secretary Direct telephone number : 01534 505253 Direct fax number : 01534 505515 Email : proutier@jec.co.uk 16 December 2003 The Powerhouse, PO Box 45, Queens Road, St Helier, Jersey JE4 8NY THE JERSEY ELECTRICITY COMPANY LIMITED Preliminary announcement of annual results Year ended 30 September 2003 The Chairman, Derek Maltwood, comments : 'I am pleased to report on another year of increasing profits, falling electricity prices in real terms, excellent environmental performance and continued high reliability from our electricity supply system. Pre-tax profits,before exceptional costs, rose by 37% to £6.1m due principally to improved terms for power purchases from the competitive European electricity market and a 3% growth in our electricity sales. This growth reflects our continuing success in securing the major share of the new energy market offered by Jersey's booming property development programme, in which three out of every four premises built so far this decade are all-electric. Our focus remains on sustaining electricity's environmental and price stability and advantages over other fuels,whilst preserving the high reliability of electricity supplies on which Jersey's finance industry, in particular, depends.' Key Financial Information 2003 2002 % rise/(reduction) Turnover £59.3m £60.4m (2%) Profit before tax * £6.1m £4.5m 37% Earnings per share * £2.66 £2.14 24% Net dividend per ordinary share 72.8p 66.0p 10% Group turnover for the year to 30 September 2003 at £59.3m was 2% lower than the year ended 30 September 2002. The Energy business contributed £42.2m of the Group turnover, which was £1.2m above last year due to a 3% increase in units sold compared to 2002. Tariffs were frozen at the same level as the previous year and will be frozen again during the 2004 financial year. Turnover in the Property business rose in the year by £0.2m to £2m but fell in Contracting by £1.4m due to the decision announced at the half-year to withdraw from the larger projects arena. Turnover in the Retail and Other Businesses segments fell marginally. Profit on ordinary activities before tax and exceptional costs for the year to 30 September 2003 rose by 37% to £6.1m. Profits in the Electricity business rose by £2.3m to £6.5m with increased unit sales and the benefits of our new European electricity supply agreement offset by higher pension costs. The Electrical Retailing business maintained profits at a similar level to 2002 despite a year on year decrease of 2.5% in like for like sales. The Contracting business produced a loss of £0.5m, most of which was incurred in the first half of 2003, due to pressures on margins in this very competitive industry which was the catalyst for our decision to exit substantially from the business. The Property division continued to grow profits to £1.0m being 13% higher than last year due to higher occupancy rates. Other businesses, including joint ventures and associates, produced a loss of £1.0m slightly above the level in 2002. Interest payable was £0.2m lower due to an average lower level of net debt during the year. The net debt figure at the year end rose to £4.5m, up from £1.5m at the previous year end due to the injection of £7m into the JEC pension scheme in July 2003 as disclosed at the half-year. The taxation charge for the year was £1.8m, net of the exceptional tax credit of £0.2m in relation to restructuring costs. Group earnings per share, excluding the impact of exceptional costs, rose 24% to £2.66 compared to £2.14 in 2002. Earnings per share, including the impact of exceptional charges, were £2.20 compared to £0.49 in the previous year. Dividends for the year rose by 10% from a gross level of 82.5p (66.0p net of tax) in 2002 to a recommended 91.0p (72.8p net of tax) for 2003 consistent with the aim to deliver a sustained increase in real terms each year. Dividend cover, excluding exceptional costs, increased from 3.2 to 3.7 times. * Before exceptional items An exceptional item of £0.9m (before tax) has been recognised in the year to 30 September 2003 relating to the costs of manpower reductions within our Contracting business as announced when our half-year results were issued. Exceptional items totalling £2.9m (before tax) were recognised for restructuring costs and impairment of investments in 2002. THE JERSEY ELECTRICITY COMPANY LIMITED Consolidated Profit and Loss Account for the year ended 30 September 2003 Notes 2003 2002 £ 000 £ 000 Turnover: Group and share of joint venture 59,809 60,812 Less: Share of joint venture turnover (556) (461) Group turnover 2 59,253 60,351 Cost of sales (34,532) (37,510) Gross profit 24,721 22,841 Net operating expenses (17,266) (16,999) Exceptional item - restructuring costs 3a (886) (1,790) Exceptional item - impairment of investments 3b - (1,098) Group operating profit 6,569 2,954 Share of operating loss in joint venture (655) (661) Share of associate's operating loss (684) (503) Profit on ordinary activities before interest and 2 5,230 1,790 taxation Net interest and similar charges (21) (217) Profit on ordinary activities before taxation 5,209 1,573 Tax on profit on ordinary activities (1,771) (782) Profit on ordinary activities after taxation 3,438 791 Minority Interest (66) (41) Profit on ordinary activities after taxation and 3,372 750 minority interest Dividends paid and proposed (1,124) (1,020) Retained profit/(loss) for the group and share in 2,248 (270) joint venture Earnings per ordinary share (basic and diluted) £2.20 £0.49 Earnings per ordinary share (basic and diluted) £2.66 £2.14 excluding exceptional items THE JERSEY ELECTRICITY COMPANY Consolidated Statement of Total Recognised Gains and Losses for the year ended 30 September 2003 2003 2002 £ 000 £ 000 Profit on ordinary activities after taxation and minority 3,372 750 interest Unrealised surplus on revaluation of plant 12 91 Unrealised surplus on revaluation of investment properties 25 425 Deferred tax credit on items previously recognised in the 1,960 - Statement of Total Recognised Gains and Losses Total recognised gains since last annual report 5,369 1,266 Consolidated Note of Historical Cost Profits and Losses for the year ended 30 September 2003 2003 2002 £ 000 £ 000 Profit on ordinary activities before taxation (after minority interest) 5,143 1,532 Difference between the historical cost depreciation charge and the actual depreciation charge for the year calculated on the revalued amount 1,711 1,241 Historical cost profit on ordinary activities before taxation 6,854 2,773 (after minority interest) Historical cost profit for the year retained after taxation, minority interest and dividends 3,959 971 THE JERSEY ELECTRICITY COMPANY Balance Sheets 30 September 2003 Group Group Company Company 2003 2002 2003 2002 £ 000 £ 000 £ 000 £ 000 FIXED ASSETS Intangible fixed assets 141 182 - - Tangible fixed assets 120,186 119,905 120,185 119,901 Investments: subsidiary - - 477 477 other investments 5 5 3,944 2,963 joint venture - - 2,251 1,389 Share of associate's net assets 873 566 - - Joint venture share of gross assets 561 557 Joint venture share of gross liabilities (328) (73) Net share of joint venture assets 233 484 - - 121,438 121,142 126,857 124,730 CURRENT ASSETS Stocks and work in progress 2,961 2,708 2,885 2,646 Debtors due within one year 9,404 7,982 9,198 8,227 Debtors due after more than one year 7,191 596 7,191 720 Cash at bank and in hand 77 210 17 75 19,633 11,496 19,291 11,668 CREDITORS Amounts falling due within one year 15,990 11,078 15,932 11,011 NET CURRENT ASSETS 3,643 418 3,359 657 Total assets less current liabilities 125,081 121,560 130,216 125,387 CREDITORS Amounts falling due after more than one 1,344 961 1,296 925 year PROVISIONS FOR LIABILITIES AND CHARGES Pensions and similar obligations 538 484 538 484 Deferred taxation 10,699 11,884 10,699 11,884 12,581 13,329 12,533 13,293 112,500 108,231 117,683 112,094 CAPITAL AND RESERVES Called up share capital: Equity 1,532 1,532 1,532 1,532 Non-Equity 235 235 235 235 Reserves - Equity 110,647 106,402 115,916 110,327 SHAREHOLDERS' FUNDS 112,414 108,169 117,683 112,094 Equity - Minority Interest 86 62 - - 112,500 108,231 117,683 112,094 THE JERSEY ELECTRICITY COMPANY LIMITED Consolidated Cash Flow Statement for the year ended 30 September 2003 2003 2002 £ 000 £ 000 RECONCILIATION OF OPERATING PROFIT TO NET CASH INFLOW FROM OPERATING ACTIVITIES Group operating profit 6,569 2,954 Depreciation and amortisation charges 8,276 7,676 (Increase)/decrease in stocks & work in progress (253) 249 (Increase)/decrease in debtors (1,036) 2,204 Special contribution to pension scheme (7,000) - Increase in creditors 892 1,707 Impairment of investment - 1,098 NET CASH INFLOW FROM OPERATING ACTIVITIES 7,448 15,888 Returns on investments and servicing of finance (21) (217) Taxation (231) (284) Capital and investment expenditure (9,047) (5,481) Dividends paid (1,173) (952) (DECREASE)/INCREASE IN CASH (3,024) 8,954 RECONCILIATION OF NET CASHFLOW (Decrease)/increase in cash (3,024) 8,954 Net debt - start of year (1,486) (10,440) Net debt - end of year (4,510) (1,486) Cash at bank and in hand 77 210 Overdraft (4,587) (1,696) Net debt (4,510) (1,486) THE JERSEY ELECTRICITY COMPANY LIMITED Notes to the accounts Year ended 30 September 2003 1. Basis of Preparation The accounts have been prepared on the basis of the accounting policies set in the Group 2002 Annual Report and Accounts. 2. Turnover and profit The contributions of the various activities of the Group to turnover and profit are listed below: Turnover Profit/(loss) 2003 2002 2003 2002 Principal activities: £000 £000 £000 £000 Energy 42,244 40,954 6,536 4,238 Contracting 6,191 7,557 (539) 78 Retail appliance sales 5,773 6,467 141 176 Property 1,964 1,845 1,008 891 Other 3,081 3,528 (1,030) (705) 59,253 60,351 6,116 4,678 Exceptional item - restructuring costs (886) (1,790) Exceptional item - impairment of investments - (1,098) Profit on ordinary activities before interest and 5,230 1,790 taxation The information currently available to report the net assets of each business class 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 Group's material operations are conducted within the Channel Islands area. 3. Exceptional Items a. Restructuring costs The 2003 exceptional item of £886,000 relates to the costs of manpower reductions within our Contracting business. The tax benefit arising from this exceptional item is £177,000 giving a net cost for the current year of £709,000. In 2002 the 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 was £358,000 giving a net cost for the prior year of £1,432,000. b. Impairment of investments The exceptional charge of £1,098,000 in 2002 relates to the write-off of the Group investment in GoPro Landsteinar Ehf. following an impairment review. This information is provided by RNS The company news service from the London Stock Exchange

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