RNS Number : 5291X

Jersey Electricity PLC

20 December 2023


Financial Results Summary

Year Ended 30 September 2023

At a meeting of the Board of Directors held on 20 December 2023, the final accounts for the year ended 30 September 2023 were approved and have been published on our website (www.jec.co.uk).

The financial information set out in this summary does not constitute the statutory accounts for the year ended 30 September 2023, or 2022, but is derived from those accounts. Statutory accounts for 2022 have been delivered to the Jersey Registrar of Companies, and those for 2023 will be delivered in early 2024. The auditor reported on the accounts for both years and their reports were unmodified.

A final dividend of 11.40p on the Ordinary and 'A' Ordinary shares in respect of the year ended 30 September 2023 was recommended (2022: 10.80p) . Together with the interim dividend of 8.00p (2022: 7.60p) the proposed total dividend declared for the year was 19.40p on each share (2022: 18.40p).

The final dividend will be paid on 15 March 2024 to those shareholders registered on 23 February 2024. A dividend on the 5% cumulative participating preference shares of 1.5% (2022: 1.5%) payable on 1 July 2024 was also recommended.

The Annual General Meeting will be held on 5 March 2024 at 2.00 pm at the Powerhouse, Queen's Road, St. Helier, Jersey.

L.G. Fulton

Chief Financial Officer

   Direct Line:           01534 505270 

Mobile Number: 07797 778688

Email: lfulton@jec.co.uk

20 December 2023

The Powerhouse

PO Box 45

Queens Road

St. Helier

Jersey JE4 8NY


Financial Results Summary

Year ended 30 September 2023

The Chair, Phil Austin, comments:


The Group has achieved another solid year of operational and financial performance and is strategically well-positioned for the future. Wholesale prices have eased in the last year, but they remain high in relative terms, in what continues to be a challenging economic environment.

Our Energy Business delivered a Return on Assets of 7.2% in the year, restoring the under recovery of costs from prior years and bringing the 5-year rolling average to 6.2% within the target range of 6%-7%.

We implemented a 5% rise in tariffs in January 2023 to help keep pace with wholesale prices but, due to our strong hedged position, and coupled with contractual provisions, we have been able to significantly shelter Islanders from the recent turmoil in energy markets. However, whilst wholesale prices have recently come down, they remain well above our long-term hedged position and therefore we expect further upward pressure on retail prices over the next few years.

To give customers some certainty over the coming winter, we announced a further 12% tariff rise in June, to take effect from January 2024. As we look forward to 2025 - 2027, approximately one third of our energy is already hedged at fixed prices and our focus now is on transitioning our customers through this difficult period, whilst keeping bills as stable and at as low a cost as possible.

Our other businesses within the Group continued to perform in line with expectations, providing consistent year-on-year return.

The Board has recommended a final dividend for the year of 11.40p, a 6% rise on the previous year, payable on 15 March 2024.

Climate Change

In April 2022, the UK became the first G20 country to introduce legislation, making it mandatory for large businesses to disclose climate-related financial information in line with the Taskforce on Climate-related Financial Disclosures (TCFD) recommendations. At Jersey Electricity, we have made significant progress towards establishing our net-zero strategy, together with key priorities, metrics and targets. Details of our progress are set out on pages 22-33 of the 2023 Annual Report and Accounts.

Energy Security

This year we completed a review of our Supply Security Standard. The review was driven by the recent energy crisis, the demands of the Government of Jersey's (GoJ) Carbon Neutral Roadmap

(CNR) and the French fishing dispute of 2021. Following this review, and subject to securing long-term tenure on our site at La Collette, the Board has approved a four-year GBP22.6m project to enhance our on-Island emergency generation capacity at La Collette Power Station.

While we continue to deploy solar PV across the Island, with a view to increasing energy sovereignty and long-term supply diversity, as well as supporting the local economy, we have at the same time continued more detailed investigations into the viability of offshore wind generation and how it might integrate into Jersey's future energy system. We are actively engaging with GoJ to determine the future approach and role Jersey Electricity Plc (JE)should play in the development of such a project.

In Conclusion

I am very proud of the response efforts from the JE team and our customers following storm Ciarán. I wish to thank all our teams and fellow Board members for their hard work and dedication this past year, as well as our shareholders for their continued support. We have achieved much together during what has been a very successful year, while keeping Jersey Electricity on course to take advantage of the opportunities the future holds and meet the challenges it will demand of us.

Financial Performance

 Financial Highlights                              2023        2022 
 Revenue                                      GBP125.1m   GBP117.4m 
 Profit before tax                             GBP14.9m    GBP10.6m 
 Earnings per share                              36.81p      27.17p 
 Dividend paid per share                         18.80p      17.80p 
 Final proposed dividend per share               11.40p      10.80p 
 Net cash                                      GBP17.4m    GBP17.4m 
 In Year Return on Assets                          7.2%        4.2% 
 Return on Assets - 5 year rolling average         6.2%        6.2% 
-------------------------------------------  ----------  ---------- 

2022/23 has seen a return to a less volatile operating environment following the pandemic. Our hedging strategy for the procurement of power has protected us against a volatile wholesale energy market which has seen prices reach over 10 times historical levels in the same period. Escalating inflation has put pressure on the cost base as the business continues to maintain performance and build towards a decarbonised future. Our balance sheet continues to be healthy underpinned by high quality assets.

Group revenue for the year to 30 September 2023 increased year on year by GBP7.7m (6.5%) due to tariff price increases in the Energy Business. Revenue across the wider group remained in line with the previous financial year.

Group Profit before tax for the year to 30 September 2023 was GBP14.9m compared to GBP10.6m in 2022. The profit increase is attributed to GBP1.8m from the energy business and GBP1.6m income from interest earnings. In the year the energy business received a rebate of GBP3.6m relating to prior year wholesale energy costs and following a full review, our property portfolio was devalued by GBP1.2m.

Underlying profit before tax (excluding the impacts of the rebate and property valuation) was GBP12.5m in 2023 against GBP9.6m in 2022.

Energy Business: Operating Profit, excluding the rebate of past energy costs, at GBP9.3m, was GBP1.8m above the GBP7.5m achieved in 2022. This is due a GBP7.4m increase in revenues, following a tariff price increase on 1 January 2023 which has been offset by a GBP5.6m increase in wholesale energy costs and operating costs. Operating costs have increased due to increased inflation and increased investment in our systems and people, as we head into a period of increased capital investment and enhancing our capability as we continue to achieve our net-zero ambition and supporting the GoJ in meeting its Carbon Neutral Roadmap objectives and a net-zero Jersey.

Our 2023 in year Return on Assets (see other information, Alternative Performance Measures, p127 of the 2023 Annual report and Accounts) is 7.2% compared to 4.2% in 2022. This increase is effectively a 'truing up' of prior years under recovery and includes the rebate on prior year energy costs. We target Return on Assets to be within a 6% to 7% range over a 5-year rolling average basis. Our 2023 5-year rolling average Return on Assets is 6.2%.

Property: The GBP1.1m profit in our property division, is GBP0.3m lower than in 2022 due to one of the commercial spaces being vacated in March 2023. A new tenant is expected for the space during early 2024.

Powerhouse.je: Our Powerhouse retail business saw profits fall 22% from GBP1.2m to GBP0.9m, despite a marginal fall in revenues of 1%, due to increased overheads in staff and storage costs.

JEBS: Profits fell by GBP0.1m across our building services business due to an under recovery in revenue from a lower-than-expected number of fuel switches. The reduction was due to a slowing in the pace of switching for a short time as the government incentive scheme was being launched.

Other business units (Jersey Energy, Jendev, Jersey Deep Freeze and fibre optic lease rentals) produced combined profits of GBP0.6m, being GBP0.1m higher than last year.

Net interest income was GBP0.3m in 2023 compared to a net interest cost of GBP1.3m in 2022 due to a higher level of interest earned on deposits from rising interest rates. Taxation at GBP3.4m was higher than the previous year, due to increased taxable profits.

Group basic and diluted earnings per share, at 36.81p, compared to 27.17p in 2022, rose due to increased profitability. Dividends paid in the year, net of tax, rose by 6%, from 17.80p in 2022 to 18.80p in 2023. The proposed final dividend for this year is 11.40p, a 6% rise on the previous year. Dividend cover, at 2 times has increased from 1.5 times in 2022.

Net cash flows from operating activities at GBP17.6m was GBP3.6m lower than in 2022. Investing activities, at GBP11.4m, was 3% higher than the prior financial year. Dividends paid were GBP5.8m compared to GBP5.5m in 2022. The resultant position was that net cash at the year-end was GBP17.4m, being GBP30.0m of borrowings offset by GBP47.4m of cash and cash equivalents, which was the same as last year.

Consolidated Income Statement for the year ended 30 September 2023

                                                        2023       2022 
                                                      GBP000     GBP000 
 Revenue                                             125,078    117,421 
 Cost of sales                                      (80,924)   (77,242) 
 Rebate of past energy costs - non recurring           3,593          - 
------------------------------------------------   ---------  --------- 
 Gross Profit                                         47,747     40,179 
 Movement in valuation of investment properties      (1,215)      1,020 
 Operating expenses                                 (32,010)   (29,293) 
-------------------------------------------------  ---------  --------- 
 Group operating profit                               14,522     11,906 
 Finance income                                        1,871        218 
 Finance costs                                       (1,528)    (1,523) 
-------------------------------------------------  ---------  --------- 
 Profit from operations before taxation               14,865     10,601 
 Taxation                                            (3,432)    (2,135) 
 Profit from operations after taxation                11,433      8,466 
 Attributable to: 
 Owners of the Company                                11,280      8,326 
 Non-controlling interests                               153        140 
-------------------------------------------------  ---------  --------- 
                                                      11,433      8,466 
 Earnings per share 
 - basic and diluted                                  36.81p     27.17p 

Consolidated Statement of Comprehensive Income

                                                         2023      2022 
                                                       GBP000    GBP000 
 Profit for the year                                   11,433     8,466 
 Items that will not be reclassified subsequently 
  to profit or loss: 
 Actuarial (loss)/gain on defined benefit 
  scheme                                                (815)     8,976 
 Income tax relating to items not reclassified            163   (1,795) 
---------------------------------------------------  --------  -------- 
                                                        (652)     7,181 
 Items that may be reclassified subsequently 
  to profit or loss: 
 Fair value (loss)/gain on cash flow hedges           (3,361)     4,815 
 Income tax relating to items that may be 
  reclassified                                            672     (963) 
---------------------------------------------------  --------  -------- 
                                                      (2,689)     3,852 
 Total comprehensive income for the year                8,092    19,499 
 Attributable to: 
 Owners of the Company                                  7,939    19,359 
 Non-controlling interests                                153       140 
---------------------------------------------------  --------  -------- 
                                                        8,092    19,499 

Consolidated Balance Sheet as at 30 September 2023

                                                     2023                2022 
                                                  GBP 000             GBP 000 
 Intangible assets                                    681                 967 
 Property, plant and equipment                    216,136             216,235 
 Right of use assets                                3,194               3,280 
 Investment properties                             27,615              28,830 
 Trade and other receivables                          300                 300 
 Retirement benefit asset                          25,545              26,434 
 Derivative financial instruments                     129               2,640 
 Other investments                                      5                   5 
-----------------------------------------------  --------  ------------------ 
 Total non-current assets                         273,606             278,691 
-----------------------------------------------  --------  ------------------ 
 Inventories                                        9,187               7,173 
 Trade and other receivables                       25,959              19,934 
 Derivative financial instruments                      64                 483 
 Cash and cash equivalents                         47,429              47,397 
-----------------------------------------------  --------  ------------------ 
 Total current assets                              82,639              74,987 
-----------------------------------------------  --------  ------------------ 
 Total assets                                     356,245             353,678 
-----------------------------------------------  --------  ------------------ 
 Trade and other payables                          19,459              21,043 
 Current tax liabilities                            3,301               2,088 
 Lease liabilities                                     81                  69 
 Derivative financial instruments                     536                 330 
-----------------------------------------------  --------  ------------------ 
 Total current liabilities                         23,377              23,530 
-----------------------------------------------  --------  ------------------ 
 NET CURRENT ASSETS                                59,262              51,457 
-----------------------------------------------  --------  ------------------ 
 Trade and other payables                          26,249              25,162 
 Lease liabilities                                  3,193               3,251 
 Derivative financial instruments                     225                   - 
 Financial liabilities - preference shares            235                 235 
 Borrowings                                        30,000              30,000 
 Deferred tax liabilities                          31,422              32,126 
-----------------------------------------------  --------  ------------------ 
 Total non-current liabilities                     91,324              90,774 
-----------------------------------------------  --------  ------------------ 
 Total liabilities                                114,701             114,304 
-----------------------------------------------  --------  ------------------ 
 Net assets                                       241,544             239,374 
-----------------------------------------------  --------  ------------------ 
 Share capital                                      1,532               1,532 
 Revaluation reserve                                5,270               5,270 
 ESOP reserve                                        (35)                (38) 
 Other reserves                                     (455)               2,234 
 Retained earnings                                235,100             230,232 
-----------------------------------------------  --------  ------------------ 
 Equity attributable to owners of the company     241,412             239,230 
 Non-controlling interests                            132                 144 
-----------------------------------------------  --------  ------------------ 
 Total equity                                     241,544             239,374 
-----------------------------------------------  --------  ------------------ 

Consolidated Statement of Changes in Equity for the year ended 30 September 2023

                                Share         Revaluation         ESOP       Other       Retained     Total 
                              capital             reserve      reserve   reserves*       earnings 
                                  GBP                              GBP         GBP            GBP 
                                  000             GBP 000          000         000            000   GBP 000 
 At 1 October 2022              1,532               5,270         (38)       2,234        230,232   239,230 
 Total recognised income 
  and expense for the year          -                   -            -           -         11,280    11,280 
 Amortisation of employee 
  share option scheme               -                   -            3           -              -         3 
 Movement on hedges (net 
  of tax)                           -                   -            -     (2,689)              -   (2,689) 
 Actuarial gain on defined 
  benefit scheme (net of 
  tax)                              -                   -            -           -          (652)     (652) 
 Equity dividends                   -                   -            -           -        (5,760)   (5,760) 
 At 30 September 2023           1,532               5,270         (35)       (455)        235,100   241,412 
                             ========  ==================  ===========  ==========  =============  ======== 
 At 1 October 2021              1,532               5,270         (79)     (1,618)        220,178   225,283 
 Total recognised income 
  and expense for the year          -                   -            -           -          8,326     8,326 
 Amortisation of employee 
  share option scheme               -                   -           41           -              -        41 
 Movement on hedges (net 
  of tax)                           -                   -            -       3,852              -     3,852 
 Actuarial gain on defined 
  benefit scheme (net of 
  tax)                              -                   -            -           -          7,181     7,181 
 Equity dividends                   -                   -            -           -        (5,453)   (5,453) 
 At 30 September 2022           1,532               5,270         (38)       2,234        230,232   239,230 
                             ========  ==================  ===========  ==========  =============  ======== 

*'Other reserves' represents the foreign currency hedging reserve.

Consolidated Statement of Cash Flows for the year ended 30 September 2023

                                                      2023       2022 
                                                    GBP000     GBP000 
 Operating profit                                   14,522     11,906 
 Depreciation and amortisation charges              11,581     11,094 
 Share based reward charges                              3         41 
 Loss/(gain) on revaluation of investment 
  property                                           1,215    (1,020) 
 Pension operating charge less contributions 
  paid                                                  73      1,303 
 Deemed interest income from hire purchase 
  arrangements                                         183         50 
 Profit on sale of property, plant and 
  equipment                                            (3)        (7) 
-----------------------------------------------  ---------  --------- 
 Operating cash flows before movement in 
  working capital                                   27,574     23,367 
 Working capital adjustments: 
      Increase in inventories                      (2,014)      (257) 
      Increase in trade and other receivables      (3,835)    (1,926) 
      (Decrease)/increase in trade and other 
       payables                                      (617)      4,444 
-----------------------------------------------  ---------  --------- 
 Net movement in working capital                   (6,466)      2,261 
 Interest paid                                     (1,368)    (1,380) 
 Preference dividends paid                             (9)        (9) 
 Income taxes paid                                 (2,089)    (3,020) 
-----------------------------------------------  ---------  --------- 
 Net cash flows from operating activities           17,642     21,219 
 Purchase of property, plant and equipment        (13,046)   (11,001) 
 Investment in intangible assets                      (92)      (319) 
 Deposit interest received                           1,688        168 
 Net proceeds from disposal of fixed assets              3          7 
-----------------------------------------------  ---------  --------- 
 Net cash flows used in investing activities      (11,447)   (11,145) 
 Equity dividends paid                             (5,760)    (5,453) 
 Dividends paid to non-controlling interest          (165)      (154) 
 Repayment of lease liabilities                      (242)      (206) 
-----------------------------------------------  ---------  --------- 
 Net cash flows used in financing activities       (6,167)    (5,813) 
 Net increase in cash and cash equivalents              28      4,261 
 Cash and cash equivalents at beginning 
  of year                                           47,397     43,136 
 Effect of foreign exchange rates                        4          - 
----------------------------------------------   ---------  --------- 
 Cash and cash equivalents at end of year           47,429     47,397 

Notes to the accounts

Year ended 30 September 2023

   1.   Basis of Preparation 

The consolidated financial statements of Jersey Electricity plc, for the year ended 30 September 2023, 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). This is consistent with the accounting policies in the 30 September 2022 annual report and accounts and the 31 March 2023 interim report.

While the financial information included in this summary 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. Full financial statements that comply with IFRS have additionally been published on our website; www.jec.co.uk.

Segmental information

Revenue and profit information are analysed between the business segments as follows:

                                             2023       2023      2023       2022       2022      2022 
                                         External   Internal     Total   External   Internal     Total 
                                           GBP000     GBP000    GBP000     GBP000     GBP000    GBP000 
 Energy - arising during the 
  course of ordinary business              97,053         89    97,142     89,683        100    89,783 
 Building Services                          3,349        831     4,180      3,365        780     4,145 
 Retail                                    18,514         56    18,570     18,695         41    18,736 
 Property                                   2,350        641     2,991      2,345        639     2,984 
 Other*                                     3,812        466     4,278      3,333        625     3,958 
--------------------------------------  ---------  ---------  --------  ---------  ---------  -------- 
                                          125,078      2,083   127,161    117,421      2,185   119,606 
 Intergroup elimination                                        (2,083)                         (2,185) 
--------------------------------------  ---------  ---------  --------  ---------  ---------  -------- 
 Revenue                                                       125,078                         117,421 
 Operating profit 
 Energy profit before rebate 
  of past energy costs**                                         9,329                           7,502 
 Rebate of past energy costs                                     3,593                               - 
--------------------------------------  ---------  ---------  --------  ---------  ---------  -------- 
 Energy profit including rebate                                 12,922                           7,502 
 Building Services                                                 162                             266 
 Retail                                                            917                           1,174 
 Property                                                        1,149                           1,436 
 Other*                                                            587                             508 
--------------------------------------  ---------  ---------  --------  ---------  ---------  -------- 
                                                                15,737                          10,886 
 Revaluation of investment properties                          (1,215)                           1,020 
--------------------------------------  ---------  ---------  --------  ---------  ---------  -------- 
 Operating profit                                               14,522                          11,906 

*Other segment includes the divisions of Jersey Energy, Jendev as well as Jersey Deep Freeze Limited, the Group's sole subsidiary.

Materially, all the Group's operations are conducted within the Channel Islands. All transfers between divisions are on an arms-length basis. The revaluation of investment properties is shown separately from Property operating profit.

Revenues disclosed by the business segments above are recognised both on a point in time and over time basis. The treatment of revenue recognition in accordance with IFRS 15 is detailed for each of these business segments in note 1 in the full version of these financial statements.

**During the year ended 30 September 2023, the Company received a credit which has been disclosed as 'Rebate of past energy costs - non-recurring item' within gross profit in these financial statements. This was a rebate from the French network operator (RTE) in respect of payments made in 2022 which they were instructed to return to us as part of a regulatory decision due to volatility in the energy marketplace during 2022. Due to the unknown timing, amount and eligibility regarding this reimbursement, it was not possible to disclose this rebate in relation to the prior year ending 30 September 2022.

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our Privacy Policy.



(END) Dow Jones Newswires

December 20, 2023 12:51 ET (17:51 GMT)

Jersey Electricity (LSE:JEL)
Gráfica de Acción Histórica
De Mar 2024 a Abr 2024 Haga Click aquí para más Gráficas Jersey Electricity.
Jersey Electricity (LSE:JEL)
Gráfica de Acción Histórica
De Abr 2023 a Abr 2024 Haga Click aquí para más Gráficas Jersey Electricity.