RNS Number:2314X
Mid Kent Water PLC
14 June 2002
Mid Kent Water plc
Preliminary Results
for the year to 31 March 2002
Chairman's Statement
Introduction
The year has seen significant changes in terms of performance, management and
ownership. As I reported in November, the Company's ultimate parent company
changed in May 2001 and is now Swan Capital Group Ltd. Part of the reason for
the change in ownership was to secure the funds required during the current
regulatory period to meet our substantial capital investment programme. The new
management team is now well established and it is pleasing to report both
significant improvements in levels of service for our customers and a strong
financial performance.
Results
Overall turnover for the year was £38.7m, an increase of 5.9% from £36.6m with
water supply revenue increasing 6.8% on last year. This increase reflects
increased water prices of 7.7% as allowed by the Regulator, offset by the impact
of metering and the reduction in metered volumes.
Operating profit was £14.2m compared with £8.8m. It should be noted that
operating profit last year was stated after Competition Commission costs of
£1.5m. Profits on surplus property disposals were down from £1.9m last year to
£0.5m. Net interest payable has increased from £3.3m to £4.3m reflecting the
increased borrowing requirement to fund capital expenditure.
An interim dividend of 9.45p per share was paid on 27th November 2001 (2001:
9.01p) and a second interim dividend of 14.16p (2001: 13.52p) will be paid on 26
July 2002. This represents a 4.8% increase on last year's dividend. No final
dividend is proposed. The dividend policy is to provide shareholders with a
return in line with market expectations. This will be reviewed in the coming
year along with the financial structure of the Company.
Capital expenditure
Capital expenditure in the year of £28.0m gross (£24.8m net of contributions)
represents the largest annual programme in the history of the Company. Five new
treatment plants are in the course of completion of which three have been
commissioned during the year. 128km of mains were either refurbished or replaced
in the year. This is part of our mains rehabilitation project which is
underpinned by an undertaking given to the Drinking Water Inspectorate on behalf
of the Secretary of State.
We continue to promote the take up of meters with in excess of 7,000 free meters
to customers transferring from unmeasured accounts and 2,000 new domestic
property meters being installed in the year.
Operations
Performance in terms of all levels of service measured by OFWAT has shown
improvement in the year. Unaudited figures show that the Company's leakage
target has been met and water quality results for the year are the best on
record, beating last year's compliance figure for overall water quality.
Non regulated activities
We have continued to develop further our contracted services for the industrial
and commercial market place in South East England, and a number of innovative
opportunities are actively being investigated. We are also continuing to grow
our share of the plumbing service market and to build on the reputation of our
Fisheries business.
Community
We take an active role in working with our community and in the year we were
delighted to support the Festival for Schools, an education programme working in
conjunction with Kent County Council, and the Kent Environment Award where we
sponsored the site management category.
Prospects
We aim to continue to deliver improved levels of service in the coming year.
This will be coupled with a significant programme of improved performance
delivery and process efficiencies. Successful completion of the programme will
ensure that we are well positioned in efficiency terms when compared with other
water companies.
Employees
The Company and its customers benefit from the skills, dedication and commitment
of its staff. I would like to take the opportunity to thank them for their hard
work and support, and look forward to working with them to meet the challenges
in the year ahead.
Keith Tozzi
Chairman
14 June 2002
Profit and loss account
Year ended 31 March 2002
Notes 2002 2001
£000 (restated)
£000
2 Turnover 38,710 36,561
Operating costs (24,478) (27,758)
---------- ----------
3 Operating profit 14,232 8,803
Profit on sale of fixed assets 477 1,875
----------- -----------
Profit on ordinary activities before interest 14,709 10,678
Interest receivable 106 604
Interest payable and similar charges (4,357) (3,946)
---------- -----------
1, 4 Profit on ordinary activities before taxation 10,458 7,336
Tax on profit on ordinary activities (1,464) (848)
---------- ----------
Profit on ordinary activities after taxation 8,994 6,488
5 Dividends paid and proposed (4,402) (4,200)
---------- ----------
Retained profit for the year 4,592 2,288
---------- ----------
6 Earnings per ordinary share 48.2p 34.8p
---------- ----------
5 Dividends per ordinary share 23.61p 22.53p
Summarised balance sheet
At 31 March 2002
Notes 2002 2001
£000 (restated)
£000
Fixed assets
Tangible assets 151,978 133,869
---------- ----------
Current assets
Stocks 567 459
Debtors 7,922 7,335
Cash at bank and in hand 1,370 5,184
---------- ----------
9,859 12,978
Creditors: amounts falling due within one year (33,200) (37,172)
---------- ----------
Net current liabilities (23,341) (24,194)
---------- ----------
Total assets less current liabilities 128,637 109,675
Creditors: amounts falling due after more than one year (56,107) (42,531)
Provision for deferred taxation (12,898) (12,104)
1
---------- ----------
Net assets 59,632 55,040
---------- ----------
Capital and reserves
Attributable to equity interests
Called up share capital 18,646 18,646
Profit and loss account 40,986 36,394
---------- ----------
Capital employed 59,632 55,040
---------- ----------
Summarised cash flow statement
Year ended 31 March 2002
2002 2001
£000 £000
Net cash inflow from operating activities 17,727 17,718
Returns on investments and servicing of finance (4,009) (3,349)
Taxation 682 (2,537)
Net capital expenditure (27,456) (11,051)
Equity dividends paid (4,283) (4,600)
---------- ----------
Cash outflow before financing (17,339) (3,819)
Financing 13,525 (54)
---------- ----------
Decrease in cash (3,814) (3,873)
Notes 7 to 10 are part of this statement.
NOTES
1. Basis of preparation
(i)The financial information included within this statement has been prepared on
the basis of accounting policies consistent with those set out in the Report and
Accounts for the year ended 31 March 2001 with the following exceptions:
(a) Financial Reporting Standard 19 "Deferred tax" has been adopted for the
first time in these accounts, resulting in a restatement of prior year figures.
Profit for the year to 31 March 2001 has been reduced by £739,000 reflecting the
deferred tax charge for that year. Net assets at 1 April 2001 have reduced by
£12,104,000, reflecting the provision for deferred tax.
(b) Financial Reporting Standard 18 "Accounting Policies" (FRS 18) has also been
adopted for the first time in these accounts. The directors have reviewed the
Company's accounting policies and consider that the accounts are prepared in
accordance with FRS 18. This has had no impact on the profit or net assets of
the Company.
(ii) The information shown for the years ended 31 March 2002 and 31 March 2001
does not constitute statutory accounts within the meaning of section 240 of the
Companies Act 1985 and has been extracted from the full accounts for the years
ended 31 March 2002 and 31 March 2001 respectively. The reports of the auditors
on those accounts were unqualified and did not contain a statement under either
Section 237(2) or Section 237(3) of the Companies Act 1985. The accounts for the
year ended 31 March 2001 have been filed with the Registrar of Companies. The
accounts for the year ended 31 March 2002 will be delivered to the Registrar of
Companies in due course.
(iii) The financial information included in this statement was approved by the
Board on 14 June 2002.
2 Analysis of turnover
2002 2001
£000 £000
Unmeasured supplies 21,200 20,599
Measured supplies 14,645 12,967
Other activities 2,865 2,995
---------- ----------
38,710 36,561
---------- ----------
3 Operating profit
2002 2001
£000 £000
Operating profit is stated after charging
Competition Commission referral costs - 1,545
4 Corporation tax
2002 2001
£000 (restated)
£000
Current tax
UK Corporation tax 1,878 1,105
Tax over provided in previous years (1,208) (517)
Group relief surrended at nil charge by other group undertaking - (479)
---------- ----------
670 109
Deferred tax
Discounted origination and reversal of timing differences 794 739
---------- ----------
1,464 848
---------- --------
5 Dividends
A second interim dividend of 14.16p per ordinary share in respect
of the year ended 31 March 2002 will be paid on 26 July 2002 to
shareholders on the register on 28 June 2002. The second interim
dividend is in addition to the interim dividend of 9.45p, already paid,
making a total of 23.61p for the year. This compares with a second
interim dividend last year of 13.52p and an interim dividend of 9.01p,
making a total of 22.53p for that year. No final dividend is proposed.
6 Earnings per ordinary share
Earnings per ordinary share are calculated on the profit for the year of
£8,994,000 (2001 restated: £6,488,000) and the weighted average number
of shares in issue of 18,646,142 (2001: 18,646,142).
7 Reconciliation of operating profit to net cash flow from operating
activities
2002 2001
£000 (restated)
£000
Operating profit 14,232 8,803
Depreciation charge 6,637 6,619
(Increase)/decrease in stocks (108) 66
Increase in debtors (249) (112)
(Decrease)/increase in creditors (2,785) 2,342
---------- ----------
17,727 17,718
---------- ----------
8 Analysis of cash flows for headings netted in cash flow statement
2002 2001
£000 £000
Returns on investments and servicing of finance
Interest received 106 608
Interest paid (4,100) (3,941)
Interest element of finance lease rental payments (15) (16)
---------- ----------
(4,009) (3,349)
---------- ----------
Net capital expenditure
Purchase of tangible fixed assets (28,473) (18,477)
Contributions to infrastructure assets 805 4,976
Sale of tangible fixed assets 212 2,450
---------- -----------
(27,456) (11,051)
---------- ----------
Financing
Capital element of finance lease rental payments (75) (54)
Loans from holding company 13,600 -
---------- ----------
13,525 (54)
---------- ----------
9 Analysis of net debt
At At
1 April Cash flow 31 March
2001 £000 2002
£000 £000
Cash at bank and in hand 5,184 (3,814) 1,370
Finance leases (128) 75 (53)
Loans from holding company (38,000) (13,600) (51,600)
Debenture stock (4,461) - (4,461)
---------- ---------- ----------
(37,405) (17,339) (54,744)
---------- ---------- ----------
10 Reconciliation of net cash flow to movement in net debt
2002 2001
£000 £000
Decrease in cash in the year (3,814) (3,873)
Cash outflow from lease repayments 75 54
Cash inflow from loans from holding company (13,600) -
---------- ----------
Movement in net debt resulting from cash flows (17,339) (3,819)
Net debt at 1 April (37,405) (33,586)
---------- ----------
Net debt at 31 March (54,744) (37,405)
---------- ----------
This information is provided by RNS
The company news service from the London Stock Exchange
Mid Kent Wtr4% (LSE:48HO)
Historical Stock Chart
From Jun 2024 to Jul 2024
Mid Kent Wtr4% (LSE:48HO)
Historical Stock Chart
From Jul 2023 to Jul 2024
