1998 - 1999 Preliminary Results -- "Investing For Growth".GLASGOW Glasgow, city, Scotland Glasgow (glăs`gō, –kō, glăz`gō), city (1991 pop. 688,500) and council area, S central Scotland, on the river Clyde. , Scotland--(BUSINESS WIRE)--May 6, 1999-- ScottishPower (NYSE NYSE See: New York Stock Exchange : SPI (1) (Stateful Packet Inspection) See stateful inspection. (2) (Service Provider Interface) The programming interface for developing Windows drivers under WOSA. ), a leading UK multi-utility, today announced its preliminary statement for the year ended March 31, 1999. - Turnover up 3.6% to 3,242 million pounds ($5,224 million(a)) - Profit before tax up 4 million pounds to 644 million pounds ($1,038 million) - EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) A metric used to show a company's profitability, but not its cash flow. EBITDA became popular in the 1980s to show the potential profitability of leveraged buyouts, but has become up 66 million pounds to 1,017 million pounds ($1,639 million) - Earnings per share up 2.8% to 42.4p (68.3 cents) ($2.73 per ADR ADR - Astra Digital Radio ) - Dividend per share up 10.3% to 22.5p (36.3 cents) ($1.45 per ADR) - Over one million new energy accounts acquired - ScottishTelecom doubles turnover - Construction commences on 400 MW CCGT CCGT Combined Cycle Gas Turbine CCGT Chicago Center for Green Technology CCGT Combined-Cycle Generating Technology CCGT catalytic combustion gas turbine - PacifiCorp PacifiCorp is an electric power company in the north-western United States. PacifiCorp has three primary subsidiaries: Pacific Power is a regulated electric utility with service territory throughout Oregon, northern California, and southeastern Washington. merger on track (a) US dollar equivalents are provided for reader convenience at the March 31, 1999 exchange rate of 1 pound = $1.6112. Murray Murray, river, Australia Murray, principal river of Australia, 1,609 mi (2,589 km) long, rising in the Australian Alps, SE New South Wales, and flowing westward to form the New South Wales–Victoria boundary. Stuart, Chairman of ScottishPower, said: "These results demonstrate a satisfactory financial performance from the group and reflect our commitment to investing to grow the business to deliver a high quality service for customers and enhanced value for shareholders. Our investment in the competitive electricity and gas markets has positioned ScottishPower as a market leader, with new domestic energy accounts secured to date in the competitive market totaling over one million. ScottishTelecom has continued to grow, doubling turnover, and extending both its markets and product range. We are currently considering with financial advisers how best to maximise Verb 1. maximise - make the most of; "He maximized his role" maximize exploit, tap - draw from; make good use of; "we must exploit the resources we are given wisely" 2. shareholder value from this business. We have achieved further improvements in cost efficiency and customer service, particularly in our Power Systems and Southern Water businesses. Final approvals have been achieved and construction has commenced on our 400 MW CCGT near Brighton Brighton, city (1991 pop. 134,581) and district, East Sussex, SE England. The largest and most popular resort in S England, Brighton also has engineering works and factories that manufacture office machinery, machine tools, electrical apparatus, vacuum cleaners, , a 50% joint venture project. Through our proposed merger with US utility PacifiCorp, we aim to establish a strong platform for growth in the US electricity sector. The merger approval process is proceeding in line with our expectations and we continue to envisage en·vis·age tr.v. en·vis·aged, en·vis·ag·ing, en·vis·ag·es 1. To conceive an image or a picture of, especially as a future possibility: envisaged a world at peace. 2. completing the transaction later this year. We believe that the transaction will derive de·rive v. 1. To obtain or receive from a source. 2. To produce or obtain a chemical compound from another substance by chemical reaction. benefit from the application of ScottishPower's proven utility management skills to PacifiCorp's western US business." OVERVIEW Our strategy for delivering shareholder value has two key elements - a strong growing UK multi-utility business and the establishment of a strong platform for growth in the US electricity sector. UK Businesses: Our investment in the competitive electricity and gas markets has positioned ScottishPower as a market leader, with new domestic energy accounts secured to date in the competitive market totaling over one million. ScottishTelecom has continued to grow, doubling turnover, and extending both its markets and product range. We are currently considering with financial advisers how best to maximise shareholder value from this business. We have achieved further improvements in cost efficiency and customer service, particularly in our Power Systems and Southern Water businesses. Final approvals have been achieved and construction has commenced on our 400 MW CCGT near Brighton, a 50% joint venture project. US Merger: In December December: see month. we announced a major step in ScottishPower's stated strategy of achieving growth and creating value for shareholders by transferring our core skills to the US. Through the proposed merger with the US utility, PacifiCorp, we aim to create an international utility company, with substantial energy businesses in the UK and the US. The Directors believe that through the application of ScottishPower's proven utility management skills, they will be able to reduce costs and increase operating efficiencies at PacifiCorp, thereby delivering benefits for shareholders. Alan Richardson Alan Richardson (born May 6, 1975 in Newcastle-under-Lyme, Staffordshire[1]) is an English cricketer. As of 2006 he plays for Middlesex. Richardson made his first-class debut for Derbyshire in 1995 and, though he didn't make a contribution with the bat, his three , formerly Managing Director of our Power Systems business, is leading a management team in Portland Portland, town, England Portland, town (1991 pop. 12,945), Dorset, S England. It is on the Isle of Portland, a small rocky peninsula. Portland stone has been used in St. Paul's Cathedral and other important London buildings. Lobsters and crabs are harvested. , Oregon Oregon, city, United States Oregon, city (1990 pop. 18,334), Lucas co., NW Ohio, a suburb adjacent to Toledo, on Lake Erie; inc. 1958. It is a port with railroad-owned and -operated docks. The city has industries producing oil, chemicals, and metal products. , which is examining how to maximise the benefits from the integration of PacifiCorp into the ScottishPower group. The merger approval process is proceeding in line with our expectations. At the US Federal level we have sought expedited clearance CLEARANCE, com. law. The name of a certificate given by the collector of a port, in which is stated the master or commander (naming him) of a ship or vessel named and described, bound for a port, named, and having on board goods described, has entered and cleared his ship or vessel of our application to the FERC FERC Federal Energy Regulatory Commission FERC FEMA Emergency Response Capability and we have already received clearance under the Hart Scott-Rodino Act. Applications in connection with the proposed transaction have been filed in each of the six States in which PacifiCorp operates and hearings are scheduled to take place during July July: see month. and August. We have detailed in testimony Oral evidence offered by a competent witness under oath, which is used to establish some fact or set of facts. Testimony is distinguishable from evidence that is acquired through the use of written sources, such as documents. testimony n. to the State Regulatory reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. bodies the benefits we believe ScottishPower will bring in terms of customer service improvements, efficiency benefits, and community and environmental investments. In the UK the Secretary of State for Trade and Industry has announced that it is not his intention to refer the merger to the Competition Commission. This is subject to certain assurances from ScottishPower to address the regulatory concerns of the Director General of Electricity Supply. The Australian Australian pertaining to or originating in Australia. Australian bat lyssavirus disease see Australian bat lyssavirus disease. Australian cattle dog a medium-sized, compact working dog used for control of cattle. Foreign Investment Review Board has given its consent to the transaction. Based upon the current timetable “Schedule” redirects here. For other uses, see Schedule (disambiguation). A timetable or schedule is an organized list or schedule, usually set out in tabular form, providing information about a series of arranged events: in particular, the time at which we continue to envisage completing the transaction later this year. Posting of the UK and US shareholder documentation is due to commence on 6 May. Shareholder meetings to approve the merger, and in the UK the introduction of a new holding company for the ScottishPower group, will be held in the UK on 15 June June: see month. and in the US on 17 June. The Board intends to implement a share buy-back programme of up to 500 million pounds, following approval of the merger by both ScottishPower shareholders and PacifiCorp shareholders, to take place prior to the merger date. It is anticipated that the buy-back will be undertaken through on-market purchases. FINANCIAL REPORT Group Turnover Group turnover of 3,242 million pounds was 114 million pounds higher than 1997-98, an increase of 3.6%, due principally to growth in the developing domestic gas area and the telecommunications Communicating information, including data, text, pictures, voice and video over long distance. See communications. business. Total energy sales across the group were 2,274 million pounds, a reduction of 6 million pounds on the previous year. In electricity, higher sales volumes in the ScottishPower franchise area were more than offset by lower volumes in Manweb, the latter as a result of exiting from unprofitable business in the commercial and industrial sectors. In addition, turnover reduced due to continued competitive pricing in the ScottishPower second tier and large business markets and lower domestic electricity prices. Gas and other energy sales were up by 77 million pounds to 240 million pounds, due to the significant growth in the number of domestic gas customers being supplied. Southern Water's contribution to group turnover reduced by 13 million pounds, mainly reflecting the full year impact of the disposal of non-core businesses in the prior year, with underlying business turnover increasing by 19 million pounds year-on-year. Total turnover in ScottishTelecom increased by 107 million pounds to 220 million pounds, including a contribution to group turnover of 49 million pounds from Demon Internet Demon Internet Demon Internet is a British Internet Service Provider. It was one of the earliest ISPs, one of the UKs first, especially targeting the "dialup" audience starting on 1 June 1992 from an idea posted on CIX by Cliff Stanford of Demon Systems Ltd. for the period since acquisition in May 1998. The group's other businesses increased their turnover by 35 million pounds. Group Operating Profit Operating profit (or loss) Revenue from a firm's regular activities less costs and expenses and before income deductions. operating profit See operating income. The 0.5% rise in cost of sales to 1,861 million pounds compared favourably Adv. 1. favourably - showing approval; "he reviewed the play favorably" favorably favourably U.S. favorably adverb 1. with the 3.6% increase in turnover, reflecting higher revenues in infrastructure businesses, margin growth in our telecommunications business and continued focus in the group on cost control. Transmission and distribution costs distribution costs distribute npl → Vertriebskosten pl increased by 39 million pounds year-on-year largely due to capture costs in growing the customer base for electricity and gas and the costs resulting from the severe winter storms in Scotland Scotland, political division of Great Britain (1991 pop. 4,957,000), 30,414 sq mi (78,772 sq km), comprising the northern portion of the island of Great Britain and many surrounding islands. . Administrative expenses increased by 46 million pounds in the year due to the expansion of our developing businesses, especially telecommunications, and increased rates and depreciation charges in our wires and pipes businesses. Group operating profit amounted to 803 million pounds, an increase of 2.3% or 18 million pounds compared with 1997-98, principally due to increased profit in Power Systems and Southern Water. This increase in group operating profit is after absorbing ab·sorb tr.v. ab·sorbed, ab·sorb·ing, ab·sorbs 1. To take (something) in through or as through pores or interstices. 2. To occupy the full attention, interest, or time of; engross. an additional 28 million pounds of costs, compared to the previous year, for capturing new energy and telecoms customers, marketing the ScottishPower brand and depreciation of new systems required to operate in the competitive electricity and gas markets. Earnings before interest, tax, depreciation and amortisation Noun 1. amortisation - the reduction of the value of an asset by prorating its cost over a period of years amortization reduction, step-down, diminution, decrease - the act of decreasing or reducing something 2. ('EBITDA') increased by 66 million pounds to 1,017 million pounds. The profit in Generation Wholesale was 115 million pounds in the year, down 16 million pounds compared with 1997-98. Higher electricity volumes were sold at lower average prices, both to our Energy Supply business and to the wholesale market. In addition, there were higher capacity and transmission charges. Interconnector This article is about the gas pipeline linking the UK and continental Europe. For the railway tunnel proposed for Dublin city centre, see Interconnector (rail tunnel). For the cross channel electricity interconnector, see HVDC Cross-Channel. capacity was increased in the year, with volumes increasing by 442 GWh to 6,049 GWh, with contribution unchanged due to reductions in Pool prices. Power Systems increased profit by over 12 million pounds, to 262 million pounds. Transmission increased operating profit by 3 million pounds, to 84 million pounds, with price increases allowed under the regulatory formula offset by increased grid grid: see electron tube. (1) Any interconnected set of nodes such as the electric power network or a communications network. (2) "The Grid" is a nickname for Internet2. See Internet2. costs, rates and depreciation. Distribution profits improved by 9 million pounds, with distribution revenues improved from allowed price increases, higher sales volumes and from a more favourable mix of units sold. Further business cost reductions were achieved, which partially offset increased depreciation charges and new industry costs associated with the operation of the competitive electricity market. In Energy Supply, first tier profit fell by 2 million pounds to 36 million pounds with lower generation costs more than offset by price reductions to customers and the costs of operating in the competitive electricity market. The impact of competition on financial performance in our first tier market has not been significant. The second tier segment recorded a break-even result, 4 million pounds better than in 1997-98 despite absorbing 3 million pounds of capture costs for new domestic electricity customers won in this market. Margins have been improved, despite the competitive pressures in the large business sector of this market, primarily as a result of lower Pool prices and the exit from loss making contracts. In the commercial and domestic gas markets, the operating loss operating loss The excess of operating expenses over revenue. As with operating income, operating losses exclude revenues and expenses from operations that are not considered a regular part of the business. Also called deficit. Compare operating income. of 16 million pounds reflects domestic customer capture costs in the year of 17 million pounds and increased costs from serving the expanded customer base, in part offset by the margin obtained from supplying each new gas customer in the domestic sector. Payback Payback The length of time it takes to recover the initial cost of a project, without regard to the time value of money. on our initial investment to acquire a domestic gas customer is currently being achieved in 18 months. Overall, Energy Supply profits increased by 5 million pounds to 20 million pounds. Operating profit in Manweb decreased by 6 million pounds to 125 million pounds. Increased depreciation charges and marketing costs in the competitive electricity market contributed to the reduction in profit, with price reductions passed on to customers offset by lower generation prices. Southern Water contributed over 21 million pounds of additional operating profit, mainly from increased revenues and cost savings of 10 million pounds delivered by the acquisition transition plan during 1998-99, offsetting the additional cost obligations arising from the construction and operation of new treatment plants. Year-on-year, Southern Water's operating profit increased by 8.9% to 262 million pounds from 241 million pounds. ScottishTelecom's contribution to group operating profit was 10 million pounds, up from 5 million pounds in 1997-98, reflecting the increased volume of network traffic and growth in the provision of internet Internet Publicly accessible computer network connecting many smaller networks from around the world. It grew out of a U.S. Defense Department program called ARPANET (Advanced Research Projects Agency Network), established in 1969 with connections between computers at the services resulting from our acquisition of Demon Internet on 1 May 1998. EBITDA for ScottishTelecom increased by 15 million pounds to 26 million pounds. Profit in the other businesses was 8 million pounds, 5 million pounds lower than the previous year, due to a fall in Retail profit as a result of the difficult market conditions in this sector throughout 1998-99. Performance in the other businesses was in line with the prior year. Interest, Taxation, Earnings & Dividends The net interest charge of 161 million pounds was 14 million pounds higher than in 1997-98 due mainly to the full year effect of increased debt on payment of the first installment Regular, partial portion of the same debt, paid at successive periods as agreed by a debtor and creditor. An installment loan is designed to be repaid in certain specified, ordinarily equal amounts over a designated period, such as a year or a number of months. of the windfall tax windfall tax Noun a tax levied on profits made from the privatization of public utilities in December 1997 and the part year impact from the second installment paid in December 1998. Changes to the group's debt portfolio were made during the year to take advantage of falling interest rates and to extend the maturity profile of the group's borrowings. As a result the average interest rate for the group during the year was 8.0%, versus 8.4% in 1997-98. Interest cover remained prudent at 5.0 times against 5.3 times in the prior year. The effective tax rate was reduced to 22.0% from 23.7% in the previous year largely due to higher capital allowances on the current mix and level of capital expenditure. The profit after ordinary tax for the year amounted to 502 million pounds, an increase of 14 million pounds or 2.9%. Earnings per share were 42.42p, an increase of 2.8% on a comparable basis. The proposed final dividend of 15.00p net per share, brings the total dividend per share for the year to 22.50p net, an increase of 10.3%. The full year dividend was covered 1.9 times by earnings, versus 2.0 times in 1997-98. This increase in dividend is in line with our stated aim of achieving 7% to 8% real dividend growth until at least the regulatory reviews in the year 2000, whilst maintaining a prudent level of dividend cover. It is ScottishPower's current aim to deliver real dividend growth thereafter and this will be re-examined once the outcome of the regulatory reviews is known. The Directors recommend that the final dividend be paid on 4 October October: see month. 1999 to those shareholders whose names appear in the Register of Members on 25 June 1999. Cash Flow Free cash flow for the year was 702 million pounds, a reduction of 32 million pounds versus 1997-98, reflecting working capital increases in our developing gas and telecommunications businesses. The group invested 754 million pounds in capital projects during the year, 97 million pounds more than in the previous year. This investment was primarily to improve the quality of the infrastructure assets in our electricity and water and wastewater Wastewater is any water that has been adversely affected in quality by anthropogenic influence. It comprises liquid waste discharged by domestic residences, commercial properties, industry, and/or agriculture and can encompass a wide range of potential contaminants and services businesses and in the growth of our telecommunications business. In addition, expenditure on improving information systems throughout the group continued. Net debt at 31 March 1999 was 2,421 million pounds, an increase of 468 million pounds compared with a year ago, principally due to payments of windfall tax and the increased programme of capital expenditure. Gearing at 31 March 1999 was 124%, up from 114% at 31 March 1998. BUSINESS REPORT Energy Supply ScottishPower and Manweb were two of the first companies to enter the competitive domestic gas and electricity markets. At 31 March 1999, new domestic energy accounts secured since the introduction of competition, totalled 950,000, comprising 307,000 in Scotland, 155,000 in Manweb, 131,000 in Southern Water and 357,000 outside our home territories. These new contracts are split 760,000 gas accounts and 190,000 new electricity accounts. Our focus is on securing "dual fuel", electricity and gas customers, and to date we have 317,000 customers contracted to take both products from the ScottishPower group. With up to 760 sales agents we are winning new energy accounts at an average rate of 20,000 per week across the UK. We continue to see an 18-month payback on this new business. We are maximising Adj. 1. maximising - making as great as possible maximizing increasing - becoming greater or larger; "increasing prices" the synergies with our network of retail shops and early trials have resulted in 1,000 new energy supply accounts a week through this route. Customer losses at 31 March 1999 were slightly lower than expected at 147,000, representing 5% of franchise electricity customers. We remain on course to achieve our March 2000 market share targets: - 13% of the UK domestic electricity market (12% at 31 March 1999) - 7% of the UK domestic gas supply market (4% at 31 March 1999) Our gas supply target for 2000 is equivalent to 1.3 million new customers - a similar sized customer base to that of a small REC. In March, we launched our first national advertising campaign to help us position ScottishPower as a national brand. Excellence in customer service is integral to the success of our supply business and we are pleased to report that our performance in respect of failures on guaranteed standards and improvements in underlying customer minutes lost were significantly improved over the already good figures for 1998. In Manweb, for example, supply complaints to OFFER have shown a 41% decrease, dropping from 123 complaints to 72. Competition in the commercial and industrial supply market remains intense. Our strategy is to focus on the provision of value added Value Added The enhancement a company gives its product or service before offering the product to customers. Notes: This can either increase the products price or value. services. Our Energy & Utility Services team has secured a 12 million pounds contract to develop a 27 MW CHP CHP Chapter CHP Combined Heat and Power CHP California Highway Patrol CHP Cumhuriyet Halk Partisi (Turkish: Republican People's Party) CHP Chemical Hygiene Plan (OSHA) CHP Community Health Plan project and provide energy management services for Pilkington in the Manweb service area. ScottishPower is the first UK utility to offer invoicing in·voice n. 1. A detailed list of goods shipped or services rendered, with an account of all costs; an itemized bill. 2. The goods or services itemized in an invoice. tr.v. over the internet and we already have 13 major multi-site customers enrolled. We are also trialling electricity and gas sales to customers across the internet. Power Systems Within our Power Systems business the focus continues to be on reducing costs and improving service. A major new benchmarking
Benchmarking (also "best practice benchmarking" or "process benchmarking") is a process used in management and particularly strategic initiative to ensure operating costs operating costs npl → gastos mpl operacionales are at best-in-class See best-of-class. levels is being undertaken and implementation is expected to begin later in the year. The storms in Scotland around Christmas Christmas [Christ's Mass], in the Christian calendar, feast of the nativity of Jesus, celebrated in Roman Catholic and Protestant Churches on Dec. 25. In liturgical importance it ranks after Easter, Pentecost, and Epiphany (Jan. 6). and New Year were the worst for 30 years and caused extensive damage to our network, with over 7,000 separate incidents. We deeply regret Regret See also Remorse. Epimetheus Pandora’s husband; regretted opening box. [Gk. Myth.: Kravitz, 90] Hale, Nathan (1755–1776) American Revolutionary spy, hanged by British; regretted only having one life to give for the fact that at the peak some 125,000 customers were without power, mainly as a result of trees falling onto our overhead lines
Power Systems has been working in conjunction conjunction, in astronomy conjunction, in astronomy, alignment of two celestial bodies as seen from the earth. Conjunction of the moon and the planets is often determined by reference to the sun. with National Grid national grid Noun Brit & NZ 1. a network of high-voltage power lines linking major electric power stations 2. the arrangement of vertical and horizontal lines on an ordnance survey map Company to maximise the capacity of the Anglo-Scottish interconnector. The outturn capability in the year to March 1999 was an average 1,430 MW compared with 1,260 MW in 1998. The upgrade of capacity to 2,200 MW is expected to be complete by the end of September September: see month. 2001. Agreements have now been concluded under which ScottishPower will supply 125 MW of electricity to Northern Ireland Electricity Northern Ireland Electricity plc (NIE) is the electricity transmission company in Northern Ireland. NIE does not generate electricity but purchases it from several power stations in Northern Ireland, as well as interconnectors with the Republic of Ireland and Scotland. via a new interconnector. A further 125 MW of capacity will be open to competition. Subject to final regulatory approvals it is expected that the 250 MW line will commence commercial operation in December 2001. The current year is an important year for Power Systems with OFFER undertaking a periodic review of the price controlled revenues of the transmission business and the distribution businesses in Manweb and Scotland. Business plans have already been submitted and the company is waiting for OFFER to set out its views on the policy and principles behind future price controls. ScottishPower has responded to the OFFER consultation on the Review of Scottish Trading arrangements. Against the background of the onerous on·er·ous adj. 1. Troublesome or oppressive; burdensome. See Synonyms at burdensome. 2. Law Entailing obligations that exceed advantages. Nuclear Energy Agreement, the company is seeking the creation of a single Scottish trading area with a separate Scottish system operator. Generation In Scotland, the focus of the Generation business continues to be to reduce costs, improve efficiency and enhance environmental performance. Capital investment in our Longannet and Cockenzie power stations Cockenzie power station is a coal-fired power station sited in the town of Cockenzie and Port Seton on the shores of the Firth of Forth in East Lothian, on in 1998-99 was 28 million pounds. A major new cost savings initiative has been launched as reported previously. We expect this to deliver 17 million pounds per annum Per annum Yearly. in cost reductions over the next two years. During the year we have reviewed our generation strategy for England and Wales England and Wales are both constituent countries of the United Kingdom, that together share a single legal system: English law. Legislatively, England and Wales are treated as a single unit (see State (law)) for the conflict of laws. . Our target is to continue to source around 50% of our projected electricity sales in England and Wales from our own generation. This will largely be achieved through sales from Scotland across the interconnector and new gas plant. The 400 MW CCGT near Brighton which is a 50:50 joint venture with CSW CSW Commission on the Status of Women CSW Christian Solidarity Worldwide CSW Clinical Social Worker CSW College of the Southwest (New Mexico) CSW Cambridge SoundWorks (audio manufacturer) is expected to commence commercial operation in Winter 2000. Progress on developing Hatfield Hatfield, town (1991 pop. 33,174), Hertfordshire, SE England. Hatfield was designated one of the new towns in 1948 to alleviate overpopulation in London. The plans for this new town were coordinated with those of nearby Welwyn Garden City. Moors Moors, nomadic people of the northern shores of Africa, originally the inhabitants of Mauretania. They were chiefly of Berber and Arab stock. In the 8th cent. the Moors were converted to Islam and became fanatic Muslims. as a gas storage site continues apace with all necessary planning and consents for construction obtained. The 17.6 million pounds project remains on target for gas importing by the end of August with export available by the end of December 1999 in time for winter peak demands of some 450,000 customers. Southern Water Southern Water continues to make substantial progress in terms of cost efficiency and improved customer service standards and OFWAT recorded continuing improvements. Southern Water emerged as the top overall performer of the large water companies for water supply and customer service and was also top for efficiency in water supply. A record number of 97% of beaches in Southern Water's area reached European European emanating from or pertaining to Europe. European bat lyssavirus see lyssavirus. European beech tree fagussylvaticus. European blastomycosis see cryptococcosis. Bathing Water Standards. The regulator regulator, n the mechanical part of a gas delivery system that controls gas pressure that allows a manageable flow of drug vapor to escape. regulator see reducing valve. takes these measures into account when setting prices for the future. Southern Water's leakage LEAKAGE. The waste which has taken place in liquids, by their escaping out of the casks or vessels in which they were kept. By the act of March 2, 1799, s. 59, 1 Story's L. U. S, 625, it is provided that there be an allowance of two per cent for leakage, on the quantity which shall appear level of 11.5% is the lowest level among the 10 major water and wastewater companies. Over 300 million gallons were saved during the year by finding and repairing leaks. Water resources are now back in line with the long-term Long-term Three or more years. In the context of accounting, more than 1 year. long-term 1. Of or relating to a gain or loss in the value of a security that has been held over a specific length of time. Compare short-term. average. The substantial capital investment programme amounted this year to 347 million pounds, or over 6.5 million pounds a week. A major sludge sludge (sluj) a suspension of solid or semisolid particles in a fluid which itself may or may not be a truly viscous fluid. sludge a suspension of solid or semisolid particles in a fluid. treatment centre was commissioned at Millbrook Millbrook may refer to: Geographic places
Portsmouth, city (1991 pop. 174,218) and district, Hampshire, S England, on Spithead Channel. The district includes Portsea (naval station), Southsea (residential district and resort), and the old town of Portsmouth proper. . Work is proceeding on the 111 million pounds Isle of Wight Noun 1. Isle of Wight - an isle and county of southern England in the English Channel Wight county - (United Kingdom) a region created by territorial division for the purpose of local government; "the county has a population of 12,345 people" wastewater treatment scheme and the 53 million pounds Hastings Hastings, city, England Hastings, city (1991 pop. 74,979) and district, East Sussex, SE England. A resort and residential city, Hastings is backed by cliffs and has a 3-mi (4.8-km) marine esplanade, parks, and bathing beaches. sewerage sewerage, system for the removal and disposal of chiefly liquid wastes and of rainwater, which are collectively called sewage. The average person in the industrialized world produces between 60 and 140 gallons of sewage per day. infrastructure project. The Government's upgrading of minimum levels of wastewater treatment for coastal works will mean further improvements to recently completed new works such as Eastbourne Eastbourne (ēst`bôrn), city (1991 pop. 86,715) and district, East Sussex, SE England. Eastbourne is a popular resort and conference center with a 3-mi (4.8-km) terraced promenade along the sea front. and Shoreham Shoreham is the name of several different places:
Dover (dō`vər), town (1991 pop. 33,461), Kent, SE England, on the Strait of Dover, beneath chalk cliffs (the "White Cliffs of Dover") c.375 ft (114 m) high. The small Dour River flows through the town. and Folkestone Folkestone (fōk`stən), town (1991 pop. 42,949), Kent, SE England. The town is a summer resort with an active port. The Leas promenade runs along the chalk cliffs overlooking the English Channel. , Littlehampton Coordinates: Littlehampton is a seaside resort town in the Arun District of West Sussex, England.The parish covers an area of 11. and Bognor, Margate Margate (mär`gĭt), city (1991 pop. 53,137), in the Isle of Thanet, Kent, SE England. It is a seaport with light industries and, since the late 18th cent., a popular resort, especially for Londoners. Of interest is the Church of St. and Broadstairs, and the Isle of Wight. We estimate that these additional environmental obligations could add some 500 million pounds to the company's investment programme over the five year period from 1 April 2000. Largely as a consequence of this additional investment, Southern Water has responded to OFWAT's proposals outlined in the document Prospects for Prices, by requesting an initial price increase of 3.5% and a K factor of +3%. This would result in an average regulated reg·u·late tr.v. reg·u·lat·ed, reg·u·lat·ing, reg·u·lates 1. To control or direct according to rule, principle, or law. 2. rate of return after tax of 6.5%. Transition plan savings remain ahead of target, achieving 10 million pounds this year, some 41 million pounds in total. The new five-year "Way Ahead" initiative, which builds on the success of the transition plan, envisages the closure of existing county headquarters and the redeployment re·de·ploy tr.v. re·de·ployed, re·de·ploy·ing, re·de·ploys 1. To move (military forces) from one combat zone to another. 2. of essential staff to under-utilised accommodation accommodation n. 1) a favor done without compensation (pay or consideration), such as a signature guaranteeing payment of a debt, sometimes called an accommodation indorsement. on water and wastewater works. Further restructuring restructuring - The transformation from one representation form to another at the same relative abstraction level, while preserving the subject system's external behaviour (functionality and semantics). is taking place in order to reduce operating costs. ScottishTelecom ScottishTelecom continues to grow rapidly, doubling turnover over the year, with growth in all parts of the business. Traffic volume carried over the ScottishTelecom network now exceeds one billion minutes, an increase of 214%; "blue chip" corporate accounts have doubled over the period to more than 500; residential customers are up 86% to almost 25,000; and mobile customers are up 52% to 88,000. On 1 May 1998 ScottishTelecom completed its acquisition of Demon Internet for 66 million pounds. Demon's business continues to grow strongly and has increased its customer base from 172,000 to over 275,000 customers, an increase of 60% over the year. Services to the corporate market are also showing strong growth, with Demon demon, supernatural being, generally malevolent in character. In general, the more civilized pagan societies came to consider demons as powerful, supernatural beings who lacked the dignity of gods and who, depending on the circumstance, might be either benevolent or now the 4th largest web hosting Making a Web site available on the Internet. Many ISPs host a few personal Web pages for an individual at no additional cost above the monthly service fee, but the address is subordinate to the ISP; for example, www.friendlyisp.com/pat_smith. business in the world. ScottishTelecom's network extends from the north of Scotland to the north of England England, the largest and most populous portion of the United Kingdom of Great Britain and Northern Ireland (1991 pop. 46,382,050), 50,334 sq mi (130,365 sq km). It is bounded by Wales and the Irish Sea on the west and Scotland on the north. , with a London London, city, Canada London, city (1991 pop. 303,165), SE Ont., Canada, on the Thames River. The site was chosen in 1792 by Governor Simcoe to be the capital of Upper Canada, but York was made capital instead. London was settled in 1826. ring and a major voice and data switching centre in London's Docklands Docklands can refer to:
(networking) Internet Protocol - (IP) The network layer for the TCP/IP protocol suite widely used on Ethernet networks, defined in STD 5, RFC 791. IP is a connectionless, best-effort packet switching protocol. capability and extend its reach throughout the United Kingdom. ScottishTelecom has been reorganised Adj. 1. reorganised - organized again; "a reorganized business" reorganized organized - formed into a structured or coherent whole to integrate its businesses with a single management structure to lever lever, simple machine consisting of a bar supported at some stationary point along its length and used to overcome resistance at a second point by application of force at a third point. The stationary point of a lever is known as its fulcrum. products, services, and people skills across the whole organisation, for future top line growth. OTHER BUSINESSES Retail: The Retail business now includes 183 stores across the UK, and their profile offers a particular advantage in the midst Adv. 1. in the midst - the middle or central part or point; "in the midst of the forest"; "could he walk out in the midst of his piece?" midmost of electricity market liberalisation n. 1. Same as liberalization. Noun 1. liberalisation - the act of making less strict liberalization, relaxation alleviation, easement, easing, relief - the act of reducing something unpleasant (as pain or annoyance); "he asked the nurse . This "brand presence" in the High Street helps raise the company's profile, as well as providing a means of marketing gas and electricity services. The past year has been a difficult one for all electrical retailers, but we were pleased that we substantially, and profitably, maintained our share of the UK market. Technology & Contracting Services: The Technology and Contracting businesses have continued to expand their activities outside the group. External clients now include many UK utility groups, British Aerospace British Aerospace (BAe) was a UK aircraft and defence systems manufacturer, now part of BAE Systems. History The company was formed as a statutory corporation on April 29, 1977 as a result the Aircraft and Shipbuilding Industries Act. , Du Pont Du Pont (d  pŏnt), family notable in U.S. industrial history. The Du Pont family's importance began when Eleuthère Irénée Du Pont established a gunpowder mill on the , Rolls Royce Rolls Roycethe millionaire’s vehicle. [Trademarks: Brewer Dictionary, 928] See : Luxury and Vauxhall Coordinates: Vauxhall is an inner city area of South London in the London Borough of Lambeth. It has also given its name to the Vauxhall Parliamentary Constituency, which also includes large swathes of Brixton and Clapham . Year 2000 Compliance The group-wide Year 2000 Programme, established in 1997 to manage the effects the so-called so-called adj. 1. Commonly called: "new buildings ... in so-called modern style" Graham Greene. 2. 'millennium bug' may have on the group's operations, is progressing well. At 31 March, 89% of all critical projects were substantially complete, with compliance work on other systems expected to be completed several months before the rollover A graphic element in an application or on a Web page that changes its color or shape when the pointer is moved (rolled) over it. See JavaScript rollover. See also n-key rollover. date. As part of the work undertaken, critical suppliers have been rigorously rig·or·ous adj. 1. Characterized by or acting with rigor: a rigorous program to restore physical fitness. 2. Full of rigors; harsh: a rigorous climate. assessed and no current major issues have been identified. All other suppliers are being treated according to according to prep. 1. As stated or indicated by; on the authority of: according to historians. 2. In keeping with: according to instructions. 3. the group's dependence on them. Where appropriate, alternative suppliers may be appointed ap·point tr.v. ap·point·ed, ap·point·ing, ap·points 1. To select or designate to fill an office or a position: appointed her the chief operating officer of the company. 2. . Work is now under way to review contingency plans A plan involving suitable backups, immediate actions and longer term measures for responding to computer emergencies such as attacks or accidental disasters. Contingency plans are part of business resumption planning. and develop operational procedures The detailed methods by which headquarters and units carry out their operational tasks. to deal with any residual risk Residual risk Related: Unsystematic risk for the rollover period. This is taking the form of a Millennium millennium [Lat.,=1,000 years], the period of 1,000 years in which, according to some schools of Christian eschatology, Christ will reign again gloriously on earth. Belief in the millennium, based on Rev. 20, has recurred in Christianity since the earliest times. Operating Regime whereby the group can deliver an enhanced state of readiness See: defense readiness condition; weapons readiness state. . Our previous estimate, that the total cost of the Year 2000 Programme would be approximately ap·prox·i·mate adj. 1. Almost exact or correct: the approximate time of the accident. 2. 30 million pounds, has been reviewed and no change has been required. Summary & Outlook The financial year ended 31 March 1999 has been a very significant one for the company. ScottishPower has established itself as a leader in the competitive UK energy supply markets and ScottishTelecom has delivered further growth. At the same time we have invested significantly in our other regulated businesses. Trading for the first month of ScottishPower's 1999-2000 financial year has also been satisfactory. The Directors intend to continue to invest to develop the UK business thereby delivering long-term value to shareholders. Looking ahead into the new millennium, regulation will continue to have a significant bearing on the profitability and investment capability of the ScottishPower group. Notwithstanding the group's success to date in reducing costs and improving efficiency, regulatory factors may have a greater influence than previously. The PacifiCorp merger is expected to be earnings enhancing from the first full year, before goodwill amortisation, compared to the Directors' present expectations for the existing ScottishPower group. The merger will create one of the largest international utility companies and should open up more growth opportunities for the combined group. ScottishPower is a leading UK multi-utility company, serving five million domestic, commercial and industrial customers -- about one in five British households. ScottishPower is a vertically integrated electric utility in Scotland, and is active in the distribution and/or and/or conj. Used to indicate that either or both of the items connected by it are involved. Usage Note: And/or is widely used in legal and business writing. supply of electricity, gas and water throughout the UK. Through its ScottishTelecom subsidiary, the company is also developing a regional telecommunications business. ScottishPower's ADR, equivalent to four ordinary shares, trades on the New York Stock Exchange New York Stock Exchange (NYSE) World's largest marketplace for securities. The exchange began as an informal meeting of 24 men in 1792 on what is now Wall Street in New York City. under the symbol SPI. ScottishPower's ordinary shares trade on the London Stock Exchange London Stock Exchange London marketplace for securities. It was formed in 1773 by a group of stockbrokers who had been doing business informally in local coffeehouses. . Prices may be accessed on Bloomberg Bloomberg A major global provider of 24-hour financial news and information including real-time and historic price data, financials data, trading news and analyst coverage, as well as general news and sports. under the symbols SPI and SPW SPW Signal Processing Workstation SPW Shelter in Place Warning SPW Spencer, IA, USA - Spencer Municipal Airport (Airport Code) SPW Special Purpose Weapon SPW Spokane Washington (border patrol sector) LN, on the Reuter Reu·ter , Baron Paul Julius von 1816-1899. German-born British journalist who founded (1848) Reuter's, one of the first international news agencies. Equities 2000 Service under SPW.L and on Quotron under SPWU.EU.
-0-
Group Profit and Loss Account
for the year ended 31 March 1999
1999 1998
Notes m pounds m pounds
Turnover: group and
share of joint
ventures and associates 3,251.5 3,134.1
Less: share of turnover
in joint ventures (7.3) (3.8)
Less: share of turnover
in associates (1.9) (2.1)
------ ------
Group turnover from
continuing operations 2 3,242.3 3,128.2
Cost of sales (1,860.5) (1,850.7)
------ ------
Gross profit from
continuing operations 1,381.8 1,277.5
Transmission and
distribution costs (258.1) (219.1)
Administrative expenses (348.8) (303.0)
Other operating income 27.9 29.7
------ ------
Operating profit from
continuing operations 2 802.8 785.1
Share of operating profit
in joint ventures 2.1 1.6
Share of operating
profit in associates 0.2 0.3
------ ------
Profit on ordinary
activities before interest 805.1 787.0
Net interest charge
-Group (160.8) (147.1)
-Joint ventures (0.5) (0.2)
-Associates - (0.1)
------ ------
(161.3) (147.4)
------ ------
Profit on ordinary
activities before taxation 643.8 639.6
Ordinary taxation
-Group (141.0) (151.5)
-Joint ventures (0.5) (0.4)
-Associates (0.1) 0.3
------ ------
(141.6) (151.6)
------ ------
Profit after
ordinary taxation 502.2 488.0
Exceptional taxation
- windfall tax 3 - (317.0)
------ ------
Profit after
taxation 502.2 171.0
Minority interests 0.6 (0.9)
------ ------
Profit for the
financial year 502.8 170.1
Dividends 5 (267.9) (243.3)
------ ------
Profit/(loss)retained 234.9 (73.2)
------ ------
Earnings per ordinary share 4 42.42p 14.41p
Adjusting items
- goodwill amortisation 0.10p -
- windfall tax - 26.87p
------ ------
Earnings per ordinary
share before
goodwill amortisation
and windfall tax 4 42.52p 41.28p
------ ------
Diluted earnings per
ordinary share 4 42.00p 14.27p
Adjusting items
- goodwill amortisation 0.10p -
- windfall tax - 26.60p
------ ------
Diluted earnings per
ordinary share before
goodwill amortisation
and windfall tax 4 42.10p 40.87p
------ ------
Dividends per
ordinary share 5 22.50p 20.40p
------- ------
Statement of Total Recognised Gains and Losses
for the year ended 31 March 1999
1999 1998
m pounds m pounds
Profit for the financial
year 502.8 170.1
Surplus on revaluation
of assets - 229.0
------- ------
Total recognised gains and
losses for the
financial year 502.8 399.1
------- ------
Note of Historical Cost Profits and Losses
for the year ended 31 March 1999
1999 1998
m pounds m pounds
Profit on ordinary activities
before taxation 643.8 639.6
Difference between historical
cost depreciation charge and
actual depreciation charge
for the year calculated
on the revalued amount
of fixed assets 3.4 1.7
------ ------
Historical cost profit on
ordinary activities before
taxation 647.2 641.3
------ ------
Historical cost profit/(loss)
retained for the financial year
after taxation, minority
interests and dividends 238.3 (71.5)
------ ------
Reconciliation of Movements in Shareholders' Funds
for the year ended 31 March 1999
1999 1998
m pounds m pounds
Profit for the financial year 502.8 170.1
Dividends (267.9) (243.3)
------ ------
Profit /(loss) retained 234.9 (73.2)
Share capital issued 3.2 45.5
Revaluation of fixed assets - 229.0
Goodwill written off - (16.2)
------ ------
Net movement in
shareholders' funds 238.1 185.1
Opening shareholders' funds 1,707.8 1,522.7
------ ------
Closing shareholders' funds 1,945.9 1,707.8
------ ------
Group Cash Flow Statement
for the year ended 31 March 1999
1999 1998
Notes m pounds m pounds
Cash inflow from
continuing operating
activities 7 944.9 1,014.1
Dividends received from
associates
and joint ventures 0.9 0.9
Returns on investments
and servicing
of finance 6 (149.9) (146.7)
Ordinary taxation (93.7) (134.5)
------ ------
Free cash flow before
windfall tax 702.2 733.8
Exceptional taxation
- windfall tax 3 (157.8) (157.8)
------ ------
Free cash flow 544.4 576.0
Capital expenditure
and financial investment 6 (683.0) (592.7)
------ ------
Cash flow before
acquisitions
and disposals (138.6) (16.7)
Acquisitions and disposals 6 (77.4) 67.9
Equity dividends paid (252.8) (226.0)
------ ------
Cash outflow before
use of liquid resources
and financing (468.8) (174.8)
Management of liquid resources 6,9 (12.1) (17.5)
Financing
-Issue of ordinary share
capital 6 3.2 8.9
-Increase in debt 6,9 451.0 252.6
------ ------
454.2 261.5
------ ------
(Decrease)/increase in cash in
year 9 (26.7) 69.2
------ ------
Free cash flow represents cash flow from continuing operating
activities after adjusting for dividends received from associates and
joint ventures, returns on investments and servicing of finance and
taxation.
Reconciliation of Net Cash Flow to Movement in Net Debt for the year
ended 31 March 1999
1999 1998
Note m pounds m pounds
(Decrease)/increase in
cash in year (26.7) 69.2
Cash inflow from increase
in debt (451.0) (252.6)
Cash outflow from
movement
in liquid resources 12.1 17.5
------ ------
Change in net debt
resulting from cash flows (465.6) (165.9)
Net debt acquired (2.7) (0.1)
Net debt disposed - 6.7
Loan notes issued - (3.0)
Other non-cash movements (0.3) -
------ ------
Movement in net debt
in year (468.6) (162.3)
Net debt at end of
previous year (1,952.6) (1,790.3)
------ ------
Net debt at end of
year 9 (2,421.2) (1,952.6)
------ ------
Group Balance Sheet
as at 31 March 1999
1999 1998
Notes m pounds m pounds
Fixed assets
Intangible assets 71.3 -
Tangible assets 5,295.1 4,723.9
Investments
- Investments in joint
ventures:
Share of gross assets 54.2 23.8
Share of gross liabilities (29.8) (8.0)
------ ------
24.4 15.8
- Investments in associates 5.9 7.4
- Other investments 43.4 44.1
------ ------
73.7 67.3
------ ------
5,440.1 4,791.2
------ ------
Current assets
Stocks 125.8 144.2
Debtors 559.3 525.9
Short term bank
and other deposits 106.9 115.5
------ -----
792.0 785.6
------ -----
Creditors: amounts
falling due within
one year
Loans and other borrowings (843.6) (1,035.7)
Other creditors (1,332.8) (1,396.3)
------ ------
(2,176.4) (2,432.0)
------ ------
Net current
liabilities (1,384.4) (1,646.4)
------ ------
Total assets
less current
liabilities 4,055.7 3,144.8
Creditors: amounts
falling due after
more than one year
Loans and other borrowings (1,684.5) (1,032.4)
Provisions for liabilities
and charges 10 (30.8) (38.1)
Deferred income (393.2) (364.6)
------ ------
Net assets 2 1,947.2 1,709.7
------ ------
Called up share capital 599.4 598.4
Share premium 394.0 388.7
Revaluation reserve 223.9 227.3
Profit and loss account 728.6 493.4
------ ------
Equity shareholders' funds 1,945.9 1,707.8
Minority interests 1.3 1.9
------ ------
Capital employed 1,947.2 1,709.7
------ ------
Notes to the Preliminary Statement
for the year ended 31 March 1999
1 Basis of preparation
(a) The financial information included within this Preliminary
Statement has been prepared on the basis of accounting policies
consistent with those set out in the Directors' Report and Accounts
for the year ended 31 March 1998, with the following exceptions:
(i) In accordance with Financial Reporting Standard 10, goodwill
arising on acquisitions since 1 April 1998 is capitalised and
amortised through the profit and loss account over its useful economic
life. Previously all acquired goodwill was written off directly to
reserves.
(ii) The method of accounting for water infrastructure renewals has
been revised following the introduction of Financial Reporting
Standard 12, and the infrastructure renewals accounting basis as set
out in Financial Reporting Standard 15. Expenditure on maintaining the
operating capability of the water infrastructure network in accordance
with defined standards of service is now treated as an addition to
fixed assets. The effect of the change in policy has been to increase
tangible fixed assets and reduce prepayments and accrued income by
15.7 million pounds (1998 5.4 million pounds). There is no effect on
the profit and loss account other than to reclassify the renewals
charge as depreciation. Comparative figures have been restated in the
cash flow statement, the balance sheet and Notes 6(b),7 and 11.
(b) The information shown for the years ended 31 March 1999 and 31
March 1998 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 1999 and 31 March 1998
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 1998 have been filed with the Registrar of
Companies. The Accounts for the year ended 31 March 1999 will be
delivered to the Registrar of Companies in due course.
(c) The financial information on pages 11 to 14 was approved by the
Board on 6 May 1999.
2 Segmental business information
In the segmental analysis shown below, all material activities are
derived from continuing operations in the United Kingdom.
(a)Turnover by
business segment Inter
Total -segment External
turnover turnover turnover
1999 1998 1999 1998 1999 1998
Notes m pounds m pounds m pounds m pounds m pounds m pounds
Generation
Wholesale (i) 914.3 1,014.3 695.3 764.8 219.0 249.5
Power Systems 470.1 443.0 416.8 391.1 53.3 51.9
Energy Supply 1,434.5 1,336.2 28.8 11.5 1,405.7 1,324.7
Manweb 614.2 667.8 18.1 13.9 596.1 653.9
Southern Water 440.2 453.0 0.7 0.4 439.5 452.6
ScottishTelecom(ii)219.9 113.3 39.2 31.2 180.7 82.1
Other (i),(ii)612.8 410.7 264.8 97.2 348.0 313.5
----- ----- ----- ----- ----- -----
Total 3,242.3 3,128.2
----- ----- ----- ----- ----- -----
(b)Operating profit and net
assets/(liabilities) by
business segment Operating Net
profit assets/(liabilities)
1999 1998 1999 1998
Notes m pounds m pounds m pounds m pounds
Generation Wholesale 115.3 130.8 322.7 361.2
Power Systems 261.7 249.5 1,234.7 1,136.4
Energy Supply 20.1 15.1 97.8 45.2
Manweb (iii) 125.2 131.3 672.4 607.3
Southern Water 262.2 240.7 1,612.4 1,222.4
ScottishTelecom (ii) 10.3 4.7 307.6 151.0
Other (ii),(iv) 8.0 13.0 69.9 69.4
----- ----- ----- -----
Sub-total 802.8 785.1 4,317.5 3,592.9
Unallocated
net
liabilities (v) - - (2,370.3) (1,883.2)
----- ----- ----- -----
Total 802.8 785.1 1,947.2 1,709.7
----- ----- ----- -----
(i) The Generation Wholesale segment previously included sales from
gas trading activities which are now reported in the Other business
segment. Total turnover for the Generation Wholesale segment for 1998
included 100.5 million pounds of gas trading sales of which 82.4
million pounds related to internal sales.
(ii) The ScottishTelecom business segment and the Other business
segment were previously combined as the Developing businesses and
ancillary services segment.
(iii) Operating profit for Manweb comprises distribution operating
profit of 91.9 million pounds (1998 95.4 million pounds) and supply
and other operating profit of 33.3 million pounds (1998 35.9 million
pounds).
(iv)The net assets of the Retail business, included within the Other
business segment, excluding short term bank and other deposits of 37.2
million pounds (1998 19.7 million pounds), are 18.6 million pounds
(1998 35.6 million pounds).
(v)Unallocated net liabilities include net debt, dividends payable,
tax liabilities and fixed asset investments.
3 Exceptional taxation - windfall tax
Exceptional taxation in 1997-98 related to the group's share of the
windfall tax according to the formula contained within the Finance
(No. 2) Act 1997. The first of two equal instalments was paid on 1
December 1997 and the second instalment was paid on 1 December 1998.
4 Earnings per ordinary share
(a)Earnings per ordinary share have been calculated in accordance with
FRS 14 'Earnings per share' for both years by dividing the profit for
the financial year by the weighted average number of ordinary shares
in issue during the financial year, based on the following
information:
1999 1998
Profit for the financial year
(million pounds) 502.8 170.1
Basic weighted average share
Capital
(number of shares, million) 1,185.2 1,180.1
Diluted weighted average
share capital
(number of shares, million) 1,197.2 1,191.9
------ ------
The difference between the basic and the diluted weighted average
share capital is wholly attributable to outstanding share options.
(b)The calculation of earnings per ordinary share, on a basis which
excludes goodwill amortisation and the windfall tax, is based on the
following adjusted earnings:
1999 1998
m pounds m pounds
Profit for the financial year 502.8 170.1
Adjusting items
- goodwill amortisation 1.2 -
- windfall tax - 317.0
------ -----
Adjusted earnings 504.0 487.1
------ -----
Adjusted earnings per share has been presented in addition to earnings
per share calculated in accordance with FRS 14 in order that more
meaningful comparisons of financial performance can be made. The
figures for the year ended 31 March 1998 do not contain goodwill
amortisation as the group has adopted the transitional provisions of
FRS 10 and only capitalised goodwill arising on acquisitions since 1
April 1998.
5 Dividends per ordinary share
1999 1998
pence per pence per
ordinary ordinary 1999 1998
share share m pounds m pounds
Interim dividend paid 7.50 6.80 89.9 80.4
Proposed final
dividend 15.00 13.60 178.0 162.9
------ ------ ------ ------
Total dividends 22.50 20.40 267.9 243.3
------ ------ ------ ------
6 Analysis of cash flows
1999 1998
m pounds m pounds
(a) Returns on investments and
servicing of finance
Interest received 3.5 2.7
Interest paid (153.4) (149.0)
Interest element of finance lease
rental payments - (0.4)
----- ------
Net cash outflow for returns on
investments and servicing of
finance (149.9) (146.7)
------ ------
(b) Capital expenditure and financial
investment
Purchase of tangible fixed assets (745.1) (664.6)
Deferred income received 47.8 57.9
Sale of tangible fixed assets 20.4 26.4
Purchase of fixed asset investments (6.1) (12.4)
------ ------
Net cash outflow for capital
expenditure and financial
investment (683.0) (592.7)
------ ------
(c) Acquisitions and disposals
Purchase of subsidiary undertakings (77.4) (0.4)
Sale of subsidiary businesses - 68.3
------ ------
Net cash (outflow)/inflow from
acquisitions and disposals (77.4) 67.9
------ ------
(d) Management of liquid resources Cash outflow in relation to short
term deposits and other short term
investments (12.1) (17.5)
------ ------
Net cash outflow for management
of liquid resources (12.1) (17.5)
------ ------
(e) Financing
Issue of ordinary share capital 3.2 8.9
Debt due within one year:
- net repayment of uncommitted
facilities (39.1) (81.8)
- net commercial paper redeemed (174.9) (31.0)
- medium term notes/private
placements (62.5) 62.5
- redemption of loan notes (1.1) (39.4)
- European Investment Bank loans (10.0) 1.3
Debt due after one year:
- net repayment of committed
facilities - (200.6)
- medium term notes/private
placements 197.5 240.9
- European Investment Bank loans 51.2 20.0
- 5.875% euro-US dollar bond issue - 182.9
- Variable coupon bond issue - 99.6
- 8.375% euro-sterling bond issue - 0.2
- 6.750% euro-sterling bond issue 247.0 -
- 5.250% deutschmark bond issue 245.5 -
Capital element of finance lease
rental payments (2.6) (2.0)
----- ------
Increase in debt 451.0 252.6
----- ------
Net cash inflow from financing 54.2 261.5
----- ------
7 Reconciliation of operating profit to net cash inflow from
continuing operating activities
1999 1998
m pounds m pounds
Operating profit 802.8 785.1
Depreciation and
amortisation 225.4 184.6
Profit on sale of tangible
fixed assets and disposal
of businesses (18.6) (21.7)
Release of deferred income (13.6) (20.6)
Movements in provisions
for liabilities and charges (7.3) (5.1)
Decrease /(increase) in stocks 18.4 (32.0)
(Increase) /decrease in debtors (68.7) 81.9
Increase in creditors 6.5 41.9
------ ------
Net cash inflow from continuing
operating activities 944.9 1,014.1
------ ------
8 Analysis of cash flows in respect of acquisitions and disposals
1999 1998
m pounds m pounds
Cash consideration including
expenses (69.7) 70.2
Cash at bank and in hand
acquired/(disposed) 1.4 (1.9)
Deferred consideration in respect
Of prior year acquisitions (9.1) -
------ ------
(77.4) 68.3
------ ------
The acquisitions in 1999 were Demon Internet Limited and Watermark
Games Limited.
9 Analysis of net debt
Acquisitions
At 1 (excl. Other At 31
April Cash cash & non-cash March
1998 flow overdrafts) changes 1999
m pounds m pounds m pounds m pounds m pounds
Cash at bank 58.8 (20.7) - - 38.1
Overdrafts (9.3) (6.0) - - (15.3)
-----
(26.7)
Debt due
after 1 year (1,032.4) (741.2) (0.1) 89.2 (1,684.5)
Debt due
within 1
year (1,026.4) 287.6 - (89.5) (828.3)
Finance
leases - 2.6 (2.6) - -
-----
(451.0)
Other deposits 56.7 12.1 - - 68.8
----- ----- ----- ----- -----
Total (1,952.6) (465.6) (2.7) (0.3) (2,421.2)
----- ----- ----- ----- -----
10 Provisions for liabilities and charges
Charged to
At 1 the profit Utilised At 31
April Transferred and loss during March
1998 to creditors account year 1999
m pounds m pounds m pounds m pounds m pounds
Reorganisation
and restructuring 16.7 (6.8) - (0.4) 9.5
Environmental and
health 10.0 - 1.5 (1.4) 10.1
Other 11.4 - 2.1 (2.3) 11.2
------ ----- ----- ----- -----
Total 38.1 (6.8) 3.6 (4.1) 30.8
------ ----- ----- ----- -----
11 Southern Water Services Limited -
Preliminary results for the year ended 31 March 1999
This note is included to comply with assurances given to OFWAT at the
time of the acquisition of Southern Water plc to supply financial
information for Southern Water Services Limited, the regulated
business.
Summarised Profit and Loss Account
Notes 1999 1998
(a) m pounds m pounds
Company turnover from
continuing operations 439.2 420.4
------ -----
Profit on ordinary
activities
before interest 241.8 223.0
Net interest payable (51.4) (40.1)
------ -----
Profit on ordinary
activities
before taxation 190.4 182.9
Ordinary taxation (32.0) (33.2)
------ -----
Profit after ordinary
taxation 158.4 149.7
Exceptional taxation
- windfall tax (b) - (76.4)
------ -----
Profit after taxation 158.4 73.3
Dividends (44.4) (43.4)
------ -----
Profit retained 114.0 29.9
------ -----
Earnings per share
(pounds per ordinary share) (c) 2,828.6 1,308.9
------ -----
Dividends per share
(pounds per ordinary share) (d) 792.3 775.4
------ -----
Summarised Balance Sheet
Note 1999 1998
(a) m pounds m pounds
Fixed assets 1,857.2 1,580.1
Net current liabilities (446.5) (147.2)
Creditors: amounts falling due
after more than one year
Loans and other borrowings (524.1) (662.6)
Provisions for liabilities
and charges (3.2) (3.3)
Deferred income (33.4) (31.0)
----- -----
Net assets 850.0 736.0
----- -----
Share capital 0.1 0.1
Share premium account
and reserves 849.9 735.9
----- -----
Capital employed 850.0 736.0
----- -----
Summarised Cash Flow Statement
1999 1998
m pounds m pounds
Cash inflow from operating
activities 386.6 263.6
Net dividends and interest (88.9) (86.6)
Ordinary taxation (26.4) -
----- -----
Free cash flow before
windfall tax 271.3 177.0
Exceptional taxation
- windfall tax (38.2) (38.2)
Capital expenditure (316.0) (244.0)
Other items 7.7 10.2
----- -----
Decrease in cash (75.2) (95.0)
----- -----
(a)Disclosure of information
The summarised profit and loss account and balance sheet for Southern
Water Services Limited have been prepared on the same basis as those
for Scottish Power plc group Accounts as disclosed in Note 1.
(b)Exceptional taxation - windfall tax
Exceptional taxation in 1997-98 related to the company's share of
windfall tax according to the formula contained within the Finance
(No.2) Act 1997. The first of two equal instalments was paid on 1
December 1997 and the second instalment was paid on 1 December 1998.
(c)Earnings per ordinary share
Earnings per ordinary share have been calculated by dividing the
profit for the financial year by the weighted average number of
ordinary shares in issue during the financial year, based on the
following information:
1999 1998
Profit for the financial year
(million pounds) 158.4 73.3
Weighted average share capital
(number of shares, million) 0.056 0.056
------ ------
1999 1998
pounds pounds
per per
ordinary ordinary 1999 1998
(d) Dividends per share share m pounds m pounds
ordinary share
Interim dividend paid 264.1 258.5 14.8 14.5
Proposed final dividend 528.2 516.9 29.6 28.9
------ ------ ------ ------
Total dividends 792.3 775.4 44.4 43.4
------ ------ ------ ------
Dividends to the holding company are consistent with the assumptions
made in setting prices, as agreed with OFWAT, and for the appointed
business the policy is to increase dividends by 2% above RPI.
12 Summary of differences between UK and US Generally Accepted
Accounting Principles ('GAAP')
The consolidated Accounts of the group are prepared in accordance with
UK GAAP which differs in certain significant respects from US GAAP.
The effect of the US GAAP adjustments to profit for the financial year
and equity shareholders' funds are set out in the tables below.
(a)Reconciliation of profit for the financial year to US GAAP:
1999 1998
m pounds m pounds
Profit for the financial year
under UK GAAP 502.8 170.1
US GAAP adjustments:
Amortisation of goodwill (30.0) (29.8)
Deferred tax (33.5) (28.1)
Pensions 17.6 22.7
Depreciation on revaluation uplift 3.4 1.7
------ ------
460.3 136.6
Deferred tax effect of US GAAP adjustments:
Pensions (5.3) (6.8)
------ ------
Profit for the financial
year under US GAAP 455.0 129.8
------ ------
Earnings per share
under US GAAP 38.39p 11.00p
------ ------
Diluted earnings per
share under US GAAP 38.01p 10.89p
------ ------
As permitted under UK GAAP, earnings per share have been presented
including and excluding the impact of the windfall tax and goodwill
amortisation, to provide an additional measure of underlying
performance. In accordance with US GAAP, earnings per share have been
presented above based on US GAAP earnings, without adjustments for the
impact of windfall tax and goodwill amortisation. As such additional
measures of underlying performance are not permitted under US GAAP,
the inclusion of windfall tax in the determination of earnings for the
purpose of computation of earnings per share in accordance with US
GAAP decreased earnings by 317.0 million pounds or 26.86 pence per
share for the year ended 31 March 1998. The inclusion of goodwill
amortisation decreased earnings by 31.2 million pounds or 2.63 pence
for the year ended 31 March 1999 and by 29.8 million pounds or 2.53
pence per share for the year ended 31 March 1998.
b)Effect on equity shareholders' funds of differences
between UK GAAP and US GAAP:
1999 1998
m pounds m pounds
Equity shareholders'
funds under UK GAAP 1,945.9 1,707.8
US GAAP adjustments for:
Goodwill 1,036.7 1,036.7
Business combinations 163.1 163.1
Amortisation of goodwill (92.1) (62.1)
ESOP shares held in trust (33.8) (36.6)
Pensions 116.8 99.2
Dividends 178.0 162.9
Revaluation of fixed assets (229.0) (229.0)
Depreciation on revaluation
uplift 5.1 1.7
Deferred tax:
Effect of US GAAP adjustments (35.7) (30.4)
Effect of differences in
methodology (594.2) (560.7)
------ ------
Equity shareholders'
funds under US GAAP 2,460.8 2,252.6
------ ------
Operating Statistics
1999 1998
Electricity sales - ScottishPower
First tier supply
Domestic m pounds 565 544
GWh 8,303 7,974
Commercial m pounds 294 298
GWh 5,298 `5,134
Industrial m pounds 216 227
GWh 5,477 5,688
Other m pounds 41 42
GWh 753 752
----- -----
Total m pounds 1,116 1,111
GWh 19,831 19,548
----- -----
Distribution GWh 22,368 21,712
----- -----
Electricity sales - Manweb
First tier supply
Domestic m pounds 365 380
GWh 4,999 4,916
Commercial m pounds 135 151
GWh 2,161 2,394
Industrial m pounds 24 55
GWh 437 1,122
Other m pounds 22 23
GWh 380 395
----- -----
Total m pounds 546 609
GWh 7,977 8,827
----- -----
Distribution GWh 17,324 18,522
----- -----
Other electricity sales
Second tier - m pounds 138 155
group GWh 3,565 4,164
----- -----
Wholesale sales m pounds 185 199
GWh 7,118 6,716
----- -----
Total m pounds 323 354
GWh 10,683 10,880
----- -----
Gas sales
Domestic m pounds 96 26
Therms(m) 243 68
----- -----
Business m pounds 56 34
Therms(m) 220 144
----- -----
Total m pounds 152 60
Therms(m) 463 212
----- -----
Fuel and electricity
purchases- ScottishPower
Nuclear contract m pounds 368 366
GWh 14,110 13,619
----- -----
Purchases from m pounds 95 109
Scottish and Southern GWh 3,345 4,656
Energy plc under
contract ----- -----
Own generation m pounds 151 152
GWh 11,887 10,377
----- -----
Other(a) m pounds 115 132
GWh 3,920 4,141
----- -----
Total m pounds 729 759
GWh 33,262 32,793
----- -----
(a) Includes Pool purchases for second tier customers.
Fuel and electricity
purchases - Manweb
Electricity purchases m pounds 293 379
GWh 9,169 9,923
----- -----
1999 1998
m pounds m pounds
Total turnover
Generation Wholesale 914.3 1,014.3
Power Systems
Transmission 136.8 129.6
Distribution 333.3 313.4
Energy Supply
First tier electricity 1,131.4 1,112.4
Second tier electricity 148.8 162.3
Gas and other energy sales 154.3 61.5
Manweb 614.2 667.8
Southern Water 440.2 453.0
ScottishTelecom 219.9 113.3
Other 612.8 410.7
----- -----
Total turnover 4,706.0 4,438.3
Less: total internal turnover (1,463.7) (1,310.1)
----- -----
Total external turnover 3,242.3 3,128.2
----- -----
Operating profit
Generation Wholesale 115.3 130.8
Power Systems
Transmission 83.5 80.1
Distribution 178.2 169.4
Energy Supply
First tier electricity 36.3 38.0
Second tier electricity - (3.8)
Gas and other energy sales (16.2) (19.1)
Manweb 125.2 131.3
Southern Water 262.2 240.7
ScottishTelecom 10.3 4.7
Other 8.0 13.0
----- -----
Total 802.8 785.1
----- -----
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