ESB profits, revenues and debts rise in 2015

ESB grew its revenues and profits in the first six months of the year, although its progress was crimped by factors such as the weakening euro against sterling, according to interim financial statements released yesterday.

The group also confirmed it has fully paid off the €400 million special dividend agreed with the Government during the financial crisis to help plug the State’s parlous finances.

The dividend payout of €214 million in January completes the crisis-era agreement. ESB said it brings the total of its dividend payments to almost €1.5 billion over the last 10 years.

The accounts for the six months to the end of June show ESB’s revenues were marginally ahead by €62 million to €1.7 billion.

Operating profits were up €10 million to €337 million, while the group’s bottom line profitability after tax almost tripled to €201 million, mainly due to the non-recurrence of finance costs.

The relatively calmer weather during the period compared to last year contributed to a spike in profits at its network business, which absorbs the cost of line repairs and damage to its infrastructure.

The weak euro, however, hit its investment in Northern Ireland Electricity, contributing to a more than 50 per cent reduiction in profitabiliy to €13 million.

ESB said it made capital investment of €405 million over the six months, a reduction of 10 per cent that helped boost its profitability.

The company appeared to focus its investment in the island of Ireland, however, boosting such spending in its home markets by €100 million to €320 million.

It cut back on capital expenditure abroad, including at its Carrington plant in the UK. This new £500 million gas-fired power station, located near Manchester, is due to come onstream next year.

Net debts at the State-owned power group has risen by €300 million since the end of December to €4.9 billion, partly due to the hefty dividend payments it is making to the State.

The figure is also €800 million ahead of the debt position at the end of 2013, as ESB takes advantage of the once-again benign borrowing environment for State-backed entities.

ESB’s total payroll bill was flat at €270 million. The group said it has about 7,200 employees, suggesting an average cost per staff member for the six months of €37,500.

Over a year, a the average ESB employee costs about €75,000 in salaries, overtime and pension costs.

The balance sheet also list various employee pension scheme liabilities totalling about €920 million, with €740 million attributable to employee sin the south and the rest relating to NIE.

The liability in the group pension scheme was the source of a bitter industrial dispute in 2013 that brought ESB to the bring of a Christmas-time strike.

Pat O’Doherty, the chief executive of the ESB, said it was a “solid performance” over the six months but added that wholesale electricity markets were “challenging” due to low prices.