Electricity firms keep high dividends coming

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The Independent Online
THE TREND towards sharp dividend increases in the electricity sector has continued, with Northern Electric announcing a 17.5 per cent rise to 7.4p for the first half of the year and South Western Electricity revealing a 19 per cent improvement in its interim dividend to 7p, writes Mary Fagan.

Both companies stressed the need for continued cost control. Northern is cutting up to 140 jobs in this financial year and South Western expects to reduce staff numbers by 470 by the middle of 1994.

David Morris, chairman of Northern, denied being influenced by the rest of the electricity sector in setting the dividend.

'We have tried to reflect our long- term view of the company's performance,' he said.

Northern increased its pre-tax profits by 28 per cent to pounds 52.6m in the first half from pounds 41.1m a year earlier, helped by lower interest charges and higher margins. Earnings per share increased by 30 per cent to 32.1p and turnover rose to pounds 461m from pounds 395m a year ago.

South Western increased interim pre-tax profits by 28 per cent to pounds 30.6m. Lower operating costs and lower interest charges accounted for some of the growth, and the company benefited for the first time from income generated by the joint-venture power station on Teesside.