NIE profits rise 18.5%: Utility generates pounds 42.3m in six months since privatisation

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The Independent Online
NORTHERN Ireland Electricity, in its first results since privatisation in June, increased half-year pre-tax profits by 18.5 per cent to pounds 42.3m, thanks to growth in volume, higher prices and cost-cutting.

The company underlined the dividend power of the electricity sector with a notional 12.6 per cent increase in its half-year payout.

Sir Desmond Lorimer, chairman, said the rate of growth in pre-tax profits at NIE would not be sustained for the full year, but the rise in the interim dividend to 3.39p, compared with a notional 3.01p payment, pointed to a sustainable rate of increase.

NIE shares, in their partly paid form, jumped by 15p to 226p, compared with the 100p flotation price five months ago. A second instalment of 120p a share is payable in June 1994.

Share prices of regional electricity companies, whose reporting season gets into full swing today with results from Midlands Electricity and Swalec, rose in sympathy yesterday. Dividend increases from the RECs are expected to rise by 13 to 14 per cent.

NIE's sales increased by 9.4 per cent to pounds 206.2m, after a 6.6 per cent rise in average tariffs and a 3 per cent climb in the volume of units sold, or by 2 per cent after correcting for weather. Sir Desmond said the Northern Irish economic scene had been healthier than on the mainland and lower-than-expected fuel costs would mean better news for customers on electricity prices next year.

Operating costs fell by 7.5 per cent, including an 8 per cent or pounds 2.6m cut in salary costs to pounds 30m. NIE had reduced its head count by 256 over the year to September and aims to cut another 600 to bring the workforce to 2,557 by March 1996, a fall of 25 per cent since September 1992.

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