Southern Electric considers further share buy-back
Thursday 27 November 1997
Ian Marchant, Southern's finance director, predicted that the abolition of ACT would end the recent vogue from the privatised utilities for complex capital restructuring schemes, designed to hand back cash to investors but avoid the tax charge associated with straightforward buy-backs.
In February Southern returned pounds 156m to shareholders through a share consolidation. Yorkshire Water and BG, the former British Gas, both followed Southern's lead this year. However Mr Marchant said he was disappointed that the tax change would not take place until 1999.
Southern also predicted a wave of consolidation in the privatised electricity industry if the Government allowed regional power companies (RECs) to split their supply and distribution businesses. Jim Forbes, chief executive, said Southern had already been approached by other power groups.
"We talk to everyone. We have to look at these things but we can't say yet what will happen. This is still two years away," he said.
Shares in Southern fell 8p to 447p yesterday after the group revealed a pounds 9m drop in half yearly profits, to pounds 103m. Earnings from its non-regulated contracting businesses slumped from pounds 7.4m to pounds 1.5m, following a sharp drop in orders at its MP Burke subsidiary, which lays television cables. Southern said Cable & Wireless Communications, its biggest customer, had cut its investment budget "overnight."
Mr Forbes also warned that Southern's supply business could lose money in 1999-2000, the second year of a new price formula which caps customer bills for the first time.
Diving in at the deep end is no excuse for shirking the style stakes
- 2 Loom bands: Bids for dress made from colourful rubber reach almost £154,000 on eBay
- 3 PornHub begs users to stop uploading video clips of Brazil getting beaten 7-1
- 4 Why I'm on the brink of burning my Israeli passport
- 5 L'Oreal cuts ties with Belgium supporter Axelle Despiegelaere after hunting trip photographs
Sustained immigration has not harmed Britons' employment, say government advisers
Australia facing international condemnation after turning around Sri Lankans at sea
7/7 memorial defaced on anniversary of 2005 attacks with ‘Blair lied thousands died’ graffiti
Even when it brutalises one of its own teenage citizens, America is helpless against Israel
Socialist Worker called to apologise over ‘vile’ article saying Eton schoolboy Horatio Chapple's death is ‘reason to save the polar bears’
War is war: Why I stand with Israel
iJobs Money & Business
£50000 - £70000 per annum: Harrington Starr: Business Analyst Consultant (Fina...
£300 - £350 per day + competitive: Orgtel: My client, a leading bank, is curre...
£28000 - £32000 per annum + pension, 25 days holiday: Ashdown Group: A highly ...
Negotiable: Randstad Education Birmingham: Randstad Education are seeking a Fi...