ESB Group announces Annual Results for 2016

Financial Highlights

  • Capital Investment – €897million
  • Operating Profit – €597million
  • Profit after Interest and tax €186million
  • Dividends – €116 million declared for 2016, almost €1.5billion paid to the Irish Exchequer in the last ten years

ESB Group today (Friday, 10 March 2017) published its Annual Report and Financial Statements for 2016, reporting an operating profit of €597million and profit after interest and tax of €186million. ESB continues to deliver value to our customers, with significant reductions in electricity and gas prices to residential customers and continued strong capital investment in critical long term electricity infrastructure benefitting the wider Irish economy. 

Operating profit for 2016 at €597million reflected strong operational performance. The profits represent a 6.1% return on the capital employed in ESB.  The decrease of €38million in 2016 operating profits before exceptional items is largely attributable to the impact of weakening sterling on earnings. Profit after interest and tax of €186million decreased by €100million, primarily due to negative (non-cash), fair value movements on Northern Ireland inflation linked interest rate swaps, reflecting the current low interest rate environment.

ESB’s strategic commitment to leading the transition to a low-carbon economy powered by clean electricity is demonstrated by our continued capital investment in strengthening our smart network infrastructure; investing in sustainable low-carbon generation solutions like wind and solar and empowering our customers to control how and when they use electricity.

Commenting on the results, ESB’s Group Finance Director, Pat Fenlon said, “In the face of intensifying competition, these results reflect a strong operating performance across the ESB Group. ESB continues to focus on delivering value and investing in critical long term electricity infrastructure for the benefit of our customers, shareholders and the wider Irish economy, and this is enabled by maintaining a strong financial position.”

Shareholders

A dividend of €116million was declared in 2016. Total dividends paid to the Irish Exchequer over the past ten years amount to almost €1.5billion.

Customers

Electric Ireland, ESB’s supply business, reduced electricity standard unit prices for residential customers by 6% from 1 June 2016, equivalent to an average saving of €58 per year for customers. In addition, gas unit prices were reduced by 5% from 1 October 2016 delivering an annual saving of €39 for an average residential customer.

Electric Ireland has reduced both residential electricity and gas prices three times in just over two years. These reductions give a total saving of €107 per year for the ‘typical household’ electricity customer and €187 for ‘typical household dual fuel (electricity and gas) customers compared to 2014 prices. 

In 2016, Electric Ireland became the first supplier to offer enduring long term savings to its residential electricity and gas customers with all residential customers able to benefit from savings of up to 8.5% based on certain behaviours such as online billing and paying by direct debit. Electric Ireland continues to develop competitive and innovative product offerings for its customers and has high customer satisfaction ratings.

Irish Economy

ESB invested €897 million in energy infrastructure during 2016.

ESB contributes over €2billion annually to the Irish economy through dividends, investments, taxes and jobs. ESB provides significant employment both directly, with 7,600 employees, and indirectly through contractors and service providers.

The ESB Group 2016 Financial Statements can be found here.

E‚ÄčNDS

Exceptional items: 2016: No Exceptional Items. 2015: Impairment charge (€104 million) associated with two generation assets. This generation asset impairment represented less than 1% of ESB’s total assets at the end of 2015.

  

About ESB

ESB operates right across the electricity market: from generation, through transmission and distribution to the supply of customers with an expanding presence in the Great Britain generation market. In addition we extract further value through supplying gas and using our networks to carry fibre for telecommunications. ESB is the owner of the distribution and transmission networks in the Republic of Ireland and Northern Ireland. It has a 47% share of generation in the all-island market and a 37% share of electricity supply in the all-island market with 1.4 million customer accounts.

ESB contributes over €2billion annually to the Irish economy through dividends, investments, taxes and jobs. ESB provides significant employment both directly, with 7,600 employees, and indirectly through contractors and service providers. Read more here.