Envestra has declared an interim distribution of 5.7 cents for the six months ended September 30, 2007, which will be paid to shareholders on November 30, 2007. The company has announced that the distribution re-investment plan will apply to the payment.
The interim payment is made up of 0.90 cents interest on the loan note, 3.87 cents repayment of loan note principal, and an unfranked dividend of 0.93 cents. Envestra reported that gas volumes for the first quarter had been impacted by warmer than normal weather and are below expectations, though, in line with the previous year, which was also warm during this period.
The company expects continuing consistent organic growth with over 20,000 new consumers to be connected during the current year. 6,500 consumers were connected in the first quarter. The company expects to record its first after tax profit in 2007-08, that is apart from the profits recorded in 2003 and 2004 arising from abnormal items. This is broadly in line with long-term expectations when Envestra floated in 1997.
John Allpass, chairman of Envestra, said: The company was still not in a position to raise distributions given they had remained at 9.5 cents per security for six years. The unsatisfactory regulatory outcomes in South Australia and Victoria imposed significant constraints to providing increased rewards to shareholders.
The chairman expressed concerns with the final decision of the Essential Services Commission of South Australia on the access arrangement for that State, and the draft decision of the Essential Services Commission of Victoria. The access arrangements set the tariffs and service conditions for the five-year periods to June 2011 and December 2012 respectively.