ESB has released its annual report for 2013 which show the State-owned energy group boosted its after-tax profits by €80 million to €415 million.
Donal Flynn, the group finance director, said the results were a "strong performance". He also confirmed that an agreement for a pay freeze with its 7,500 staff expires at the end of this month.
The ESB's group of unions is believed to be preparing a fresh pay claim for submission to the company's management, although one union official told The Irish Times that "no final decision has yet been taken" on the matter.
Mr Flynn declined to comment on whether the group was braced for a request from unions for a pay rise, and would only say that “no formal communication” had been received by the company.
The group's overall revenues increased by 4.5 per cent last year to almost €3.5 billion. The largest slice of its revenues, with just over €2 billion, came from its Electric Ireland retail division, although its power generation division was the most profitable, with operating profits of €355 million.
Executive salaries
Lochlann Quinn, the group's chairman, received fees for 2013 of €75,000, down €3,000 on the previous year, according to the accounts.
Chief executive Pat O’Doherty’s salary remained €295,000. Including pension payments and other benefits, his total pay package came in at €358,000.
Each of the members of the company’s board received fees of €15,750, with the exception of Noreen O’Kelly, a former board member of Independent News & Media and the cider maker C&C. She waived her ESB fees for 2013 and 2012.
The board and the chief executive accrued business expenses, such as accommodation and entertainment, totalling €95,000 over the year.
Mr Flynn said ESB expected to wrap up the sale of its 50 per cent stake in a Spanish power station before the summer. It also said it hoped to complete the sale of two peat power plants in Ireland “by the end of the year”.
Asset sales
The asset sales are part of a strategy to raise cash to pay a special dividend of €400 million to the State. The annual report says the company paid a total dividend last year of €258 million, about 5 per cent of which went to its employee share-ownership scheme with the remainder to the exchequer.
About €161 million of the total dividend payment constituted part of the €400 million special dividend. Mr Flynn declined to say whether the impending asset sales in Spain and Ireland would take care of the remaining €239 million. "It is too early to say," he said.
The accounts confirm that ESB will target a regular dividend of 40 per cent of its profits after tax annually each year until 2020. The group is also targeting the addition of €1 billion to its annual earnings by this date.
The accounts also include a lengthy explanatory note relating to its pension scheme, the subject of an industrial relations dispute in December over whether or not it is a defined-benefit arrangement.
The scheme is thought to have a deficit of up to €1.6 billion in a wind-up scenario, although both the company and unions agree there is currently no deficit in the scheme on an operating basis.
The dispute was settled at the Labour Relations Commission. As per that deal, the annual report now clearly states that the ESB pension fund "is a defined-benefit scheme".
