Town attempts to clarify what it makes on Essex Power dividends


EPOWERBy Ron Giofu


With council’s decision coming on whether or not to sell the town’s Essex Power shares to Entegrus, town administration is attempting to clarify its position as to how much the dividends are.

The town, which has obtained a 30-day extension which lasts until mid-May, agreed to keep the public meeting on the matter at April 8 at the Libro Centre although some wanted the meeting date pushed back.

The town has circulated its own numbers stating what the municipality received in cash dividends from its shares in Essex Power.

The town states that since 2005, the actual cash dividends collected by the municipality have been $1,083,730. That breaks down to $42,750 in 2005, $171,120 in 2006, $114,080 in 2007, 2008 and 2009, a combined $327,980 in 2010 and 2011 and $199,640 in 2012.

By comparison, the town’s consolidated financial statements read the town’s share of hydro income for the year was $154,063 (2005), $60,766 (2006), $181,451 (2007), $146,491 (2008), $306,311 (2009), $205,669 (2010), $998,900 (2011) and $328,396 (2012). The town stated the 2006 figure incorporates a share of hydro loss that year.

“The dividends is the portion of the net income that Essex Power declares to be paid to the shareholders, and the difference between the net income for the year and the dividends declared is reinvested back into the company. This portion becomes the retained earnings,” said Niza Fadel, the town’s supervisor of financial reporting. “The town’s share of the net income and the dividends are based on 14.258 per cent.”

The 2011 figures, which included the $998,900 share of hydro income figure and the town’s claim the actual cash dividend was $327,980, were explained by Fadel as being a one-time matter.

“The dividends reported included the amounts for both 2010 and 2011,” she said. “The share of hydro income increased that year due to Essex Power recognizing a gain on the remeasurement of Utilismart Corporation Investment. This was a one-time event that increased their income for that year only.”

The town’s investment includes both the shares and the town’s portion of the Retained Earnings in Essex Power, she added.

According to Fadel, the town’s investment in Essex Power at the end of 2012 amounted to just shy of $4 million. A total of $2,678,176 were attributed to the town’s shares while its retained earnings amounted, or share of hydro income, amounted to $1,315,900 totalling $3,994,076.


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