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(Alliance News) - OPG Power Ventures PLC on Thursday reported a sharp jump in financial 2019 profit, but lowered its scrip dividend following shutdowns of one of its plants for three months.
Shares in the Indian focused power plant operator were down 11% in London in midday trading at 19.84 pence each.
OPG declared a full year scrip dividend of 0.6 pence, 40% lower than the 1.0p distributed the year before. The company blamed the shutdown of Unit 4 at its Chennai plant for three months, affecting its cash flow.
The company said it needs to preserve cash for the implementation of the emission reduction program - which is expected to lower OPG's plant load factor. OPG ended the year with GBP2.1 million in cash.
In financial 2019, OPG's plant load factor slipped to 75% from 77% the year before.
In the year ended March 31, OPG's pretax profit jumped to GBP11.9 million from GBP1.6 million the year before.
The sharp rise was attributed to OPG's average tariff rising to INR5.56 per unit, about 6.6 pence, from INR5.21 per unit, about 6.2p, the year before.
OPG also noted a GBP4.0 million loss suffered the year before for assets under construction that was not repeated in financial 2019.
The company's revenue was flat year on year at GBP140.6 million.
OPG's total generation in the period slipped 3.6% to 2.7 billion kilowatt hours from 2.8 billion the year before.
"The outlook for the Indian economy in general and the power sector in particular continues to be buoyant. OPG's business in financial 2019 performed well both operationally and financially. We are maintaining our strategy to build value for shareholders by repaying borrowings. In the year under review we added 5.3p per share to equity holders from deleveraging and are recommending a full year scrip dividend of 0.6p per share," said Executive Chair Arvind Gupta.
Gupta added: "By maintaining our focus on the profitable operation of our high quality assets, we expect to continue to reduce debt and pay dividends in order to maximise shareholder value."
