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Govt receives $4.34m dividend from record profits in utility companies


Mr Carl Sanft presents a $4.34 million dividend cheque to Hon. Poasi Tei at the Tano’a International Dateline, Nuku'alofa, 29 November 2016

Tonga's Minister for Public Enterprises, Hon. Poasi Tei received a dividend cheque of $4,345,262 pa'anga, presented by the Chairman of the Common Utilities Board of Directors, Mr Carl Sanft on November 29.

The Combined Utility Dividend of over $4.3 million for the year 2016 goes to the Government of Tonga, being the sole shareholder of power, water and waste utilities and the subsidiary companies Tonga Gas/Home Gas.

This dividend declaration was presented during the Common Utility Board’s Annual General Meeting on 29 November 2016 at the Tano’a International Dateline.

In a statement, the Combined Utility Board said it follows the successful financial performance by Tonga Power Ltd., Tonga Water Board, Waste Authority Ltd. and Tonga Gas Ltd. and Home Gas Ltd. for the year ended 30 June 2016, where the utility companies posted a combined record net profit after tax of $7,118,028 pa’anga.

"This year’s dividend sets a record compared to previous years from all of the public utility companies. It is highest dividend to be paid on top of a record net profit from all utilities.

"This also marks another record for the amount of tax payable to government for $1,361,658, being the collective tax payable from all three utilities including Tonga Gas and Home Gas Ltd."

The tax payments are being paid individually to the Ministry of Inland Revenue from each utility’s annual return.

$5.7 million

The total payment to government for the year 2015/2016 is $5,706,920, being the dividend of $4,345,262 plus tax payable of $1,361,658, the board stated.

"All companies are fully self-sustaining with no budgetary injections from government, showing an average of 10% return on equity, which exceeds that set by the Public Enterprises Act.

"The record dividend payment is among the major achievements of the common utilities and the gas companies. This portrays the positive outcome of having one Common Utility Board that enables and encourages the companies to use excess capacity to share services, improve efficiencies and reduce costs with a strong emphasis on improved service delivery and profitability.

"The success is undeniable evidence of the benefits of having one common board for similar operating type companies within the industry. It also shows how the success of one company can be leveraged and utilized to help another.

"This strong performance from the utilities highlights good governance, good policies implemented by the Common Board with clear guidelines from the shareholding ministry (Ministry of Public Enterprises) and its staff lead by the Hon. Tei. 

"The record financial results emphasizes the valuable experience that Hon. Tei has brought to the Ministry through the government's reform agenda and the structural changes put in place, which has proven to be a financial success.

"It shows how a business-sensitive and determining Board can help empower and install confidence in CEOs to utilize the best skills available from managements and staff.

"The establishment of the combined Board of Directors was successfully implemented in October 2015, an initiative identified as world class practice by the Ministry of Public Enterprises and Cabinet, the results of which are highly evident in today’s dividend presentation."

Sponsored Post #3860 to 11/12/16