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Originally Posted by ianch99
I'm worried, we've agreed again 
As for Water, England's privatised water firms have paid out £57bn in dividends since 1991, just under half what they spent on the infrastructure. They also borrow and use the debt to finance dividends. A disgrace .. |
Where people invest in a company, they expect to get their money back. The invested money is NOT a gift, never to be returned.
Debt is used to obtain large amounts in advance. Just as it is for households with mortgages and the like.
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Anglian Water said it was incorrect to say debt was being used to pay dividends. “Financing though debt is the most cost-effective and legitimate way to fund new infrastructure. Customers benefit: bills are cheaper. This is why we do it.”
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It said investors had not taken a dividend payment since 2018. However, according to the company’s annual report, dividends totalling £67.8m were paid in the financial year to the end of March 2019.
When this was put to Anglian, a spokesperson said: “The £67.8 referred to as a dividend was retained within Anglian Water Group and used to finance group operating costs and working capital needs … which I appreciate wasn’t clear from the wording used [in the annual report].”
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Thames Water said its shareholders were in it for the long term and had not taken a dividend payment for three years. “We invested more than £1bn again in 2019-20, leading to a total of £15bn in the past 15 years.
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This article was amended on 3 July 2020 to include clarification below a chart showing Anglian Water as having paid £5bn in dividends to shareholders in the past decade. The overall Anglian Water Group said £3.5bn of this was, rather, internal fund transfers from the water and sewerage company to the parent company; dividends totalled £1.5bn. On 10 July, the text clarification was removed, after the chart itself was revised to show £1.5bn.
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The figures are misleading because the listed companies can or did, include other areas, eg United Utilities once included electricity, so dividends will have also been for that.