Florida Power & Light Case Study - Dividend Policy Essay

The next 3 years witnessed a continuous increase in sales and revenues. Their profit margin increased to reach 4.97% by year 1992.

The most noticeable growth in this section is seen in sales from 2002 to 2003. These sales have increased from 3.7% in 2001-02 to 23.5% in 2002-03 after the expansion of the store. This truly helps the company to a positive way when seeing such drastic changes. Net earnings have almost doubled and gross profit was on the rise as well, which is also a positive trend for the company that will not go unnoticed. This indicates a positive correlation and increases in profitability.

The new nuclear power plants will all be federally run by the Department of Energy. The price of the energy will be exactly the breakeven point because there is no incentive for the government to make a profit because they are funded through taxes. This will keep the prices of electricity low to satisfy the customers. Regulations will be extremely high to prevent against disasters and to calm citizens about the dangers of nuclear energy. Based on 2016 estimates from the EIA, to completely replace coal energy with nuclear alone, 1.24 trillion killowatthours of nuclear energy will have to be generated. This would equate to roughly 13 new nuclear reactors the size of the Palo Verde nuclear power plant in Arizona. In reality, more than 13 plants will be needed to save on

From 1976 to 1982 the compound annual growth in net sales was 18.5% and the compound annual growth of after tax profit was 25.9%. Therefore, a 10% net sales growth shown in the proforma financial data seems reasonable.

1. In the last five years the growth in sales for the company has been around 10% per annum, except for the 1997, the growth was 18.78%. In the case, nothing is mentioned that company has made any drastic changes in its strategy to grow faster. In such a scenario, projected a consistent growth of 20% per annum for the next 5 years is too optimistic.

Consolidated Edison is one of the largest investor-owned energy companies in United States with over $120 billion in annual revenues and $40 billion in assets. The firm is located in New York and focuses their operations in electric, gas and steam activities. It is estimated that the company provides electricity to approximately 3.3 million costumers and offers gas services to other 1.1 million costumers in New York City and Winchester County. The business model of Con Edison, Inc is divided into three main areas. Con Edison Solutions sells electricity and offers energy-related services directly to costumers in the Northeast and Mid-Atlantic regions. Con Edison Development develops, constructs, owns and operates renewable energy projects across the U.S. At the end of 2014, the firm had 446 MW of solar and wind projects in operation. Lastly, the third area of Consolidated Edison provides support to the main area of business. Con Edison Energy focuses on generating electric energy, fuel and capacity for Con Edison Solutions. According to the firm’s website, “Con Edison’s strategy is to deliver reliable energy services and provide a stable foundation for supporting New York’s economy.” The company believes that their Integrated Long Range Plan along with their Sustainability Strategy will work together to add value to the stakeholders. John McAvoy, chairman and CEO of Consolidated Edison, Inc shares the view that the energy landscape is changing and Con Edison is committed in

The productive assets of property, plant, and equipment changed dramatically in 1996 they were 5,581 to 2010 an increase to 21,706. In total current assets there was a increase in 1996 from 5,910 to in 2010 21,579. Another significant change is in long term debt in 1996 of 1,116 to in 2010 an increase to 14,041. Also an important figure to note is in the retained earning in 1996 they were 94% (15,127) to 2010 68%

Fuel prices are an important part to look at, and when doing so you can see an obvious difference in the numbers between coal burned power plants and nuclear power plants. The fuel costs make up 30 percent of the overall production costs of nuclear power plants. Fuel costs for coal, natural gas and oil, however, make up about 80 percent of the production costs. Between these two lies a fifty percent difference for fuel costs. For nuclear run plants it is every 18-24 months that a nuclear power plant needs to be refueled. Because nuclear plants refuel every 18-24 months, they are not subject to fuel price volatility like natural gas and oil power plants. The numbers $300 million to $500 million—includes estimated radiological, used fuel ($100 million) and site restoration costs (about $300 million) (Costs: Fuel, Operation, Waste Disposal & Life Cycle,

Today, nuclear fission produces 70% of the zero-carbon electricity used in the United States. In the face of the increasing effects of climate change, scientists and some environmental activists are calling for a “nuclear renaissance” in the United States. Yet, with just a few nuclear reactors under construction—compared with more than two-dozen in China—there is no evidence that such a nuclear revival is in the making. Instead, recent years have seen some nuclear plants forced to close and dozens more facing early retirement

outlook remains stable. This rating action follows the announcement that Pfizer will acquire Allergan Plc in a stock

In light of the situation mentioned above, FPL has to ensure that it has the resources available to meet future competition where one of the determinants of winning or retaining new business may be price. Hence, its dividend payout policy must be modified to account for these industry changes.

Projected rising electricity demand and higher natural gas prices next year are expected to contribute to higher utilization rates among the remaining coal-fired power plants, while they stay in operations for the time being.

In terms of the financial outlook for the O.M Scott & Sons Company for the next few years, there are several notable changes that occur as a result of the changes management enacted through 1957-1961. It is important to note that both the pro forma income statement and balance sheet assume a 23.5% annual compounded growth figure based on the years stated earlier. Emphasis will be placed on forecasted numbers for the years 1962-1964 in order to provide readers with projected figures established through several key assumptions.

Since the accident at Fukushima, many scientists and citizens are worried about the nuclear industry. In 2011 the nuclear reactors at Fukushima, Japan were damaged causing a reactor meltdown. Even to this day, highly radioactive substances are flowing into the ocean. (The real nuclear meltdown 1) Incidents such as these have caused many counties and industries to debate using this technology and to move on from the nuclear industry. Recently in the United States, many nuclear reactors were shutdown due to aging reactors and power plants, costing many companies millions of dollars. Many companies have spent millions of dollars maintaining power plants and upgrading them to meet new safety standards. Some business people have determined that upgrading the reactors to meet new safety standards are just not worth it. Nuclear reactors become more unpredictable as they age, making it difficult to decide if a twenty-year-old reactor is worth upgrading.

This means that a reactor would supply a facility with a large amount of power, instead of that electricity coming from the grid. A few examples would be desalination of water, nitrogen fixation, and oil refining[1]. As shown before, building a Gen II reactor is a huge undertaking of both time and money. Therefore, the companies that finance them are focused on maximizing the power output upon completion. There was no economical reason to customize the energy output for a specific need, so nuclear energy was resigned to supply the grid exclusively. The problem with producing energy to the grid is that a lot of it is lost in transportation and distribution. The Energy Information Association (EIA) estimates that about six percent of all energy production to the grid in the US is wasted in this way[6]. Direct power does not factor into this calculation, so increasing its use will not decrease that percentage. What it will do is decrease the amount of energy the grid needs to supply by a significant amount, thus reducing the amount of waste. Industry accounts for about twenty percent of energy used in the US, none of which is supplied by Nuclear power[9]. Other alternative energy sources, like wind and solar, fail to adequately address the needs of factories that need continuous and large amounts of electricity. The EIA has invested a lot of money in SMR