Earnings exceeded budget projections in Saskatchewan's Crown sector in 2011, enabling CIC to provide a dividend to the provincial treasury in spite of challenges and increasing demands for services.
On a consolidated basis, Crown Investments Corporation (CIC) and its subsidiaries earned a profit of $450.9 million on revenue of $4.6 billion in 2011. Both the consolidated debt ratio, at 49.8 per cent, and the return on equity at 10.9 per cent were ahead of target.
"Extreme weather was certainly a factor in 2011, along with continued growth in demand for Crown sector services," Minister responsible for Crown Investments Corporation Tim McMillan said. "Despite these challenges, the Crowns met our dividend commitment, invested in infrastructure, and achieved appropriate debt to equity ratios, while delivering high quality service to Saskatchewan customers."
The Crown sector adopted International Financial Reporting Standards (IFRS) in 2011. Last year's financial statements (2010) have been restated according to IFRS, rather than Generally Accepted Accounting Principles (GAAP) standards, which is how they appeared in the 2010 annual reports. In 2011 CIC's earnings as a holding company, which are recorded on the separate financial statements, were $167.1 million, down $68.9 million from 2010's restated results, largely due to decreased dividend revenue from the Crowns. CIC paid a dividend of $128.5 million to the General Revenue Fund.
To achieve the necessary capital investment of $1.1 billion throughout the sector, there was an increase in borrowing which resulted in Crown debt increasing by $260.9 million in 2011.
"The Crowns continue to invest heavily in the province, which benefits their customers," McMillan said.
"Our goal is to have the infrastructure in place to meet the strong economic growth in Saskatchewan, while continuing the high standard of services our customers have come to expect."
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