Take UK Power Networks, the National Grid power distributor. Last financial year, according to Companies House, it made a staggering £1.3bn pre-tax profit. Billions in profit, bonanzas for the executives and shareholders, while there are only real pay cuts on offer for workers.
Err, no, no it didn’t. And this is a union leader trying to tell us stuff.
EBITDA and profit really are not the same thing.
Firstly, the Companies House return shows a £531m pre-tax profit, and secondly that is massively overstated because the depreciation charge is calculated on the historic cost of tangible assets created up to 60 years ago. If they had shown accounts using replacement cost depreciation my guess is that they would have shown a loss after tax.
I’m fairly confident that the CEO wouldn’t have been paid a £million in salary if they had reported the true cost of depreciation throughout his tenure.
Why do they even talk about ‘pre tax profit’ except to obfuscate.
They made 263 million after everyone was paid and the government took it’s cut. That’s a far cry from 1.3 billion.
I agree Agammamon. That nonsense always pisses me off.