Corporate Responsibility

International Power Policy on Handling of Price Sensitive Information

International Power’s (IPR) investor relations objectives are designed to complement the primary task of running and developing the company with maximum efficiency in shareholders’ interests. Recognising that stock markets need a flow of information to function efficiently, the company seeks actively to inform the market of its policies, progress and financial performance and to meet its regulatory obligations.
In meeting these objectives, IPR pays full regard to the Stock Exchange’s Listing Rules, which place a general obligation on companies to disclose information to the market in a timely way where there are major developments which may lead to a substantial movement in the price of their securities or where necessary to avoid a false market. IPR also recognises the legal considerations relating to the release of information, including the Financial Services Action (section 47), the Criminal Justice Act and the Financial Service and Markets Act relating to insider dealing and similar matters. It also has regard to the City Code on Takeovers and Mergers and the express rules of the Stock Exchange.
IPR’s communications with the market, the investment community, analysts and shareholders always take place within a carefully planned framework, with clear objectives.

Principal examples of material which is generally to be regarded as price sensitive and hence requiring maintenance of strict internal confidentiality until disclosure to the market by means of an announcement include:

significant financial data such as quarterly interim and final results;
aggregated sales and profit figures (actual or forecast);
plant closures or mothballing;
major financial commitments;
major organisational changes;
planned strategic developments;
operational matters having potentially significant commercial or industrial relations implications;
acquisition and disposals; and
dealings with regulatory authorities.

Decisions as to the nature and timing of announcements of price sensitive information will be made as appropriate by the Executive Directors and the Corporate Communications Department. Advice is sought from advisers where necessary.
Responsibility for securing the release of price sensitive information in accordance with (i) and (ii) above, drafting the appropriate documents, and the subsequent promulgation in a sequential and co-ordinated fashion, are allocated to the Corporate Communications group.
Price sensitive information, which it is intended to announce will be kept strictly confidential and subject to the most limited internal circulation practicable, until the moment of its announcement.
IPR will not use the practice of allowing price sensitive information to seep into the public domain (for example by selectively ‘correcting’ analysts’ forecasts).

IPR’s objective is to assist analysts, journalists and others to form an informed view on its sensitivities and trading prospects. In doing so, the company will draw upon, and further explain as appropriate, information which has already been provided to the market, or which is generally available in the public domain.
IPR will decline to answer questions from analysts, journalists and other external commentators where the answers would, individually or collectively, provide price sensitive information. If questioners’ comments or conclusions appear inaccurate, the company will consider what publicly available information might be drawn to their attention, to help correct the inaccuracies.
IPR will, as a general rule, not comment on specific transactions, market or media rumours, and will explain to questioners that if the company has comments to make this will be done by means of a market announcement in the normal way. IPR will not comment if pressed by journalists or analysts to provide details which might comprise price sensitive information.
IPR’s principal market communications programmes are built around release of its quarterly financial results with emphasis on the final and interim results.
IPR will, as a general rule, co-operate to correct factual errors in draft analysts’ reports if requested. Regarding conclusions reached by analysts on the basis of their own mistaken assumptions, the company will consider on a case by case basis whether an analyst might be encouraged to reconsider his assumptions. A formal announcement correcting analysts’ forecasts will only be made when it is clear that the market is being materially misled.
It is not the purpose, nor should it be the practice, to release price sensitive information in meetings with analysts or the media in any circumstances: for the avoidance of doubt or subsequent misinterpretation, IPR will ensure that the principal spokesman is always accompanied by at least one other company representative at business meetings, and a full record will be kept. A note will also be made of main points affecting the company’s business raised in discussions on other than business occasions, for circulation internally as necessary for information and to ensure consistency of future messages.
Communication with the market during the company’s closed periods presents potential difficulties given the heightened sensitivity of the market to possible ‘signals’ in the run up to release of quarterly results. Accordingly, except as may be necessary to release price sensitive information in the normal way, IPR will not as a general rule seek proactively to communicate with the market during closed periods. Where communications are judged appropriate as part of the on-going investor relations programme, then these will adhere scrupulously to information already provided to the market or otherwise in the public domain. Particular care will also be taken to frame communications so as to minimise the potential for inferences to be drawn in relation to the nature and content of impending announcements of financial results.
It is not IPR’s practice generally to make ‘insiders’ of third parties (including the company’s brokers), substantial shareholders or parties with whom it is negotiating.
IPR’s practice is to ensure strict confidentiality of price sensitive information, and to circulate such information internally on a “need to know” basis.

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