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Pennon Group PLC (PNN)

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daveh
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Pennon Group PLC (PNN)

#210098

Postby daveh » March 25th, 2019, 12:37 pm

Trading statement released today:
www.investegate.co.uk/article.aspx?id=2 ... 8066T&fe=1

Key highlights
South West Water business plan for the period 2020-2025 'fast tracked' by Ofwat
Momentum continuing in South West Water, with sector leading customer service and an enhanced Return on Regulated Equity (RORE)
Operational ramp up for Glasgow, Dunbar and Beddington Energy Recovery Facilities (ERFs) progressing well, construction of Avonmouth well advanced
Viridor's strategic focus on recycling and residual waste aligned with Government's Resources and Waste Strategy
Strong liquidity and funding position - £680 million of financing secured so far this year, of which £450 million is under Pennon's sustainable financing framework.


But with IRV going bust they are not sure how much they will be able to claim of the £72m IRV owe then 'cos IRV couldn't complete the ERF's they had contracted to build for them.

Given the recent announcements regarding Interserve plc entering into administration we are seeking further clarification regarding the financial position of Interserve Construction Limited the ongoing operating company with whom we contracted, which may change the level of provision to be announced with the full year 2018/19 results on 30 May 2019.

idpickering
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Re: Pennon Group PLC (PNN)

#225411

Postby idpickering » May 30th, 2019, 7:18 am


77ss
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Pennon (PNN)

#230376

Postby 77ss » June 18th, 2019, 10:26 am

Focuses on the Viridor waste business, which is forming an increasingly important part of Pennon.

My only water holding, so I was interested in the article. It hasn't done as well as I had hoped (I don't suppose the Intereserve fiasco helped) but it is a solid deliverer of decently increasing dividends (so far, anyway).

https://www.investorschronicle.co.uk/co ... prospects/

daveh
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Re: Pennon (PNN)

#230393

Postby daveh » June 18th, 2019, 11:10 am

IC won't let me read it even when I log in (I'm registered but not a subscriber which I thought was supposed to let me read a certain amount per month). My usual trick of then searching for it on google has also failed.

Itsallaguess
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Re: Pennon (PNN)

#230394

Postby Itsallaguess » June 18th, 2019, 11:13 am

daveh wrote:
My usual trick of then searching for it on Google has also failed.


Does this work?

https://tinyurl.com/yyfmrumk

It should give you the top link....

Cheers,

Itsallaguess

daveh
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Re: Pennon (PNN)

#230406

Postby daveh » June 18th, 2019, 11:35 am

Itsallaguess wrote:Does this work?

https://tinyurl.com/yyfmrumk

It should give you the top link....

Cheers,

Itsallaguess


Yes thanks, worth a read as I have a Pennon holding and suggests the ERF's will be a successful source of cash flow going into the future.

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Re: Pennon (PNN)

#230409

Postby monabri » June 18th, 2019, 11:38 am

Itsallaguess wrote:
daveh wrote:
My usual trick of then searching for it on Google has also failed.


Does this work?

https://tinyurl.com/yyfmrumk

It should give you the top link....

Cheers,

Itsallaguess


Worked for me, thanks IAAG.

77ss
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Re: Pennon (PNN)

#230411

Postby 77ss » June 18th, 2019, 11:40 am

daveh wrote:IC won't let me read it even when I log in (I'm registered but not a subscriber which I thought was supposed to let me read a certain amount per month). My usual trick of then searching for it on google has also failed.


Sorry - I didn't realise that there might be a problem - I'm neither registered nor a subscriber!

For reasons that I won't go into, I just googled for News on Pennon (using Firefox) and out dropped the IC link.

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Re: Pennon (PNN)

#230468

Postby BirlingB » June 18th, 2019, 1:57 pm

@daveh Sorry but not approved to post links in my reply but.....
I think it depends on your browser but I find that if you click on the 'Cached' arrow at the end of the searched results link it usually brings up the un-restricted page for viewing without the rather annoying "subscribe to read blurb..."

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Re: Pennon Group PLC (PNN)

#230493

Postby mattman74 » June 18th, 2019, 3:41 pm

What the IC article does not mention is the next investment that Viridor (waste management part of Pennon) is doing.

ERFs burn waste and produce electricity and heat as a by product thanks to the 2nd Law of thermodynamics.
(There is a Flanders and Swann song here if you are interested)
Now with conventional power stations that heat goes up the chimney.
PNN are going to build a plastics recycling plant next to an ERF and use the waste heat to help run it as well as the electricity produced. From an engineering point of view this is very smart.
With a lot of countries no longer accepting plastic waste imports we have to do something with the stuff and 8% of it can be recycled by this new plant. The "blue planet effect" will help here for sure.

If they get this right (and I rate the management here) this could be a real money spinner.

Plus the continuing roll out of ERFs means that PNN have some real growth opportunities.

I have topped up recently as a result of dumping my last tranch of Vodafone.

As always DYOR

Matt

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Re: Pennon Group PLC (PNN)

#251864

Postby Stan » September 14th, 2019, 6:39 pm

I have the option to get some Pennon Shares next year as part of South West Waters offer for customers so I will be following PNN from now on.

ReformedCharacter
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Re: Pennon Group PLC (PNN)

#251890

Postby ReformedCharacter » September 14th, 2019, 8:35 pm

Stan wrote:I have the option to get some Pennon Shares next year as part of South West Waters offer for customers so I will be following PNN from now on.

About £25's worth apparently, or money off a bill.

RC

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Re: Pennon Group PLC (PNN)

#252041

Postby Stan » September 15th, 2019, 6:12 pm

Is that right? is that everyone the same then?

idpickering
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Re: Pennon Group PLC (PNN)

#254244

Postby idpickering » September 27th, 2019, 7:06 am

Pennon Group Trading Statement;

· On track to meet management expectations for 2019/20

· Strong funding and liquidity position

· Viridor's ten operating Energy Recovery Facilities (ERFs) performing well, with Avonmouth, the final ERF in the current portfolio on track for commissioning during H2 2019/20 with operational ramp-up from 2020/21

· Joint venture with Grundon Waste Management Limited to build a new ERF in West Sussex

· Construction at Viridor's recently announced £65 million plastics reprocessing facility is underway. The plant is set to contribute to earnings from 2020/21 with c.85% of inputs and c.75% of offtake now contracted

· South West Water remains on track to deliver continued outperformance and enhanced Return on Regulated Equity (RORE) of c.11.8% for K6 (2015-2020) whilst focusing on the early implementation of the fast-track K7 (2020-25) Business Plan

· Reviewing strategic focus, growth options and capital allocation policy for the Group


https://www.investegate.co.uk/pennon-gr ... 00088753N/

ayshfm1
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Re: Pennon Group PLC (PNN)

#254308

Postby ayshfm1 » September 27th, 2019, 11:30 am

Useful idiot Corbyn remains the problem here.

I do like the wheeze of giving out free shares to the customers, all the utes should do this, I'd like to see how "what's yours is really all mine" John McDonnell works his way through nationalising them if they had mass customer ownership.


(I hold)

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Re: Pennon Group PLC (PNN)

#254505

Postby mattman74 » September 28th, 2019, 9:08 am

Very happy to be holding here.

Since 2013 when I started buying pennon, Viridor has done very well and is becoming the major reason for investing. The ERFs are doing well and the plastics recycling could go great guns. Yes, there have been a few bumps along the way (the interserve thing and the greater manchester recycling contract) but they seem to manage these.

SW water looks like the steady eddy but again management seems to do smart things like the bolt on aquisition of Bournmouth water. Ofwat seems to like what they do. The political risk is there but I really like the free shares to SW water customers wheeze. Again a clever approach. If Labour come in and nationalise then people are likely to lose their free shares.
I think labour will have to respect property rights if they nationalise, however, and that means that Viridor will have a huge capital injection as HM Gov. pay out for SW Water (Whether they pay what it is worth is a different matter).

So a boring business with some interesting growth prospects and a decent, growing yield. The political risk means that it is not hugely expensive.

Matt

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Re: Pennon Group PLC (PNN)

#254512

Postby 77ss » September 28th, 2019, 9:31 am

mattman74 wrote:Very happy to be holding here.

Since 2013 when I started buying pennon, Viridor has done very well and is becoming the major reason for investing. The ERFs are doing well and the plastics recycling could go great guns. Yes, there have been a few bumps along the way (the interserve thing and the greater manchester recycling contract) but they seem to manage these.

SW water looks like the steady eddy but again management seems to do smart things like the bolt on aquisition of Bournmouth water. Ofwat seems to like what they do. The political risk is there but I really like the free shares to SW water customers wheeze. Again a clever approach. If Labour come in and nationalise then people are likely to lose their free shares.
I think labour will have to respect property rights if they nationalise, however, and that means that Viridor will have a huge capital injection as HM Gov. pay out for SW Water (Whether they pay what it is worth is a different matter).

So a boring business with some interesting growth prospects and a decent, growing yield. The political risk means that it is not hugely expensive.

Matt


Agreed. I first bought Pennon in mid-2011 and so far am satisfied with the outcome, with hopes that the Viridor end of the business will do well.

As for political risk, I think this has been hugely over-exaggerated - but certainly presented great buying opportunities at the turn of the year! We all have our different political outlooks but its an error to allow them to distort ones perspective on companies.

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Re: Pennon Group PLC (PNN)

#254694

Postby Arborbridge » September 29th, 2019, 8:54 am

mattman74 wrote:Very happy to be holding here.

Since 2013 when I started buying pennon, Viridor has done very well and is becoming the major reason for investing.
Matt


My thoughts too. But are we about to be robbed?

I've been reading of plans to sell off Viridor (presumably we'll get some cash) then we will just have the steady eddy rump water company at the mercy of the political will. Just when one thought one was on to quite a good thing with this "two in one" company structure, it seems it could be all whipped away.

Unless they get on with it quickly, we may not even end up with cash+rump, because the way things are going a general election will come along first and rob us completely. Although the way things are at present, it's far from clear that Corbyn has much chance of getting in.

Arb.

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Re: Pennon Group PLC (PNN)

#254811

Postby mattman74 » September 30th, 2019, 12:30 am

Arb

I hope you don't mind me asking but where have you be reading about the Viridor sell off plans?

I seem to remember some talk a few years ago when viridor seemed to be a drag on the business (I think recyclate prices were crashing in the commodities downturn).

Matt

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Re: Pennon Group PLC (PNN)

#254834

Postby 77ss » September 30th, 2019, 10:11 am

mattman74 wrote:Arb

I hope you don't mind me asking but where have you be reading about the Viridor sell off plans?

I seem to remember some talk a few years ago when viridor seemed to be a drag on the business (I think recyclate prices were crashing in the commodities downturn).

Matt


Matt - in the recent trading statement they say:

Given the strong financial performance and operational progress of Viridor and South West Water, coupled with the imminent start of the new K7 regulatory delivery period for South West Water and the near and medium-term growth opportunities at Viridor, the Pennon Board has concluded that it is an appropriate time to conduct a full review of the strategic focus, growth options and capital allocation policy for the Group.

https://www.investegate.co.uk/pennon-gr ... 00088753N/

The commentariat is interpreting that statement as signalling a separation of the water and waste businesses. A demerger/flotation/industrial sale.....? And asserts that the parts are worth more than the whole.

Maybe so. If it occurs, I think I will end up wealthier. In the mean-time, I am happy to just keep taking the 5% yield!


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