seagles wrote:JohnnyCyclops wrote:As I recently realised, on rejoining the world of HYPs after a sabattical, the 'formal' classifcations went through an update around 2019. Spotting you have the super-sector "Oil and Gas", that's now rebranded "Energy". Some other sectors have moved around, for instance the new super-sector "Personal Care, Drug & Grocery Stores" now includes both Unilever and Tesco. They were previously split between "Food/Beverage" and "Retail" super-sectors.
I noted pyad posting above suggesting investors apply sector designations that suit them. I've thought for a while not to clump both water and gas utilities (Pennon and Centrica) into "Gas, Water & Multiutilities" sector. The new joining of ULVR & TSCO above may be one I choose to split out.
I have taken the above straight from HYPTUSS. If you saying they are wrong then we need to let the "boys" know. I have no use for these super sectors myself though.
I think the point is just that there's a bit of an inherent inconsistency in sector classification systems: on the one hand, the ICB system is the only widely-accepted 'official' system, so is the only one that a for-general-use utility like HYPTUSS can reasonably present as objective and uninfluenced by personal biases; on the other hand, the ICB system does have features that make it quite noticeably less than ideal for UK-based HYPers.
For example, at least in recent years most of the utilities are very largely gas/electricity companies with at most minor sidelines in water, or very largely water companies with at most minor sidelines in gas/electricity - but when a utility company has a lot of its business in either gas or electricity, it tends to have a lot of its business in the other as well. Furthermore, the balance between the two can easily shift, since they are used for broadly similar purposes, and indeed it seems politically likely that there will be quite a shift from gas to electricity over the next few years. As one of the most likely cases, National Grid is currently in the "Gas, Water and Multi-utilities" sector and at least its UK operations are already very largely electricity rather than gas - a look at the "Segmental analysis" note to its accounts says that in its 2020/2021 financial year, 33% of its revenues were from UK activities that are specifically identified as either gas or electricity, and the electricity:gas split of those revenues was 82%:18%. Five years earlier in its 2015/2016 financial year, the corresponding figures were 45% and 58%:42%. That's not conclusive evidence of a shift away from gas and towards electricity, as unfortunately the remainder of the company's revenues are mostly US-based ones that aren't broken down between electricity and gas, plus some miscellaneous activities ("
commercial operations in metering, LNG at the Isle of Grain in the UK, electricity interconnectors and our investments in National Grid Renewables (formerly Geronimo) and Emerald Energy Venture LLC (Emerald)") that also aren't broken down. But it does seem indicative of such a shift, and such a shift does seem likely anyway in the current political/investment climate. And if such a shift goes far enough, the ICB classification will probably cease to regard the company as a "multi-utility" in favour of regarding it as an electricity company. For comparison, SSE is classified as an "Electricity" company and its 2020/2021 report suggests its corresponding split is something like 60% of its revenues identifiable as either electricity or gas, with something like a 79%:21% electricity:gas split - though there is a fair amount of uncertainty about those figures because of issues to do with how to treat inter-segment revenues (i.e. one part of the company selling on another part's products and services).
The upshot is that for quite a few HYPers, classifying utilities as Energy Utilities (covering both electricity and gas) and Water Utilities makes a good deal more sense than using the ICB classifications of "Electricity" and "Gas, Water and Multi-utilities": it produces much clearer classifications for existing 'usual suspect' companies such as National Grid and SSE, that seem much less likely to change in the future, and in particular less likely to 'drift' into a different classification, as opposed to being taken into one by explicit management decisions to enter or exit particular business areas.
But HYPTUSS can only really cater for those HYPers by providing the ICB classifications by default while making it easy for its users to configure it to use their own preferred classifications instead, since individual HYPers' preferred classifications probably vary widely. Anything it provides by default will end up not suiting quite a few users, so the only really consistent story for providing any particular option is "it's the official one"... I should add that I believe from reading previous posts (edit: and see that Itsallaguess has confirmed above) that it does make it easy for its users to configure it - though I don't know that from personal experience, since I use spreadsheets I developed myself years before HYPTUSS appeared and find perfectly satisfactory. So on the "if it ain't broke, don't fix it" principle, I've never started using HYPTUSS... (And before anyone asks, no, I won't make my spreadsheets available to others. I know how to use them and find them easy to use, but they would need a lot of work to Fool-proof for others! ;
-) And there seems little if any reason to do that work, as HYPTUSS users generally seem pretty satisfied with it.)
Gengulphus