Pennon Group PLC (PNN)

[Gerry557]

Well at least this share buyback tranche is being done when the share price is two pounds cheaper. They spent £150m then. Now its cheaper £50m. Is the rest being saved for when it's cheaper again or for buying when it's more expensive.

Still the board don't mind overspending, as they did with Bristol water. Hopefully that will get sorted soon.

Great water company terrible dealers

[daveh]

Bristol water merger approved by CMA

https://www.investegate.co.uk/pennon-gr ... 35288462D/

CMA clears Bristol Water merger with South West Water

The CMA has today published its clearance of the merger of Bristol Water with South West Water, following the acquisition announced in June 2021.

Pennon Group plc is pleased that the undertakings proposed, which will maintain separate price controls for the Bristol Water region within a merged water business [1] , have now been accepted.

[idpickering]

TRADING STATEMENT.

Key Highlights

· Pennon remains on track to deliver resilient financial and operational performance across the Group in line with management expectations - continued South West Water RORE outperformance run rate

· CMA clearance for Bristol Water merger with South West Water - integration process underway, synergies targeting c.£20 million per annum identified across the Group by 2024/25

· Largest environmental investment programme in 15 years of c.£1.4 billion, across South West Water and Bristol Water well underway

· Planned acceleration and additional spend of c.£150 million in the current regulatory period, funded by re-investment of RORE outperformance announced to date, driving RCV growth

· £200 million of the share buy-back programme delivered so far - further phases expected to commence, subject to review of growth opportunities

· Continuing to support customers, with a bill cut for 2022/23, and bills lower than they were 10 years ago for South West Water customers.

https://www.investegate.co.uk/pennon-gr ... 00040338I/

[idpickering]

Full Year Results 2021/22.

https://www.investegate.co.uk/pennon-gr ... 00053192N/

Ian.

[idpickering]

Share Repurchase Programme.

The first four phases of Pennon's previously announced on-market share buy-back programme of up to c. £400 million (the "Programme") have deployed c.£200 million in total over the period from 23 July 2021 to 1 March 2022.

Pennon is announcing today that it is initiating the fifth phase of the Programme and has entered into a non-discretionary agreement with Morgan Stanley & Co. International plc ("Morgan Stanley") to enable Morgan Stanley, acting as principal, to purchase ordinary shares of 61.05 pence each in the share capital of Pennon for an aggregate purchase price of no greater than £40 million and the simultaneous on-sale of such shares by Morgan Stanley to Pennon. This agreement commences on 1 June 2022 and share purchase activity pursuant to the agreement is expected to end no later than 22 July 2022. Morgan Stanley will make trading decisions in relation to Pennon shares purchased under the Programme independently of, and uninfluenced by, Pennon. All shares repurchased will be cancelled.

Full deployment of the Programme is subject to Pennon's continued review of value creating opportunities in the UK water sector.

https://www.investegate.co.uk/pennon-gr ... 00084759N/

Ian.

[idpickering]

TRADING STATEMENT.

Key Highlights

· Trading in line with expectations given volatile macro-economic environment

· Resilient operational delivery through challenging conditions

· Delivering our WaterFit plans, improving river and bathing water quality outcomes

· Strategically well positioned to maintain cumulative doubling of RORE base returns

· Supporting customers - sharing c.£20 million of outperformance via WaterShare+

· Investing in environmental enhancement and resilience - expected c.30% increase in capital investment compared to the same period last year

· Disciplined capital allocation - c.£160 million ringfenced for investment in renewable energy generation.

https://www.investegate.co.uk/pennon-gr ... 00152542B/

Ian.

[ayshfm1]

It turns out in addition to being a shareholder I'm also a customer. I have thus received the water share details as a customer. It boils down to getting £13 which you can either have in share(s), at the implied price for more than one I'll be crying if it's more than a "share" or £13 off the bill. If the share is cheaper than £13 then the difference comes off the bill if more then at it's discretion they make up the difference.

As a shareholder I'm not massively happy about the potential for thousands of people to be added to the share register with just one share each.

[idpickering]

TRADING STATEMENT.

Pennon Group announces the following trading update for the year ending 31 March 2023.

Pennon Group is on track to deliver results in line with management expectations. Full year 2022/23 results will be announced on 1 June 2023.

Key highlights

· Bristol Water licence merger successfully completed in February 2023

· Reinvesting outperformance in South West Water to increase water resilience and enhance the environment - on track to continue the delivery of double base returns on regulated equity (RORE) in 2022/23, driven by our strategically positioned financing portfolio

· Accelerating environmental capital expenditure - record c.40% increase year on year

· Driving improvements in underlying EPA[i] performance, with a c.30% reduction in pollution incidents in 2022

· Delivered c.100% coverage monitoring storm overflows - one year ahead of plan

· Reducing releases from storm overflows, with a 30% reduction in 2022

· Water resilience initiatives progressing well - innovative 'Stop The Drop' campaign highly successful and delivered £30 benefit per household[ii]

· Operating a socially responsible business - supporting all customers

o Below inflation bill increases for 2023/24

o WaterShare+ second £20 million issuance completed, including Bristol Water customers, with more households than ever before now shareholders

o Over 100,000 customers benefiting from one of more of our extensive affordability initiatives.

https://www.investegate.co.uk/pennon-gr ... 00118789S/

Ian (No holding).

[idpickering]

Ofwat investigation into leakage and per capita consumption data.

Ofwat have this morning announced an investigation into South West Water's 2021/22 operational performance data relating to leakage and per capita consumption.

This operational performance data was reported in South West Water's Annual Performance Report 2021/22. This report is subject to rigorous assurance processes which include independent checks and balances carried out by external technical auditor.

We will work openly and constructively with Ofwat to comply with the formal notice issued to South West Water as part of this investigation.

https://www.investegate.co.uk/announcement/7538735

Ian (No holding).

[idpickering]

Full Year Results 2022/23.

· Underlying revenue increase includes growth in Non-household demand, supported by contract wins from Pennon Water Services[4], in areas outside of our wholesale supply regions, and a full twelve-month contribution from Bristol Water. The Group's statutory revenue for 2022/23 of £797.2 million includes non-underlying revenue reductions of £27.8 million

· £16.8 million underlying profit before tax - reduction compared to the prior year reflects the flagged near-term pressures on earnings from inflation driven power and financing costs

· Net non-underlying costs before tax of £25.3 million - delivering on our WaterShare+ commitments and helping to address the severe drought conditions

· Statutory profit after tax of £0.4 million (2021/22: £15.6 million profit after tax)

· Adjusted earnings per share of 7.3 pence, down from 50.2 pence in 2021/22

· Statutory earnings per share of nil pence after net non-underlying costs. Statutory earnings per share for 2021/22 were impacted by the significant non-underlying deferred tax charge in respect of the change in corporation tax rate

· Group RORE2 for 2022/23 of 10.5% reflecting an increase of 1.6% on 2021/22

· Delivering on established K7 (2020-25) dividend policy - total dividend up 10.9% (CPIH +2%) to 42.73 pence.

A full reconciliation to the statutory reported results is included in item (i) in the Alternative Performance Measures on pages 58 to 63 of this announcement.

And later;

The Board has recommended a final dividend of 29.77 pence per share for the year ended 31 March 2023. Together with the interim dividend of 12.96 pence per share paid on 5 April 2023 this gives a total dividend for the year of 42.73 pence. This represents an increase of 10.9% (March 2023 CPIH + 2%) on 2021/22. Pennon offers shareholders the opportunity to invest their dividend in a Dividend Reinvestment Plan (DRIP).

https://www.investegate.co.uk/announcement/7553884

Ian (No holding).

[Dod101]

Full Year Results 2022/23.

· Underlying revenue increase includes growth in Non-household demand, supported by contract wins from Pennon Water Services[4], in areas outside of our wholesale supply regions, and a full twelve-month contribution from Bristol Water. The Group's statutory revenue for 2022/23 of £797.2 million includes non-underlying revenue reductions of £27.8 million

· £16.8 million underlying profit before tax - reduction compared to the prior year reflects the flagged near-term pressures on earnings from inflation driven power and financing costs

· Net non-underlying costs before tax of £25.3 million - delivering on our WaterShare+ commitments and helping to address the severe drought conditions

· Statutory profit after tax of £0.4 million (2021/22: £15.6 million profit after tax)

· Adjusted earnings per share of 7.3 pence, down from 50.2 pence in 2021/22

· Statutory earnings per share of nil pence after net non-underlying costs. Statutory earnings per share for 2021/22 were impacted by the significant non-underlying deferred tax charge in respect of the change in corporation tax rate

· Group RORE2 for 2022/23 of 10.5% reflecting an increase of 1.6% on 2021/22

· Delivering on established K7 (2020-25) dividend policy - total dividend up 10.9% (CPIH +2%) to 42.73 pence.

A full reconciliation to the statutory reported results is included in item (i) in the Alternative Performance Measures on pages 58 to 63 of this announcement.

And later;

The Board has recommended a final dividend of 29.77 pence per share for the year ended 31 March 2023. Together with the interim dividend of 12.96 pence per share paid on 5 April 2023 this gives a total dividend for the year of 42.73 pence. This represents an increase of 10.9% (March 2023 CPIH + 2%) on 2021/22. Pennon offers shareholders the opportunity to invest their dividend in a Dividend Reinvestment Plan (DRIP).

https://www.investegate.co.uk/announcement/7553884

Ian (No holding).

I have never invested in the water companies and find it very difficult not to be critical of a 10.9% increase in the dividend when there is so much investment required to stop leaks and update the sewerage network for all the water companies. Strangely enough one of the few public enterprises in Scotland which seems more or less uncontroversial is Scottish Water. it is not innocent in respect of sewage overspills and it is of course blessed with a mostly excellent quality of water occurring naturally. It may also be no coincidence that the Scottish Government seems to have left it alone.

Privatising utilities is supposed to bring more efficiency and the dividends are the reward for shareholders. Water companies are more or less regulated but still.............

Dod

[idpickering]

Further to the above, dividend 29.77p per share, ex dividend 20 Jul 23, paid 04 Sep 23.

Ian.

[monabri]

Quite a cheek! Dividend increases of ~11% and they are asking consumers to pay more to clean up the pollution they cause!

[ReformedCharacter]

I'm a customer of SW Water and a Pennon shareholder. I reported a leak about a week ago. The leak is on my supply pipe and therefore I'm liable for the repair cost. But SWW have an offer at the moment to repair such leaks without charge to the consumer and a few days after reporting the leak a SWW employee arrived and located the leak. He was pleasant and helpful. A couple of days later I had a call from SWW asking whether I was happy with the service and how I would rate the person who called and detected the source of the leak. I gave him a 10/10 for being pleasant and helpful. Two days later a contractor arrived and fixed the leak. The dug up soil and the contents of the hole were wet so they arranged to come back today to fill it back in when it has dried out somewhat. I know there's an issue with sewage but I can't fault the leak repair service, nor the dividend increase

RC

[Gerry557]

The problems around pollution stem back to pre privitised times and who is going to pay if and when it's decided that more work is required.

So yes it's we the public that will pay but we can't have lower bills and more investment. So I suppose there will have to be a balance between rising bills and more pollution schemes.

I think Pennon is a bit different as it has the biggest coastline and the rest of the country subsidies it's bills.

I also think Pennon showed it's investors how bills were now lower that if it remained nationalised. It's probably still available in an annual report somewhere. I think it was 2 or 3 years ago.

[Dod101]

I'm a customer of SW Water and a Pennon shareholder. I reported a leak about a week ago. The leak is on my supply pipe and therefore I'm liable for the repair cost. But SWW have an offer at the moment to repair such leaks without charge to the consumer and a few days after reporting the leak a SWW employee arrived and located the leak. He was pleasant and helpful. A couple of days later I had a call from SWW asking whether I was happy with the service and how I would rate the person who called and detected the source of the leak. I gave him a 10/10 for being pleasant and helpful. Two days later a contractor arrived and fixed the leak. The dug up soil and the contents of the hole were wet so they arranged to come back today to fill it back in when it has dried out somewhat. I know there's an issue with sewage but I can't fault the leak repair service, nor the dividend increase

RC

Were I to be unusually cynical, I guess that SW water can log that as a leak repaired within a couple of days and include that in their report to the regulator. If I were a shareholder I would be asking why they do not complete the job and send you the bill. Maybe of course you are getting this treatment as a shareholder benefit.

Dod

[ReformedCharacter]

Were I to be unusually cynical, I guess that SW water can log that as a leak repaired within a couple of days and include that in their report to the regulator. If I were a shareholder I would be asking why they do not complete the job and send you the bill. Maybe of course you are getting this treatment as a shareholder benefit.

Dod

It's not a shareholder benefit. According to SWW's website they are offering free leak repairs for domestic customers and the SWW bod who inspected the leak said that SWW will pay half the cost of replacing existing pipework. My supply is via alkathene pipes which apparently tend to fail after c. 30 years. The SWW region still has a hosepipe ban in place (since last summer) so they must be keen to - and be seen to - minimise losses due to leaks.

RC

[Dod101]

Were I to be unusually cynical, I guess that SW water can log that as a leak repaired within a couple of days and include that in their report to the regulator. If I were a shareholder I would be asking why they do not complete the job and send you the bill. Maybe of course you are getting this treatment as a shareholder benefit.

Dod

It's not a shareholder benefit. According to SWW's website they are offering free leak repairs for domestic customers and the SWW bod who inspected the leak said that SWW will pay half the cost of replacing existing pipework. My supply is via alkathene pipes which apparently tend to fail after c. 30 years. The SWW region still has a hosepipe ban in place (since last summer) so they must be keen to - and be seen to - minimise losses due to leaks.

RC

I guess that if there is a hosepipe ban still in place it is in everyone’s interests that leaks, any leaks, are repaired asap.

I was just thinking of my own experience some years ago when my incoming water pipe kept bursting. Our water authority basically said to me ‘It is your side of the toby, nothing to do with us’ and left me to it. After a while I realised that it was a very old lead pipe and had to be replaced. I think I got a grant from someone towards the cost but it was mostly at my cost and it was quite a long way from the said toby to the stopcock in my house. At least I had no further problems after it was repaired.

Dod

[idpickering]

Publication of Annual Report and Accounts 2023.

The Company's Annual Report and Accounts for the year ended 31 March 2023 (the "Annual Report") and Notice of Annual General Meeting 2023 (the "Notice of Meeting") have been published on the Company's website are available to view at http://www.pennon-group.co.uk/investor- ... l-meetings. A hard copy version of the Annual Report and Notice of Meeting will be sent to those shareholders who have elected to receive paper communications.

https://www.investegate.co.uk/announcem ... 3-/7580079

Ian (No holding).

[Dod101]

I wonder for how long Pennon will get away with paying a dividend of 42.73p per share (up 10.9%) against EPS of Nil against the backdrop of the water companies in general?

Dod