HY23/24: More capex for more RAV

SSE reported good earnings with operating profit down by 3% vs last year as expected due to a decline in the gas storage activities and higher operating costs in distribution not offset by a 200% surge in SSE thermal. The FY23/24 guidance was confirmed whilst the 2027 capex programme has been increased by £2.5bn dedicated to transmission.

FY 2022/23: Strong performance, SSE Thermal business was the key driver

SSE reported higher than expected FY22/23 earnings with SSE Thermal as the main contributor. The business unit tripled its operating profit from £300m to more than £1bn propelled by price, volume and perimeter effects. The group nevertheless indicated that this level of income will be adjusted downwards to around £750m in the following year.

Q3-2022/2023: On track to deliver record investment and earnings per share

Scottish and Southern Energy Plc reported a very encouraging Q3 trading statement for 2022/2023, highlighting an adjusted earnings per share of more than 150 pence, higher than the expected 120p. The Scottish group confirmed that it is on course to deliver a record year in terms of investment of at least £2.5bn, and its resilient and robust business model.

HY22/23: Good half year results, supported by thermal generation and gas storage

Scottish and Southern energy beat estimates over the period, amidst soaring energy prices and higher thermal generation and gas storage. The Networks segment also played its part with the increasing number of new generation assets connected to the grid. The group confirmed the full year guidance from May 2022, with at least 120p expected, and also renewed its ambitious investment plan by investing four times more than it makes in profits to boost UK energy security and sustainability.

FY21/22: strong results and visibility on guidance...for now ?

A strong set of results from SSE that both beat expectations for the FY21/22 results and increased mid-term guidance by FY26. The thermal fleet obviously recorded very strong earnings but a material acceleration in networks, more sustainable, is a positive. The dividend also came in higher-than-expected, at 85.7p. However, the threat of a windfall tax in the UK is beginning to emerge. Even if only at the rumour-stage for now, the risk is high and potential impacts could be material.

9M 21/22: improved guidance thanks to thermal generation amid low renewables output

In a context of adverse weather conditions for renewables leading to low output (-15.6% yoy), SSE has been able to rely on its thermal and hydro assets to benefit from the favourable energy prices and to boost its performance over the first 9M of the fiscal year. As a result, EPS guidance is improved from ‘at least’ 83p to ‘at least’ 90p, ahead of analysts’ expectations. Capex, net debt and dividend are confirmed to be in line with our expectations.

H1 21/22 and new 2026 strategic roadmap: conservativeness is a negative

Apart from the H1 21/22 results being in positive territory, SSE particularly disappointed with its new 2026 strategic update. The group intends to invest £12.5bn by 2026 to increase its renewables asset base by 4GW and increase its electricity network RAV to £9bn. This appears conservative, especially with regards to renewables, not to mention that the funding of the plan requires a dividend cut. We would have liked more aggressiveness on renewables. Negative view confirmed.

FY20/21 driven by renewables, boosted by disposals

Following the disposal of multifuel assets, SEE’s EPS soared by 5.3x for the 2020/21 March-ending fiscal year. £878m extra gains on disposals offset a £170m negative impact on EBIT from the pandemic. The adjusted figures were, however, in line with the consensus, and slightly above our expectations, driven in particular by a strong performance from offshore wind. The long-term guidance was confirmed, but no precise outlook was given for FY21/22. Expect upwards adjustments to our estimates.

Good set of FY19/20 figures

Good set of FY19/20 results (to 31 March). On the back of the restoration of the capacity market payments in the UK and a strong performance in the renewables activities, offsetting the slight decrease in network activities, earnings per share increased by more than a third.

Capital Access' Hot Off The Wires - The Day Ahead

Our Hot Off The Wires daily newsletter takes a look at the morning's market movements, news stories and company announcements. Don't forget to have a go at our daily trivia! Companies mentioned in this edition include: SSE, Hargreaves Lansdown, TalkTalk, Britvic, Investec, Impact Healthcare REIT, Laura Ashley, *Savannah Petroleum and Staffline. If you would like to be subscribed, please email us at info@capitalaccessgroup.co.uk. *Capital Access represents Savannah Petroleum - if yo

H1: increase in the EPS guidance

SSE realised a good set of H1 19 results, driven by new renewables capacity and favourable weather conditions. However, the transmission and distribution activites decreased sharply, but were partially compensated by the good results in gas distribution. The group increased by 3.6% the mid-point of the FY20e EPS guidance.

Weak FY18/19 results

SSE released a weak set of FY results, lower than our estimates. Network segment was the only one to grow, but not enough to compensate for the decrease in Wholesale and Retail. The group reiterated its five-year dividend plan.

Unsurprisingly weak H1 results

SSE reported a weak set of H1 results, in line with the September profit warning. Adjusted operating profit was down 24%, to €448m on the back of lower renewables output and losses in the group’s EMP activities, due in part to a losing short position on gas prices. The group reiterated its five-year dividend plan.

Calmer winds, higher gas and fiercer retail competition trim £80m off Q1 earnings

SEE released a disappointing set of Q1 results, hampered by poor wind conditions in early June, higher gas prices and warmer weather. The 97.5p dividend has been confirmed. The demerger of SSE Energy Services is still expected to be completed by year end.

Renold - Strong end to FY24: EPS up 11%. Robust FY25: EPS up 27.6%

The FY24 year-end update is very upbeat signalling trading being materially ahead of expectations, with a better-than-expected profit out turn and stronger cash generation. It continues to strengthen margins through efficiencies and investment in modern equipment. The order book remains close to record levels providing a robust view of future forecasts. In FY24E we upgrade EPS by 11% and in FY25E a significant upgrade of 27.6%. It looks capable of declaring a dividend in FY25 as well as manageme

Q1 Operating Results

Another Good Year of Diversified Growth with More to Come in 2024 CCapital have released their Q1 operating results. Overall, revenue has come in slightly lower than expected at $80.2m vs TamE of $85.9m but is largely tracking in line with our FY24 annual estimate and we note the company has maintained guidance. Drilling revenue for this quarter was impacted by a fall in utilisaztion rates as well as general remobilisation geographically but we expect a strong recovery throughout the year as k

Billington Holdings - Record result boosts dividend; forecasts upgraded

FY23 results show very strong growth over FY22, driven by strong Structural Steel activity, with results slightly ahead of upgraded profit expectations, while stronger than expected cash flow resulted in an unexpectedly generous dividend of 33p (offering a FY23 yield of 7.0%). The group now has net cash of £22.1m and is debt free and is therefore in a strong position for potential M&A activity. Following the recent £90m of new orders to increase the order book to record levels we conservatively

Morning Note – 16 April 2024

Plant Health Care - China distribution with AMVAC

Plant Health Care announced it has signed a distribution agreement with AMVAC, an American Vanguard Company, to support commercialisation of novel fertiliser products incorporating Plant Health Care's Harpinαβ in China starting in 2024. The novel product combines Harpinαβ technology with an AMVAC fertiliser and is expected to help growers improve crop quality and yield as part of an integrated and environmentally responsible crop production programme. AMVAC continues to evaluate Plant Health Car

Morning Note – 15 April 2024

discoverIE - Back to organic growth

discoverIE’s March year-end update confirms a strong operational performance in challenging markets. Following two years when sales increased by +48%, FY 2024 Group sales were +1% ahead of 2023 at CER (reported -3%) driven by a +2% contribution from acquisitions and organic -1%. As expected, organic growth returned in the later part of the year (Q4 +2%, +11% sequentially) and the order book has reverted to normalised levels of c.4.5 months’ sales, which – combined with a continuing strong pipeli

Severfield - Multiple positives should excite investors

Severfield’s trading update indicates that FY23 results are expected to slightly exceed market expectations and the company ends the year with a record UK and Europe order book. Furthermore, with a positive trading outlook and net debt coming in lower than expected, Severfield has announced a £10m share buyback, highlighting the cash-generative nature of the company and management’s confidence in its position. The stock trades on an FY25 P/E of less than 6x and yields 7%, which we believe appear

Warns on brine supply costs

SP Angel . Morning View . Copper prices hold higher as China processing fees fall below $0/t amid low feedstock availability

Hardman & Co Insight: 2023 was an annus horribilis for Quoted UK Infrastructure and Renewable Energy

The focus of Hardman & Co Research is on the nine quoted Infrastructure Investment Companies (IICs) and on the 22 Renewable Energy Infrastructure Funds (REIFs): the stocks analysed are all members of the Association of Investment Companies (AIC). We are updating our publication of January 2023, assessing both the lacklustre share price performances during 2023 and the key issues, including interest rates, inflation and power prices. As a 31-strong group, its combined market capitalisation is no

PROGRESSIVE: Severfield: Targeted acquisition strategy aids growth path

Acquisitions have been an important element of Severfield management’s growth strategy, with the aim of adding new products, sectors and regions to what we have identified as exciting long-term organic opportunities. In this Spotlight report, we focus on the group’s targeted M&A approach, highlighting three significant deals.

LIBERUM: Severfield: Erratum: Better EPS and cashflow, and buyback

Invinity Energy Systems - Update on Strategic Investment

Invinity’s update on discussions with strategic investors reveals interest from multiple parties. While this has slightly delayed finalising an agreement it increases the potential for a better outcome. Although details are unknown at this stage, we think there is enough in the statement to be comfortable that any agreements will be consistent with the company’s strategy of growing market share in core markets and using a licencing and royalty model in other markets.

Clean and competitive fertiliser