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E.ON’s Q1 22 exhibited relatively weak results due to the inability to pass on higher energy costs fully to end-customers. But the group made a point of showing confidence in its ability to recover these losses in subsequent quarters. Our view is rather cautious, but management’s pitch is convincing and, at least for now, backed by fragile visibility amid regulatory uncertainties.
Full-year guidance is confirmed, but one thing is clear: no margin for error in the rest of 2022.
Companies: E.ON SE
A rather solid set of FY21 results, higher than the consensus but slightly lower than our estimates, is not enough to offset the uncertainties to come. The impact of network losses and a risky exposure to the supply business are likely to tip the balance into negative territory regarding the exposure to soaring energy prices in 2022. Added to the Russian-linked uncertainties (NS1, gas supply), E.ON should remain the persona non grata of cautious investors’ portfolios until there is more visibili
E.ON unveiled its 2026 roadmap. The focus was on capex and network expansion to offset the lower regulated returns in the coming years. In all, nothing surprising, which from a market point of view means disappointment. The fnancial targets are in line with expectations while funding issues prevent further aggressiveness. E.ON is staying the course, business as usual. And this consequently lengthens the road to a rerating.
E.ON released a set of strong but expected 9M 21 results, with adjusted EBIT up by 46%. Positive effects from favourable weather conditions were the main driver. It allows the group to confirm its FY21 guidance, upgraded in H1.
Note a substantial improvement on the net debt, even if several one-offs have contributed.
Next trigger: the CMD on 23 November 2021.
What if the best solution for the energy transition were … nuclear power? Nuke is back at the heart of political debates in the context of the current energy crisis and massive but insufficient investments in renewables. This short review provides an overview of nuclear power in Europe and speculates on options. This ‘nuke optionality’, hinging on a favourable green taxonomy, is a game-changer for EDF, Centrica, Fortum but also Engie, Iberdrola, Enel and EDP.
The network giant beat estimates by 6% to reach €1.66bn in terms of EBIT (+14% yoy). Indeed, as the main growth driver, E.ON can be fully satisfied with its restructuring plan in the UK which pushed the Customer Solutions business up to return to profitability.
Furthermore, all short and mid-term guidances are confirmed. Strengthened by a good start to the year, we stand at the top of targets. Positive view reiterated.
E.on released slightly above expectations FY20 figures, but were globally in line with our estimates. Net income is better but the dividend slightly worse. The impact of COVID-19 remains limited and should be recovered. The good news comes from targets for the next three years that are revised upward. A good point is also on the initiated deleveraging process from 6x to 4.8-5.2x net debt/EBITDA. Our positive view is confirmed.
Compared to H1 19 pro forma, adjusted EBIT was down by 7%, to €2.7bn, due to lower volumes (related to lockdowns) and lower regulated WACC in Sweden. The group revised downwards its FY20 EBIT and net income guidance, the mid-points are down respectively 7% and 11%. However, assuming no further severe lockdowns, the dividend policy as well as the 2022 targets are confirmed. We confirm our positive long-term recommendation on the back of the RAB’s growth potential and expected synergies.
EBIT decreased by 6% to €1.5bn due to lower allowed WACC for assets in Sweden, mild weather in Europe and higher depreciation. In Q1, the impact of COVID-19 was limited. Following EBIT, adjusted net income was down 8% to €691m. In short, the figures are roughly in line with expectations and the group is showing great resilience in the face of current uncertainties.
The group confirmed its good progress over H2. The FY19 figures are perfectly in line with the guidance and our estimates. So good news, but expected. The group did not provide any specific details concerning the impact of COVID-19, but the overall impact should be limited as the guidance is roughly in line with our figures, and the group expects its dividend to grow by 5% per year up to 2022. Positive view confirmed.
After a down (but in line) in H1, the group showed a recovery in Q3. E.On’s adjusted EBIT was up 20% to €491m. Thanks to this and a more optimistic view of the conditions for Innogy’s integration, E.On slightly increased its EBIT annual guidance. The mid-point is up by 6%, to €3.1-3.3bn. The dividend remains unchanged, but the stock is already trading at an attractive yield of ~5%. Positive view confirmed.
EBIT as expected due to headwinds in the UK for the retail activities and thought comparatives for Energy Networks, while asset expansion helped to limit the decline. Economic net debt was up but mainly due to IFRS16 and lower discount rates for pensions. As all the figures were broadly in line and we do not expect any major changes to our target price
EBIT and adjusted net income was down, as expected, after an exceptionally high base in Q1 18. The group also suffered from fierce competition in the UK and a delayed pass-on higher grid feed to customers in Germany. Full-year guidance is confirmed, and the Innogy transaction is on track.
The fierce competition and the price cap in UK had a negative impact on the Customer Solutions segment, especially in Q4. Renewables capacity continues to grow, pushing up EBIT. The RAB target for 2020 is revised upward.
E.ON released a good set of 9M results. EBIT was up 11%, supported by strong growth in the renewables business as well as positive trading developments in the customer solutions division in Q3, although this likely to reverse in Q4. The group confirmed its FY18 objectives. We stick with our current Add recommendation.
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Volex has issued its year end trading update confirming revenues in excess of $605m and an operating profit in excess of $55m that are ahead of consensus FY22E expectations of $581m and $54.2m respectively. The Group continues to trade strongly whilst effectively managing global supply chain challenges and benefits from its proven ability to pass through inflationary cost increases, albeit with a time lag. Demand increased during the year, in particular in the EV sector where sales almost double
Companies: Volex plc
Seeing Machines has announced that it has been appointed by an existing customer and global Automotive Tier-1 supplier to deliver its FOVIO Driver Monitoring System (DMS) for a leading Japanese carmaker. This contract win, with an initial lifetime value of A$21m, is due to start production in 2025 and marks Seeing Machines' first production Automotive award in Japan bringing the total number of OEMs with which Seeing Machines has won business, to nine. Delivery is via the Company's deeply embedd
Companies: Seeing Machines Limited
What’s cooking in the IPO kitchen?
Lift Global Ventures plc to join AQSE Growth Market. The Company's investment strategy is to operate as an enterprise company seeking acquisition or investment opportunities within the financial media and technology industries. Within these broad industries, areas of focus may include: Financial news websites and other forms of “new media”, Investment research providers, Financial PR, IR, design and marketing agencies, Production studios and visual content prov
Companies: BSE CFX DPP EOG SEE SOLI SML
Weekly round-up of AIM-listed healthcare news.
Intelligent Ultrasound, Inspiration Healthcare, Agronomics, CareTech Holdings, e-therapeutics, ABCAM, EKF Diagnostics, HUTCHMED (China), Benchmark Holdings, Totally, ImmuPharma, Open Orphan, Destiny Pharma, Polarean Imaging, Induction Healthcare.
Companies: ANIC RUA CREO GENI HEIQ IHC IXI IUG OPTI SBTX VAL VLG
Seeing Machines has announced that it has entered into a strategic collaboration with an image-sensor and optical systems design technology company in order to create an anticipated step-change in the performance of cabin-monitoring technology. As part of this it has obtained a world-wide perpetual exclusive licence which applies to both automotive and aviation market sectors, for A$5m payable over three years, in order to access and customise the optical technology to the specialised field of c
Companies: Macfarlane Group PLC
XPD has re-hired Richard Myson as Group CFO to build back the Board and improve financial management, following various recent senior resignations. This is welcome news. Richard previously worked at XPD for 16 years, held numerous senior finance and non-finance positions, and helped steer the Group through the successful IPO in mid-2017. He left XPD in late 2018 but has remained in close contact with the Group. Richard owns c.1.4% of the shares. Further, hiring of a new non-executive chair and C
Companies: Xpediator Plc
Imperial Helium (IHC CN)C; Under review: Merger with Royal Helium to build a material player with discovered resources and huge upside - Imperial Helium is merging with Royal Helium with Imperial Helium shareholders set to hold ~30% of the combined entity. The share exchange ratio suggests a 10% premium to the Imperial Helium share price on the day prior to the announcement. Shareholders will vote on the transaction in June with completion expected in the 2nd half of June. Management, insiders a
Companies: XOM XOM TRIN SHEL RBD OEX NOG MATD ALV ALV IOG GTE FEC EQNR EQNR ENOG BP/ IHC PEN PEN SDX EGY
Weekly round-up of AIM-listed healthcare news.
Agronomics, Eden Research, IXICO, HeiQ, Trellus Health, NetScientific, Circassia, 4basebio, Fusion Antibodies, Surgical Innovations Group, Yourgene Health, Abingdon Health, Verici Dx, Poolbeg Pharma, Omega Diagnostics
Companies: Ilika plc
Although RR has returned to growth in FY21, both sales and profitability have been disappointing. The resignation of Warren East after eight years as CEO will not help the stock, which saw its stock price fall as much as 18% today. The inflation in raw material and energy prices linked to Putin’s declaration of war won’t make the recovery of RR in FY22 any easier.
Companies: Rolls-Royce Holdings plc
Oil closed Friday at a six-week high on signs the market is tightening as members of the European Union moved closer toward banning Russian crude.
West Texas Intermediate futures posted its first back-to-back weekly gain in two months. The EU intends to ban Russian crude in six months and oil products by the end of the year to punish Moscow for its war on Ukraine. The bloc has proposed giving Hungary -- which has pushed back against an embargo -- and Slovakia an extra year to comply, people f
Companies: FO 88E CHAR DEC EME GTC TRIN WEN
Dish of the day
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What’s cooking in the IPO kitchen?
EnSilica, intends to join AIM. EnSilica is a designer and supplier of mixed signal Application Specific Integrated Circuits (ASICs). ASICs are integrated circuits or semiconductor chips developed for a particular use or product rather than for general purpose usage. ASICs help differentiate products through optimised hardware thereby making products smaller, faster, lower power and more
Companies: XTR XLM VRS SUP ROCK SLE SEMP OHG HDD FIH
Companies: Wincanton plc