Utilities equity research

Explore the most viewed and latest equity research and media content for companies within the Utilities sector. Companies within this sector provide services including electricity generation, water, gas and multiservice utilities.

  • 01 Mar 21
Resilient results, strong outlook

Results were well trailed in January’s trading update. In the event, adjusted PBT emerged marginally ahead of FY2020, despite material impacts from Covid-19 and a depressed oil price. Although biomass incinerators were closed for much of the second quarter, the Group grew sales from residues from Energy from Waste (‘EfW’) by 15% and signed a further 6 new contracts, maintaining its high win rate. The outlook for EfW remains very strong with c.40 plants in planning or construction that provides the opportunity for Augean to double its current EfW revenues and profits of c.£20m and c.£14m over the longer term. Group operating margins are forecast to reach 25% and cash generation is strong, supporting a 3.5% yield on a resumed forecast dividend. EV/EBITDA multiples for FY2021E, FY2022E and FY2023E are 6.2x, 5.3x and 4.3x, which are well below established industrial sector metrics.

Companies: Augean PLC
  • 01 Mar 21
THE MONTHLY March 2021

UK railway privatisation, which was launched in the mid-1990s, has finally turned full circle: the Department of Transport has recently confirmed that its controversial railway franchise system will be scrapped. In this month's feature article, Nigel Hawkins, the Infrastructure analyst at Hardman & Co, examines the 25-year history of railway privatisation and chronicles its ups and its downs. The successes of railway privatisation, such as new rolling stock, are addressed, along with the many shortcomings, which included minimal vertical integration. With the winding up of the franchise system, the UK railway sector is effectively reverting to its former status as a nationalised industry, a shift started with the renationalisation of the collapsed Railtrack – later re-badged as Network Rail – in 2001.

Companies: ARBB BBGI CLIG DNL FLTA ICGT OCI PCA PIN PXC RECI SCE TRX SHED VTA YEW

  • 26 Feb 21
FY20 - a weak set of figures

Affected by volumes which were lower than their long-term average and weak commodity prices for the upstream division, the group published a disappointing set of FY20 figures. Although the group’s efforts on its cost structure are notable, we maintain a cautious view on inventory due to the economic uncertainty that could erode cash generation (due to an increase in working capital requirements, among other things).

Companies: Centrica plc
  • 25 Nov 20
H1 20/21: reported profit up yoy due to non-operational reasons

United Utilities posted its H1 20/21 (closing in March) result with revenues down by 4.3% due to the new pricing regime and the pandemic, with an underlying operating profit decline (-18%). Net profit, however, was supported by lower net financial expenses and the underlying movement in the share of joint-ventures. For FY 20/21, the company expects revenue to be £1.75-1.8bn vs £1.86bn recorded last year. Additionally, it expects an ODI reward of around £10m.

Companies: United Utilities Group PLC
  • 15 Jan 21
Funding Expedites Project

A £10m fundraising expedites the Protos project and opens the way for the £10.2m Peel warrant exercise in the current year. The funding will also give the company additional resources to pursue international opportunities. Adjusting for the raise and some timing differences, our UK only base valuation rises from 5.0p to the raise price of 5.5p and we see existing international opportunities taking this to 7.5p (from 6.9p) and including opportunities in Europe this could rise to 12.1p (from 11.2p).

Companies: Powerhouse Energy Group PLC
  • 04 Feb 21
ContourGlobal - Initiation Note

ContourGlobal is a pure-play contracted energy generator that acquires, develops, and operates a technologically diverse range of renewable and thermal assets around the world. It currently controls c.6.3GW of generation capacity with 119 assets in Europe (46% of EBITDA), Latin America (31%), US and Caribbean (13%), and Africa (10%). This business was designed and built to produce stable cashflows and thus benefits from long, mostly inflation-protected, take-or-pay, predominantly fixed-price (or regulated tariff) contracts – with commodity price pass-throughs on thermal production. Its counterparties are usually government-linked entities or large, investment-grade multi-national corporates. It insures political risk (though hasn't ever had to claim) and hedges currency risk. It has a record of operational excellence in both building and re-structuring power production assets, achieving improved safety, output, and cashflows from the existing assets it takes on.

Companies: ContourGlobal Plc
  • 05 Feb 21
THE MONTHLY February 2021

In the past two years, since Hardman & Co first started to target the IC sector, we have heard many managers of ICs and boards talk of the growth of the retail investor on their registers. Many have approached Hardman & Co for help in addressing this market, since we have a unique strength in this field relative to other providers.

Companies: AVO ARBB BBGI CLIG DNL FLTA ICGT OCI PCA PIN PHP RECI STX TRX VTA YEW

  • 25 Feb 21
Progress In Generation And Pellets

The Drax prelims show continued progress in generation and pellet production with the impacts of COVID 19 on the customers business within expectations. The company is delivering cost reductions in its pellet supply business and this business will be significantly expanded with the proposed acquisition of Pinnacle Renewable Energy, turning the company into a major vertically integrated biomass business.

Companies: Drax Group plc
  • 25 Feb 21
FY20 – in line with expectations

EBITDA was down by nearly 10% over the year but was perfectly in line with the consensus. In the first months of FY21, the group is still impacted by lower waste volumes but offset by a positive price effect – in all, FY21 EBITDA is expected to increase by more than 10% to finish above €4bn. The group also intends to restore its pre-pandemic dividend policy. We will slightly increase our figures, but no significant changes are expected.

Companies: Veolia Environnement (VIE:EPA)Veolia Environnement SA (VIE:PAR)
  • 01 Mar 21
FY 20 results - in line

FY20 figures were mainly impacted by already known elements: COVID-19-related impact on volumes (€1.2bn at the COI level) and FX fluctuations (€0.4bn), but EBITDA and COI were respectively 3.3% and 5.7% above expectations. However, the proposed dividend of €0.53/share is well below our current model (but roughly in line with the consensus). Even if FY21 guidance is slightly below market expectations, we confirm our positive view – based on the expected growth in renewables.

Companies: Engie (ENGI:EPA)ENGIE SA. (ENGI:PAR)
  • 03 Mar 21
Satisfactory end to a challenging year

Aggreko announced its FY20 results which were largely in line with market expectations. The company’s performance was negatively impacted by pandemic-induced restrictions and lower oil prices. However, the activity levels across key end-sectors are improving with management announcing a final dividend of £10/share. As a reminder, Aggreko is the target of an acquisition bid by a consortium of TDR Capital LLP and I Squared Capital in a deal worth £2.2bn.

Companies: Aggreko plc
  • 18 Jan 21
PowerHouse Energy: 'Part of solution to two of the greatest environmental challenges of this decade'
powerhouse-energy-part-of-solution-to-two-of-the-greatest-environmental-challenges-of-this-decade-
  • 16 Nov 20
Renewi - executive interview
renewi-executive-interview-16-11-2020
  • 21 Dec 20
Powerhouse Energy Group plan to become 'significant player in UK energy market as well as overseas'
powerhouse-energy-group-plan-to-become-significant-player-in-uk-energy-market-as-well-as-overseas-
  • 02 Nov 20
Renewi - EKF interview
renewi-ekf-interview-02-11-2020
  • 23 Dec 20
Watch: VivoPower announces US$250m deal
watch-vivopower-announces-us-250m-deal-23-12-2020
  • 07 Sep 20
Filta Group 'ready to drive forward' with rights to disinfectant to help stop spread of Covid-19
filta-group-ready-to-drive-forward-with-rights-to-disinfectant-to-help-stop-spread-of-covid-19
  • 01 Jul 20
Powerhouse Energy CEO updates on commercial development and plans for future rollout
powerhouse-energy-ceo-updates-on-commercial-development-and-plans-for-future-rollout
  • 11 Aug 20
Renewi - executive interview
renewi-executive-interview-11-08-2020
  • 24 Aug 20
SIMEC Atlantis Energy seals deal to finance 100% of Uskmouth Phase 1 project
simec-atlantis-energy-seals-deal-to-finance-100-of-uskmouth-phase-1-project
  • 07 Aug 20
Fundraise clears way to financial close at Uskmouth says SIMEC Atlantis Energy Ltd's CEO
fundraise-clears-way-to-financial-close-at-uskmouth-says-simec-atlantis-energy-ltd-s-ceo
  • 24 Jun 20
SIMEC Atlantis says positive Uskmouth test results have 'huge implications for viability of project'
simec-atlantis-says-positive-uskmouth-test-results-have-huge-implications-for-viability-of-project-
  • 28 Jul 20
Vivo Energy - 2020 interim results video
vivo-energy-2020-interim-results-video-28-07-2020
  • 24 Mar 20
Powerhouse Energy: 'Progress on track and as scheduled' as it moves Protos forward
powerhouse-energy-progress-on-track-and-as-scheduled-as-it-moves-protos-forward
  • 14 Jul 20
Filta Group Holdings CEO reveals recent trading update highlights
filta-group-holdings-ceo-reveals-recent-trading-update-highlights
  • 10 Dec 18
Executive interview – 2G Energy
executive-interview-2g-energy-10-12-2018

Latest Content

Satisfactory end to a challenging year

Aggreko announced its FY20 results which were largely in line with market expectations. The company’s performance was negatively impacted by pandemic-induced restrictions and lower oil prices. However, the activity levels across key end-sectors are improving with management announcing a final dividend of £10/share. As a reminder, Aggreko is the target of an acquisition bid by a consortium of TDR Capital LLP and I Squared Capital in a deal worth £2.2bn.

Aggreko plc

  • 03 Mar 21
  • -
Vivo Energy plc - Full Year Results 2020 highlights

Vivo Energy Plc

  • 03 Mar 21
China Water Affairs Group - Termination of coverage

Edison Investment Research is terminating coverage on China Water Affairs Group (855), CREALOGIX Group (CLXN), FCR Immobilien (FC9), HarbourVest Global Private Equity (HVPE), Marble Point Loan Financing (MPLF), Paion (PA8), PDL Biopharma (PDLI), Redhill Biopharma (RDHL) and Targovax (TRVX). Please note you should no longer rely on any previous research or estimates for these companies. All forecasts should now be considered redundant.

China Water Affairs Group Limited

  • 01 Mar 21
  • -
SP Angel Oil & Gas Daily Flow: 01/03/21

Market update 01/03/2021

CZN LOGP UJO

  • 01 Mar 21
  • -
Resilient results, strong outlook

Results were well trailed in January’s trading update. In the event, adjusted PBT emerged marginally ahead of FY2020, despite material impacts from Covid-19 and a depressed oil price. Although biomass incinerators were closed for much of the second quarter, the Group grew sales from residues from Energy from Waste (‘EfW’) by 15% and signed a further 6 new contracts, maintaining its high win rate. The outlook for EfW remains very strong with c.40 plants in planning or construction that provides the opportunity for Augean to double its current EfW revenues and profits of c.£20m and c.£14m over the longer term. Group operating margins are forecast to reach 25% and cash generation is strong, supporting a 3.5% yield on a resumed forecast dividend. EV/EBITDA multiples for FY2021E, FY2022E and FY2023E are 6.2x, 5.3x and 4.3x, which are well below established industrial sector metrics.

Augean PLC

  • 01 Mar 21
  • -
FY 20 results - in line

FY20 figures were mainly impacted by already known elements: COVID-19-related impact on volumes (€1.2bn at the COI level) and FX fluctuations (€0.4bn), but EBITDA and COI were respectively 3.3% and 5.7% above expectations. However, the proposed dividend of €0.53/share is well below our current model (but roughly in line with the consensus). Even if FY21 guidance is slightly below market expectations, we confirm our positive view – based on the expected growth in renewables.

Engie (ENGI:EPA)ENGIE SA. (ENGI:PAR)

  • 01 Mar 21
  • -
THE MONTHLY March 2021

UK railway privatisation, which was launched in the mid-1990s, has finally turned full circle: the Department of Transport has recently confirmed that its controversial railway franchise system will be scrapped. In this month's feature article, Nigel Hawkins, the Infrastructure analyst at Hardman & Co, examines the 25-year history of railway privatisation and chronicles its ups and its downs. The successes of railway privatisation, such as new rolling stock, are addressed, along with the many shortcomings, which included minimal vertical integration. With the winding up of the franchise system, the UK railway sector is effectively reverting to its former status as a nationalised industry, a shift started with the renationalisation of the collapsed Railtrack – later re-badged as Network Rail – in 2001.

ARBB BBGI CLIG DNL FLTA ICGT OCI PCA PIN PXC RECI SCE TRX SHED VTA YEW

  • 01 Mar 21
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Strong end to FY2020 on the back of continued recovery in H2

Elecnor reported a flat FY2020 top line, on the back of the recovery in core operations such as energy generation and transmission, and telecom infrastructure during the second half of the year. The group’s order-book (€2.27bn) improved marginally from last year with c.73% of contracts related to international markets. Looking ahead, management expects a better performance in FY 2021 supported by a strong order pipeline, the strategic nature of operations, and geographic diversification.

Elecnor (ENO:BME)Elecnor S.A. (ENO:MCE)

  • 26 Feb 21
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FY 20 in line, with a promising FY21 guidance

The figures for 2020 are broadly in line with expectations, and the good surprise comes from the guidance for 2021. The company still refuses Veolia’s bid, but seems increasingly stuck. Overall, the change in model is not expected to be significant.

Suez (SEV:EPA)SUEZ SA (SEV:PAR)

  • 26 Feb 21
  • -
FY20 - a weak set of figures

Affected by volumes which were lower than their long-term average and weak commodity prices for the upstream division, the group published a disappointing set of FY20 figures. Although the group’s efforts on its cost structure are notable, we maintain a cautious view on inventory due to the economic uncertainty that could erode cash generation (due to an increase in working capital requirements, among other things).

Centrica plc

  • 26 Feb 21
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