In a year during which tariff restrictions from regulator Ofwat's latest five-year price review came into force, water and waste management utility Pennon still managed decent revenue growth. That largely reflected an enhanced contribution from its waste services subsidiary, Viridor.
Indeed, a raft of recent acquisitions, together with improved performances at Pennon's joint ventures, combined to boost Viridor's revenues by 14 per cent in the period to £712m. What's more, even without the boost from acquisitions, Viridor's existing recycling and waste conversion businesses still grew revenue by £44.9m in the year. Meanwhile, South West Water managed a stable performance, with revenue there up by a percentage point to £449m - increased customer numbers and rising summer demand cancelled out a £6.9m fall in turnover as customers switched to metered tariffs. And, despite a savage winter, South West Water also managed to meet its annual leakage target and cut costs by £8.3m.
The integration of the new businesses pushed up group wage and raw material costs by around a quarter, while Pennon's cash profits remained broadly flat at £403m. Credit Suisse anticipate adjusted 2012 EPS of 43.1p a share.
| PENNON (PNN) | ||||
|---|---|---|---|---|
| ORD PRICE: | 661p | MARKET VALUE: | £2.4bn | |
| TOUCH: | 660-661.5p | 12-MONTH HIGH: | 681p | LOW: 482p |
| DIVIDEND YIELD: | 3.7% | PE RATIO: | 14 | |
| NET ASSET VALUE: | 218p* | NET DEBT: | 248% | |
| Year to 31 Mar | Turnover (£bn) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2007 | 0.75 | 131 | 26.5 | 18.6 |
| 2008 | 0.88 | 150 | 38.2 | 19.8 |
| 2009 | 0.96 | 159 | 25.8 | 21.0 |
| 2010 | 1.07 | 186 | 40.4 | 22.6 |
| 2011 | 1.16 | 189 | 48.4 | 24.7 |
| % change | +8 | +2 | +20 | +9 |
Ex-div: 10 Aug Payment: 7 Oct *Includes intangible assets of £297m, or 83p a share | ||||
