Pennon Group PLC Full Year 2019/20 Trading Statement (9582H)
30 Marzo 2020 - 12:00AM
UK Regulatory
TIDMPNN
RNS Number : 9582H
Pennon Group PLC
30 March 2020
30 March 2020
PENNON GROUP PLC
Full Year 2019/20 Trading Statement
Pennon, one of the UK's largest environmental infrastructure
groups, is issuing the following update ahead of its results for
the year ended 31 March 2020, which will be announced on 4 June
2020.
Key highlights
-- Group performance for 2019/20 in-line with management expectations
-- We are doing all we can to support our employees and
customers through this unprecedented COVID-19 epidemic, with the
Group being well positioned with strong funding and liquidity to
weather current uncertainty
-- South West Water has outperformed in K6 (2015-20) on TOTEX
and financing and will end the five year period to 2020 in a net
reward position on Outcome Delivery Incentives (ODIs)
o Revenue for 2019/20 has reduced, driven by prolonged wet
weather with rainfall 50% more than the levels seen last year and
higher than long-term averages. Year on year shortfalls in revenues
(compared with the Final Determination) are subject to a revenue
true-up mechanism in future years
o Operationally the business has performed well, ensuring
minimal impact to customers at times of extreme wet and stormy
weather
o Water resources now over 95%
-- Viridor continues to perform well - focused on operational
excellence and driving ongoing efficiency
o Growth in energy recovery with ramp-up of existing plants.
Avonmouth Energy Recovery Facility (ERF) is now in commissioning
and contributing to earnings, operational ramp-up expected during
2020/21
-- Announced on 18 March 2020, the sale of Viridor to Planets UK
Bidco Limited, a newly formed company established by funds advised
by Kohlberg Kravis Roberts & Co. L.P. for an Enterprise Value
of GBP4.2 billion. The transaction is expected to complete in
Summer 2020
-- Following the sale of Viridor, Pennon will focus on its
sector-leading water and wastewater businesses and will continue to
pursue growth within the UK water industry.
COVID-19
In these unprecedented times, the health and safety and
wellbeing of our employees and customers is paramount and our
number one priority during the COVID-19 epidemic. We are doing all
we can to support them and help prevent the spread of the virus.
Following the latest Government and Public Health guidance, we have
strict precautions in place at our sites including enhanced levels
of cleaning, additional hygiene facilities and social distancing.
Many of our employees are designated key workers and are delivering
the best possible service to customers during this challenging
time. Enhanced precautions and safety checks are in place and only
essential customer visits are taking place, everything possible is
being handled remotely. We know that this is a difficult time for
our customers, and we have stepped up our support for those on our
priority services register and customers that need extra support
with their bills during this period.
Outlook
The Group is well positioned with strong funding and liquidity
to weather the current uncertainty as a result of COVID-19, but we
continue to closely monitor the current situation as it develops.
GBP840 million of new or renewed finance was raised in 2019/20,
including GBP245 million of funding through the Sustainable
Financing Framework for South West Water. The Group has c.GBP1.6
billion of cash and committed facilities providing liquidity, with
Pennon's GBP300 million perpetual capital security approaching the
first call date in May 2020.
On completion of the sale of Viridor, Pennon will continue to
focus on its sector-leading water and wastewater businesses and
will consider further growth opportunities that create value for
customers, employees and shareholders. A further update, alongside
a new dividend policy will be provided at the Full Year Results on
4 June 2020.
South West Water accepted Ofwat's final determination for K7
(2020-25). Whilst revenues in K7 have reduced, reflecting the
re-based cost of capital allowance across the industry, we are
focused on delivering for our customers and communities. Work is
already underway to deliver our business plan, with capital
investment being advanced to support delivery of the ODIs on
leakage, supply interruptions and pollution incidents. Further
information on our K7 Business Plan is available here:
https://www.pennon-group.co.uk/system/files/uploads/financialdocs/sww-fd-investor-summary.pdf
For further information, please contact:
Chief Financial Officer
Susan Davy Director of Corporate Affairs & Investor
Sarah Moody Relations 01392 443
Jennifer Cooke Investor Relations Manager 168
James Murgatroyd 020 7251
Harry Worthington Finsbury 3801
Cautionary statement in respect of forward-looking
statements
Certain statements in this announcement are forward-looking
statements relating to the Group's operations, performance and
financial position based on current expectations of, and
assumptions and forecasts made by, management. They are subject to
a number of risks, uncertainties and other factors that could cause
actual results, performance or achievements of the Group to differ
materially from any outcomes or results expressed or implied by
such forward-looking statements. The Group's principal risks were
described in the 2019 Pennon Group Annual Report which can be
viewed online at http://annualreport.pennon-group.co.uk/ Such
forward looking statements should therefore be construed in light
of such risks, uncertainties and other factors and undue reliance
should not be placed on them. They are made only as of the date of
this announcement and no representation, assurance, guarantee or
warranty is given in relation to them including as to their
accuracy, completeness, or the basis on which they are made. No
obligation is accepted to publicly revise or update these
forward-looking statements or adjust them as a result of new
information or for future events or developments, except to the
extent legally required. Nothing in this Statement should be
construed as a profit forecast.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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