|British Energy Group
||EPS - Basic
||Market Cap (m)
Real-Time news about Brit.Eng.Gp (London Stock Exchange): 0 recent articles
|speedy: Hmmm ... things that could boost the share price:
possible "raising load above 70%"
Hunterston's ten years from start to electricity production, and now this
"Yesterday, a "highly placed source" in Moscow was reported as saying the Kremlin intends to turn off the oil export pipeline to the EU on Monday, so great is Russian ire about the rhetoric in Brussels and warships in the Black Sea. If this is true, we are entering a whole new ball game in what has come to be called "energy security". Even if the report proves false, the west should be on red alert about energy export weaponry.
Barely noticed in the runup to the crisis in Georgia, Russia signed a deal that gives its energy giant Gazprom control over gas supply from neighbouring Turkmenistan - one of three former Soviet satellite states around the Caspian sea on which Europe is pinning its hopes for a future gas supply. This Turkmen coup deepens Britain's possible energy dependence on Russia as North Sea production falls away. "|
|nabcom: RNS Number : 3048W
British Energy Group PLC
09 June 2008
British Energy Group PLC
9 June 2008
British Energy Group plc update on discussions
On 16 May 2008, the Board of British Energy announced that it had received a range of
proposals from several parties wishing to make a
full offer for the Company including the Nuclear Liabilities Fund's convertible cash sweep
Since then, discussions have continued. However, none of the proposals put forward so far
is above the share price at the close of
business on Friday 6 June. The Board is clear that in current circumstances such proposals do
not represent value for shareholders as they
fail to take proper account of the current forward price of electricity and the value of the
Company's sites and people in the context of
nuclear new build.
The Board will continue to progress the opportunities available either through an offer for
the Company or other partnering arrangements
which maximise the value of British Energy's participation in nuclear new build. It expects
further discussions with interested parties.
There can be no certainty that any of the discussions will lead to an offer being made for
the Company nor as to the terms on which any
offer would be made.
A further announcement will be made in due course.|
|speedy: Wholesale electricity appears to be in the range £60 - £70 per MWh for the UK, and
has been for a while.
I thought that this should have pushed BGY's price a lot higher. Maybe double
profits, double share price?
I'm wondering what I've missed???|
|phillip evans: spacemoggy, many thanks for your post, the support level is at what share price based on the support line ?|
I think the Hinckley/Hunterston news is in the price and there is potential upside if the reactors can be returned to service at greater than 70% power. On a site by site basis, at current power prices (£40+) on forward contracts they are still going to make a profit and any uplift in power later deemed commercially viable on against possible loss of life extension will be positive for the share price.
However, if prices move to, and possibly move below £25/MWH then I think the economic case may be much much harder. Having said that Dungeness B has defied grim reaper for more years than I care to mention. Dungeness B may have escaped the chop for many years because the decommissioning costs would have been more expensive in the short term than repair and BGY would have born the cost pre reconstruction in 2003, however, that's not the case now with the NDF. If any of the stations look as if they are long term uneconomic then they can be handed over to the NDF who pay the costs from there on.
For those looking for good news (sat69!) the capital spend on plant improvement should improve plant reliability and technically increase output. However, much of this money is cash that should have been spent years ago. On the negative side (sorry Sat69) the number of "surprises" that regularly jump out of the woodwork still don't look good.
I believe that this is basically down to the design of the AGR's. If you buy a Lada with lots of gadgets how long would you expect to be on the road for?
Ultimately the biggest factor in the near term will be the forward price of electricity. If this keeps falling and increased output does not compensate then something is going to have to give. They will either have to dump the loss makers (potentially Hinckley/Hunterston/Dungeness) and cut back on internal investment in the plant.
On the positive side (keep reading sat69...) as mentioned in the previous post the electricity market must be rigged by either guaranteed prices to nuclear or it simply won't get off the ground with private finance. If they want nuclear build then this has to be sorted first to get the finance to come forward. On that basis a rigged market for nuclear could be with us within 2 years.
I would be very surprised if the current BGY management were not in regular discussions with government. A further financial debacle at BGY when trying to get a new wave of nuclear power station built would be a dream come true for Greenpeace and the government will be very keen to avoid that.
A further positive must be the governments current 2/3rds share holding. If BGY is not in the new build programme then the company will simply wither away as its plants close and the government will loose heavily with it.
I think what I'm saying is that the government has too many fingers in BGY's pie to simply "let the market decide". It will of course let the market decide after the market has been rigged to ensure that the market gets the right answer.
When, where and more importantly how, I just don't know. But if something very major has not happened within the next 12 months on this front for BGY I would be very worried for the share price given the points I made in the previous post.
Happier now Sat69?|
|watwungyi: The company is earning well, but the prospect of maintaining current level of profit is quite uncertain. No wonder share price is doomed. It's highly likely that new nuke power stations are to be built. But what is not clear is which role BGY is to play in the future. Will its aging reactors be decommissioned altogether and the govt allow French and German firms build power station, selling all its stake there. Second sceniario is unlikely. First BGY already has expertise. And I think executive Bill Coley is steering it well, for example, his vision to fix the energy price for next couple of years. He's been in business for 40+years. And it would be a disgrace for the govt to overlook its own energy firm and give it to Frenchy. So what could happen is BGY still have a good role to play in future energy project.
We might have to put up with 70% output for two reactors till 2011. And they will build new ones, but will not invest on the two ageing reactors. So this might be a very good buying opportunity. The share could go further who knows? But in the long term its prospects are really good.|
|wapper: Doubts Over British Energy Stake Sale Talk
0903 GMT [Dow Jones] Collins Stewart urges caution on talk of the UK government selling part of its British Energy (BGY.LN) stake following the 3Q update this week. Analyst Lakis Athanasiou says any disposal is likely to be a sale of shares in the market. Says a trade buyer "could find British Energy attractive at these levels," but adds such a deal would be extremely difficult politically. Says share price would likely fall below 400p if the Government announces a sale. Reiterates buy rating, 515p target. Department of Trade and Industry not immediately available for comment. Shares +3.3% at 432.5p. (BBL)
Reactor Delays May Lower British Energy Shares
0739 GMT [Dow Jones] News that British Energy's (BGY.LN) two units at Hunterston B may not return to service until April instead of March could drag down the share price, says a London-based analyst. But otherwise the results, released Tuesday, showed "no surprises", he adds. (EHM)|
|oharebj: Oil, gold and gas are all sharply up over the last few days. The Nigerians have actually complied with OPEC and cut production. US/Iran tensions are rising - Tomorrow is the anniversary of the Iranian Revolution and they have threatened to target US assets worldwide if their nuclear facilities are attacked. It is alleged that they are supplying the missiles that have accounted for the 4 helicopters in Iraq over the past 2 weeks. Gold is up $30/ounce in the past fortnight, oil up 20% from a $50 low. Geo-political tensions are rising without doubt.Inflation is rearing its ugly head.
The point is, this notion that electricity prices are due to collapse is ridiculous and totally disregards political factors. Certainly the share is very volatile at present. It could dip a bit but the downside is very limited. The downed stations will come back on stream. This is a classic situation where lots of ill-founded negativity have driven down the share price to ridiculously low levels.
My advice - buy them on Monday and don't look at them til May/June. I picked up 5000 at £4.19 via a CFD and I will sleep easy in my bed at night. However, DYOR & make your own decisions. By the time the muddied waters clear the share price will have jumped considerably|
|watwungyi: I jumped in because the prospect for the company looks good. I first noticed it last year when shares are down to 400p. Then I studied some more details about it. The positive side is that it has kind of fixed electricity prices for next FY as well as some residual to sell direct to consumers, through British Energy I guess, which has been quite reputable among its customers.
Despite boilers issue, the management somehow is able to give us a figure for this year output and next year. Perhaps the news, which I expect very soon, that bust boilers are functionin to almost full capacity will help share price It has so much cash accumulated and capex will be around £300M for two consecutive years, these figures should be treated as a long term capital investment which should be amortised gradually. Divdend is said to be paid for the first time and the div yeild seems attractive. No minority interests, operations are only in UK added some assurance to the visibility of company's prospect.
The negative sides are that, first the future of nuclear energy is yet to be decided although successive govts will not be foolish enough to significantly reduce the amount of electricity generating from nuclear energy. It would woresen 'energy gap'. Secondly, the company has experienced financial crisis in the past and that has not completely gone away, the govt intervened and still act as a major shareholders. And if the lives of its reactors are not extended, then that's gonna be the end of it, as it has no exposure to alternatives, like BP.
Although its PE is low compared to Centrica of IPR or SPW and the likes, it might be that uncertain fuutre is reflected in low rating PE.
So we need to look at tradign update and 3rd quarter result out in Feb very carefully. I estimate its unit margin to be greater than £19/MWhr which includes amortisation. So if the £600M to be spent on improving its boilers and safety std are to be amortised over ten years, taking £60M each year and staff cost to remain in line with CPI, its cash flow for this year wil be nearly £200M and expect to increase quite significantly in 07-08 then gradually increase.
On the basis of these calculation, I estimate share price is undervalued. The only negative sentiment comes from boiler issues, which I think is not as bad as it was reported. After repair, output is bound to increase. So in the long term, this should be a good buy.|
|sandbank: Yes - you have to remember that the guy at the helm of BGY - Sir Adrian Montague - is a smooth-talking ex-Treasury insider who constructed the mind-bogglingly complex rescue plan that saved BGY. He finessed it through and turned the company around. He really has earned his knighthood and his CBE .I've seen him in action at BGY AGMs. He is a class-act.
The Government needs to have BGY's share price stable and at a reasonable level so it can dispose of its stake when the time comes.
As for the maintenance issues. Well they've been there all the time. If you run old power stations - like running old cars - you have to make sure they'll pass the equivalent of the nuclear MOT. I'm glad they're putting the equivalent of a new exhaust on these older stations - the UK can't manage without them. And where is about the only place they can built new stations? ....Why - where there's nuclear station already of course - and that means BGY will run them.|
British Energy share price data is direct from the London Stock Exchange