Centrica Share Discussion Threads

[andyj] 27/11/2017 09:11

823,000 customers lost = 6% of the total, hardly hand over fist. Besides, politically, it might keep the wolves from the door.

[nortic 007] 27/11/2017 09:07

I hate to burst your bubble gents but The Express would turn a shower of rain into a torrent and then tropical. It's the only way they can sell papers.

[gswredland] 27/11/2017 09:02

That's a point Ham - weather due to get really cold and it isn't December

[essentialinvestor] 27/11/2017 09:00

Mark, the post was just to point out existing challenges facing the business,
outside of any legislative, regulatory changes.

[hamhamham1] 27/11/2017 08:20

Karateboy. Wise words. Was interesting what you said about output levels of the Nuclear powerstations. I presume cna have 20% of this EDF division? Its quite handy to see the current outputs. hxxps://www.edfenergy.com/energy/power-station/daily-statuses

[hamhamham1] 27/11/2017 08:05

Wack the heating up... winters coming.

[minerve] 26/11/2017 23:33

Centrica have economies of scale and brand strength. They could use it to good affect to stifle the new entrants anytime they choose to, however, it would cost them. It would cost shareholders too. They are having to tread a very careful line between profitability and not attracting too much attention from politicians and regulators. I am sure the big boys could kill the spot market for the little fish if they wanted to. They could also buy new entrants or start new ones themselves. It is difficult to do this whilst political risk and regularity risk is high. Just need to bide 'our' time. Patience will be rewarded IMO when the time is right. Now isn't that time. Let the low value customers go. It would probably cost more to keep them and they are unlikely to be great candidates for upselling which is part of the Centrica business plan going forward.

[supermarky] 26/11/2017 23:11

Centrica is losing customers but I believe their strategy was to have less customers but to make more money on the ones they have (and also to up sell things like hive, local heroes, boiler care etc?).

[supermarky] 26/11/2017 23:07

There is no valuing this company. EI; you point out the negatives of which there are many. There are two sides; positive and negative. Are we for the rest of our days going to see negative negative negative and watch the price fall from effectively 400 to 130? 120? All the way to 0? We have come from 400 ish to 130 odd in such a relatively short period of time. Sentiment can and I believe will change. Cna will find a new trading range and eventually will slowly appreciate. I remember aal last year. Look at it now! Markets overreact. I will reinvest my divi and wait patiently. Patience is the key. Everybody seems to want instant gratification these days.

[minerve] 26/11/2017 13:23

Fundamentals are still in place.

Cheap money has just changed business emphasis by lowering operational focus and increasing financial focus. The increase in money supply has just extended PEs and this will remain so until world GDP catches up with the increase in money supply IMO.

If you make allowances for this fundamentals are still in play.

[nortic 007] 26/11/2017 13:23

andjI remember reading broker notes following Anglo figures about a year or so ago.They all predicted the end of the world. How wrong they were.

[essentialinvestor] 26/11/2017 13:19

There is some confusing of the issues facing CNA imv.


Outside of ANY government legislation, Centrica is currently losing
domestic accounts hand over fist.

Coupled with this their US business is now finding trading conditions far more
competitive.

Initiatives such as HIVE appear to have largely fallen flat.

All of the above has nothing to do with May, Miliband, Corbyn, they are commercial
issues facing CNA, outside of any regulatory, legislative changes.

[andyj] 26/11/2017 13:17

Interesting to note that I am not the only one who feels the traditional way of valuing companies has changed, however it depends how long your time frame is. Over the short term, which might be a couple of years, the hedge funds have enormous collective power and it is true, they aren't interested in yields or PE ratios, they have their own agenda and it works for them. It is easy and naive of a Times journalist to sound the death knell of fundamentals based on that. Over the long term, fundamentals hold sway. It wasn't long sgo that BP, Bay, Shell, Anglo American etc were trading at all multi year lows and the point was being made about them. BP has risen 70% since then and Anglo Am has risen 700%. The bigger question for us private investors is, does buy and hold make sense given the volatility? For those holding IHG, or RB it does, but few others have gone up in a steady uptrend. The vast majority are cyclical, trading within ranges and occasionally overshooting before returning to their range. The list of companies were buy and hold hasn't worked is too long to write.

[careful] 26/11/2017 12:33

same with the Brexit cash.
talk about £8bn p.a. for 5 years.

that is £8bn out of an annual spend of £800bn.
just 1%, or £40bn out off $4000bn.

The economy (and Centrica) are being crushed by economic ignorance.

[nortic 007] 26/11/2017 12:27

Karateboys Thank you

[karateboy] 26/11/2017 12:23

Centrica paid £2.3b in 2009 for 20 % of BE nuclear generation. It was part of its strategic investment on having low carbon generation.Nuclear fleets are doing very well with record generation but suffering from low electricity prices. Centrica decided not to take any stake in new nuclear build. That was a good decision, with HPC 3000 MW twin reactors costing £15b to build . Chinese may be interested to buy Centrica 20% nuclear stake if government allows it.

[nortic 007] 26/11/2017 10:36

CarefulI've seen this type of commentary before and it's all after the Lord Mayor Show. If the likes of CNA and others look like they are taking steps to address the issues then get in there first, then maybe the regulators won't come down on them so hard.When stocks hit lows there's never a clear signal to buy because everyone at their most bearish...... history tells you that.Only time will tell but keep your chin up.

[careful] 26/11/2017 10:23

I too feel the need to post very early today having read the three Sunday Times articles.(10 o'clock is early for a gentleman)

The Ian Day bit explaining market volatility and the huge one day share swings, often followed by a rebound, was interesting.
As we suspected, caused by algo momentum trading, but since the crash no proprietary trading allowed to snap up bargains and hence reduce the fall.

The article featuring Conn headed, 'we are not going to be a dinosaur' explains how Centrica are under attack from all sides.
Conn tried to reassure but was not convincing.Analysts at Deutsche said there were 'existential' threats to Centrica.
But that Centrica still had 13.1m accounts after the recent losses was comforting.

The article about tariffs 'energy firms on thin ice over rip off rates' added to the gloom.

And to cap it all Luke Johnson wrote about how the old fundamental ways of valuing companies, PE, Yield, cash flow is over.

Crikey, we buy Centrica to get a quiet steady life and we are headline news every damn day. A perfect storm, we need to look away.

[nortic 007] 26/11/2017 07:52

Russell250MorningYou're as keen as I am on this frosty morning. Read The Times plus there's a piece in The Mail. I'm just hoping that they can get their backsides into gear and sort this mess out. It does seem like Conn is determined to do this under his watch. I still think it would have been prudent of him to have reduced the dividend and cut out the future uncertainty. The irony is that if they were to find buyers for their nuclear stake or even someone who might look at the company as a whole it would then be opposed by Government. I'd be interested to know what their 20% nuclear stake could be worth.Have a good day.

[russell250] 26/11/2017 07:33

three articles in todays times -- most interesting the piece by Iain Dey

" why those market swings so wild "

looking at price reversals from ftse huge falls this year


Suggests a Centrica rebound


Separate article - the 20% nuclear stake in 8 power stations up for grabs

[diku] 25/11/2017 21:16

You scratch my back I scratch your back...isn't that what goes in the Remuneration Committee?...has there ever been a situation when a committee member questions CEO's salary within Plc Casino markets on performance or a non performer?...how do you put a benchmark formulation on salaries?...it is all telephone numbers!!...and as for the free share issue ban the lot within Plc..

[richj5000] 25/11/2017 20:01

If I was the CEO I really don't think I could go into head office and look staff in the eye. His salary is absolutely ridiculous.Note to the Remuneration Committee - Get a grip!Note to CEO - Take a pay cut!

[masurenguy] 25/11/2017 16:24

Analyst Ahmed Farman retained his ‘hold’ recommendation and target price of 190p on the stock, which was trading down 15.6%, or 25.5p, at 138.1p at the time of writing. Markets were upset by news that the company had lost 823,000 domestic UK customer accounts between June and October after British Gas raised standard electricity prices by 12.5%. The company warned full year earnings per share would also fall short of expectations as a result of problems in its North America division.

‘2017 is on track to be another tough year for Centrica,’ said Farman. ‘The company has indicated that full-year 2017 earnings per share would be 12.5p, a substantial 19% miss at consensus, due to tough operating conditions. ‘Although there appears to be a commitment to pay 12p dividend per share - similar to 2016 - the negative trajectory in earnings would disappoint many,’ he said. He added that dividend growth looked unlikely - even though the full year dividend is underpinned. This is because earnings-per-share is expected to be 26% lower year-on-year. ‘This suggests to us that dividend growth is unlikely in 2017, and it likely to be in line with 2016 dividend of 12p. This means the stock currently trades on 7.5% dividend yield.’

[gaffer73] 25/11/2017 16:02

Too right rich, I'd do it for 500K and probably do it better.!