Centrica Share Discussion Threads

[discodave4] 23/3/2019 11:33

......you keep ignoring their cash burn, only 8 months on a like-for-like basis and £350m reduction to come.

[the logician] 23/3/2019 11:07

great news if CNA sells nuclear for £1.7bn




The eight nuclear power stations, which used to be grouped under British Energy, generate 8.9 gigawatts of electricity and supply about 20% of Britain’s electricity needs. They were bought by EDF for £12.5bn in 2008. The following year, Centrica took a 20% stake, which it values at £1.7bn.

[the logician] 23/3/2019 11:00

revenue is significant as there is plenty of fat that can be trimmed. dividends can easily be paid from cash flow...




In 2019 we continue to face a number of challenges. Our 2019 adjusted operating cash flow will be impacted by the UK default tariff cap which was introduced on 1 January 2019, including an unexpected one-off impact of GBP70m in the first period of the cap. In addition, Spirit Energy volumes are expected to remain in the lower half of its 45-55mmboe range, nuclear volumes remain impacted by current outages while cash tax will be higher than in 2018 reflecting the timing of payments. These impacts will be partly offset by cost efficiency. Taking these factors into account, we are targeting 2019 adjusted operating cash flow in the range GBP1.8bn-GBP2.0bn, which is below the targeted range of GBP2.1bn-GBP2.3bn on average over 2018-20.

Against this backdrop, we are taking a number of further actions to strengthen the company in 2019 and improve underlying performance in 2020. These actions also underpin our 2018-20 target of maintaining Group net debt in the range GBP2.7bn-GBP3.7bn, which has been updated to reflect the adoption of IFRS 16. They include divestments of non-core positions totalling GBP500m, of which the first GBP230m has already been achieved through our disposal of the Clockwork home services portfolio in North America. In addition, cash capital investment including any small acquisitions is expected to be around GBP1.0bn in 2019.

The actions also include further cost efficiency delivery. Having achieved GBP248m of cost efficiency savings in 2018, taking cumulative savings relative to 2015 to GBP940m, we are targeting a further GBP250m of savings in 2019 meaning we will have achieved our 2018-2020 target one year early. We are also targeting an additional GBP500m of annualised savings beyond 2019, as we target becoming the "most efficient price setter" in our chosen markets. This would take total efficiency programme savings since 2015 to GBP1.75bn. These actions will underpin our performance, resilience and competitiveness against a challenging and uncertain backdrop.

Our strategic direction remains aligned to external trends, despite regulatory challenges and falling energy use per unit gross domestic product in our core markets. Our propositions are shifting towards what customers need and want and are not limited to energy supply. We are now exposed to an expanding opportunity set, in terms of customers, channels and geography. We have built material new capabilities in Centrica Consumer and Centrica Business and are seeing indicators of stabilisation and growth potential.

We continue to improve and simplify our portfolio of businesses, with non-core divestments and the ongoing Nuclear disposal process. We are also focused on improving the performance and sustainability of the Spirit Energy portfolio, while limiting Centrica's exposure to the sector and creating options for the future. Overall, our focus remains on performance delivery and financial discipline as we continue to satisfy the changing needs of our customers.

[discodave4] 23/3/2019 10:58

Does anybody know what the impact on rev from last years "Beast from the East" was?, know it cost them circa £83m in operational/servicing costs but what was the net impact?.Thanks

[nortic 007] 23/3/2019 10:52

Short term pain,long term gain is my view regarding the dividend reduction.Off for a run now.Busy this weekend JP ?

[discodave4] 23/3/2019 10:47

Morning,"there is no need to cut the divvie, it only costs around £550m per annum.... peanuts on £30bn of revenue.""Only" jeez, no offence but comparing the div to revenue is absolutely ridiculous. Try comparing it with profit/earnings as that's where it comes from - adjusted (Bull) £631m and statutory (true) £183m.It has to be cut (halved IMO).

[jpjohn1] 23/3/2019 09:44

I agree Nortic, I would like this to carry on paying 10% div, but I'm also realistic. Should get 8,400 pounds div on the 9th ( I own 100,000 shares at the moment) which is a nice payout. I have never been short either

[nortic 007] 22/3/2019 23:24

FYII'm long not short

[nortic 007] 22/3/2019 23:24

If you thought that maintaining the dividend would be a hindrance on the share price would you still take it ?

[nortic 007] 22/3/2019 23:22

If you thought a reduction in the divi would help in the long run would you take it ?

[tim 3] 22/3/2019 23:06

Yes 10% yield does put it firmly in possible cut territory.

Can see some wild swings in the next few weeks in the broader market with the Brexit mess particularly if the US starts to weaken too.

Hope if they do cut it removes some uncertainty.

Good luck all have a great weekend.

[the logician] 22/3/2019 23:04

for the yield to fall to "a more realistic" 6-7%....

thats easy- the share price can rise to 171p to 200p trading range! ex div!

there is no need to cut the divvie, it only costs around £550m per annum.... peanuts on £30bn of revenue.

[nortic 007] 22/3/2019 22:44

Hi jpJust got back from Wembley with my young lad. I just thought it was prudent for a cut but hasn't really gone down well. Have a good weekend and keep smiling

[jpjohn1] 22/3/2019 22:28

I think realistically like Nortic said earlier, this cannot carry on paying 10% dividend. After we get the final 8.4p in May I would not be surprised to see this dropping to a more realistic 6 - 7 %

[diku] 22/3/2019 21:59

Is there any part of the business that can be disposed of to realise value...

[jpjohn1] 22/3/2019 21:58

Note the Dow had a good drop has well this evening like the FT 100 earlier. Dow -460 points -1.8%

[jpjohn1] 22/3/2019 21:45

Like to think this will hit the 130p mark with going xdiv 9th May.

[diku] 22/3/2019 21:15

Good to see this going below 120p...get ready for 100p only matter of time... the board are living in their comfy world detached from the real world...paying 10% divi...of course they also have shares and the luxurious salary/fees...

[discodave4] 22/3/2019 19:15

Hi whatsup,I still haven't managed to locate that article from thefool recommending a buy. Can you recall when it was?, or post up the link please.

[whatsup32] 22/3/2019 18:05

CNA holders should be happy campers today barely down .7%. where as elsewhere -2.5% to -50%.

[jpjohn1] 22/3/2019 17:58

Neutral GBX 144 ? GBX 1283/8/2019 HSBC Lower Price Target Hold GBX 140 ? GBX 1203/8/2019 JPMorgan Chase & Co. Lower Price Target Overweight GBX 170 ? GBX 1503/1/2019 Jefferies Financial Group Lower Price Target Hold GBX 125 ? GBX 1102/27/2019 Royal Bank of Canada Lower Price Target Underperform GBX 130 ? GBX 1152/22/2019 Goldman Sachs Group Downgrade Neutral GBX 158 ? GBX 1322/18/2019 Berenberg Bank Downgrade Hold GBX 155 ? GBX 1401/23/2019 Credit Suisse Group Downgrade Neutral GBX 180 ? GBX 1551/17/2019 Morgan Stanley Reiterated Rating Underweight GBX 1051/16/2019 Kepler Capital Markets

[jpjohn1] 22/3/2019 17:58

Evening chaps, with all the swings in the week it finished quite flat. We lost only 1.35p or 1.1% and the FT 100 - 20.71 points. 12 Wall st analysts have us at Buy 2, Hold 7, sell 3And a consensus of 127.73pCNA hit a high of 123.2p and a low of 118.2p Have a good weekend all. :)