United Utilities Share Discussion Threads

[praipus] 20/1/2012 19:21

Regret to say Z we dont stand a chance:)

uncle China is here:

CHINA INVESTMENT CORP: BOUGHT 8.68% OF UK'S THAMES WATER
China Investment Corporation, China's Sovereign wealth fund, said Friday it purchased 8.68% of U.K. utility Thames Water. (published 0224 GMT)

and....

From December last year....

Macquarie Infrastructure and Real Assets, or MIRA, has sold a 9.9% stake in Kemble Water Holdings Ltd., the holding company of Thames Water, to Infinity Investments S.A., a wholly owned subsidiary of the Abu Dhabi Investment Authority.

Goodbye UK water utilities

[zeppo] 20/1/2012 19:08

Beardmore

Some of our major utilities are already in the hands of Germans, French etc but no longer PLCs.

With the Chinese, Canadian Teachers Pension Fund, Australians and others also muscling in, private investors could eventually lose most of these 'safe' earnings opportunities.

I try to diversify but do not look forward to the disappearance of 'dull' but safe utilities et al..


z

[beardmore] 20/1/2012 18:39

Seemingly other utilities - NG, UU, SSE and, a little riskier, VOD. Maybe not the most inspiring list, but I don't mind 'dull'.

[zeppo] 20/1/2012 18:11

Beardmore

I agree about the strength of DVW but there has not been any volume traded.

DVW seems tightly held.

Any takeover might be a mixed blessing.

Even with a profit, where do you invest it for safe inflation-linked income?



z

[beardmore] 20/1/2012 12:53

Someone's been buying Dee Valley - it has shown remarkable strength in recent months.

[alphorn] 20/1/2012 11:44

Read that China is buying some Thames Water - first purchase. Don't have a link.

[alphorn] 10/1/2012 15:44

This one just ticks along - for those option traders watch that June xd date just following June expiries.

[wad collector] 02/12/2011 23:36

United Utilities
603p -7
Questor says BUY

United Utilities Group

United Utilities, the UK's largest listed water company, plans to increase its payout to shareholders by two percentage points above the retail price index (RPI) between now and 2015.

In line with this policy, the company increased its interim dividend yesterday to 10.67p – a year-on-year rise of 6.7pc. It will be paid on February 1. The prospective yield in the current year is 5.3pc, rising to 5.6pc next year.

Obviously a sharp fall in RPI inflation would lower returns – and this measure of inflation is expected to decline next year.

RBS is forecasting that it will drop to 2.4pc by the end of 2012 and hit 1.9pc in 2013, compared with the current 5.6pc. However, the important thing about the payment is that it will be ahead of inflation.


The north west of England-based water group said that pre-tax profits had risen to £124.4m from £122.24m on revenues that rose 4pc to £792.7m in the six months to September.

However, on stripping out factors such as financing costs, which United argues gives a more representative view of performance, profits fell by 1pc to £184.9m. This fall was caused by extra spending on infrastructure, with the bulk of this spending on replacement pipes.

Of course, the industry faces challenges. In difficult times, customers can have problems paying their bills, but the group has maintained the bad debt level at 2.1pc of revenues. There could be regulatory challenges ahead – but Questor thinks they will be manageable.

Yesterday morning, Ofwat published its consultation document on the methodology for setting future price limits for the sector. The regulator wants to see increased retail competition and increased water trading between suppliers. However, Ofwat moved to reassure investors.

"Our proposals are an 'evolution' of our approach rather than 'revolution', not least as a reassurance to investors that the stability and transparency of the regulatory process remain high priorities for us," the regulator said. Ofwat also wants to cut the administrative cost of compliance, which is good news for the sector.

The company's gearing – the measure of the amount of debt it is carrying on its balance sheet – came in at 60pc, the middle of Ofwat's "assumed" range of 55pc to 65pc.

The shares are trading on a March 2012 earnings multiple of 17, falling to 14.9 next year. This is relatively high, but reflects the security of income. The average price target of the 11 analysts monitored by Bloomberg is 681p, some 13pc above its share price.

Questor recommended buying the shares on May 29 2009 at 538½p, and they are now 12pc ahead of that compared with a market up 17pc. However, the shares are an income play. Buy.

[deanforester] 23/11/2011 10:29

Earnings per share

Basic earnings per share increased from 19.5 pence to 20.7 pence,
principally reflecting the aforementioned taxation credits and an increase in
profit before taxation in the current period. Underlying earnings per share
reduced slightly from 20.4 pence to 19.9 pence. This underlying measure is
derived from underlying profit before taxation less underlying taxation. This
includes the adjustments for the deferred taxation credits in both the first
half of 2011/12 and 2010/11, associated with the reduction in the corporation
taxation rate.

Dividend per share

The board has declared an interim dividend of 10.67 pence per
ordinary share in respect of the six months ended 30 September 2011. This is
an increase of 6.7%, compared with the interim dividend relating to the
previous year, in line with group's dividend policy of targeting a real growth
rate of RPI+2% per annum through to at least 2015. The inflationary increase
of 4.7% is based on the RPI element included within the allowed regulated
price increase for the 2011/12 financial year (i.e. the movement in RPI
between November 2009 and November 2010).

The interim dividend is expected to be paid on 1 February 2012 to
shareholders on the register at the close of business on 16 December 2011. The
ex-dividend date is 14 December 2011.

[praipus] 08/11/2011 14:31

Using RCV of £8.1bn from the presentation below gives approx RCV per share circa £11!

[alphorn] 08/11/2011 14:28

Praipus - there is a figure of £7.5bn in here:

I am no expert on these things.

[praipus] 08/11/2011 14:17

Ok my RCV estimates range between £6.5bn-11.5bn so circa £9.5-£16 per share?

Anyone care to comment on my figures?

[praipus] 08/11/2011 11:56

Can anyone tell me what the RAV or RCV is here please?

RAV Regulatory Asset Value
RCV Regulatory Capital Value

[wad collector] 01/11/2011 12:37

Switched back from SSE today for a quick 10% ; odd how similar companies drift differently in market chaos.

[pirgatto] 03/10/2011 11:25

Blue again??
P

[pirgatto] 30/9/2011 12:52

MMM , UU. seems to be going up,one of the very few today.?
Is there any reason for this???
P

[wad collector] 30/9/2011 10:22

I just sold half my holding here and put into SSE - which has a significantly higher yield now for a similar risk I reckon.

[wad collector] 26/9/2011 13:01

22 September 2011

UNITED UTILITIES TRADING UPDATE

United Utilities Group PLC today issues an update for the six months ending 30
September 2011. Current trading is in line with the group's expectations and
the company's operational and efficiency initiatives continue to progress well.
The business remains on track to deliver its outperformance targets.

As outlined in the group's 2010/11 full year results, published on 26 May 2011,
United Utilities has now adopted a single segment for financial reporting
purposes.

Revenue in the first half of this year is higher than the corresponding period
last year, largely as a result of the impact of the regulated price increase
for 2011/12 of 4.5% nominal (0.2% real price decrease plus 4.7% RPI inflation).
However, as outlined previously, operating expenses are also expected to rise,
principally as a result of higher infrastructure renewals expenditure and
depreciation, alongside other inflationary cost pressures. It is anticipated
that regulatory capital investment and depreciation will be higher in the
second half of 2011/12, compared with the first half of the year.

United Utilities' financial position remains robust with the group having
headroom to cover its projected financing needs into the second half of 2013,
consistent with its prudent liquidity policy. Reflecting this robust financing
position, the group intends to accelerate approximately GBP100 million of
previously agreed pension deficit payments, providing a higher investment
return for the group than could have been achieved through short term deposits.

The underlying net finance expense for the first half of 2011/12 is expected to
be slightly higher than the first half of last year. This reflects additional
finance expense relating to the GBP200 million index-linked loan facility with
the European Investment Bank, drawn down between March and May 2011, and
marginally higher RPI inflation in respect of the group's index-linked debt
with an eight month lag.

A deferred taxation credit of approximately GBP50 million will be recognised in
the financial statements for the first half of 2011/12. This follows the UK
government substantively enacting the change to reduce the mainstream rate of
corporation taxation from 26% to 25% from 1 April 2012. A similar credit was
also recognised in the first half of last year.

Group borrowings, net of cash and short term deposits and derivatives, at the
half year are expected to be moderately higher than the position at 31 March
2011. This principally reflects expenditure on the regulatory capital
investment programme, payment of the 2010/11 final dividend and payments in
relation to pensions, interest and tax, partly offset by operational cash
flows.

United Utilities will announce its half year results on 23 November 2011.

[wad collector] 22/9/2011 15:49

Price remains stronger than the rest of the market.Tempting to sell a few more , buy something that has fallen more , then switch back.Again.

[alphorn] 15/9/2011 09:46

Increased bullish position on UU this morning. Looking fairly solid in these volatile times; famous last words.

[holts] 05/9/2011 21:36

av. yielding 8%+

[holts] 02/9/2011 11:56

wstirrup , i'm a luddite , don't do the emotions etc.

[wad collector] 31/8/2011 17:05

Sick squid again.Ah , why didn't I put my entire portfolio into UU ?

[mac15] 16/8/2011 10:08

Water utilities were under pressure after bearish analysis on the sector from Goldman Sachs. The broker cut its rating on Severn Trent, Pennon and United Utilities from "neutral" to "sell", saying they had outperformed the wider European utilities sector by 9 per cent in the last month.
In a note to clients, Fred Barasi, Goldman's analyst, said: "Our 'sell' [rating], relative to other utilities, is predicated on our expectation of rising commodity prices and an economic recovery. Were investors to continue to seek defensive, inflation-protected investments, the UK water stocks may continue to outperform the more cyclical end of the sector."
Severn Trent fell 1.9 per cent to £14.65, United Utilities lost 1.4 per cent to 590½p and Pennon was 1.7 per cent weaker at 656½p.