Any thoughts on the company?


Red line 200 MA

24 Mar 2015 "Deutsche Bank cuts Centrica to 'sell' from 'hold', target cut from 280p to 225p"

halifax, I wonder whether the sp weakness can in part be attributed to the ramifications of fracking, ie how will the prices asked by the big five energy providers be affected when fracking really gets going. We are told that fuel prices will be lower, so won't their margins get squeezed?
2517

2517 you may well be right but significant revenue from fracking is at least five years away. CNA has in any case already spent millions in buying into fracking as well as wasting a great deal of shareholders money on wind farms and it is time institutional investors voiced their dissatisfaction by replacing the board of directors.

Final Results

GOOD STRATEGIC PROGRESS, HELPING SECURE FUTURE GAS SUPPLIES FOR THE UK

Group wide £500 million cost reduction programme completed

Engaging with all stakeholders to improve understanding and rebuild trust

£14 billion of new gas supply agreements signed with Cheniere and Qatargas, taking the

Group’s gas and power supply commitments to over £60 billion

£2.6 billion invested in the year, including:

Over £1.5 billion of organic investments, predominantly in North Sea E&P, including in major projects such as Cygnus

C$1 billion Canadian upstream gas acquisition, in partnership with Qatar Petroleum International

The acquisition of a 25% stake in the Bowland shale exploration licence in the UK
$1.2 billion Hess Energy Marketing acquisition, delivering a step-change in North America B2B

£650 million of divestments of selected E&P assets, UK wind assets and US power stations, for value

Adding value through 56mmboe of organic reserve additions, principally in Norway, however £699 million pre-tax (£318 million post-tax) exceptional impairments of UK

Southern North Sea projects and existing Canadian gas assets
£420 million share repurchase programme in 2014 following sale of Texas CCGTs; recommending a 4% increase in the full year dividend to 17.0 pence per share

Recommended final divi 12.08p

Ex-divi 23 Apr 2014.
Will be very interesting to see what the brokers say, as the yield is very attractive.

Deutsche Bank note today:
"Centrica reported FY results this morning in line with our and Inquiry Financial provided consensus estimates. However there was a c. £700m write down of North Sea and Canadian assets and the company said that it expects adjusted EPS to be lower YOY, partly due to adverse weather in N America and the UK. Rising costs in upstream production were flagged again, while the company will seek to turn around customer losses which amounted to 360k in British Gas Residential. With the competition review by regulators still due in March we would not see any weakness today as a buying opportunity.
Centrica reported adjusted operating profits of £2,695m (4% below DBE and 6% below consensus) but adjusted EPS was in-line and flat YOY at 26.6p/share and the DPS was up c.4% to 17.0p/share, roughly in line with expectations. British Gas Residential lost 360k customers and profits for British Gas as a whole were down 6% yoy partly due to rising commodity and social/environmental costs (reduced by the government to allow a 3.2% price drop from January 2014).
The company guidance that adjusted EPS is expected to be lower yoy is likely to bring down consensus estimates (we expect a high single digit consensus downgrade). We remain concerned that all three main divisions are facing headwinds. The UK competition assessment in March seems increasingly likely to call for a full Competition Commission review. Meanwhile all North Sea gas producers are facing rising cash costs, and retailers in North America are seeing a margin squeeze."

Ex-divi wed 23rd Apr (12.08p)

Have been watching this one carefully for a while now, but even so have managed to miss the boat.
EDIT: Bought in at 329p

Credit Suisse has raised its recommendation for British Gas owner Centrica from ‘underperform’ to ‘neutral’ after the stock’s recent underperformance.

Seems to have had a good effect on the sp. Profit and the divi.....now that would be nice!

Good call Harry - I bailed here a while ago unfortunately!

Note from HSBC today:
"Cutting the coat to fit the cloth – for Centrica in 2014 this means cost reduction and efficiency, new growth, political engagement: It has been 12 months since Centrica’s management announced a strategy announcement to focus investment on the US rather than the UK. This strategy was vindicated by the prospect of intervention in the UK supply market by the Labour party if elected to government in 2015 and the lack of political drive to offer attractive investment incentives for new gas-fired generation. At the FY results on 20 February, management pointed out that 20% of Centrica’s customers are already on a fixed-price contract so progress has been made on encouraging customers to fix prices, which helps to mitigate political risk. It also defended its integrated and UK/US model as sheltering from volatility, giving it scale in gas contracts, and allowing UK leverage from a growing US liberalised market. In 2014 it intends to drive growth in British Gas residential and ‘harvest’ its upstream assets, cutting upstream investment by 20% to GBP900m for the next three years.
Hidden value in upstream: Management announced at the FY results that 155mmboe of 2P gas reserves had been added, some 56mmboe organically from its own assets, after a rapid phase of expansion. We set out as a small example recent exploration drilling success in the Butch Norwegian field. Centrica is the field operator, and has a 40% stake. Its near field exploration wells indicate the potential for a four-fold increase in field size. In the Butch Main field 50-60mmboe has been discovered. We value Faroe Petroleum’s (FPM LN, OW(V), 201p) 15% stake at GBP143m, implying a value for Centrica of GBP381m.
Target price raised to 380p from 350p; rating upgraded to OW from Neutral. Our target is based on the average of three methodologies – DCF, DDM and SOTP. We have also included the Butch asset valuation in our sum of parts and increased our long-term dividend growth assumption. Lower capex in upstream has increased FCF but still will generate additional FCF as Centrica shifts its attention to higher producing areas such as Norway and the US and away from the UK. Lower storage earnings have offset some of the Butch benefit in our SOTP though."

StockMarketWire.com
Centrica bought back 1,000,000 ordinary shares yesterday at an average price of 330.1746p each to be held in treasury.

Harry - that's a regular occurrence lately - CNA RNS

(Reuters) - British utility Centrica (CNA.L) has agreed to buy the gas and electricity supply arm and a gas-fired power plant from Ireland's state-owned Bord Gais Eireann for 1.1 billion euros (922 million pounds).

Centrica's partners iCON Infrastructure Partners and Brookfield Renewable Energy Partners will purchase Bord Gais' distribution and renewable power generation assets, respectively, the companies said.

The transaction is expected to close in the first half of 2014.

The Irish state had put the Bord Gais assets up for sale as part of its privatisation programme.

Ex-divi wed 23rd Apr (12.08p)

StockMarketWire.com
Centrica's North American subsidiary, Direct Energy, has agreed to sell its Ontario home services business to EnerCare C$550 million (£300 million).

Direct Energy currently has nearly 1.9 million home services contracts in Ontario, to provide a range of plumbing, heating, ventilation, air conditioning and other related services. The majority of customers are served through a joint arrangement, under which EnerCare owns the water heater assets, while Direct Energy provides services and manages the customer relationships. This transaction will combine the two parts of the business into a single entity, wholly-owned and managed by EnerCare, enhancing the overall customer proposition.

Badar Khan, President and CEO of Direct Energy, said: "This is an attractive opportunity to realise value from the Canadian home services business. With our activities in Ontario no longer forming a material part of the business, we will focus our attention on opportunities in the United States and Alberta, through a range of innovative products, including combined energy and services offerings."

CENTRICA ENTERS RAPIDLY GROWING US RESIDENTIAL SOLAR MARKET THROUGH ACQUISITION OF ASTRUM SOLAR

Centrica plc's North American subsidiary, Direct Energy, has acquired the US residential solar business, Astrum Solar, for US$54 million (£32 million).

Astrum Solar designs, installs and maintains solar power generating equipment for use in the home. It currently has around 4,000 customers, predominantly in the US Northeast and California, and in 2014 is expected to generate around US$40 million of revenue. The company was founded in 2008 and is one of the fastest growing residential solar energy companies in the United States.

This acquisition provides Direct Energy with the opportunity to expand the range of products offered to its customers, selling solar alongside energy and services.

Direct Energy President and CEO Badar Khan said: "We are excited at the potential of the Astrum Solar business in a rapidly growing market and we are delighted to be adding solar power to the range of energy options we already offer our customers. This acquisition fully aligns with our vision of using new technology and innovation to help our customers gain greater control over their energy use."

LONDON--U.K.-based utility Centrica PLC (CNA.LN) on Tuesday confirmed the appointment of BP PLC's (BP.LN) Board Director Iain Conn as Chief Executive with effect from Jan. 1, 2015.

Centrica's announcement follows last week's confirmation of talks with Mr. Conn about the possibility of him succeeding as CEO of the firm.

Centrica, which distributes gas to U.K. households through its British Gas commercial unit, said Mr. Conn's remuneration package will consist of a basic salary of 900,000 pounds ($1.58 million) and variable incentive arrangements which are in line with Centrica's current remuneration policy and practice.

Interim results announcement tomorrow - 31st July.