Some KCQs related to Pennon group’s and my understanding

So, after going through 3, 80-100 pages long, financial reports of the Pennon Group, some of the key concepts and the questions that stuck to my mind are as under:

  1. Group Financial Highlights
  2. Business Model
  3. Strategic Priorities
  4. Risk Report
  5. Financial Statements and Shareholder Information

I have read articles and news about the group and see what they are upto, which by the way are mentioned in the previous report, take a read should that interest you.

Key challenges the firm appears to be facing

  • Compare the values in ‘Key Performance Indicators’ section for past 3 years ( year 2017 report will have values for 2016 and 2015 too, so refer to 2017 report) and see what the trend is. If ratios/figures are falling, report that as an issue.
  • Check whether shareholders are getting more profit each year or not? Again, look at the trend in the past 3 years
  • Analyze the section ‘Key Performance Indicators’ (on page 07 of 2017 report) there are some ratios that are falling, report those as issues
  • Market competition (refer to page 12)
  • Non-compliance or occurrence of avoidable health and safety incident (page 47 – risk report)
  • Poor operating performance due to extreme weather or climate change (page 49 – risk report.)
  • List the other 2 factors in the risk report that have an upward directed arrow indicating increase of risk. (Page 49)

How successful it appears to be in meeting these challenges and its apparent strategy.

  • Refer to Business Model (page 14, 15, 16, 17 and their details on subsequent pages)
  • Refer to Capital Structure (on page 44) and state that they have the necessary funds for meeting challenges etc etc

My company’s financial statements are presented in vertical columns, whereas I have read, that isn’t the case in all of the scenarios. Different style of presentation of the company’s report are these.

List the order of the financial statements, as in 1st is Income Statement, 2nd is Balance Sheet, 3rd, 4th etc (starting from page 114 to 118)

And financial notes are mentioned in detail at the end of the financial statement/ Annual reports.

My Company: Pennon Group

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Pennon group is one of the finest and biggest water, waste water and waste management services company in UK. The company is among top 20s in FTSE (The Financial Times Stock Exchange). The company’s vision is ‘To deliver sustainable shareholder value by providing high quality environmental infrastructure and customer services.’ The company have an estimated total assets of around £5.9 billion with a mighty workforce of around 5,000 people. Pennon group is among the leading companies to recycle waste in UK. The companies portfolio enjoys more than 150 local authorities and local clients with more than 32,000 customers in UK.

OUR STRATEGY:

Leadership in UK water and waste
We aim to lead in the water and waste sectors by capitalising on Group strengths, capabilities, best practice and synergies and achieving the right balance between risk and reward.

Leadership in cost base efficiency
We are focused on driving down overheads and operating in the most efficient way to minimise costs.

Driving sustainable growth
We actively seek opportunities to invest for growth, whether through investment to increase our asset portfolio, initiatives to expand our customer base or partnerships with other organisations.

The company shares a futuristic vision and they are working on affordable infrastructure opposite to the current, short-term affordability versus long-term resilience. Sarah Heald, Director of Corporate Affairs and Investor Relations, have said, along the lines of, in her latest press conference that we should work on the long term and affordable infrastructure solution. The complete press report can he accessed and read here.

This is the current FTSE graph of the company for the past 5 days and we can see the growth in the trend. Well by no means I am an expert over it but this is quite interesting. The image is the courtesy of http://www.cityam.com/company/pennon-group 

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The group have two main businesses, South West Water supply and Viridor waste management services. Viridor have announced patron-ship with Barnstaple and District Chamber of Commerce and are continuously thriving in the business. They have recently announced the partnership with Lidl Exeter as well. You can read all of the news and blog related to them here.

Feel free to comment below and share some more details should you find them.

Hello guys!

So, I know I am a wee bit late in this thing but I am here. So, its really good to see so many people in this course and hope we will be able to communicate with each other very well. After an hour or so, there is a match that I will be watching. I am sure you guys will be doing really great. Wish us luck for the match, Hala Madrid! download