Good Energy Group PLC (LSE:GOOD) (Q2 2024) Earnings Call Transcript Highlights: Strong Profit ...

GuruFocus Research
4 min read

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Release Date: September 17, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

  • Good Energy Group PLC (LSE:GOOD) reported a strong profit for the first half of the year, only 23% shy of the full-year profit from last year.

  • The company maintains a robust balance sheet with GBP40 million in cash, transitioning to an asset-light business model.

  • The Board announced a 10% increase in the interim dividend to 1.1p.

  • Good Energy Group PLC (LSE:GOOD) acquired JPS, expanding its footprint in heat, solar, and storage installations across southern England.

  • The company is now an accredited B Corp, the only domestic supplier in the UK to achieve this certification, highlighting its strong environmental credentials.

Negative Points

  • The energy market remains volatile, with a 10% increase in the off GEM price cap driven by fluctuating gas costs.

  • The electric vehicle market has shown signs of slowing growth in registrations, creating some uncertainty.

  • Despite positive interim results, the company had previously swung into a loss in the second half of last year due to the reversal of the energy crisis effects.

  • The integration of newly acquired businesses, such as JPS, is still ongoing and may present operational challenges.

  • The company faces external pressures from international market price movements, which could impact future profitability.

Q & A Highlights

Q: Can you elaborate on the financial performance for the first half of the year and how it compares to last year? A: Nigel Pocklington, CEO: The first half of this year showed a strong profit, which is 23% shy of the full-year profit from last year. This is notable given that last year's first half was marked by abnormal profitability due to the energy crisis. This year, the market has been more stable, leading to a more normal business pattern. The Board has reiterated guidance on our full-year outlook.

Q: What are the key changes in the Services division, and how is it performing? A: Nigel Pocklington, CEO: We are moving towards reporting the Services division as a separate segment by the full year. The Services division is growing, with revenue increasing. We acquired JPS in the first half of the year, enhancing our capabilities in heat, solar, and storage installations across the south of England.

Q: How is the company's cash position, and what are the implications for shareholders? A: Nigel Pocklington, CEO: We have GBP40 million of cash on the balance sheet, which is crucial for our transformation into an asset-light business with a strong balance sheet. This cash position, combined with our profit performance, has allowed the Board to announce a 10% increase in the interim dividend to 1.1p.

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