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8,724
Yü Group meter points In 2019
Okay? If hvivo finds your analysis useful then fine. I just thinks its off even based on some guess work. £17.9m down to £6m whilst RO payments net to only about 1.something million in recent years and cash with counterparts were getting transferred out as soon as smartest came along and ROC issuance and renewables have only gone up... I just think that is way off. But that's my tske on what Yu's cash situation is like
Yes YU do report customer number it’s in the annual report. 9400 ish 2018 and 8500 ish 2019 the rationale was for the drop was dumping the very low margin customers as they openly told the market.
Read the annual report
MKS can I also ask you to go back on this thread -a fellow investor was concerned what the gross margin was in H1 2020 as it wasn't in the recent update. (Why, we don't know). What we do know is they made a £2M loss.
I therefore provided an analysis of what I believed the gross margin was in H1. My calculations came out at almost 3%.
I was asked yesterday to provide a valuation on the business.
You will note that Yu expressly advised in the recent RNS that they have cash in the bank to make their industry payments. (Why announce they have money to pay their debts as if this is something to be proud of). My friend sparky believed Yu paid its RO in advance however we know this isn't correct.
Yes Yu will benefit from the Smartest deal but as per recent RNS an amount of cash is still held as collateral with trading parties.
The current industry payment due in August is for periods Apr 19 to March 20.
Note we are now in August 20 so Yu is carrying 5 months worth of cash which doesn't belong to them in relation to RO payments.
My valuation is on a cash free debt free basis as of today!!! I trust you understand that definition.
"fixed daily standing charge revenue would remain constant - this equates to up to 20% of a customers invoice and sometimes more."
I just don't think you/I have enough info to make estimates along these lines. If you use 0 energy, then the fixed is 100% of your bill. But this is hardly ever the case. Anyway, have a read of Yu's last annual report. They have 8724 meter points. They say they have 0.2% market share with 129 staff. This is for FY2019.
1. I said upto 20%!!!!
2. if customer has low consumption the percentage will be greater.
3. If customer has high consumption the percentage will be lower.
4. My overall point is that just because usage was impacted by C19, that doesn't mean they lost revenue on the fixed element of the invoice and therefore revenue shouldn't have decreased by 21% overall between H1 2019 and H1 2020
5. This means they business has lost more customers than it has gained.
6. YU never reports on meters or customer numbers, why??
7. Instead we have to do our own analysis to work out whats really happening. I've never heard of anyone report on monthly bookings.
8. To see how they should be reporting numbers for a utility business take a look at the annual reports/trading updates of the Utility Warehouse (TEP) Clear, precise reporting, no smoke and mirrors. You know exactly how the business is performing. (& no I'm not an investor in TEP)
9. Yu - take a leaf out of their book.
Fixed rate change is not 20% is 159p per day. Gas is cheaper at 79p.
So how do you get 20% and 20% of what ? Usage ?
https://smallbusinessprices.co.uk/electricity/
Where do you get 20% as the fixed daily charge? That seems way to high.
Interesting analysis ontheup. FY 2019 gross margin was 4.9% with 6.7% for H2 2019 (see past RNSs). I'm not clear on which collateral and trading counterparts you refer to now. That's what the smartest energy deal was about. Cash as of 30th June 2020 was £17.9m with avaerage monthly sales of £6.2m in H1 2020. There are 16.2m shares in issue. All these numbers are easy to get. There is no need to guess everything
The covid impact should have only impacted Q2 revenue, not the whole of H1 revenue.
So if H1 revenue was £56M in 2019, average that out over 6 months thats approximately £9.33M per month
The board advised a 35% drop in consumption was expected - note the drop in consumption does not impact the fixed daily standing charge that Yu levies on all of its customers. What that means is that whilst consumption would be reduced, fixed daily standing charge revenue would remain constant - this equates to up to 20% of a customers invoice and sometimes more.
Therefore for three months at £9.33M = £28M
A 35% reduction in Q2 revenue would equate to a reduction of £8.4M on the previous H1 period
The actual reduction was £11M
Therefore this business is in decline.
Interesting, why makes you think the customer book is declining ?
Yes H1 revenue down agreed. But this is due to 90% of the U.K. in lockdown and limited usage. Therefore normalised revenue stream didn’t apply That is why revenue down to 45m from 56m.
Agree or disagree ? because you actually have no idea on customer numbers from the trading update. Also COVID-19 shut the majority of SMEs for 3 months so you could argue a 11m decline is actually a good result ?
A rough stab would look something like this for me;
If Yu called collected all of its debt from customers and had its collateral returned from its trading parties I think there would be around £6M cash left in the business plus the value of the customer book - the value of the customer book isn't easy but based on my recent analysis I think they're making around 2-3% gross profit on circa £90M of annual revenue which is around £2.7M
If Yu sold the company privately on cash free debt free basis I think they could reasonably expect to receive £2.7M (equivalent of 1 years gross profit) plus the £6M cash left in the business £8.7M would be a rough guess.
estimate based on an asset sale.
I think theres around 16.5M shares in issue so I would say the current value should be around 53p per share.
There are 50 different ways to value a company and this is just one I would use, others on this board might have a different method.
Mine also takes into account that this customer base is declining as evidenced by recent H1 results.
Rgr
I will plump for 135m turnover FY 21
Thats my 2021 prediction (just to be clear).
So FY revenue is going to be less than £60m when 45m even through Covid 19 and lockdown.
Okay let’s see my man
Sparky, my oats are aimed at providing balance to the board and thats my only motive.
If I see genuine indictators the company is turning around my opinion will state that.
In all of your responses of late you have attacked the person rather than the arguments provided.
This is disappointing and does lead me to believe you are in very deep with this business and now desperate for a share price turn around.
I don't know these other two gentlemen but if theres any truth in their reports I hope your eyes start to open just a little wider.
Revenue down from £56M to £45M (21% reduction) in the previous H1 period. My previous prediction is on track for 2021 revenue to be less than £60M if these declines continue. Look out for the cash balance in the next announcements post Aug 31st.
& finally WAKE THE F**K UP mate.
Ontheupupup, 39 posts since becoming a member 35 all negative on YU. Hmmm rather fishy also.
Double tag team with tommy ?