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"At least 33 have died and many more are missing following severe flooding in western Germany..." BBC today. Plus at least 4 more in Belgium, and the Netherlands "has also been badly hit".
'nuff said.
News this morning of £2.7 billion allocated to deliver environmental improvements in the water sector. with an extra £800m being spent and the remainder being brought forward - RNWH's acquisition of J Browne could not have been better timed:
Https://www.investegate.co.uk/water-services-auth/rns/ofwat-announces-green-recovery-final-decisions/202107150700032828F/
"Ofwat, in collaboration with Defra, the Environment Agency, the Drinking Water Inspectorate, and CCW, has given the go ahead on delivering a broad range of proposals to offer a more resilient, greener and healthier future.
Five water companies - Severn Trent Water, South Staffs Water, South West Water, Thames Water, and United Utilities will invest an extra £793 million, on top of their existing five-year PR19 packages, to help the green economic recovery. These companies, along with seven others in England, are also bringing forward £1.9 billion worth of investment in additional statutory environment schemes into the 2020-25 period."
You beat me to it rivaldo. I can't find any announcements or news, just wondering if there is a reason for such a sudden jump.
Nice :o))
Buying coming in at steadily higher prices, and now at 749p....
and good to see a succession of buys just now at the full 700p offer.
Does anybody know how much cash is on the balance sheet?
Also, what %age of shares do directors hold?
Leading to a nice rise in SP this morning.
Thanks for posting this rivaldo.
RNWH have been tipped as a Buy in today's Tempus column in the Times.....
Even better considering the current investment zeitgeist, the column overall has an ESG theme and focuses on companies which have the LSE's Green Economy Mark. Currently this has only been granted to around 100 companies.....
Https://www.thetimes.co.uk/article/green-economy-has-blue-chips-too-lnh8r0ddl
"Renew Holdings
Another Green Economy Mark company is the Aim-listed Renew Holdings, which carries out maintenance of the rail network, roads, telecom towers, plumbing and pipework. Its customers include Network Rail and the Highways Agency. News of the government spending £640 billion on infrastructure over the next five years is very good news for Renew.
Renew has been savvy about buying companies that will benefit from that spending boost at decent multiples. One such purchase was its £5 million deal to buy Rail Electrification Limited, which provides services and machinery to install overhead lines to electrify the rail network. Network Rail has said it plans to spend up to £1.8 billion a year on electrification to cut carbon dioxide emissions. This deal adds to the services Renew can offer its rail customers and should help it win more contracts.
Elsewhere, it’s likely to see growth from servicing 5G infrastructure, increased spending on water, and nuclear decommissioning work.
Renew has the benefit of the long contracts offered by public sector organisations but does not carry the same risk as larger competitors such as Kier or Costain. Its contracts are much smaller and prices are generally not fixed so the risk of mispricing a contract is much lower.
It ploughed on through the pandemic as its work is considered to be of critical importance. Tom Fraine at Shore Capital says its ability to control costs and resilience has been better than most industrial companies. The shares are changing hands for 659p, about 14 times forecast for earnings this year, and look cheap considering the trends that will underpin demand.
Advice Buy
Why Revenues underpinned by regulatory spending
Impact Helping to cut carbon from rail travel"
and buying coming in at almost the full 690p offer price.
Great close last night at more new highs.
And more excellent news, this time from Seymour Civil:
Https://twitter.com/SeymourCEC/status/1398278736961753094
"Seymour CEC
@SeymourCEC
We are absolutely delighted to have been awarded a place on @nwater_care
NWG’s Lot 1 Water and Waste Water Network select list which will support Northumbrian Water Group’s capital programme for infrastructure projects until 2025."
I really like the sound of this joint campaign launch from RNWH's subsidiaries "to meet the ambitious electrification and decarbonisation targets set by government and Network Rail". Catchy name too :o))
Https://www.amcogiffen.co.uk/news/arq-an-electrifying-new-partnership
"15/06/2021
ARQ, which includes Amco-Giffen, REL (Rail Electrification Limited – the latest addition to Renew Holdings Plc) and QTS, will provide a truly integrated self-delivery model for the UK rail network. It will help to meet the ambitious electrification and decarbonisation targets set by government and Network Rail.
Decarbonisation is a huge challenge for us all over the next 30 years, as we seek to reduce carbon emissions and fossil fuel consumption. The UK government aims to remove all diesel-only trains by 2041, with a legally binding commitment to net zero by 2050. It has been recognised by the industry that, together, we must do more to be part of the solution to climate change.
In fact, to decarbonise the UK rail network completely, 13,000 single track kilometres (approximately 450km per year) will need to be electrified by 2050 to achieve net zero. However, it has been identified that from 2019-2020 only 251km was electrified.
ARQ therefore aims to play a key role in accelerating this change, leading the way in helping Network Rail to respond to the UK decarbonisation agenda within our country’s rail infrastructure.
Individually, each of the three businesses coming together to create ARQ have been enabling electrification programmes across the UK for several years. Now, combining their respective strengths within our unique family of multi-disciplinary engineering businesses will help us to collectively support essential UK infrastructure while gaining a key competitive edge.
The new partnership is led by Vinny O’Holloran, who says: “We understand that electrification is a significant contributor towards meeting Network Rail’s decarbonisation commitments, and that things have to change to drive efficiency. We want to be part of this change; to help drive it forward.”
etc"
and buying coming in at the full 680p offer price.
According to bsdjj elsewhere, Peel Hunt have increased their price target to 750p (from 700p).
Forecasts are unchanged, but they say they have more confidence in the outlook.
This reads well from VP Group's results yesterday - RNWH are involved in each and every one of these sectors and projects:
"Major infrastructure sectors, such as water, rail and transmission are primed for escalating growth in the coming year, added to which other major projects such as HS2 and Hinkley Point will continue to drive demand."
Very good news for J Browne from last month covering the next five years:
Https://jbconstruction.co.uk/news-blog/j-browne-construction-awarded-5-year-above-ground-framework-agreement-with-affinity-water
Extracts:
"J Browne Construction Awarded 5-Year Above Ground Framework Agreement with Affinity Water
May 20, 2021
J Browne Construction is delighted to announce a 5-year extension to our existing Above Ground framework agreement with Affinity Water. The agreement is one of four infrastructure frameworks awarded to key partners, which combined are worth circa £100 million during AMP7....
.....These four contracts make up a significant part of the multi-million AMP7 Capital Investment Programme and will cover all regions served by Affinity Water. Under this framework the four key partners will be delivering over 100 different projects providing civil engineering, M&E, process treatment and pumping station projects.
Steve Plumb, Director of Asset Strategy and Capital Delivery said: “Affinity Water is pleased to sign this long-term agreement with J Browne Construction to support in the delivery of our challenging above ground assets programme. These frameworks adopt a more collaborative approach focussing on achieving shared programme value and efficiencies. We look forward to a successful relationship with each partner”.
Nice article about RNWH with rather positive conclusions:
Https://www.stockopedia.com/articles/two-factors-the-market-might-be-missing-with-renew-holdings-220139/
Extracts:
"One of the quality metrics for Renew Holdings is that it passes 8 of the 9 financial tests in the Piotroski F-Score. The F-Score is a world-class accounting-based checklist for finding stocks with an improving financial health trend. A good F-Score suggests that the company has strong signs of quality."
"A rule of thumb for a reasonable Earnings Yield might be 5%, and the Earnings Yield for Renew Holdings is currently 6.58%.
In summary, good quality and relatively cheap valuations are pointers to those stocks that are some of the most appealing to contrarian value investors. It's among these shares that genuine mis-pricing can be found. Once the market recognises that these quality firms are on sale, those prices often rebound."
This looks like very good news - two "multi million pound" contracts for the Nuclear Decommissioning (NDL) consortium which includes RNWH's Shepley Engineers at the nuclear decommissioning project at Dounreay.
These are obviously good news in themselves, but being the first major contract wins for NDL under the Decommissioning Services Framework (DSF) should also bode well for more and bigger wins in the coming years given the £billions of work which will be necessary:
Https://www.neimagazine.com/news/newsndl-consortium-wins-two-decommissioning-projects-at-dounreay-8788483
Extracts:
"NDL consortium wins two decommissioning projects at Dounreay
3 June 2021
The UK-based Nuclear Decommissioning Ltd (NDL) consortium has won a multi million pound design contract related to the Prototype Fast Reactor Facility (PFR) decommissioning project at Dounreay in Scotland. Joint venture group NDL brings together four nuclear decommissioning businesses – James Fisher Nuclear (JFN), Shepley Engineers, React Engineering and Tetra Tech – appointed to support the clean-up and demolition of former experimental fast reactor site at Dounreay, being caried out by Dounreay Site Restoration Ltd (DSRL) on behalf of the Nuclear Decommissioning Authority (NDA).
This is the first major contract win for NDL under the Decommissioning Services Framework (DSF). The removal of irradiated fuel (IF) from site is a key goal for NDA and will significantly advance decommissioning progress on site. The consortium will be working collaboratively with DSRL to provide all scheme designs for plant, equipment and systems....
....NDL has also won a multi-million pound project related to decommissioning strategy for the Highly Active Liquor Storage and Evaporation Facility (HALSEF) at Dounreay. The NDL consortium partners will develop an integrated concept and scheme decommissioning plans for HALSEF. JNF said key to this approach will be enhanced stakeholder engagement at every stage, with NDL and DSRL working in collaboration to deliver a successful outcome. The decommissioning strategy will adopt a ‘Waste Informed Decommissioning’ approach to optimise waste streams throughout the decommissioning process, to minimise cost and required Intermediate Level Waste (ILW) storage provisions."
Thanks Rivaldo, looks like another typical Renew acquisition.
I couldn't see their profitability on documents at Companies House but would put my trust in RNWH that it's around the usual ballpark. All gently lifting the expected EPS.
GS
Correction - I've been told that Shore Capital's price target is actually 740p (not 730p). Even better :o))
Bullish coverage from Shore Capital (from memory they have a 730p target price):
Https://citywire.co.uk/funds-insider/news/the-expert-view-ssp-senior-wickes-renew-and-redde-northgate/a1514422?ref=citywire-money-latest-news-list#i=5
"Renew worthy of a bigger rerating, says Shore Capital
Engineer Renew (RNWH) is a less risky business than the market is giving it credit for, says Shore Capital.
Analyst Tom Fraine retained his ‘buy’ recommendation on the stock after the group acquired engineering services company Rail Electrification for £5.3m, expanding its capabilities in the electrification of train lines.
‘We continue to believe Renew has a much lower risk profile than the market perceives, possibly due to associations with peers servicing much larger fixed contracts,’ said Fraine.
‘Renew’s ability to control costs and resilience during the pandemic has been much greater than the majority of industrials and worthy of an even greater rerating. We believe Renew represents a good opportunity for investors seeking to benefit from the UK government’s commitment to invest £640bn in infrastructure over the next five years.’"
A good article about today's acquisition here, with much more detail than in the RNS - an impressive client list for a small company, which must be a great base from which to win some of the huge additional electrification work coming along:
Https://www.insidermedia.com/news/yorkshire/renew-holdings-acquires-rail-electrification-specialist
Extracts:
"REL provides services and road rail plant for the installation and commissioning of overhead line electrification (OLE) in both the light and heavy rail infrastructure sectors across the UK. Clients include Costain, ABC, Crossrail and Hochteif"
"The REL team, including the management trio of Scott Kernachan, Mark Potts and Kenny Barr, will join QTS at its Scottish HQ in Drumclog, South Lanarkshire."
"By adding REL to the QTS Group, we are joining forces with a leading business in this area, which will be a great benefit to the work that we deliver for our clients."
Scott Kernachan added: "Through this deal, we are opening up the future of REL to even greater possibilities. As QTS already has its Principal Contractor license, and a number of frameworks in place, it really transforms the opportunities available for us as experts in electrification."
Looks like a bargain acceleration into the overhead electrification sector - with much of the consideration dependent on performance.
There's likely to be huge amounts of work being doled out soon in this area:
"As part of the UK Government's commitment to delivering a carbon neutral rail network by 2040 for England and Wales and by 2035 for Scotland, it is estimated that there will be around 15,000 single track kilometres of new electrification carried out across Network Rail's controlled infrastructure over this period. The recently released Williams Rail Review states that electrification is likely to be the main way of decarbonising the rail network."
Paul Scott, Chief Executive of Renew, commented:
"The rail network has a crucial part to play in supporting the UK's commitment to Net Zero 2050 and this acquisition will help enable Renew to play a bigger part in Britain's green economic recovery. REL is a highly regarded business with a strong track record and will enable us to broaden our service offering within our Rail business. Our existing multidisciplinary rail capability, complemented by the electrification expertise of REL, leaves Renew ideally positioned to play its part in delivering a decarbonised railway. Rail electrification offers attractive long term structural growth opportunities underpinned by highly visible committed regulatory spend in a sector that we know extremely well. I am delighted to welcome the management and staff of REL to the Renew family."
https://uk.advfn.com/stock-market/london/renew-RNWH/share-news/Renew-Holdings-PLC-Acquisition-of-Rail-Electrifica/85247490
Good news for RNWH's Carnell Group this morning, with OFGEM announcing £300m of additional funding for highways cabling to build up the UK's electric charging infrastructure.
This will in time of course also benefit Clarke EV's electric charge point build-out services too:
Https://www.investegate.co.uk/ofgem/rns/ofgem---300m-down-payment-to-rewire-britain/202105240700075089Z/
Shore Capital have increased their target price to 740p (from 700p) - more than they initially suggested post-results as per my prior post :o))
Https://citywire.co.uk/funds-insider/news/expert-view-bt-national-grid-dominos-renew-and-euromoney/a1510413?ref=citywire-money-latest-news-list#i=5
"Shore Capital - Renew
Engineering group Renew (RNWH) is already performing ahead of forecasts and is well placed to benefit from the government’s plan to pump money into infrastructure, according to Shore Capital.
Analyst Tom Fraine retained his ‘buy’ recommendation and increased his ‘fair value’ target price from 700p to 740p on the stock, which was closed up 3.4%, or 22p, at 662p yesterday.
The group reported 12% organic revenue growth in the six months to end of March, while operating profit was up 11% and earnings per share increased by 14%.
This led Fraine to upgrade full-year 2021 revenue and profit forecasts by 3%, even before adding in the impact of newly acquired water engineering services company J Browne.
‘[We] see scope to upgraded these by a further 6%,’ he said.
‘We consider Renew to be in an excellent position to benefit from the UK government’s commitment to invest £640bn in infrastructure over the next five years and Network Rail’s £800m electrification programme to decarbonise the railways.’"
Numis have today retained their 730p target price, whilst Shore Capital "expect to upgrade" their fair value to 730p (from 700p).