Pennon’s Share Price Fell 2.78% After Its Latest Trading Update

The Pennon Group plc (LON: PNN) share price fell 2.78% after the company issued a trading update about the financial year ended 31 March 2024. The company confirmed that its financial performance aligns with the expectations set by management. Progress has been made on the SES Water acquisition, which is currently under the scrutiny of the Competition and Markets Authority.

The company has expanded its renewable energy portfolio by acquiring four new sites and has initiated the construction of a solar power facility in Dunfermline. As part of the K7 investment period, a record investment of approximately £850 million is projected in water and wastewater infrastructure up to 2025.

Achieving 90% of strategic reservoir capacity before April 1, 2024, is a goal that demonstrates effective resource management. Efforts to maintain the environmental performance gains of 2022 are ongoing despite challenges like a 50% increase in rainfall affecting wastewater management.

The company has initiated 78 projects to enhance water quality at numerous beaches by 2025 as part of the WaterFit initiative. More than £95 million has been mobilised to support customers, introducing innovative campaigns to promote water efficiency in Devon and Cornwall.

Completing diversified water resource development projects in Devon and significant progress in Cornwall contribute to the achievements of strategic reservoir capacity and regional water resilience.

Infrastructure projects such as the completion of Blackpool Pit and operational enhancements in Devon, including the winter pump storage at Gatherley, support improvements in water resource management.

Anticipated operational starts for a desalination plant in South Cornwall and the Porth Rialton water scheme will further bolster water supply resilience amidst challenging drought conditions. 

Wastewater operations faced challenges due to significant weather events, including increased rainfall and storm activity, which affected performance metrics. However, continued progress towards environmental goals is noted.

Efforts to maintain a 2-star EPA rating for 2023 are in place, with an outlook for achieving a 4-star rating by 2025, pending adjustments due to current operational challenges. A substantial support package has been delivered to customers, with significant investments to maintain affordability and promote water efficiency.

Water efficiency measures have successfully reduced demand, supported by a comprehensive suite of services, including leak repairs and the distribution of water-saving devices. The acquisition process for SES Water is advancing, with the CMA review expected to conclude favourably.

Pennon share price. 

The Pennon share price fell 2.78% to trade at 651.40p from Friday’s closing price of 670.00p.