Just Energy continues to Modernize
On November 9 Just Energy released it's second quarter results.In the past Just Energy has been a disorganized utility with average results and an attrition problem meaning that it lost customers and sometimes more than new customers that it signed up.It's quarterly reports were slightly disorganized as well.But it invested in a number of profitable American utilities and got some income to gradually organize it's operation and it's quarterly reports.Just Energy is in transition to becoming a solid second tier utility.It also has reduced it's debt slightly from $660 million to $640 million.Still more work must be done to modernize it's reports and it's operation.
The Second Quarter
It outlines the highlights at the start of their report and that contains the important details that an investor needs.Revenues fell 9% for the quarter while EBITDA grew by 24% and the payout ratio fell to 36%.The latter is a JE record.Net debt is 2.4 times EBITDA(trailing) and used to be 3.0 times a year ago.This ratio will drop again at yearend.Lastly JE reaffirmed it's guidance at $223 million to $233 million for it's fiscal year 2017.
The First Half
Sales decreased by 9% to $1.9 billion but base EBITDA increased by 16% to $98 million and funds from operations also increased by 16% to $78 million.The payout ratio dropped over the first half but especially over the second quarter.The net debt ratio will probably decrease to around 2.1 or 2.2 times by the end of the second half.
The Second Half
Traditionally the third and fourth quarters are the strongest quarters for Just Energy.The growth in the base EBITDA will probably exceed that of this quarter.This blog predicts that guidance will be raised in the third quarter and we may be looking at base EBITDA of about $350 million for 2017.This however will probably be determined by the effectiveness of programs to reduce attrition of customers.
If base EBITDA hits $350 million this would put earnings per share at about $2.30 per share.If the stock trades only at $8.00 this would be a very low multiple of earnings.And traditionally the third quarter has been a very strong quarter for JE.I just hope they organize their quarterly report better. use Blogdaleupsome for advertising quality stocks; use Blogdaleupsome for finding alternative investments
The Second Quarter
It outlines the highlights at the start of their report and that contains the important details that an investor needs.Revenues fell 9% for the quarter while EBITDA grew by 24% and the payout ratio fell to 36%.The latter is a JE record.Net debt is 2.4 times EBITDA(trailing) and used to be 3.0 times a year ago.This ratio will drop again at yearend.Lastly JE reaffirmed it's guidance at $223 million to $233 million for it's fiscal year 2017.
The First Half
Sales decreased by 9% to $1.9 billion but base EBITDA increased by 16% to $98 million and funds from operations also increased by 16% to $78 million.The payout ratio dropped over the first half but especially over the second quarter.The net debt ratio will probably decrease to around 2.1 or 2.2 times by the end of the second half.
The Second Half
Traditionally the third and fourth quarters are the strongest quarters for Just Energy.The growth in the base EBITDA will probably exceed that of this quarter.This blog predicts that guidance will be raised in the third quarter and we may be looking at base EBITDA of about $350 million for 2017.This however will probably be determined by the effectiveness of programs to reduce attrition of customers.
If base EBITDA hits $350 million this would put earnings per share at about $2.30 per share.If the stock trades only at $8.00 this would be a very low multiple of earnings.And traditionally the third quarter has been a very strong quarter for JE.I just hope they organize their quarterly report better. use Blogdaleupsome for advertising quality stocks; use Blogdaleupsome for finding alternative investments
Comments
Post a Comment