UK's Yu Group H1 revenue rises 19% on higher volumes

Overview

• UK gas and electricity supplier's H1 revenue grew 19% yr/yr, driven by higher volumes

• Adjusted EBITDA rose 4% yr/yr as gross profit increased, while gross margin narrowed

• Company declared interim dividend of 24 pence per share amid continued meter and contract growth

Outlook

• Yu Group expects FY26 revenue, adjusted EBITDA and EPS in line with market expectations

• Company expects contract book to approach £2bln by end-2026

• Yu Group says strong cash generation will support increased shareholder distributions

Result Drivers

• VOLUME AND METER GROWTH - Revenue growth was driven by a 43% increase in meter points and a 25% rise in energy volumes supplied

• MARGIN PRESSURE - Gross margin declined due to increased industry costs and ongoing competitive pressures

• SMART METER INVESTMENT - Growth in smart meter assets led to a 67% increase in recurring index-linked annuity income

Company press release:

Key Details

Analyst Coverage

• The current average analyst rating on the shares is "strong buy" and the breakdown of recommendations is 3 "strong buy" or "buy", no "hold" and no "sell" or "strong sell"

• The average consensus recommendation for the multiline utilities peer group is "buy."

• Wall Street's median 12-month price target for Yu Group PLC is GBp2,134.00, about 17.9% above its September 21 closing price of GBp1,810.00

• The stock recently traded at 8 times the next 12-month earnings vs. a P/E of 8 three months ago

Reuters Recommended Reads

• Sept 21 - UK's B90 Holdings H1 revenue rises 38%, net loss narrows

• Sept 21 - UK's Invinity H1 revenue rises on project deliveries

• Sept 20 - UK property asking prices rise for first time since May, Rightmove says

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(This story was created using Reuters automation and AI based on LSEG and company data. It was checked and edited by a Reuters journalist prior to publication.)