Pennon Group PLC, trading under the symbol OTC:PEGRY, is a prominent player in the UK water industry. The company owns South West Water and Bristol Water, providing essential water services to millions. Despite its strong market presence, Pennon faces competition from other water companies like Severn Trent and United Utilities.
On November 27, 2025, Pennon reported earnings per share of $0.3677, slightly surpassing the estimated $0.3671. However, its revenue of approximately $870.5 million fell short of the expected $881.1 million. This mixed performance was reflected in the company's share price, which increased by 3% to 544.5p, as highlighted by the recent earnings call.
Pennon's financial performance showed a return to profit for the first half of the 2025/26 financial year, with statutory pre-tax earnings of £65.9 million, a significant improvement from a £38.8 million loss the previous year. This turnaround was driven by increased water revenues and better cost management, resulting in a 56% surge in underlying EBITDA to £254.4 million.
Despite these gains, Pennon announced a reduction in its interim dividend by nearly 25% to 9.26p per share. This decision was attributed to timing mechanics following a rights issue conducted last year. The company's capital expenditure remained high at £304.8 million, as it continued with the early implementation of its ambitious K8 investment programme.
The debt-to-equity ratio is 3.14, suggesting a significant reliance on debt financing. However, the current ratio of 1.51 indicates a reasonable level of liquidity to cover short-term liabilities.
