Shares in the three listed water companies have fallen following the Brexit “shambles” which unfolded yesterday (15 November).
Shares in Severn Trent, United Utilities and Pennon Group have all been on a gradual rise over the past month. However, all plunged following the publication of prime minister Theresa May’s Brexit deal.
Shares have since recovered somewhat but continue to trade lower than in the previous week.
United Utilities share price, 12-16 November
United Utilities saw its share price fall 7.3 per cent from a high of 778.60 pence per share at 11:30am on 14 November to 721.60 pence per share at 4pm on 15 November.
Pennon Group share price, 12-16 November
Shares in Pennon Group, too, were impacted, dropping 10.6 per cent from 776.80p on 14 November to 694.20p the following day.
Severn Trent share price, 12-16 November
Meanwhile, Severn Trent shares saw an 8.9 per cent drop from 1,977.50p to 1,800p the following day.
Prime minister Theresa May’s Brexit deal has proved to be highly controversial and has resulted in the resignation of several government ministers, including the Brexit secretary himself, Dominic Raab.
Many analysts do not believe the impact of Brexit will change the fundamental environment within which water companies operate. However, according to PwC, the prolonged uncertainty “may undermine the financial support for UK infrastructure projects”.
“It has been confirmed that debt funding from the European Investment Bank, a major contributor towards UK water sector capital projects, will be not available post-Brexit, so UK water companies are actively looking for alternative sources to bridge any gaps,” said Antony Cook – partner, enterprise asset management lead at PwC – in an article on the company’s website.
Water companies are also expected to come up against skills issues that might arise in the supply chain when landing people from outside the UK – for example to implement IT systems or install or maintain technical facilities and equipment.
Share prices of all three listed water companies over the past month
