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Introduction
of Analysis of the Genesis Company
The company is involved in range of
businesses in the energy sector like they are a generation business, retail
business as well as have their interests in Kupe gas field and oil. It shows
that company has a diversified profile in the energy business. They sell range
of products such as LPG, natural gas as well as electricity with the help of
their retail business. They are not only involved in generation of electricity,
but they also trade natural gas and electricity with the support of their
generation business. In Kupe Joint Venture, the owner of Kupe oil & gas
field, their interest ratio is 46 percent. The company is from New Zealand, and
they are one of the largest gas and electricity retailers in the country. For
this purpose, they use their retail brands such as Genesis as well as Energy
Online. They handle around 650,000 connections of customers all over the New
Zealand. The range of customers include industrial, commercial as well as
residential. The company is involved in renewable generation and thermal
generation across different plants in New Zealand. The company has one big
thermal generation power station, whereas the number of renewable generation
power stations is eight. In the wholesale market, they are generating electricity
at the best lowest costs, so they have interest in Kupe oil & gas field
The range of products for the
company is vast as they provide electricity, natural gas as well as bottled gas
for residential and business customers, whereas solar product is only provided
to residential customers. The company also provides energy solutions not only
for small and medium businesses, but also for large businesses, trade
connection etc. They also provide services in rural areas for farmhouses,
farmlands, and Ruralco. It shows the variety and range of their business in the
energy sector, where they are one of the largest companies in New Zealand
The
Competition and Challenges in the Industry with
In energy sector of New Zealand, the
business has got more competitive than ever before. The more interesting part
is that competition is not staying at any particular point; rather it is
getting stiff and intense with the passage of time. It has been observed that there
are more than forty retailers in this energy retail industry, and they are all competing
to gain customer’s attention, attraction and loyalty. They are trying to find
new ways to increase their customer base. The value for customers is the most
important element of competition in this industry, that’s why Genesis is trying
it’s hard to keep customers value on top priority. They are coming up with new
solutions for customers so that things can move in right direction. To stay
ahead in the competition, the company is introducing more services for their
customers such as electricity insights for the monitoring of bottled gas and
business, power shouts as well as Energy IQ app. The executive general manager
for technology and digital, Ms Jennifer (Jen) Cherrington-Mowat has said that “Our insights and data have been designed to
be both accessible and actionable for our customers – they shouldn’t need a PhD
in mathematics to work out their energy bill. With Energy IQ, we wanted to
deliver a product that truly adds value to our customers' lives and makes
others say, “I want that”. That’s why Energy IQ is leaps and bounds ahead of
the standard ‘one size fits all’ digital approach our competitors take.” It
means that Energy IQ app is really helping Genesis to deal with intense competition,
which is throwing various challenges in the industry
The Analytical Thinking Tools of Genesis Company
It is important to look at some graphs and charts to show the results of the company in different aspects like how they are doing in terms of their market shares, what is their annual performance in terms of revenues and profits. The analysis will be based on analytical aspect so that a proper review of the company can be done.
The Brief Summary of the Situational Analysis of the Genesis Company
Overview of Analysis of the Genesis Company
It is important to mention here that
Genesis is owned by the New Zealand state for portfolio of electricity
generation. The company started its operations in 1999. The company generates
power from its renewable and thermal power stations, and it fulfills the needs
of 19 percent out of 100 percent electricity supply across New Zealand. The
company has stated its vision as “Our aim
is to operate as a commercially-focused sustainable company providing
responsible energy solutions to our customers”. It means they are striving
to become best in the business. It is important to know with facts &
figures that how company is performing, so their overall financial performance
is reviewed in this section. It is important to mention that company got its
first listing on New Zealand Stock Exchange in 2014 for its ordinary shares
To understand the overall financial performance
in different aspects, it is important analyze above mentioned statistics and
figures one by one. First of all, the share performance will be analyzed. The
data showed that current price for its share is $3.000 NZD, and it has been
observed that it is the highest share price in last 52 weeks. However, it is considerable
to know that last closed price of their share was $2.960 NZD, and the lowest
share price in last 52 weeks was $2.137 NZD. These statistics are clearly
showing that share price for the company is increasing with the passage of
time. It is depicting good performance on New Zealand’s Exchange. The graph for
share price performance also shows that share price is rising with each month.
In months of Oct and Nov, the price went down a bit, but it started rising
again from December and in last two months, the progress looks to be
significant
The next important stat to be
analyzed is income statement closed for the year 2018. It shows that operating
revenue for the company was $1,951.1m in year 2017, whereas it reached to $2,304.5m
in year 2018; a clear rise in the revenue. The operating expenses also
increased in 2018 as compared to 2017, but it was obvious as operating revenues
are increasing at a good pace. It means that company is certainly good
attention from customers as their operating revenue is increasing with the
passage of time. The other most important figure to explain is the balance
sheet, because it provides a comprehensive overview of a company’s financial
performance. According to company’s balance sheet, the current assets of the
company were $ 393.1m in 2018, whereas in 2017, the
number was at $ 372.3 showing a considerable increase in
its assets. The total assets for the company in 2018 were $ 4,235.0m
in 2018, which is again bit higher as compared to year 2017. The total current
liabilities in 2017 were $ 228.2m, whereas it extensively reached
to $462.6m in 2018, and company must analyze that why current liabilities are
going that high
The total equity for the company in
2017 was $ 1,981.9 in 2017, which was recorded as $1,961.5m in
2018, which means that there was a bit decrease in total equity for the
company. The other important financial document to review is cash flow
statement. The operating cash flow in 2017 was $ 248.5m, which
reached up to $ 330.6m 2018, and financing cash flow for
year 2018 was $ 226.9m in 2018, and both of these cash
flows were higher than year 2017. The net profit for the company in 2018 was $
19.8m.
The working capital movements observed at $5.1m in 2017, but there was
significant increase in this in 2018 as it went up to $17.9m, way higher than
the previous years. It is also important to mention here that net profit for
the company was $20m in 2018 after tax. The total generation experienced 11%
increase and Kupe gas production also observed an increase of 5%. These
financial numbers are quite evident to show that company is going well in the
energy sector and staying ahead in the competition, regardless of lots of challenges
SWOT Analysis of the Genesis Company
It is always viable to do SWOT
analysis to know more about some important relevant factors for the company.
Strengths of the Genesis Company
·
The company has great range of products
like covering different aspects of energy sector with products such as
electricity, bottled gas, natural gas and solar energy.
·
It serves clients from all important
segments of the industry such as commercial, residential corporate and
business.
·
The company also reached rural area to
serve customers of farmhouses, farmlands etc
·
The company is listed at New Zealand Stock
Exchange with good share price
·
The company is owned as an important state
enterprise
·
The company’s’ sustainability efforts are
of high standards to protect environment and society
Weaknesses
of the Genesis Company
·
The company has to deal with range of
businesses, which makes life difficult for the company to handle relevant
processes
·
They need to expand their range and supply
to meet demands on constant basis
Opportunities
of the Genesis Company
·
The company look for more innovations in
its energy management and customer services
·
Genesis can reach every part of the
country by expanding its number of power stations and plants across New Zealand
·
The company can look for more strategic
options to expand their business even outside New Zealand
Threats of the Genesis Company
·
The company is facing intense competition
from other competitors as competition is intense than ever before
·
The environmental challenges are biggest
threats like changing climate is a treat for thermal energy production
PEST Analysis of
Political of the Genesis Company
The company have impacted by the risk of
military invasion and the Bureaucracy involvement in the industry of Materials
sector. The anti-trust law related with the material also likely to have an
influence on the business of Genesis.
Economical of the Genesis Company
Stability & Exchange rates of the currency
in the host country have an impact on the Genesis. In order to effectively run the business the
company also needed to work in the efficient financial markets and they may
have the limited growth of the capital in the local markets.
Social of the Genesis Company
The culture of the country and the
education level of the population also have an impact on the Genesis. It is
also important for the company to understand that not all society encourage the
entrepreneurship.
Technological of the Genesis Company
The technology have a lot of impact in the
products that Genesis is offering. The
genesis is also moving towards the technological development.
Porters Five Forces
Analysis of
Two major competitors of the company are Heilind, BJG Electronics, Rutronik, Electro Enterprises etc.
|
Threat of New Enter |
Medium |
|
Bargaining Power of Customers |
Low |
|
Bargaining Power Suppliers |
High |
|
Threats of Substitutes |
Low |
|
Threats
of Rivalry |
High |
The overall business and situational
analysis along with SWOT very much depicts that Genesis is doing well in so
many ways. They have diversified their energy business portfolio by serving
range of products to variety of customers. The company has been on the move in
terms of its financial performance, and its share price on NZX is getting
increased with the passage of time. The company is also focusing to stay ahead
in the competition by serving its customers with variety of services such as
Energy IQ app. It can be said that future for the company is bright if they
look to continue this way.
References of the Genesis Company
Genesis. (2019a). About Genesis. Retrieved
March 24, 2019, from https://www.genesisenergy.co.nz/about-genesis
Genesis. (2018c). Annual
Report 2018. Retrieved March 24, 2019, from
https://gesakentico.blob.core.windows.net/sitecontent/genesis/media/new-library-(dec-2017)/about_us/investor/pdfs/2018/full%20year/ge-annual-report-29aug-2018.pdf
Genesis. (2019b). Genesis
Homepage. Retrieved March 24, 2019, from https://www.genesisenergy.co.nz/
Genesis. (2019d). Share
Performance. Retrieved March 24, 2019, from https://www.genesisenergy.co.nz/investors/share-performance
NZX Limited. (2019a).
GNE Analysis. Retrieved March 24, 2019, from
https://www.nzx.com/companies/GNE/analysis
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