New deep dive: "Octopus Smoke and Mirrors" exposes what's really going on behind the hype at Octopus, the UK's biggest energy supplier. Spoiler: a lot of valuation puffery, restated accounts and marketing flim-flam. A thread (1/10)
Recap: Last year I asked if we'd hit "Peak Pink Octopus" after news of spinning off Kraken (their tech platform) at £10bn, valuing the whole group at £15bn. It smelled like hype before a sale which was borne out by the actual valuation of ~£6.7bn. (2/10)
Now the latest FY2025 accounts for Octopus Energy Group Limited show it fell into losses again. Investors were not on hand to provide more funding. Instead they sought to monetise their investment by demerging Kraken (3/10)
Despite the demerger hype, Kraken fell into losses in a shortened FY2025 and they restated their 2024 accounts. This creates more than a little smoke and mirrors around the group's true value (4/10)
The main energy supply business is profitable, but they also restated their 2024 accounts in the latest submission. Octopus Energy is also apparently falling short of Ofgem’s Capital Target even though it now meets the less rigorous capital floor (5/10)
The EV business has restated its accounts again, but is still losing money and the negative asset position got even wider in FY2025. It turns out that providing “everything you need to switch to cheaper, greener electric driving” isn’t profitable (6/10)
Other subsidiaries are making losses and even Octopus Energy Generation that manages green energy investments is losing money despite claiming to be "transforming the world of renewables generation". It costs money to help investors lose money. (7/10)
CEO @g__j has made claims that renewables are cheapest but was contradicted by staff who told the ESNZ Sel. Comm. that electricity prices will be 20% higher even if wholesale prices halve, which can only be driven by the on-costs of renewables (8/10)
Separating Kraken and restating accounts will not address the underlying problems at @OctopusEnergy. The group's valuation games and restating of accounts suggest they will need more than smoke and mirrors to stem the losses (9/10)
@OctopusEnergy If you enjoyed this thread, please like and share. You can sign up for free to read the full article on the link below (10/10)
open.substack.com/pub/davidturve…
@OctopusEnergy Hi @threadreaderapp unroll please.
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