Energy Assets (EAS) recorded a 39 per cent jump in pre-exceptional operating profits at the half-year mark to £4.6m, as the industrial gas meter specialist continued to secure new contracts from major gas suppliers such as Gazprom and British Gas.
EAS delivered strong revenue growth on the back of the new contract wins, while last year's acquisition of EA Energy Solutions added £2.3m to the top line. More importantly, EAS is successfully drawing in repeat business, as demonstrated by a 58 per cent hike in recurring revenues to £7.9m, which represents two-thirds of the total. The company's portfolio of installed units has increased by 14 per cent since the March year-end to 92,500 units, while the number of meter points from which data is collected on behalf of customers has risen by 151 per cent to around 56,500. That bumper growth, coupled with a 98 per cent contract renewal rate, helped more than double revenues to £3m at the company's Automated Meter Reading business.
The expansion of EAS is also reflected in a 68 per cent rise in operating cash flow to £6.4m, but net debt was still up by 15 per cent to £46m since the year-end due to the capital-intensive growth phase EAS is undergoing. Still, that's well within credit lines which were refinanced earlier this year.
Numis anticipates full-year EPS of 18.5p (from 10.9p in 2013), rising to 26p the year after.
ENERGY ASSETS (EAS) | ||||
|---|---|---|---|---|
| ORD PRICE: | 353p | MARKET VALUE: | £96.0m | |
| TOUCH: | 350p-358p | 12-MONTH HIGH: | 356p | Low: 180p |
| DIVIDEND YIELD: | nil | PE RATIO: | 30 | |
| NET ASSET VALUE: | 96p* | NET DEBT: | 177% | |
| Half-year to 30 Sep | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2012 | 7.6 | 1.53 | 4.35 | nil |
| 2013 | 11.8 | 2.77 | 8.37 | nil |
| % change | +56 | +82 | +92 | - |
*Includes intangible assets of £13.2m, or 48p per share | ||||
