HomeServe (HSV) looked across the Atlantic to increase its customer numbers last year. After acquiring Utility Service Partners (USP) - one of North America's largest emergency home assistance companies - in July, the group signed 100 new utility partnerships. It now offers products to 50m households, with a goal to reach 80m.
The purchase of USP added 0.4m new customers, which helped push customer numbers up by 0.7m to 3m. As a result, sales in this immature market were up by almost half to £228m. Within the higher-margin French business sales were up 2 per cent at constant currency, helped by its partnerships with water and waste companies Suez and Veolia. In Spain the newly rebranded HomeServe Spain's claims handling business increased its market share. However, after ceasing its partnership with Agbar, its affinity partner households dropped to 12 from 15 in the previous year.
Customer numbers in the largest UK business were flat at 2.2m. However, the business carried out 0.2m extra jobs, with income from its repair network up almost a quarter to £100m. Management is keen on further geographical expansion via joint ventures. It also bought a 40 per cent stake in Checkatrade in the UK and a 70 per cent holding in Habitissimo in Spain to boost its online presence.
Analysts at Peel Hunt expect adjusted pre-tax profits of £129m during the 12 months to March 2018, giving EPS of 29.4p (up from £112m and 24.9p in 2016).
HOMESERVE (HSV) | ||||
|---|---|---|---|---|
| ORD PRICE: | 782.5p | MARKET VALUE: | £2.43bn | |
| TOUCH: | 782-782.5p | 12-MONTH HIGH: | 803p | LOW: 418p |
| DIVIDEND YIELD: | 2.0% | PE RATIO: | 33 | |
| NET ASSET VALUE: | 119p* | NET DEBT: | 71% | |
| Year to 31 Mar | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2013 | 547 | 67.0 | 12.9 | 11.3 |
| 2014 | 568 | 24.4 | 3.1 | 11.3 |
| 2015 | 584 | 76.7 | 17.2 | 11.5 |
| 2016** | 633 | 82.6 | 19.6 | 12.7 |
| 2017 | 785 | 98.3 | 24.0 | 15.3 |
| % change | +24 | +19 | +22 | +20 |
Ex-div: 6 Jul Payment: 3 Aug *Includes intangible assets of £591m, or 190p a share | ||||
