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'Strong results' from Aim firm

SMS hits one million meter milestone

Alan FoySmart Metering Systems has reached a number of key milestones including installation more than one million meter and data assets, it said today.

Unveiling a 15% rise in underlying pre-tax profits of £9.2 million for the half-year, Alan Foy, chief executive (pictured), said the Aim-quoted company has a growing customer base.

Willie MacDiarmid, chairman, added: “I am delighted to report another strong set of results for the first half of 2016.

“SMS now manages over one million utility metering and data assets on behalf of an expanding customer base of energy suppliers in the industrial and commercial (I&C) and domestic markets, including the new domestic smart meter market, on long-term index-linked contracts.

“During the first half of 2016, SMS signed new contract agreements for the ownership of domestic smart meters with a number of energy suppliers, including the UK’s largest independent energy supplier, First Utility, as well as RHE, Green Energy, Flow Energy, Spark Energy, Our Power, Ecotricity, and Economy Energy, thereby firmly establishing SMS’ position in the new and significant domestic smart meter market.

“The energy suppliers with whom SMS has contracted so far represent part of the fastest growing segment of the energy supply market and currently provide energy to circa 2 million of the circa 27 million homes in the UK which will be offered a new smart gas and electricity meter by 2020.

“The first six months are also notable for SMS’ strategic acquisitions of CH4, Trojan, and Qton, who together provide the Group with the necessary in-house accreditation and capacity to install and adopt ownership of utility metering assets on behalf of the UK’s licenced suppliers.

“CH4 and Trojan, prior to acquisition by SMS, have installed over 400,000 domestic smart meters, which, we understand, accounts for nearly 20% of all domestic smart meters installed in the UK. These acquisitions significantly enhance SMS’ capability to be one of the key participants in the ongoing domestic smart meter rollout.” 

SMS said the UK market for ownership of domestic smart meters presents a significant market opportunity for rollout to some 27 million homes by 2020.

With the recent acquisitions, the company has changed its operational delivery model from being wholly reliant on subcontractors for the installation of utility meters to gaining direct control of a large proportion of installation capacity. It says this potentially leads to increasing growth of a share in the UK’s domestic smart meter rollout. 

Paul Dollman stepped down from his position as non-executive chairman, and from the board, in order to concentrate on his other business interests.

Graeme Bissett was appointed as a non-executive director and chairman of the audit committee. Miriam Greenwood was appointed senior independent non-executive director and chairman of the remuneration committee.

Highlights

•              Revenue increased by 25% to £32.3m (H1 2015: £25.8m)

•              Total annualised recurring income* increased by 23% to £37.4m (H1 2015: £30.5m)

•              Underlying EBITDA** increased by 20% to £14.7m (H1 2015: £12.2m)

•              Underlying EBITDA** margin at 45% (H1 2015: 47%)

•              Underlying PBT*** increased by 15% to £9.2m (H1 2015: £8.0m)

•              Underlying earnings per share **** increased by 23% to 8.45p (H1 2015: 6.90p)

•              Interim dividend of 1.37p per ordinary share, an increase of 25%



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