Revenues and pre-tax profits up 27% and 28% respectively
Gas metering service provider Energy Assets Group (EAG) has reported strong first-half results with double-digit growth in revenues and profits.
The Livingston-based company said revenues for the six months to September 30 were up 27 per cent on a year ago to £7.6 million and pre-tax profits before exceptional items rose 28 per cent to £1.8 million.
AIM-listed EAG announced today it has signed a new non-exclusive agreement with DONG Energy Sales - formally Shell Gas Direct – to provide automated meter reading technology and data services to its industrial and commercial (I&C) users.
This latest agreement with DONG extends a current agreement between EAG, Shell Gas Direct and Gazprom Global Energy Solutions - formally Truread - signed in 2008.
The agreement is the first new advanced metering contract signed by EAG since its £13.5 million acquisition of Gazprom Global Energy Solutions (GGES) in October, a deal EAG said would double its data collection capability.
Manchester-based GGES manages a portfolio of around meters across the gas, electricity and water sectors.
CEO of Energy Assets, Phil Bellamy-Lee, said: “By signing this new agreement we are delighted that DONG Energy has continued to place its trust in EAG’ capabilities and technology.
“The agreement provides EAG with a further opportunity to continue its growth strategy and enhance its position as the leading independent provider of metering services to the UK I&C energy market.
“It is a clear indicator that the proven deployed technology, which was part of the recent acquisition, will deliver value and opportunity in the future.”
EAG said its meter portfolio rose by 16 per cent in the first half to circa 73,000 assets since the year end and by 30 per cent year on year.
The group said in first-half results today recurring revenue in the first half rose by 32 per cent year on year to £5 million and recurring revenues now account for 66 per cent of total revenues.
EAG described the acquisition of GGES as it entered into the second half of the financial year as a “transformational” deal which will double the number of meter points it takes data from as well as providing potential to double the size of its I&C meter portfolio.
The group added its partnership with a growing gas supplier also provided opportunities to increase its automated meter reading (“AMR”) portfolio and siteworks activities.
EAG's data logger portfolio has increased by 16 per cent to circa 22,000 in the first half.
Commenting on the half year results, Bellamy-Lee said: “I am delighted to be able to report a strong operational and financial performance in the first half of the year, reflecting good organic growth across our three business divisions.
“Our primary strategy continues to be the expansion of our market share as a meter asset manager (MAM) and to remain the leading independent MAM, by volume of meters owned and managed, within the UK I&C gas sector.
“This position remains secure and has been further cemented through our growth in the year to date.
“The recent acquisition of GGES is a transformational deal for the group providing us with a significant opportunity to more than double our existing I&C metering portfolio during the term of the contract, in partnership with one of the world’s largest energy companies.
“Following the acquisition, we are now a leading provider and developer of AMR technology with a proven and significantly deployed technology platform and a range of products with the potential to serve the wider utilities markets.
“We have considerably strengthened our market position and, coupled with government regulatory requirements to ensure meters in the UK are advanced or smart, we remain confident of our continued growth prospects into the future.
“We have added to our business development team through the appointment of individuals with strong industry expertise who will complement the expertise of the team at GGES.
“This strengthened resource will ensure that we can take advantage of the new opportunities available to us to grow our business.
“We have also strengthened our siteworks design team, placed further emphasis on sales and marketing activities within AMR, and gained accreditation to enable direct metering installation works.
“All of these actions enable us to maximise the opportunity available to our integrated solution.”
Shares in EAG were up more than three per cent in early trading today.