TIDMEAS
RNS Number : 3745A
Energy Assets Group plc
07 June 2016
For immediate release 7 June 2016
Energy Assets Group plc
("Energy Assets", the "Company" or the "Group")
Preliminary Results for the year ended 31 March 2016
Energy Assets Group plc (LSE: EAS.L), the largest independent
provider of industrial and commercial (I&C) gas metering
services in the UK(1) and a major provider of multi-utility
network, metering and data services, is pleased to announce its
preliminary results for the year ended 31 March 2016.
Financial highlights
-- Total revenue increased by 25% to GBP45.3m (2015: GBP36.2m);
-- Recurring revenue, generated from the Group's meter and data
asset portfolio, increased by 12% to GBP26.1m (2015: GBP23.3m)
representing 58% of total revenue;
-- Revenue from Siteworks activity increased by 49% to GBP19.2m (2015: GBP12.9m);
-- EBITDA before exceptional items increased by 16% to GBP22.5m from GBP19.4m;
-- Operating profit before exceptional items increased by 20% to GBP15.2m from GBP12.7m;
-- Profit before tax and exceptional items increased by 20% to
GBP10.7m (2015: GBP8.9m). Profit before tax was GBP10.5m (2015:
GBP9.3m);
-- Basic earnings per share increased by 11% to 30.36p (2015: 27.30p);
-- Cash generated from operations increased by 8% to GBP21.1m (2015: GBP19.5m);
-- In November 2015, the Group announced a GBP10m increase to
its current facility with Lombard, the asset finance division of
The Royal Bank of Scotland Group, taking total facilities from the
Group's three main funding partners to GBP110m. Additionally, a two
year extension of the Group's GBP35m Bank of Scotland facility was
also agreed in November 2015;
-- Available facilities at 31 March 2016 were GBP29.5m and cash at bank was GBP6.7m.
Operational highlights
-- The Group's owned and managed meter and data asset portfolio
has increased by 23% in the year to circa 450,000 assets (2015:
circa 365,000) with all existing major contracts across gas and
electricity contributing to this growth;
-- The Company acquired Blyth Utilities Limited (Blyth), a
Multi-Utility Infrastructure Provider, on 9 December 2015.
Integration is progressing well;
-- Since acquisition, Blyth has successfully secured a new GBP6m
contract with East Lothian Developments Ltd (ELDL) to provide
utility networks for a new development in East Lothian. This is
testimony to the expertise and uniquely differentiated offering
within our expanded business;
-- The three new businesses acquired in the previous financial
year, Bglobal Metering, Origin and SA Gas, are now fully integrated
into the Group and are performing well under Energy Assets
management. Performance in the 2015/16 financial year was as
expected and the Board is pleased with the progress of each of
these businesses;
-- Energy Assets was appointed as a preferred supplier to Crown
Gas and Power (Crown), the gas supply division of Crown Oil Ltd, in
December 2015. The appointment, for the provision of advanced gas
metering technology and data services solutions, was made due to
Energy Assets reputation for delivering a high quality service
offering.
(1) By number of meters owned and managed
Corporate developments
On 18 April 2016, the Boards of Energy Assets and Euston BidCo
Ltd (BidCo) announced that they had reached agreement on the terms
of a recommended cash acquisition by BidCo, a newly established
company indirectly wholly owned by the Alinda Funds, which are
controlled and managed by Alinda, of the entire issued and to be
issued share capital of Energy Assets.
As previously advised by the Board of Energy Assets on 19 May
2016, the Court Meeting and the General Meeting were adjourned, in
each case to a date, time and place to be determined by the
directors. We would expect to be in a position to further update
shareholders in relation to this in the next few days.
Further information on the proposed acquisition, which has been
unanimously recommended by the Energy Assets Board, and its current
status can be found on the Energy Assets website.
Chief Executive's comment
Commenting on today's announcement, Chief Executive Phil
Bellamy-Lee said:
"The financial year to 31 March 2016 has been very successful
for Energy Assets incorporating good organic growth across our
asset portfolio and Siteworks business from strong trading activity
and new contract wins.
We were delighted to welcome Blyth into the Energy Assets Group
in December 2015. This acquisition represents another step in our
continuing growth strategy and has allowed us to expand our
services to become a fully accredited multi-utility infrastructure
provider in the commercial area. The acquisition has also enabled
us to extend our utility networks offering to businesses within the
UK house building sector at a very exciting time following recent
government announcements that investment in the housing sector is
set to double to support home ownership.
The addition of Crown to our customer portfolio and the
confidence they have shown in the capabilities and technology that
the Energy Assets Group can offer is testament to the hard work and
focus of our operational team. The relationship is progressing well
as we continue to deliver a level of service which matches their
expectations.
We continue to enjoy good relationships with all of our banking
partners who have expressed a keen interest to continue working
with the Group. We are confident that these relationships will
provide sufficient funding to facilitate our future growth plans as
we work towards being the supplier of choice for customers within
the UK I&C utilities sector and the largest independent
provider of I&C energy metering services in the UK.
The new financial year has started well, all segments continue
to grow and we are on track to deliver another year of strong
operating and financial performance."
Enquiries
For further information visit www.energyassets.co.uk or
contact:
Energy Assets Group plc
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Phil Bellamy-Lee / John McMorrow Tel: +44 (0)1506 405 405
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Buchanan
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Richard Darby / Patrick Hanrahan Tel: +44 (0)20 7466 5000
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Numis Securities Limited
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Charlie Farquhar / Stuart Skinner Tel: +44 (0)20 7260 1000
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About Energy Assets:
Energy Assets provides metering and related services in the
I&C segment of the UK utility market and is the largest
independent provider of I&C gas metering services in the UK, by
number of assets owned and managed.
The Group offers utility suppliers, end-user energy consumers
and commercial and residential developers a broad spectrum of
expert metering related services from the design, project
management and building of utility networks to management of new
and replacement meters and the collection and provision of energy
consumption data.
Energy Assets (EAS) is listed on the Main Market of the London
Stock Exchange.
Chairman's statement
I am delighted to report continued strong trading in what has
been another successful year for Energy Assets encompassing good
organic growth, major new contract wins and the acquisition and
successful integration of Blyth into the Group.
Energy Assets continues to achieve its core objectives providing
metering and related services in a reliable and sustainable way
and, throughout the 2015/16 financial year, the Group has continued
to deliver a high quality service and strong growth which is
significantly ahead of the prior year.
Profit before tax and exceptional items is up 20% to GBP10.7m
and our owned and managed asset portfolio has increased by 23% to
circa 450,000 assets. Our Siteworks business has generated revenues
of GBP19.2m, representing an increase of 49% (2015: GBP12.9m). The
strength of this performance is testament to the continuing and
growing demand for our services and the strength and scalability of
our operating systems and procedures.
The success we have achieved to date and our continued growth is
pivotal as we strive towards our goal of being able to provide a
full end to end multi-utility service offering across gas,
electricity and water.
Strategy
The Group operates within a clearly defined, long-term strategic
framework which is built around the efficient operation of and
strategic investment in a balanced range of businesses across the
UK I&C multi-utility metering and network markets and provides
effective scope for continued expansion.
We remain well positioned to achieve our primary objectives
which are:
-- To further consolidate our position as the largest
independent metering and data service provider to the UK I&C
gas sector;
-- To grow our position across the utility sector as a whole; and
-- To grow our successful Siteworks business and expand the
range and complexity of the services provided.
Following the year end, the Group made a strategic decision to
optimise the combined expertise of Blyth and the Energy Assets'
Siteworks gas design and project management service to create a new
force in gas, electricity and water utility network provision for
housebuilders and I&C markets, Energy Assets Utilities. Going
forward, Energy Assets Utilities will deliver all utility network
services and activities as an integral part of the wider Group
activities.
Acquisitions
The Energy Assets strategy focuses primarily on continuing to
achieve growth both organically and through making targeted
acquisitions which can add value.
The Blyth acquisition in December 2015 has now been successfully
integrated into the Group. This acquisition represented another
positive growth milestone for Energy Assets and has enabled us to
progress further towards meeting our primary objectives as we
continue to extend our product ranges and service offering to the
wider multi-utility market sector, encompassing gas, electricity
and water.
Funding
In November 2015 we announced a GBP10m increase to our current
facility with Lombard, the asset finance division of The Royal Bank
of Scotland Group, taking total facilities from the Group's three
main funding partners to GBP110m.
The expansion of the Group's relationship with Lombard increased
the facility to GBP70m, on the same terms as previously agreed.
Additionally, an extension was also agreed in November 2015 on the
Group's GBP35m Bank of Scotland facility which is now available for
a further two years.
Dividend
At the time of the Company's IPO it was stated that it was the
Directors' intention to prioritise investment to grow the Company's
installed asset base. This remains the case and, in the financial
year to 31 March 2016, a total of GBP22.9m (2015: GBP22.5m) was
invested in assets that generate long term recurring revenue for
the business. Additionally, Group return on capital employed at 31
March 2016 was 13.2%.
The Board is, therefore, not recommending a dividend for the
financial year ended 31 March 2016 but is continuing to keep the
dividend policy under review as the scope and nature of the Group's
activities continue to expand.
People
We now have over 300 employees across the Group and each of
these individuals has a key role to play in the successful
operation of our business. In particular, we have a dedicated and
talented management team who have steered the business through a
period of significant growth with great success.
On behalf of the Board, I would like to thank all of our people
for their hard work during this financial year and for their
continued commitment to Energy Assets.
Outlook
The new financial year has started well across the business and
we are on track to deliver another year of sound operating and
financial performance in 2016/17 as we continue to look to the
future with confidence.
Dr Christopher Masters
Chairman
7 June 2016
Business and financial review
Energy Assets is the largest independent provider of I&C gas
metering services in the UK (by number of assets owned and managed)
and a major provider of multi-utility network, metering and data
services.
Our strategy
The Group's primary objectives are:
-- To further consolidate our position as the largest
independent metering and data service provider to the UK I&C
gas sector;
-- To grow our position across the utility sector as a whole; and
-- To grow our successful Siteworks business and expand the
range and complexity of the services provided.
This strategy focuses primarily on growing the business
organically while making targeted acquisitions which can add value
to our core business.
In implementing this strategy we expect to:
-- Continue to grow our asset base, focussing on the I&C segment of the metering market;
-- Grow and diversify the primary energy supplier client base;
-- Increase direct engagement with end-user consumers;
-- Offer services across a multi-utility platform; and
-- Increase operational flexibility.
The Group's achievement of these key strategic priorities to
date can be linked to key performance indicators as follows:
Strategic Our progress in 2015/16 Continued focus for 2016/17
priority
Continue to
grow * Total owned and managed asset portfolio increased by * Increase meter installations in the I&C gas market
our asset 23% to circa 450,000 assets; through servicing of contracts with existing
base, customers;
focussing on
the * Recurring revenue accounts for 58% of total revenue
I&C segment being GBP26.1m compared to GBP23.3m in the previous * Continue to increase our presence in the electricity
of year, an increase of 12%; market installing additional meters and contracting
the metering MOP and DC/DA services;
market
* Total future contracted revenue from I&C gas meters
was GBP281.8m at 31 March 2016 (2015: GBP255.3m). * Increase recurring revenue through further organic
growth and strategic acquisitions.
Strategic Our progress in 2015/16 Continued focus for 2016/17
priority
Grow and
diversify * Energy Assets was appointed as a preferred supplier * Continue to grow relationships with existing gas and
the primary to Crown in December 2015. The appointment, for the electricity suppliers and seek to gain new
energy provision of advanced gas metering technology and relationships by actively marketing and continually
supplier data services solutions, was made due to Energy improving our service offering.
client Assets reputation for delivering a high quality
base service offering.
Increase
direct * The Energy Assets service is now being provided to * Continue to grow relationships, revenues and profits
engagement over 1,500 end-users across data services and with existing end-user consumers and seek to cement
with Siteworks; new relationships by offering increasingly
end-user sophisticated and integrated services.
consumers
* Siteworks revenue increased by 49% to GBP19.2m in the
year to 31 March 2016;
* The acquisition of Blyth in December 2015, further
increased the Group's direct customer base;
* Immediately following the year end, the Group
announced that it has secured a new contract with
ELDL to provide utility networks for a new
development at St Clements Well, Wallyford, East
Lothian. The new contract has a contract value of
GBP6m over the complete project term and is the
largest Utility Networks contract to ever be secured
by Energy Assets.
Offer
services * The acquisition of Blyth, a Multi-Utility * Continue to grow relationships with existing
across a Infrastructure Provider, in December 2015 enables multi-utility suppliers and end users and actively
multi-utility Energy Assets to provide a complete multi-utility seek to cement new relationships;
platform network offering to the commercial and residential
property development sector.
* Continue to develop internal technology which will
enable the Group to provide services across all
utilities.
Strategic Our progress in 2015/16 Continued focus for 2016/17
priority
Increase
operational * Continued growth of the Group's internal resource * Continue to utilise internal resources to install
flexibility team enabling further control over operational meters, further improving operational flexibility;
activities;
* Successfully integrate Blyth to enable the Group to
* The internal direct labour organisation (DLO) obtain maximum benefit from the acquisition.
installed over 30% of total meters (2015: 24%)
reducing reliance on subcontracted labour to install
assets;
* Acquisition of Blyth during the year increased
internal operational capability;
* No significant non-conformities reported across all
of the Group's accreditations.
Our progress in relation to our strategy can be further
highlighted through the trends in our asset base and revenue over
the past few years as follows:
2011 2012 2013 2014 2015 2016
Gas meter portfolio 47,000 63,000 81,000 101,000 123,000 147,000
Gas data collection points 15,000 21,000 52,500 62,500 75,000 87,000
Electricity meter portfolio - - - - 68,000 93,000
Electricity data collection
points - - - - 99,000 123,000
Recurring revenue GBP5.3m GBP8.3m GBP12.3m GBP16.9m GBP23.3m GBP26.1m
Siteworks revenue GBP4.3m GBP4.4m GBP5.7m GBP7.3m GBP12.9m GBP19.2m
Business model
Energy Assets provides metering and related services in the
I&C segment of the UK utility market and is the largest
independent provider of I&C gas metering services in the UK, by
number of assets owned and managed.
The Group offers utility suppliers, end-user energy consumers
and commercial and residential developers a broad spectrum of
expert metering related services from the design, project
management and building of utility networks to management of new
and replacement meters and the collection and provision of energy
consumption data.
Meter Asset Management and Data Services
The Group's main area of recurring revenue activity is the
provision, management and maintenance of I&C gas and
electricity meters and the collection and provision of consumption
data and, during the year, the meter and data asset portfolio has
increased by circa 85,000 assets bringing the owned and managed
meter and data asset portfolio to circa 450,000 assets.
Recurring revenue, which is generated through recurring meter
rental payments and payments for the provision of consumption data
from utility suppliers and end user consumers, increased by 12% to
GBP26.1m in the current period (2015: GBP23.3m) representing 58% of
total revenue.
The Group has relationships with some of the largest UK utility
suppliers and also some of the most respected niche suppliers,
operating across both gas and electricity.
In December 2015, Energy Assets announced that it has been
appointed as a preferred supplier to Crown, the gas supply division
of Crown Oil Ltd. The appointment is for the provision of advanced
gas metering technology and data services solutions.
The Energy Assets offering encompasses a suite of innovative
options and solutions to help customers manage their energy use and
meet the industry's obligations on carbon reduction. The Group has
a reputation for delivering high quality solutions to customers and
Energy Assets will partner with Crown, and all of its existing
customers, to deliver metering and data services of the highest
calibre, delivering a service which merits the confidence our
customers have shown in the capabilities and technology that the
Energy Assets Group can offer.
Going forward the I&C asset base is expected to continue to
grow as a result of existing contracts and future demand for the
installation of advanced and smart gas meters being driven by
Government policy which currently requires every metering point in
the UK to have advanced or smart-enabled energy meters by 2020.
Siteworks
Through its Siteworks division the Group provides customers with
an expert engineering, consultancy, system design and project
management service of the highest standard for multi-utility
networks and metering installations.
The business is rapidly establishing a reputation as a technical
leader in the design, project management and building of utility
networks and metering installations enabling continued growth and
revenue from Siteworks activity has increased by 49% during the
year to GBP19.2m (2015: GBP12.9m).
The acquisition of Blyth, a Multi-Utility Infrastructure
Provider involved in the design and construction of utility
networks direct to commercial and residential developers throughout
Scotland and the North of England on 9 December 2015, now enables
Energy Assets to provide a complete multi-utility product offering
across gas, electricity and water, in accordance with the Group's
strategy. The acquisition also creates growth opportunities through
targeting businesses within the UK house building sector and will
enable the Group to increase the market share of its existing
Siteworks division and provide a broader service offering to
customers.
Following the year end, the Group made a strategic decision to
optimise the combined expertise of Blyth and the Energy Assets'
Siteworks gas design and project management service to create a new
force in gas, electricity and water utility network provision for
housebuilders and I&C markets, Energy Assets Utilities. Going
forward, Energy Assets Utilities will deliver all utility network
services and activities as an integral part of the wider Group
activities.
Financial results and Key Performance Indicators
The Group monitors a number of financial and key performance
indicators as follows:
March 2016 March 2015 Growth
Revenue GBP45.3m GBP36.2m 25%
Recurring revenue GBP26.1m GBP23.3m 12%
Siteworks revenue GBP19.2m GBP12.9m 49%
EBITDA (before exceptional items) GBP22.5m GBP19.4m 16%
Operating profit (before exceptional
items) GBP15.2m GBP12.7m 20%
Profit before tax GBP10.5m GBP9.3m 13%
Profit before tax and exceptional
items GBP10.7m GBP8.9m 20%
Cash generated from operations GBP21.1m GBP19.5m 8%
Total future contracted revenue from
I&C gas meters GBP281.8m 255.3m 10%
Net Debt/EBITDA 3.4 3.4
Return on capital employed 13.2% 13.2%
Basic earnings per share 30.36p 27.30p
Share price 475.30p 458.80p 4%
Asset portfolio
Gas meter portfolio 147,000 123,000 20%
Gas data collection points 87,000 75,000 16%
Electricity meter portfolio 93,000 68,000 37%
Electricity data collection points 123,000 99,000 24%
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Total asset portfolio (owned and
managed) 450,000 365,000 23%
The Group has continued to grow revenue and profits through
strong performances across each of its business segments.
For the year ended 31 March 2016, revenue was GBP45.3m, showing
an increase of GBP9.1m (25%) compared with the previous financial
year. This increase is predominantly due to the expanding asset
portfolio owned and managed by the Group and the strong organic
growth of the Siteworks offering.
At 31 March 2016 recurring revenue accounted for 58% of total
revenue being GBP26.1m compared to GBP23.3m in the previous year,
an increase of 12%. These recurring revenues are as a result of the
long term nature of the Group's metering and data contracts.
Gross profit margins have been maintained against the prior
year.
During the year the Group incurred non-recurring transaction
costs relating to the acquisition of Blyth amounting to GBP0.1m. In
the prior year similar costs of GBP0.1m were incurred in relation
to the acquisitions of Origin and SA Gas. The Group also incurred
non-recurring transaction costs of GBP0.1m in the current year
relating to the proposed acquisition by Euston BidCo Limited.
Upon acquisition of Bglobal Metering in the prior year, the fair
value of the net assets of this company was greater than the fair
value of the consideration paid resulting in a gain on the
acquisition of GBP0.8m in the prior year.
The Group implemented a number of share based payment schemes as
part of the IPO on 22 March 2012. The expense for the prior year in
relation to these schemes amounted to GBP0.2m. No further expense
will be incurred in the future in relation to these schemes.
Operating profit before exceptional items increased from
GBP12.7m to GBP15.2m, a rise of 20% and EBITDA before exceptional
items increased by 16% from GBP19.4m to GBP22.5m.
Profit before tax and exceptional items increased by 20% to
GBP10.7m (2015: GBP8.9m). Profit before tax was GBP10.5m (2015:
GBP9.3m) after deducting exceptional acquisition costs.
At a divisional level, the Group has installed circa 24,000 gas
meter assets during the year, increasing its total portfolio by 20%
to circa 147,000 meters. Given that the design life of meters is in
excess of 20 years it is expected that these assets will continue
to provide a solid source of long term recurring revenue over the
life of the asset which is currently forecast at GBP281.8m (2015:
GBP255.3m). Current year revenue increased to GBP16.6m (2015:
GBP14.1m).
In addition, the managed electricity meter asset portfolio
acquired with Bglobal Metering has increased to circa 93,000 assets
by the year end, up 37% compared to the prior year end.
Revenue from our data services business has increased to GBP9.5m
(2015: GBP9.2m) and the number of meter points from which data is
collected has increased to circa 210,000 across gas and electricity
(2015: circa 174,000). This represents one of the largest
portfolios within the UK I&C sector.
The Siteworks division continues to develop with significant
annual growth during the current financial year. Overall revenues
improved by 49% to GBP19.2m as a result of significant organic
growth across gas and electricity and the acquisition of Blyth in
December 2015.
Blyth Utilities Limited (Blyth)
On 9 December 2015, Energy Assets acquired the entire issued
share capital of Blyth, a Multi-Utility Infrastructure Provider
involved in the design and construction of utility networks direct
to commercial and residential developers throughout Scotland and
the North of England.
The transaction consideration comprises an initial cash payment
of GBP1.5m, 200,784 shares in Energy Assets Group plc with a market
value of GBP1m at the time of issue, which are subject to the
sellers of Blyth remaining with the Group during a restrictive
period of two years, and a three year earnout consideration of up
to GBP2.5m contingent on the future performance of Blyth.
Since incorporation in 2003, and now with a team of circa 80
highly qualified and professional employees, Blyth has built a
proven track record and has a strong reputation, based on quality,
expertise and delivery, as a key multi-utility network provider in
the commercial and residential construction sectors within Scotland
and the North of England.
This acquisition therefore enables Energy Assets to provide a
complete multi-utility product offering across gas, electricity and
water network design, project management and build, in accordance
with the Group's strategy, whilst also creating growth
opportunities to businesses within the UK house building
sector.
Energy Assets recognises the importance of high quality,
responsive and competitive provision of utility networks and, as
such, we are excited to be able to offer Blyth the support of the
wider Group to realise the potential for growth within both
businesses as a result of this acquisition.
Going forward, the Group will also examine the opportunity
arising from this acquisition to grow a pipeline asset portfolio,
utilising Blyth's existing Independent Gas Transporter (IGT)
licence, and it is intended that the Blyth business model will be
expanded across the UK using the existing Energy Assets
footprint.
The acquisition is in line with Energy Assets' established
strategy of making selective acquisitions which add value to the
Group and the Energy Assets directors are confident that the Blyth
business will provide enhanced earnings from the financial year
2016/17.
New contracts
Crown Gas and Power (Crown)
In December 2015, Energy Assets announced that it has been
appointed as a preferred supplier to Crown, the gas supply division
of Crown Oil Ltd. The appointment is for the provision of advanced
gas metering technology and data services solutions.
As the leading independent provider of I&C gas metering
services in the UK, the Energy Assets offering encompasses a suite
of innovative options and solutions to help customers manage their
energy use and meet the industry's obligations on carbon reduction.
The Group has a reputation for delivering high quality solutions to
customers and Energy Assets will partner with Crown to deliver
Meter Asset Management and AMR services of the highest calibre,
delivering a service which merits the confidence Crown has shown in
the capabilities and technology that the Energy Assets Group can
offer.
East Lothian Developments Ltd (ELDL)
Immediately following the year end, the Group announced that it
has secured a new contract with ELDL to provide utility networks
for a new development at St Clements Well, Wallyford, East
Lothian.
The new contract, which was signed by recently acquired
subsidiary Blyth, encompasses the provision of gas, water and
electricity networks for the development which will include
approximately 1,450 mixed residential units along with offices,
retail and supermarket units and a primary school.
With a contract value of GBP6m over the complete project term,
this is the largest Utility Networks contract to ever be secured by
Energy Assets and reaffirms the Group's strategy to provide a
complete multi-utility infrastructure offering across gas,
electricity and water.
The award of this contract underpins the growth aspirations the
Group has for Blyth as part of the Energy Assets Group and is
testimony to the expertise and uniquely differentiated offering
within the expanded business.
New branding
Following the acquisition of Blyth in December 2015, the Group
made a strategic decision to optimise the combined expertise of
Blyth and the Energy Assets' Siteworks gas design and project
management service to create a new force in gas, electricity and
water utility network provision for housebuilders and I&C
markets. The new Energy Assets Utilities brand was launched
immediately following the year end and, going forward, will deliver
all utility network services and activities as an integral part of
the wider Group activities.
Funding and financial position
In November 2015 we announced a GBP10m increase to our current
facility with Lombard, the asset finance division of The Royal Bank
of Scotland Group, taking total facilities from the Group's three
main funding partners to GBP110m.
The expansion of the Group's relationship with Lombard increased
the facility to GBP70m, on the same terms as previously agreed.
Additionally, an extension was agreed on the Group's GBP35m Bank of
Scotland facility which is now available for a further two
years.
We continue to enjoy good relationships with all of our banking
partners, who have expressed a keen interest to continue working
with the Group, and we are confident that these relationships will
provide sufficient funding to facilitate our future growth plans as
we work towards being the supplier of choice for customers within
the UK I&C utility sector and the largest independent provider
of I&C energy metering services in the UK.
Net debt at 31 March 2016 of GBP75.9m was GBP10.8m higher than
the previous year mainly as a result of the increase in capital
expenditure to service the growing meter portfolio. Capital
investment in meters amounted to GBP21.7m in the year and, at 31
March 2016, Energy Assets had a gas meter portfolio of circa
147,000 meters with a net book value of GBP101.5m (2015: circa
123,000 gas meters with a net book value of GBP85.4m).
Available facilities at the financial year end amounted to
GBP29.5m (2015: GBP28.7m) and the cash at bank balance at 31 March
2016 was GBP6.7m (2015: GBP7.8m).
Principal business risks and uncertainties
With 58% of our revenue being long term recurring revenue, over
a period of up to 20 years, much of our business is considered to
be predictable and relatively low risk.
Nonetheless, potential risks to the business are continuously
reviewed as part of our Operational Risk Self Assessment process
and actions to mitigate these risks are identified. The key risks
identified and managed are set out in the Strategic Report within
the 2016 Annual Report and Accounts and are summarised below:
Key risk Mitigation
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Interruption or failure
of IT systems which * Robust systems with appropriate back-up procedures in
could impair the Group's place both on and off-site;
ability to provide
services and invoice
assets effectively * Experienced internal IT software development
resource;
* Stringent test regime in respect of operating
platforms;
* Disaster recovery and business interruption processes
regularly tested.
-------------------------------- ------------------------------------------------------------------
Debt funding availability
* Ongoing dialogue with potential funders;
* Relationships with new funding partners who are keen
to work with Energy Assets;
* Current funding which, based on current plans, covers
a period of at least 18 months.
-------------------------------- ------------------------------------------------------------------
Reliance on the performance
of subcontractors * Careful monitoring of the quality of work undertaken
by subcontractors and the accreditations accorded to
them;
* Development and expansion of the Group's existing
internal resource team.
-------------------------------- ------------------------------------------------------------------
Changes in government
policy for all meters * Active engagement with industry bodies and working
to be smart or advanced groups;
by 2020
* Contribution to sector consultation;
* Well respected internal resource influencing industry
standards and DECC policy.
-------------------------------- ------------------------------------------------------------------
Key risk Mitigation
-------------------------------- ------------------------------------------------------------------
Economic conditions
impacting demand for * Broad customer mix of retail organisations, local
Group services governments and purchasing clubs minimising the
effect of economic conditions and short-term
decisions.
-------------------------------- ------------------------------------------------------------------
Pricing pressures
* Pricing pressures are regularly monitored and the
Group maintains strong relationships and
communication with all customers;
* The Group constantly reviews its prices and costs to
ensure these remain competitive whilst continuing to
ensure adequate levels of shareholder return.
-------------------------------- ------------------------------------------------------------------
Dependency on a limited
number of gas suppliers. * The Group maintains strong relationships with all
customers;
* Customer service is paramount and the level of
service provided to Energy Assets' customers is
second to none;
* Strict service levels are monitored throughout the
business to ensure the Group meets and exceeds
customer expectations;
* Continued diversification of products and services to
new and existing clients dilutes such dependencies.
-------------------------------- ------------------------------------------------------------------
Change of gas supplier
by end-user consumer * The Group strives to maintain continued dialogue with
which may lead to a number of gas suppliers and those in need of our
the return of meters services as a fully integrated metering solution;
to the Group and a
corresponding loss
of rental income * Energy Assets now serves gas suppliers who represent
over 80% of the I&C gas market by volume of gas
supplied and the Group seeks to build and maintain
strong relationships with all of these gas suppliers
ensuring the risk of churn is minimised.
-------------------------------- ------------------------------------------------------------------
Loss of required accreditations
* The Group takes its commitment to retaining
accreditations seriously and the internal compliance
manager is responsible for ensuring all requirements
are met and all staff members are fully trained;
* The Group has no significant non-conformities in
respect of the accreditations it holds.
-------------------------------- ------------------------------------------------------------------
By order of the Board
Philip Bellamy-Lee John McMorrow
Chief Executive Officer Chief Financial Officer
7 June 2016 7 June 2016
Consolidated statement of comprehensive income
For year ended 31 March 2016
Note 2016 2015
GBP'000 GBP'000
Revenue 4 45,270 36,208
Cost of sales 4 (20,064) (16,098)
--------- ---------
Gross profit 25,206 20,110
Administrative expenses 4 (10,214) (6,991)
--------- ---------
Operating profit 14,992 13,119
Attributable to:
Operating profit before exceptional
items 15,228 12,721
Exceptional acquisition costs 5 (236) (129)
Exceptional gain on acquisition 5 - 760
Exceptional IPO share based payment
expense 5 - (233)
---------
Operating profit 14,992 13,119
--------------------------------------------- ----- --------- ---------
Finance income 16 10
Finance costs (4,504) (3,811)
--------- ---------
Profit before tax 10,504 9,318
Taxation 6 (2,051) (1,852)
--------- ---------
Profit for the year 8,453 7,466
Other comprehensive income
Items that may subsequently be reclassified
to profit or loss
Cash flow hedge movement, net of tax 3 (891)
--------- ---------
Total comprehensive income for the
year 8,456 6,575
--------- ---------
Basic earnings per share (pence) 7 30.36 27.30
Diluted earnings per share (pence) 7 29.37 26.61
Consolidated Balance Sheet
As at 31 March 2016
Note 2016 2015
GBP'000 GBP'000
ASSETS
Non-current assets
Intangible assets 22,535 17,658
Property, plant and equipment 8 107,199 90,586
Deferred tax asset 3,782 4,363
--------- ---------
133,516 112,607
Current assets
Inventories 2,357 1,717
Trade and other receivables 13,051 7,785
Cash and cash equivalents 6,748 7,835
--------- ---------
22,156 17,337
TOTAL ASSETS 155,672 129,944
--------- ---------
EQUITY AND LIABILITIES
Liabilities
Current liabilities
Trade and other payables 19,223 14,240
Current tax liabilities 129 184
Borrowings 9,891 8,207
--------- ---------
29,243 22,631
Non-current liabilities
Borrowings 72,746 64,707
Derivative financial instruments 2,062 2,117
Deferred tax liabilities 5,323 3,995
--------- ---------
80,131 70,819
Total liabilities 109,374 93,450
NET ASSETS 46,298 36,494
--------- ---------
Equity attributable to owners of the
parent
Share capital 280 278
Share premium 16,270 15,272
Share based payment reserve 1,351 1,050
Other reserves (33,876) (33,879)
Retained earnings 62,273 53,773
--------- ---------
46,298 36,494
--------- ---------
TOTAL EQUITY AND LIABILITIES 155,672 129,944
--------- ---------
Consolidated Statement of Changes in Equity
For year ended 31 March 2016
Share based
payment Retained
Share capital Share premium reserve Other reserves earnings TOTAL
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Attributable
to the owners
of the Parent
Company:
At 1 April
2014 272 14,274 1,171 (32,988) 45,672 28,401
Profit for
the year - - - - 7,466 7,466
Cash flow hedge
movement, net
of tax - - - (891) - (891)
--------------------- -------------- -------------- ------------ --------------- ---------- --------
Total comprehensive
(expense)/
income for
the year - - - (891) 7,466 6,575
--------------------- -------------- -------------- ------------ --------------- ---------- --------
Issue of shares 6 998 - - - 1,004
Value of employee
services - - 290 - - 290
Equity element
of deferred
tax on share
based payments - - 269 - - 269
Transfer to
retained earnings
upon exercise
of share options - - (680) - 635 (45)
--------------------- -------------- -------------- ------------ --------------- ---------- --------
Transactions
with owners
of the Parent
Company 6 998 (121) - 635 1,518
--------------------- -------------- -------------- ------------ --------------- ---------- --------
At 31 March
2015 278 15,272 1,050 (33,879) 53,773 36,494
-------------- -------------- ------------ --------------- ---------- --------
Consolidated Statement of Changes in Equity
For year ended 31 March 2016
Share based
payment Retained
Share capital Share premium reserve Other reserves earnings TOTAL
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Attributable
to the owners
of the Parent
Company:
At 1 April
2015 278 15,272 1,050 (33,879) 53,773 36,494
Profit for
the year - - - - 8,453 8,453
Cash flow hedge
movement, net
of tax - - - 3 - 3
--------------------- -------------- -------------- ------------ --------------- ---------- --------
Total comprehensive
income for
the year - - - 3 8,453 8,456
--------------------- -------------- -------------- ------------ --------------- ---------- --------
Issue of shares 2 998 - - - 1,000
Value of employee
services - - 599 - - 599
Equity element
of deferred
tax on share
based payments - - (212) - - (212)
Transfer to
retained earnings
upon exercise
of share options - - (86) - 47 (39)
--------------------- -------------- -------------- ------------ --------------- ---------- --------
Transactions
with owners
of the Parent
Company 2 998 301 - 47 1,348
--------------------- -------------- -------------- ------------ --------------- ---------- --------
At 31 March
2016 280 16,270 1,351 (33,876) 62,273 46,298
-------------- -------------- ------------ --------------- ---------- --------
Consolidated statement of cash flows
For year ended 31 March 2016
2016 2015
GBP'000 GBP'000
Cash flows from operating activities
Profit before taxation 10,504 9,318
Finance income (16) (10)
Finance costs 4,504 3,811
Exceptional gain on acquisition - (760)
Depreciation 6,592 6,160
Intangibles amortisation 678 545
Net foreign exchange gains - (4)
Share based payment expense 599 290
Increase in inventories (440) (253)
Increase in trade and other receivables (2,318) (1,353)
Increase in trade and other payables 962 1,794
--------- ---------
Cash generated from operations 21,065 19,538
Income tax (225) -
--------- ---------
Net cash from operating activities 20,840 19,538
Cash flows for investing activities
Payments to acquire property, plant and equipment (23,589) (22,866)
Payments to acquire intangible assets (823) (339)
Purchase of subsidiaries, net of cash acquired (2,750) (6,541)
Finance income 16 10
--------- ---------
Net cash used in investing activities (27,146) (29,736)
Cash flows from financing activities
Proceeds from new borrowings 18,878 20,922
Repayments of borrowings (9,155) (6,931)
Finance costs (4,504) (3,811)
Net cash from financing activities 5,219 10,180
Net decrease in cash and cash equivalents (1,087) (18)
Cash and cash equivalents at the beginning of
the year 7,835 7,853
Cash and cash equivalents at the end of the
year 6,748 7,835
--------- ---------
Notes to the consolidated financial statements
For the year ended 31 March 2016
1) Financial information
This announcement does not constitute full accounts within the
meaning of section 434 of the Companies Act 2006 but is derived
from the audited accounts for the year ended 31 March 2016 for
which an unqualified audit report has been received. The statutory
accounts for the year ended 31 March 2016 will be delivered to the
Registrar of Companies.
The Annual General Meeting (AGM) of Energy Assets Group plc is
intended to take place in London on 7 September 2016. Notice of the
AGM and related papers, including the statutory accounts, will be
sent to shareholders at least 21 clear days before the meeting.
While the information included within this announcement has been
prepared in accordance with the recognition and measurement
criteria of International Financial Reporting Standards (IFRS), as
adopted by the European Union (EU), it does not in itself contain
sufficient information to comply with IFRS.
This information has been approved for issue by the Board of
Directors of Energy Assets Group plc on 7 June 2016. Energy Assets
Group plc was incorporated in the United Kingdom on 1 February 2012
which is where it is domiciled.
2) Basis of preparation
The consolidated financial statements of Energy Assets Group plc
have been prepared in accordance with International Financial
Reporting Standards as adopted by the European Union (IFRSs as
adopted by the EU), the Companies Act 2006 applicable to companies
reporting under IFRS and the Listing Rules.
The consolidated financial statements have been prepared under
the historical cost convention, as modified by financial assets and
liabilities (including derivative instruments) at fair value
through profit or loss.
3) Going concern
The Group's business activities, together with the factors
likely to affect its future development, performance and position,
are set out in the Strategic Report within the 2016 Annual Report
and Accounts.
The Directors have considered these factors, the likely
performance of the business and possible alternative outcomes, the
financing facilities available to the Group, compliance with
financial covenants and the possible actions able to be taken
should new facilities not be available in the future.
Having taken all of these factors into consideration, the
Directors confirm that forecasts and projections indicate that the
Group and its Parent Company have adequate resources for the
foreseeable future and at least for the period of 12 months from
the date of this report. Accordingly the financial statements have
been prepared on the going concern basis.
4) Segment information
Operating segments are reported in a manner consistent with the
reports made to the chief operating decision maker. It is
considered that the role of chief operating decision maker is
performed by the Board of Directors.
The Group currently only operates in the UK and for management
purposes is organised into three core divisions:
-- Meter asset management;
-- Data services; and
-- Siteworks
This currently forms the basis of the Group's reportable
operating segments. However, in the future as the business develops
and moves towards a multi utility offering in accordance with its
primary strategy, meter asset management and data services are
likely to converge into a single division as customer demand
increases for a combined service offering meaning it may become
less relevant to split out revenue and costs associated with these
divisions.
The measure of profit principally used to allocate resources is
gross profit. However, as interest costs arise on borrowings which
are wholly attributable to the meter asset management and data
services segments, finance costs are also allocated to these
segments.
EBITDA is monitored on a Group level but not at segment level
and therefore this has not been presented within this note.
Certain central costs, assets and liabilities are not allocated
to segments as they are managed on a Group basis. These comprise
primarily central and management overhead costs, cash, accounts
receivable and accounts payable.
Meter asset
Year ended 31 March 2016 management Data services Siteworks Total operations
GBP'000 GBP'000 GBP'000 GBP'000
Revenue from external
customers 16,653 9,476 19,141 45,270
Cost of sales - depreciation (5,501) (621) - (6,122)
Cost of sales - amortisation (331) - - (331)
Cost of sales - other - (4,326) (9,285) (13,611)
------------ -------------- ---------- -----------------
Group gross profit 10,821 4,529 9,856 25,206
Items not reported by
segment:
Other operating costs (9,161)
Depreciation (470)
Amortisation (347)
Exceptional costs (236)
-----------------
Group operating profit 14,992
Net finance costs (4,169) (127) (4,488)
Profit before tax 6,652 4,402 10,504
------------ --------------
Tax (2,051)
Profit for the year 8,453
-----------------
During the year, sales to related parties amounted to GBP9.5m
(2015: GBP9.0m) being sales made on an arm's length basis to a
company controlled by one of the Group's significant shareholders.
In addition, revenue of GBP5.3m (2015: GBP4.5m) was received from
another single external customer in relation to data and metering
services.
At 31 March 2016 Meter asset
management Data services Siteworks Total operations
GBP'000 GBP'000 GBP'000 GBP'000
Intangible assets 5,116 - - 5,116
Property, plant and
equipment 101,527 4,841 - 106,368
Assets not reported
by segment 44,188
-----------------
Total assets 155,672
-----------------
Bank borrowings (74,410) (1,552) - (75,962)
Liabilities not reported
by segment (33,412)
-----------------
Total liabilities (109,374)
-----------------
Meter asset
Year ended 31 March 2015 management Data services Siteworks Total operations
GBP'000 GBP'000 GBP'000 GBP'000
Revenue from external
customers 14,089 9,229 12,890 36,208
Cost of sales - depreciation (4,418) (1,386) - (5,804)
Cost of sales - amortisation (331) - - (331)
Cost of sales - other - (3,561) (6,402) (9,963)
------------ -------------- ---------- -----------------
Group gross profit 9,340 4,282 6,488 20,110
Items not reported by
segment:
Other operating costs (6,819)
Depreciation (356)
Amortisation (214)
Net exceptional gain 398
-----------------
Group operating profit 13,119
Net finance costs (3,632) (169) (3,801)
Profit before tax 5,708 4,113 9,318
------------ --------------
Tax (1,852)
Profit for the year 7,466
-----------------
At 31 March 2015 Meter asset
management Data services Siteworks Total operations
GBP'000 GBP'000 GBP'000 GBP'000
Intangible assets 5,447 - - 5,447
Property, plant and
equipment 85,412 4,240 - 89,652
Assets not reported
by segment 34,845
-----------------
Total assets 129,944
-----------------
Bank borrowings (65,510) (2,462) - (67,972)
Liabilities not reported
by segment (25,478)
-----------------
Total liabilities (93,450)
-----------------
5) Exceptional items
Items that are material because of their size or nature,
non-recurring and whose significance is sufficient to warrant
separate disclosure and identification within the consolidated
financial information are referred to as exceptional items. The
separate reporting of exceptional items helps to provide an
understanding of the Group's underlying performance.
2016 2015
GBP'000 GBP'000
Exceptional acquisition costs 236 129
Exceptional gain on acquisition - (760)
Exceptional IPO share based payment expense - 233
-------- --------
236 (398)
-------- --------
During the year the Group incurred non-recurring transaction
costs relating to the acquisition of Blyth amounting to GBP0.1m. In
the prior year similar costs of GBP0.1m were incurred in relation
to the acquisitions of Origin and SA Gas. The Group also incurred
non-recurring transaction costs of GBP0.1m in the current year
relating to the proposed acquisition by Euston BidCo Ltd.
Upon acquisition of Bglobal Metering, the fair value of the net
assets of this company were greater than the fair value of the
consideration paid resulting in a gain on the acquisition of
GBP0.8m in the prior year.
The Group implemented a number of share based payment schemes as
part of the IPO on 22 March 2012. The expense for the prior year in
relation to these schemes amounted to GBP0.2m. No further expense
will be incurred in the future in relation to these schemes.
6) Taxation
2016 2015
GBP'000 GBP'000
Analysis of charge in the year
Current tax:
Adjustments in respect of previous periods 17 -
Deferred tax:
Origination and reversal of temporary differences (2,212) (1,852)
Effect of changes in tax rate on opening liability 144 -
-------- --------
Total deferred tax (2,068) (1,852)
Tax charge (2,051) (1,852)
-------- --------
The tax on the Group's profit before tax differs from the
theoretical amount that would arise using the weighted average tax
rate applicable to profits of the consolidated entities as
follows:
2016 2015
GBP'000 GBP'000
Profit before tax 10,504 9,318
Tax calculated at domestic tax rate applicable
to profits (2016: 20%, 2015: 21%) (2,101) (1,957)
Effects of:
Effect of items not deductible/taxable for tax
purposes (103) 137
Adjustments in respect of previous periods 9 (32)
Effect of changes in tax rate 144 -
-------- --------
Tax charge (2,051) (1,852)
-------- --------
A number of changes to the UK Corporation tax system were
announced in the March 2015 Budget Statement with the main rate of
corporation tax reduced from 20% to 19% from 1 April 2017 and from
19% to 18% from 1 April 2020. Deferred taxes at the balance sheet
date have been measured using these enacted tax rates and reflected
in these financial statements.
7) Earnings per share
Basic earnings per share is calculated by dividing the profit
attributable to ordinary equity holders of the Group by the
weighted average number of ordinary shares in issue during the
year.
2016 2015
Net profit attributable to equity holders of
the Group (GBP'000) 8,453 7,466
Weighted average number of shares in issue (thousands) 27,846 27,346
Basic earnings per share from continuing operations
(pence) 30.36 27.30
Diluted earnings per share is calculated by adjusting the
weighted average number of ordinary shares outstanding to assume
conversion of all dilutive potential ordinary shares.
This is done by calculating the number of shares that could have
been acquired at fair value (determined as the average market share
price of the Company's shares in the year) based on the monetary
value of the exercise price attached to outstanding share options.
The number of shares calculated above is compared with the number
of shares that will be issued assuming the exercise of the share
options.
Therefore, the earnings per share calculation is required to be
adjusted in relation to the share options that are in issue under
the LTIP, Deferred Bonus Plan and the IPO Award Plan as follows.
None of the shares under the SIP or the Employee Retention Award
Plan are potentially dilutive as these are to be settled with
shares purchased on the open market.
2016 2015
Net profit attributable to equity holders of
the Group (GBP'000) 8,453 7,466
Weighted average number of shares in issue (thousands) 28,786 28,062
Diluted earnings per share from continuing operations
(pence) 29.37 26.61
8) Property, plant and equipment
Furniture,
fittings
Data & office Plant and Motor
Gas meters loggers equipment machinery vehicles TOTAL
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 31 March 2016
Cost
At 1 April 2015 99,304 7,952 1,736 78 64 109,134
Additions 21,708 1,222 293 80 - 23,303
From acquisitions - - 45 - 15 60
FV balance sheet (92) - (18) (20) (27) (157)
Disposals - - - - (1) (1)
At 31 March 2016 120,920 9,174 2,056 138 51 132,339
Accumulated depreciation
At 1 April 2015 13,892 3,712 921 13 10 18,548
Charge for the
year 5,501 621 398 46 26 6,592
At 31 March 2016 19,393 4,333 1,319 59 36 25,140
NBV
----------- --------- ----------- ----------- ---------- --------
At 31 March 2016 101,527 4,841 737 79 15 107,199
----------- --------- ----------- ----------- ---------- --------
At 31 March 2015 85,412 4,240 815 65 54 90,586
Gas Meter additions include directly attributable costs of
GBP5.3m (2015: GBP4.1m).
Borrowings are secured by a fixed and floating charge over the
metering assets to which they relate.
Furniture,
fittings
Data & office Plant and Motor
Gas meters loggers equipment machinery vehicles TOTAL
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 31 March 2015
Cost
At 1 April 2014 77,988 6,352 1,162 - 9 85,511
Additions 20,890 1,600 359 17 - 22,866
From acquisitions 426 - 215 61 67 769
Disposals - - - - (12) (12)
At 31 March 2015 99,304 7,952 1,736 78 64 109,134
Accumulated depreciation
At 1 April 2014 9,474 2,326 579 - 9 12,388
Charge for the
year 4,418 1,386 342 13 1 6,160
At 31 March 2015 13,892 3,712 921 13 10 18,548
NBV
----------- --------- ----------- ----------- ---------- --------
At 31 March 2015 85,412 4,240 815 65 54 90,586
----------- --------- ----------- ----------- ---------- --------
At 31 March 2014 68,514 4,026 583 - - 73,123
9) Net debt/EBITDA
The Group monitors capital on the basis of net debt divided by
EBITDA. Net debt is calculated as total borrowings less cash and
EBITDA is calculated as operating profit before any exceptional
items, interest, tax, depreciation and amortisation as follows:
2016 2015
GBP'000 GBP'000
Profit before tax 10,504 9,318
Add: finance costs 4,504 3,811
Less: finance income (16) (10)
Add: depreciation 6,592 6,160
Add: amortisation 678 545
Add/(less): exceptional items 236 (398)
-------- --------
EBITDA 22,498 19,426
-------- --------
2016 2015
GBP'000 GBP'000
Total borrowings 82,637 72,914
Less: cash and cash equivalents (6,748) (7,835)
-------- --------
Net debt 75,889 65,079
EBITDA 22,498 19,426
Net debt/EBITDA 3.4 3.4
10) Leased assets
The Group, as part of its core business, is a lessor of gas
metering assets. These are leased to customers under operating
leases. The minimum lease rentals receivable at current prices
assuming the lease remains in place for its expected term are as
follows:
2016 2015
GBP'000 GBP'000
Within one year 16,992 14,870
Between one to two years 16,992 14,870
Between three to five years 50,976 44,610
More than five years 196,844 180,985
-------- --------
281,804 255,335
-------- --------
These lease payments are subject to annual reviews and are
cancellable by the customer.
11) Acquisitions
Blyth
On 9 December 2015, Energy Assets acquired the entire issued
share capital of Blyth, a Multi-Utility Infrastructure Provider
involved in the design and construction of utility networks direct
to commercial and residential developers throughout Scotland and
the North of England.
The following table summarises the consideration paid for Blyth
and the fair value of the amounts recognised at the acquisition
date for each major class of assets acquired and liabilities
assumed, as provisionally determined. The fair value of assets
acquired and liabilities assumed may be revised within the 12 month
period post acquisition:
Consideration GBP'000
Cash 1,500
Shares 1,000
Deferred consideration 2,500
--------
5,000
Less: cash acquired through the subsidiary -
--------
Net cash to acquire subsidiary 5,000
--------
Net assets acquired:
Property, plant and equipment 60
Inventories 200
Trade and other receivables 2,948
Cash and cash equivalents -
Trade and other payables (2,597)
611
Goodwill 4,389
--------
Total purchase price 5,000
--------
Goodwill has been reflected within intangible assets on the
Group balance sheet. Goodwill recognised is attributable to a
variety of intangible benefits including economies of scale from
bringing the Blyth business in-house, the ability to provide a
broader service offering to customers and access to the company's
highly qualified team of specialist engineers and technicians.
The fair value of trade and other receivables is GBP2.9m and
GBP2.3m is attributed to trade receivables. This is the gross
contractual amount of which all is expected to be collectible.
In the year to 31 March 2016, revenue of GBP3.4m and a profit of
GBP0.26m was included in the income statement relating to Blyth for
the period from the date of acquisition. If the acquisition had
taken place at the start of the year revenue of GBP10.4m and a
profit of GBP0.5m would have been included.
Acquisition costs relating to the transaction amounted to
GBP0.1m and have been charged to exceptional administrative
expenses in the income statement in the year ended 31 March
2016.
Further details of the above business combinations and the
benefits that these will bring to the Group are included within the
Strategic Report.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR EAFKKEEFKEAF
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