LONDON (Alliance News) - Home improvement company entu (UK) PLC saw its shares rise in early dealing Thursday after it listed on the AIM market.
Its stock was trading at 105 pence per share, up from a share placing price of 100 pence a share prior to the start of trading on AIM.
The company, which sells things like energy efficient windows, doors and conservatories, cavity wall products, solar power panels and energy efficient boilers, said on October 16 that its current shareholders sold a stake of up to 50% of the business for GBP32.8 million in a placing.
The selling shareholders sold 32.8 million shares at GBP1 each in the placing, giving it an initial market capitalisation of GBP65.6 million at that price.
Biggest shareholder Brian Kennedy sold half his 60% stake in the business, Chief Executive Ian Blackhurst sold half his 15% stake while Belinda Blackhurst sold the same amount, and Chief Financial Officer Darren Cornwall sold half his 10% stake.
While entu did not raise any new money in the placing, it thinks admission to AIM will give it access to equity capital markets to support its growth and allow it to incentivise its management as well giving all employees the chance to own shares through an employee share option plan.
The Manchester-based company employs 365 full time employees and uses about 1,216 self-employed canvassers, 530 self-employed sales agents and 827 self-employed installation professionals.
It made revenue of GBP95.5 million in the year to October 31, 2103, up from GBP91.7 million in the previous 12 months, and earnings before interest, tax, depreciation and amortisation of GBP6.3 million, down from GBP6.7 million. Revenue in the six months to end-April of this year were GBP57.9 million, up from GBP44.0 million a year earlier, while Ebitda was GBP5.6 million, up from GBP2.8 million.
There is increasing demand for energy-efficient home improvements in the UK, partly driven by government schemes offering financial support for home owners willing to make such upgrades. Companies including entu have been taking advantage of the demand increase and the government schemes.
Entu thinks it can grow significantly by increasing its product range in energy efficient boilers and solar installations, as well as growing in the fledgling market for "smart energy control" products, such as remote intelligent heating and lighting automation controlled by smartphones and other mobile devices.
The overall UK home improvements market is worth an estimated GBP27 billion annually with windows and doors alone worth around GBP3.4 billion in 2013, according to entu.
"The directors consider the group is well placed for continued growth, both organically and through acquisition opportunities due to its national coverage of installation and service centres as well as a diversified focus on energy efficiency," it said at the time of the placing.
By Steve McGrath; stevemcgrath@alliancenews.com; @stevemcgrath1
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