(Alliance News) - Yu Group PLC on Tuesday said it is focused on "restoring profitability", reducing sales volumes in favour of higher-margin, lower-risk business.
The supplier of gas, electricity and water to the UK business sector said it expects revenue for the six months to the end of June to be in excess of GBP55 million, up from GBP35.8 million reported a year earlier.
As at June 30, Yu Group had GBP45 million of contracted revenue, which is expected to be recognised in the reminder of 2019. The AIM-listed company said it expects revenue in excess of GBP100 million for 2019 as a result of the existing contract book, combined with incremental bookings growth from new accounts and additional revenue, beyond that contracted, from existing customers.
Looking ahead, Yu Group said it aims to restore it to profitability and continuing to accelerate its growth. The company said it is now focused on new contracts with an increased margin and lower credit risk than historically realised, which has resulted in a reduced level of monthly bookings than previously achieved.
As a result, Yu Group said it anticipates reporting an adjusted loss before interest, taxes, depreciation, and amortization of between GBP2.5 million and GBP3.0 million for the six months to the end of June. The company, however, said it remains confident that actions undertaken will translate into improved results.
In addition, Yu group said it continues to invest in the business to build its infrastructure in line with the market opportunity. The company has recently expanded its Leicester operations to drive sales and customer retention.
"Significant progress has been made over the first half of this year," said Chief Executive Bobby Kalar.
"The planned investment we have made in Leicester further positions us to secure new business at higher margins and to capitalise on the significant market opportunity available, whilst continuing to deliver market leading customer service," added Kalar.
The company intends to publish its interim results on September 18.
Yu Group shares were trading 8.7% lower on Tuesday in London at 155.66 pence each.
Yu Energy (YU.)