Utilitywise Regulatory News (UTW)

8 August 2016

Utilitywise plc

("Utilitywise" or the "Group")

Trading update

Utilitywise plc (AIM:UTW), the leading independent utility cost management consultancy, today provides an update on trading for the year ended 31 July 2016.

The Group expects to report significant revenue growth in the period with revenues of at least £82m (£69.1m 2015). Adjusted* Group EBITDA is expected to be greater than £18m (£17.8m 2015). Net debt at year end was £0.2m (2015: £6.7m) as progress with improved commercial terms in our Enterprise division yielded some improvement in cash flow. As previously reported this is expected to continue into FY17.

Enterprise

The Enterprise division continued to grow its contracted customer base, increasing total Enterprise customer numbers by 21% to 30,552 as at 31 July 2016 (2015: 25,185). In the year approximately 75% (2015: 62%) of revenues came from new customers. Overall Enterprise revenue added to order book during the period increased by 35% to £84.5m (2015: £62.7). Future secured revenue was £25.6m as at 31 July 2016 compared to £24.7 million at 31 January 2016. The Energy Consultant headcount at 31 July 2016 was 625 up from 610 a year earlier.

As announced at the half year, staff attrition has continued to be a challenge. Although the actions taken to address the staff attrition are well underway, it has had an impact on the performance of this division in the period. However, we are already seeing the benefits of the actions that we have taken and we therefore expect energy consultant headcount to increase in the new financial period, as previously indicated.

The Enterprise division has continued to invest in the multi-channel route to customer acquisition which we expect will drive productivity improvements going forward. Whilst the investment in building the Group's multi-channel approach has increased costs in the short term, this will drive customer acquisition and assist the actions taken to reduce attrition.

The European business has performed well in the year and will achieve the break even position targeted. The customer base has increased in line with our expectations and will be built upon whilst targeting an improvement in the revenue per Energy Consultant in the year ahead.

Steve Attwell who was brought into the Enterprise Division to commence the transformation of the division has left the Group with immediate effect to pursue opportunities in the technology sector and has been replaced by Chris Charlton who will steer the division through this exciting growth period. Chris has been with the business for six years and has held a number of senior positions throughout this period.

Corporate

The Corporate division has traded satisfactorily and as with Enterprise, the division is going through a major transformation as it builds upon the t-mac acquisition to provide the wider Energy Services capability. The roll out of the "smartdash" data analytics software we acquired with t-mac is continuing, and a plan is underway to roll out the software to all customers, as we arrange installation of their AMR Smart Meter. The partnership with Dell to introduce Internet of Things (IoT) Building Automation solutions to customers is progressing well with trials underway and we see a significant opportunity to roll this out to both new and existing customers. 

Group

We will continue to invest in the business in the new financial year ahead to drive the next phase of growth for the Group. We expect to see revenues, EBITDA and cash flow grow across the two divisions aided by the headcount growth and the emerging Energy services opportunities.

Geoff Thompson, Chief Executive of Utilitywise, commented:

"Whilst we have seen significant revenue growth and increased customer numbers in the period, it has been a challenging year with staff attrition in the Enterprise division resulting in a weaker overall performance than we would have liked.

"We continue to drive the transition within the two divisions and focus them on the longer term objective of building our Energy Services offering with a large customer base and adjacent revenue streams. The new management team will soon be complete and we look forward to the future with a great degree of confidence."

Notice of Results

Utilitywise will announce its interim results for the year ended 31 July 2016 on 18th October 2016.

*Adjusted for share based payments and exceptional items

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About Utilitywise

Utilitywise is a leading independent utility cost management consultancy based in North Tyneside. The Group has established trading relationships with a number of major UK energy suppliers and provides services to its customers designed to assist them in achieving better value out of their energy contracts, reduced energy consumption and lower carbon footprint.