SMART Metering Systems (SMS) has lifted underlying profits before tax by 15 per cent to £9.2 million during a first half that saw it acquire three firms south of the Border.
Glasgow-based SMS geared up its preparations for the UK domestic smart meter roll-out by acquiring CH4 Gas Utility and Maintenance Services (CH4), Trojan Utilities and Qton Solutions for about £7m in March.
The deals which provided the group with UK-wide direct installation and IT support capability, with CH4 and Trojan having installed more than 400,000 domestic smart meters prior to their acquisition.
With that presence believed to represent nearly 20 per cent of the domestic meters installed in the UK, SMS said their acquisition will boost its ability to be a key player in the domestic smart meter roll-out.
The UK Government wants every home and business to be offered a smart meter by 2020 and “delivered as cost-effectively as possible”, according to the fourth annual report on the roll-out of smart meters by the Department of Energy & Climate Change.
The first half saw SMS sign contracts for the ownership of domestic smart meters with First Utility, the UK’s largest independent energy supplier, as well as RHE, Green Energy, Flow Energy, Spark Energy, Our Power, Ecotricity and Economy Energy.
SMS has an initial order book of 300,000 dual fuel domestic smart meters from eight energy suppliers. Those suppliers currently provide energy to about two million of the 27m homes that will be offered a smart and gas meter by 2020.
SMS increased revenue by 25 per cent to £32.3m in the six months, having reached the milestone of managing more than one million utility metering and data assets in the industrial and commercial sector and domestic markets. It noted it increased its asset base in all business areas.
The company reported its total portfolio of gas and electricity metering and data assets grew by 10 per cent in the first half to 1,078,000 units.
And, as a result of the three acquisitions completed in March, SMS saw its headcount increase to 660 from 340. SME said its purchase of CH4 and Trojan had provided it with two training academies, giving it the ability to carry out in-house training and increase its installation capacity, notably in the roll-out of domestic smart meters. The acquisition of Qton, meanwhile, was said to have boosted its IT skill thanks to the addition of 17 IT professionals. This effectively doubled its in-house IT resource. The Qton deal also strengthened its intellectual property (IP) rights.
Chief executive Alan Foy said: “SMS is delighted to deliver another set of strong results for the first six months of 2016.
“The numbers exemplify how our integrated business model of developing and expanding recurring gas and electricity meter rental and data services income continues to deliver financial and operational growth.”
The company, which signalled its confidence for the second half, proposed an interim cash dividend of 1.37p per ordinary share, up 25 per cent on last year.
Shares closed up 13p at 548p.
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