REG - Water Intelligence - Q1 Trading Update

Water IntelligenceAnnouncement

10/05/2023 07:00

For best results when printing this announcement, please click on link below:
http://newsfile.refinitiv.com/getnewsfile/v1/story?guid=urn:newsml:reuters.com:20230510:nRSJ8653Ya&default-theme=true

RNS Number : 8653Y  Water Intelligence PLC  10 May 2023

10 May 2023

 

 

Water Intelligence plc

 Q1 Trading Update: Strong Growth Across Operating and Financial Measures

Water Intelligence plc (AIM: WATR.L) (the "Group" or "Water Intelligence"), a
leading multinational provider of precision, minimally-invasive leak detection
and remediation solutions for both potable and non-potable water is pleased to
provide its unaudited Q1 Trading Update for the quarter ended 31 March 2023.

Overview of Growth Strategy

·    Market demand for precision water and wastewater infrastructure
solutions continues to grow with the Group's strategic plan centred on
capturing a greater share of this increased market demand by driving sales
through Corporate, Franchise and Business-to-Business Channels (Key
Performance Indicators or "KPIs")

·    The Group continues its implementation of Salesforce.com for its
scheduling, delivery and payments system in the U.S. to achieve operating
scaleability and efficiencies across corporate and franchise locations

·    The Group continues to selectively reacquire franchises in strategic
locations to unlock additional shareholder value from its core American Leak
Detection brand ("ALD"), which represents over $100 million in annual
franchise gross sales

Operating Performance

·    Water Intelligence achieved a strong revenue and profit performance
during the quarter

o The Group delivered growth for each KPI driver: Corporate (US and
International), Franchise and Business-to-Business sales

·    Network Sales (corporate direct sales and franchise gross sales from
which royalty income is derived) for the quarter grew 10% to $45.5 million (Q1
2022: $41.4 million)

·    The Group executed a strategic franchise reacquisition in Nashville,
Tennessee adding operational scale in the Midwest of the United States

·    The balance sheet position remains robust, positioning the Group
strongly to continue to execute on its growth plans

Financial Highlights / KPIs

·    Revenue increased by 18% to $19.4 million (Q1 2022: $16.5 million)

o Franchise royalty grew by 5% to $1.9 million (Q1 2022: $1.8 million)

o Franchise related activities (franchise sales, equipment sales,
business-to-business channels) increased by 22% to $3.2 million (Q1 2022: $2.6
million)

§ Insurance business-to-business channel grew by 23% to $3.1 million (Q1
2022: $2.5 million)

o US Corporate locations increased by 18% to $12.3 million (Q1 2022: $10.5
million)

o International Corporate locations rose by 26% to $2 million (Q1 2022: $1.6
million)

·    Profit Before Tax (Statutory) grew by 28% to $1.8 million (Q1 2022:
$1.4 million)

·    Profit Before Tax Adjusted (before non-cash expenses of amortization
and share-based payments; and non-core costs) increased by 12% to $2.3 million
(Q1 2022: $2.1 million)

·    EBITDA (Statutory) rose by 23% to $3.2 million (Q1 2022: $2.6
million)

·    EBITDA Adjusted (before non-cash share-based payments; and non-core
costs) rose by 11% to $3.5 million (Q1 2022: $3.1 million)

·    Balance sheet strength at 31 March 2023

o Cash at $19.4 million

o Bank Debt and Deferred Acquisition Payments at $29.3 million with payments
spread through 2027 at a fixed interest rate of approximately 5%

Commenting on the Group's performance, Executive Chairman, Dr. Patrick DeSouza
remarked:

"We are pleased with how we have started in 2023. Our resilient business model
and compelling customer value proposition enabled us to deliver a strong
performance in Q1, against a difficult market backdrop of high inflation and
rising interest rates. We have a high-quality management team and market
demand remains strong for our minimally-invasive solutions for aging water and
wastewater infrastructure. We remain confident in our long-term growth
prospects and our ability to continue delivering value for our stakeholders.

For 2H 2023 and 2024, we are focused on delivering the benefits of investments
made in prior years to reinforce our long-run growth trajectory by:
commercialising new technology solutions for our customers; hiring and
training more technicians to meet market demand; and completing implementation
of the leading customer relationship management system to automate operations,
support scaleability and enhance data security.

In delivering on our growth plan, we appreciate the on-going support of our
shareholders."

 

This announcement contains inside information for the purposes of Article 7 of
the UK version of Regulation (EU) No 596/2014 which is part of UK law by
virtue of the European Union (Withdrawal) Act 2018, as amended ("MAR"). Upon
the publication of this announcement via a Regulatory Information Service,
this inside information is now considered to be in the public domain.

Enquiries:

Water Intelligence plc
 Patrick DeSouza, Executive Chairman               Tel: +1 203 654 5426
 RBC Capital Markets - Joint Broker                Tel: +44 (0)20 7653 4000
 Rupert Walford

 Elizabeth Evans

 Daniel Saveski

 WH Ireland Limited - NOMAD & Joint Broker         Tel: +44 (0)20 7220 1666
 Hugh Morgan

 James Bavister
                                                                   Tel:  +44 (0)20 3903 7715

 Dowgate Capital Ltd - Joint Broker

Stephen Norcross

 

 

 

This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact
rns@lseg.com (mailto:rns@lseg.com)
 or visit
www.rns.com (http://www.rns.com/)
.

RNS may use your IP address to confirm compliance with the terms and conditions, to analyse how you engage with the information contained in this communication, and to share such analysis on an anonymised basis with others as part of our commercial services. For further information about how RNS and the London Stock Exchange use the personal data you provide us, please see our
Privacy Policy (https://www.lseg.com/privacy-and-cookie-policy)
.   END  TSTLKLLBXELZBBF