REG - Yu Group PLC - Trading Update

YuAnnouncement

19/07/2022 07:00

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RNS Number : 8857S  Yu Group PLC  19 July 2022

19 July 2022

Yü Group PLC

("Yü Group" or the "Group")

Trading Update

CONTINUED STRONG FINANCIAL PERFORMANCE

Yü Group PLC, the challenger independent supplier of gas, electricity and
water to the UK corporate sector, is pleased to provide an update on trading
for the six months ended 30 June 2022.

 Bobby Kalar, Group Chief Executive Officer, said:

"The period delivered a continued strong financial performance with
significant revenue growth, margin expansion and consequently much improved
profitability and cash generation. H1 22 will represent our 4(th) consecutive
period of revenue growth and margin improvement and I am confident we will
continue to deliver in H2 22.

Despite the wider macro environment and the pressures being felt in the
industry our story, brand and growth remains strong. We are delivering our
KPI's in line with management expectations and we continue to derive
significant strategic benefits both operationally and commercially from the
investments we have made in our systems and processes.

I'm pleased to welcome Liberum Capital as our new Nominated Adviser and Broker
and am looking forward to working with them to develop a wider investor reach.

In H2 22 we will launch Yü Smart, our smart metering business, and expect to
be installing our first smart meters in Q4 this year. This capability will
represent a significant strategic milestone in the expansion of the Group.

I am delighted by our performance in H1 and am confident this momentum will
continue into H2 and beyond. The Board remains as excited as ever about the
future of the Group. I would like to thank all of my team who continue to
deliver on our medium term goal of £500m of revenues with an adjusted EBITDA
margin in excess of 4%."

 Financial and Operational highlights

·    Exceptional growth with H1 22 revenues expected to exceed £125m, up
over 90% compared to H1 21 (H1 21: £65.8m, FY 21: £155.4m) and up over 39%
from H2 21

 

·    Significant increase in average monthly bookings to £14.3m, up 49.0%
on H1 21 (H1 21: £9.6m, FY 21: £13.8m)

 

·    Strong cash generation and cash performance, closing at £15.7m, an
increase of 36.5% from the prior year (30 June 2021: £11.5m, 31 December
2021: £7.0m)

 

·    Further improvement in Adjusted EBITDA with strong net customer
contribution(1) driven by operational leverage and careful management of
debtors. Adjusted EBITDA margin has continued positive momentum (H1 21: 0.7%,
H2 21: 1.4%)

 

·    26.1k meter points, an increase of 25.5% on 30 June 2021, after
taking into account the expected reduction in non-firm customers acquired
through the SoLR process

 

·    Digital by default initiatives continue to produce new growth
opportunities, combined with service and cost efficiencies driving margin
expansion.

o  The Group has successfully established its online portal where existing
customers can self-serve in relation to billing, meter submissions and other
administrative functions, reducing the Group's cost to serve

o  The Group has commenced rollout of its online platform in respect of new
customer acquisitions. The platform creates a standardised contractual journey
generating consistent data points for customers who contract through Yü
Group's in-house sales agents, third party intermediaries or elect to
self-serve when contracting with Yü Group

 

·    Appointment of Liberum Capital as Nominated Adviser and Broker to
support the Group with increasing shareholder engagement in the next chapter
of growth

Outlook

·    FY 22 revenues are expected to grow by over 50% against prior year
(FY 21: £155.4m)

 

·    The Group expects to achieve an uplift of over 50% in Adjusted EBITDA
margin for FY 22 (FY 21: 1.1%)

 

·    Cash is performing in line with expectations. In H2 22 the Group will
make its annual ROC payment and will continue to invest in the acceleration of
the "digital by default" strategy alongside financing the roll out of Yü
Smart

 

·    Launch of Yü Smart planned for H2 22, having received the required
licences and accreditation, this will provide new opportunities in smart
metering and EV charge installation, with the financial benefits expected be
derived in FY 23 and beyond

 

·    Management remains mindful of wider macroeconomic conditions and
energy market volatility and is actively managing its debtors while
successfully maintaining a robust hedging policy.

Note:

1.        Net customer contribution is calculated as gross profit less
bad debt

 

For further information, please contact:

  Yü Group PLC      +44 (0) 115 975 8258

 Bobby Kalar

 Paul Rawson

 Liberum            +44 (0) 20 3100 2000

 Edward Mansfield

 William Hall

 Cara Murphy
 Tulchan Group      +44 (0) 20 7353 4200

 Giles Kernick

 Olivia Peters

 Oliver Norgate

 

Notes to Editors

Information on the Group

Yü Group PLC, trading as Yü Energy, is an independent supplier of gas,
electricity and water focused on servicing the SME and corporate sector
throughout the UK. It has no involvement in the domestic retail market. The
Group was listed on the AIM market of the London Stock Exchange in March 2016.

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