REG - Yu Group PLC - Trading Update

YuAnnouncement

25/07/2023 07:00

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RNS Number : 0158H  Yu Group PLC  25 July 2023

25 July 2023

Yü Group PLC

(the "Group" or "Company")

 

Trading Update

CONTINUED STRONG FINANCIAL PERFORMANCE

Yü Group PLC (AIM: YU.), the independent supplier of gas, electricity, meter
asset owner and installer of smart meters to the UK corporate sector, is
pleased to provide an update on trading for the six months ended 30 June 2023.

Bobby Kalar, Chief Executive Officer, said:

"We are delighted to have accelerated our strong trading momentum and our
growth continues to surpass expectations. We continue to deliver strong
financial performance as more customers lock in the benefit of a softening
commodity market. Alongside this growth and underpinned by our "Digital by
Default" platform and Smart Meter installation business we see revenue and
profitability growth in FY 23 and beyond. We are as excited as ever about the
future of Yü Group and remain focussed on exceeding our previously stated
£500m revenue target and increased 5% EBITDA margin."

Financial and Operational highlights

·      Accelerating revenue growth in H1 23 with the Group expecting to
outperform revenue expectations for FY 23. The number of supplied meter points
grew 56% in the period to 39,700 (FY 22: 25,500, H1 22: 26,100).

·      Record average monthly bookings of £51.3m achieved for H1 23, up
109% on FY 22 (FY 22: £24.5m, H1 22: £14.3m) providing clear revenue
visibility for FY 23 and underpinning future growth.

·      Expansion in EBITDA margin expected in H1 23 as the Group has
benefited from operational leverage brought about by the "Digital by Default"
strategy. This has been supplemented by selective new business, good hedging,
customer lifecycle performance and improving bad debt metrics.

·      Exceptional cash generation, with 98% cash conversion from
billings. Closing H1 23 net cash (excluding leases) of £36.6m, up £17.6m in
the first six months and £20.9m year-on-year (FY 22: £19.0m and H1 22:
£15.7m).

·      Growing rollout of Yü Smart, with a current monthly smart meter
installation run rate of 700 and expected to scale significantly. The Group is
pleased to announce it is transitioning from the use of third-party meters and
has now commenced its own Kensington Meter Asset Limited (KMAL) installation
and funding rollout creating a future recurring revenue annuity.

Outlook

·      Record monthly bookings secures future revenue and provides
management with confidence in the Group's prospects for FY 23 and beyond.

·      Margin expansion achieved through "Digital by Default" strategy
coupled with smart meter roll out. As a result, the Group has exceeded its
stated mid-term EBITDA margin goal of 4%.

·      Medium to long term margin benefit expected from a modest yet
growing number of smart meter assets.

·      Management now target £500m revenue with 5%+ sustainable EBITDA
margin in the short to medium term.

·      Group net cash (excluding leases) expected to increase in H2 23
despite the annual ROC payment falling due in Q3 23.

·      As a result of the accelerating revenue profile of the Group and
significantly increased EBITDA margin expected to be achieved in FY 23, the
Group expects to report results substantially ahead of current market
expectations.

Notice of results

·      The Group will issue interim results on Tuesday 26 September
2023.

 

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

 Satbir Kler

 Cara Murphy

 Teneo              +44 (0) 20 7353 4200

 Giles Kernick

 Alec Tidbury

 

Notes to Editors

Information on the Group

Yü Group PLC is a leading supplier of gas and electricity focused on
servicing the corporate sector throughout the UK. We drive innovation through
a combination of user-friendly digital solutions and personalised, high
quality customer service. The Group plays a key role supporting businesses in
their transition to lower carbon technologies with a commitment to providing
sustainable energy solutions.

Yü Group has a clear strategy to deliver sustainable profitable growth and
value for all of our stakeholders, built on strong foundations and with a
robust hedging policy. In 2022 the Group launched Yü Smart to support growth
through new opportunities in smart metering installation. With a significant
opportunity in a £50bn+ addressable market, Yü Group continues to deliver on
the medium-term goal of £500m of revenues with an adjusted EBITDA margin in
excess of 5%.

 

 

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