TIDMWATR
RNS Number : 6510W
Water Intelligence PLC
27 April 2021
Water Intelligence plc
Strong 1Q Trading Results
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 1Q Trading Update. The Group has had an outstanding first
quarter; one that both accelerates a very strong set of 2020
trading results and builds upon the Group's consistently strong
compounded annual growth (CAGR) trajectory.
During 1Q the Group grew revenue strongly by 38% to $11.4
million (1Q 2020: $8.3 million) and statutory profits before tax by
an outstanding 152% to $1.66 million (1Q 2020: $0.66 million).
Profits before tax adjusted for share-based payments and
amortization grew an equally outstanding 115% to $1.78 million (1Q
2020: $0.83 million).
These first quarter results follow a strong 2020 which, despite
Covid, produced 17% growth in revenue to $37.9 million and 78%
growth in statutory profits before tax to $4.2 million. The first
quarter also builds upon the Group's historic growth trajectory.
Since 2016, the Group has achieved a CAGR of 33% in terms of
revenue and 53% in terms of profits before tax.
Audited results for 2020 are expected during the latter half of
May as traditionally released.
Highlights
-- Water Intelligence revenue grew strongly by 38% reaching
$11.4 million (1Q 2020: $8.3 million)
o Core business units - American Leak Detection (ALD) and Water
Intelligence International (WII) - each grew strongly enabling a
broader mix of residential, commercial and municipal offerings for
both clean water and wastewater problems.
-- Implied total annualized sales to customers (implied gross
sales from which franchise royalty is derived plus direct sales
from corporate locations) would surpass $140 million providing
critical mass
o ALD revenue grew by 36% to $10.2 million (1Q 2020: $7.5
million)
-- Royalty income from franchisees grew in absolute terms by 3%
to $1.84 million (1Q 2020: $1.78 million), despite eight franchise
reacquisitions during 2020 that reduced the available pool of
royalty income
-- Franchise-related sales (national accounts; parts and
equipment; franchise territory sales) grew 15% to $2.4 million (1Q
2020: $2.1 million)
-- Key insurance business-to-business channel grew 19% to $2.3 million (1Q 2020: $1.9 million)
-- Corporate location sales grew 64% to $5.9 million (1Q 2020:
$3.6 million); Selective franchise reacquisitions continue,
increasing corporate presence for working with franchisees under
one ALD brand
o WII revenue grew 63% to $1.3 million (1Q 2020: $0.8
million)
-- Water Intelligence statutory profits before tax grew very
strongly by 152% to $1.66 million (1Q: $0.66 million)
o Corporate locations profit margins were 21% during 1Q
unlocking earnings growth
-- Water Intelligence profits before tax adjusted for non-cash
amortisation expense and share-based payments grew very strongly by
115% to $1.78 million (1Q 2020: $0.83 million)
-- Water Intelligence Balance Sheet strong at 31 March 2021
o Cash: $9.46 million
o Net Borrowings (Cash Minus Bank Debt): $0.5 million
o Company has sufficient resources to execute its accelerated
growth plan
-- Corporate Development during 1Q; Subsequent Events
o Expansion of Credit Facility
o Franchise reacquisition in Central Florida
o Two national insurance contracts
o Addition of Board Member with substantial financial markets
experience
o Proprietary sewer diagnostic device commercialized in UK
o 2Q Subsequent Event: Acquisition of Irrigation and Stormwater
run-off IP Assets
Commenting on the Group's performance, Executive Chairman, Dr.
Patrick DeSouza remarked:
"Once again we are reporting outstanding results. We are racing
ahead as an 'essential service provider' offering valuable
water-related solutions to our residential, commercial and
municipal customers during this late-Covid period. As noted in a
recent release, even as we move beyond Covid, we expect that market
demand for our solutions will only increase as a result of the
Biden Administration's American Jobs Plan and its anticipated $100
billion investment in water infrastructure.
We are exceptionally pleased that each of our key performance
indicators is strongly positive as we pass the mid-point of the
second quarter. We are building on a great 2020 and proud that we
have consistently delivered while scaling operations over the last
five years. As our profits increase, we are committed to reinvest
not only in more execution capabilities for current market capture
but also in leading technologies that reinforce our brand and our
growth throughout this decade. We have a strong matrix of clean
water and wastewater solutions and we aim to be market leaders with
respect to the world's most precious resource."
The information communicated in this announcement is inside
information for the purposes of Article 7 of Regulation
596/2014
Enquiries:
Water Intelligence plc
Patrick DeSouza, Executive Tel: +1 203 654 5426
Chairman
WH Ireland Limited - Tel: +44 (0)207 220
NOMAD & Broker 1666
Adrian Hadden
James Sinclair-Ford
Matthew Chan
Dowgate Capital - Joint Tel: +44 (0)20 3903
Broker 7721
Stephen Norcross
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END
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(END) Dow Jones Newswires
April 27, 2021 02:00 ET (06:00 GMT)
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