TIDMEAAS
RNS Number : 9175N
eEnergy Group PLC
28 September 2023
28 September 2023
eEnergy Group plc
("eEnergy" or "the Group")
12 Month Interim Results
eEnergy (AIM: EAAS), the net zero energy services provider, is
pleased to announce its unaudited interim accounts for the 12
months to 30 June 2023. On 22 June 2023 the Company announced that
it had changed its accounting reference date from 30 June to 31
December. Accordingly, the Company is today presenting unaudited
interim results for the 12 months to 30 June 2023. Audited full
year results for the 18 months to 31 December 2023 will be
announced in 2024.
Financial Highlights
-- Revenue up 50% to GBP33.2 million (FY 2022: GBP22.0 million)
o Energy Services revenue GBP19.5 million, up 87%, Adj EBITDA
GBP2.3 million, up 131%
o Energy Management revenue GBP13.6 million, up 17%, Adj
EBITDA GBP4.4 million, up 20%
-- Adj EBITDA(1) up 55% to GBP4.7 million (FY 2022: GBP3.0 million)
-- Adj PBT(2) up 34% to GBP2.7 million (FY 2022: GBP2.0 million)
-- PBT GBP1.1 million (FY 2022 Loss Before Tax: GBP2.2 million)
-- Net Cash / (Debt) GBP(6.9) million (FY 2022: GBP1.5 million),
a consequence of GBP5.2 million increase in working capital,
reflecting a strengthened balance sheet
Operational highlights
-- Launch of eSolar with 29 MW under Heads of Terms or signed
contract as at 30 June 2023, up 226% on 30 June 2022 (8.9
MW)
-- Completion of a new EUR5 million two-year project funding
facility with Solas Capital AG to finance LED lighting projects
in Ireland
-- Appointment of John Foley as Non-Executive Chairman
Post Period end
-- Increased ownership in subsidiary, eEnergy Insights Ltd,
which holds the Group's MY ZeERO smart metering and analytics
platform, to 100%
-- Contract with Tudor Grange Academies Trust worth GBP3.0 million
Total Contract Value for onsite solar generation
Harvey Sinclair, eEnergy CEO, said, "We are pleased with both
the financial and strategic progress throughout the year. We have
expanded into new market segments and built strong platforms in
eSolar and eCharge which are expected to be key growth drivers of
the business going forward.
"We achieved a significant milestone in the year in reaching
profitability. The signing of Tudor Grange post period end
demonstrates the sales team's cross selling abilities, and our
Forward Order Book remains strong, standing at GBP27.5 million. Our
established market position is creating larger project
opportunities and Management are focused on improving cash
generation to enable us to pursue these exciting projects. The
Board is reviewing a number of strategic options to further
strengthen our balance sheet to support our continued strong
growth. We are cautiously optimistic of delivering trading
expectations for the full period."
Investor & Analyst presentations
An online analyst briefing will be held at 11:00. Analysts
wishing to attend should contact eEnergy@tavistock.co.uk to
register.
Management will provide online presentations relating to the
interim results for investors via the Investor Meet Company
platform at 09:00, and the Equity Development platform at 15:30.
Both presentations are open to all existing and potential
shareholders.
Investors can sign up to Investor Meet Company for free and add
to meet eEnergy Group plc via:
https://www.investormeetcompany.com/eenergy-group-plc/register-investor
Investors can register for the Equity Development presentation
for free via:
h
ttps://www.equitydevelopment.co.uk/news-and-events/eaas-investor-presentation-28sept2023
Note: (1) Adjusted EBITDA is Earnings before interest, tax,
depreciation and amortisation, excluding exceptional items.
Exceptional Items are those items which, in the opinion of the
Directors, should be excluded in order to provide a consistent and
comparable view of the underlying performance of the Group's
ongoing business and include transaction-related items,
restructuring and integration costs and share based payment
expenses.
(2) Adjusted PBT excluding Exceptional Items and amortisation of
acquired intangibles.
Contacts:
eEnergy Group plc Tel: +44 20 7078 9564
Harvey Sinclair, Chief Executive Officer info@eenergyplc.com ; www.eenergyplc.com
Crispin Goldsmith, Chief Financial
Officer
Strand Hanson Limited (Nominated Tel: +44 20 7409 3494
Adviser)
Richard Johnson, James Harris
Canaccord Genuity Limited (Joint Tel: +44 20 7523 8000
Broker)
Max Hartley, Harry Pardoe (Corporate
Broking)
Turner Pope Investments (Joint Broker) Tel: +44 20 3657 0050
Andy Thacker, James Pope info@turnerpope.com
Tavistock Tel: +44 207 920 3150
Jos Simson, Heather Armstrong, Katie eEnergy@tavistock.co.uk
Hopkins
About eEnergy Group plc
eEnergy (AIM: EAAS) is a net zero energy services provider,
empowering organisations to achieve net zero by tackling energy
waste and transitioning to clean energy, without the need for
upfront investment. It is making net zero possible and profitable
for all organisations in four ways:
-- Transition to the lowest cost clean energy through the
Group's digital procurement platform and energy management
services.
-- Tackle energy waste with granular data and insight on
energy use and dynamic energy management.
-- Reduce energy use with the right energy efficiency solutions
without upfront cost.
-- Reach net zero with onsite renewable generation and
electric vehicle (EV) charging.
eEnergy is a Top 5 B2B energy company and has been awarded The
Green Economy Mark by London Stock Exchange.
CEO Statement
I am pleased to report that the last 12 months has proved to be
another successful period for eEnergy, delivering significant
growth in both revenue and profitability. Our vision of making Net
Zero possible and profitable for organisations continues to be
increasingly relevant as the country continues its journey to Net
Zero by 2050.
Our established energy-as-a-service, end to end solution enables
businesses to access the lowest cost clean energy, identify and
tackle energy waste, reduce energy consumption and transition to an
EV charging model through zero capital solutions.
Energy Market
While energy markets have started to stabilise, energy
independence and moving away from the grid remains a high priority
at state level, all the way down to the consumer.
Although energy prices have dropped since the spike in 2022,
volatility and uncertainty remains, where a single event could see
prices escalate quickly. However, even at current levels which
remain significantly higher than historic trends, there is still a
considerable opportunity for organisations to unlock substantial
cash savings without investing their own capital in the transition
to reducing carbon. Compliance and governance are increasing across
the public and private sectors meaning that decarbonising is no
longer an option, but rather a necessity for organisations.
Results
During the 12 month interim period to 30 June 2023, revenue
increased by 50% to GBP33.2 million, up from GBP22.1 million, and
Adjusted EBITDA increased 54% to GBP4.7 million. Energy Services
revenue was up 87% to GBP19.5 million and Energy Management was up
to GBP13.6 million, an increase of 17%. Adjusted EBITDA was GBP2.3
million and GBP4.4 million for Energy Services and Energy
Management respectively, supported by a strong underlying
performance from both of the Group's divisions.
The increase in revenue has resulted in Profit Before Tax of
GBP1.1 million (FY 2022 Loss Before Tax: GBP2.2 million) and as at
30 June 2023 the Group's cash balance was GBP0.8 million, excluding
GBP0.5 million of restricted cash balances.
Net Debt (excluding IFRS 16 lease liabilities) at 30 June 2023
was GBP7.0 million following the Group securing further debt
finance of GBP2.5 million as announced on 25 November 2022 (the
"Subordinated Debt"), in order to provide additional funding to the
Group. The Subordinated Debt was structured as secured discounted
capital bonds (the "Bonds") which are due for repayment on 24 May
2024 and 21 June 2024. GBP1.0 million of the Subordinated Debt was
provided by each of, Hawk Investment Holdings Limited, an existing
shareholder of eEnergy, and FFIH Limited, with the balance of
GBP0.5 million being provided by Directors of the Company.
eEnergy has a fully drawn GBP5.0 million revolving credit
facility with HSBC Innovation Finance (previously known as Silicon
Valley Bank) . The Company is actively engaged in discussions with
a short list of debt providers and the Board expects to secure a
combined refinancing facility for both debt instruments. Financing
costs during the period were higher due to, inter alia, the new
Subordinated Debt facility and the higher interest rate
environment.
Sales across Energy Services have increased by 87% over the last
12 months, driven partly by the increasing penetration into the
education sector but also due to greater diversification in the
broader public sector and through the ability to cross sell to
customers across the Group.
We see increasing growth opportunities developing from new
products being launched in both the education sector and multi-site
organisations, which will see our data services division provide
the opportunity to access procurement services combined with smart
granular energy data within buildings, tackling energy wastage,
through the Company's unique capital free subscription service.
Change in accounting reference date
As announced on 22 June 2023, the Company has changed its
accounting reference date and financial year end from 30 June to 31
December. The Group's business activities and revenues are weighted
towards the middle of the calendar year and the Board therefore
believes that a 31 December year end will be in the best interest
of the Group.
Strategy
Since launching its renewables division, eSolar, the Company has
seen strong demand, originating 29 MW of signed contracts and HOTs
as at 30 June 2023, which we expect to convert to revenue over the
coming 12 months. We see Solar as a significant growth area across
the Group.
The Group announced on 7 June 2023 that it had entered into an
initial new EUR5 million two-year project funding facility with
Solas Capital AG ("Solas") to finance LED lighting projects in
Ireland. This partnership replaces previous arrangements and
reinforces the Group's commitment to its growth strategy.
The Solas Sustainable Energy Fund is supported by the European
Investment Bank, the Ireland Strategic Investment Fund, and the
LIFE-programme of the European Commission.
eEnergy has built a strong market position which is creating
larger project opportunities. The Company has achieved a
significant milestone and is now profitable. It has improved its
working capital position and has made substantial reductions in
legacy liabilities. Management recognises that further improvements
to cash generation are necessary in order that the business can
continue to scale. The Board is reviewing a number of strategic
options to further strengthen the balance sheet to support
growth.
On 10 August 2023, the Company announced that it had increased
its ownership to 100% in its subsidiary, eEnergy Insights Ltd
("EIL"), which holds the Group's MY ZeERO smart metering and
analytics platform, through the acquisition of the minority
holdings of two former management shareholders. The acquisition of
the final tranche of MY ZeERO allows the differentiated offering to
be fully integrated into the eEnergy proposition.
Board
Further to the Group's debt financing in November 2022, John
Foley was formally appointed as Non-Executive Chairman of eEnergy
in March 2023, while David Nicholl moved to Non-Executive Director.
Derek Myers resigned from the Board on 2 May 2023.
Outlook
Energy remains high on the agenda across the UK, and we continue
to see strong appetite from new and existing customers for our
suite of products and services.
Post period end, the Company secured a significant contract with
a Total Contract Value ("TCV") of GBP3.0 million, resulting in
GBP1.9 million revenues, from existing customer Tudor Grange
Academies Trust, for a solar energy generation project across its
collection of academies. This illustrates the Company's ability to
execute against its cross selling strategy within its existing
customer base.
Whilst market conditions tightened over the summer period,
eEnergy's contracted revenue book remains significant, giving
strong visibility on revenues for the final six months of the
financial period. Contracted forward revenues (the "Forward Order
Book") at 30 June 2023 were GBP27.5 million (31 December 2022:
GBP26.4 million), of which GBP14.1 million are expected to convert
into revenues in the six months to 31 December 2023.
The Group remains confident that eEnergy's proposition is more
relevant than ever, further supported by a continued shift in
regulatory and structural growth drivers. The Group remains
cautiously optimistic of delivering results for the 18 month period
ending 31 December 2023 in line with market expectations.
Harvey Sinclair
Chief Executive Officer
28 September 2023
CFO Statement
Group key performance indicators
12m 6m 6m
Period Period Year Period Year
to 30 to 31 to 30 to 31 to 30
June December June December June
2023 2022 2022 2021 2021
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
----------------------------- -------- ---------- -------- ---------- --------
Revenue 33,159 15,124 22,096 9,592 13,596
Adj. EBITDA 4,665 1,508 3,021 807 830
Adj. EBITDA% 14.10% 10.00% 13.70% 8.40% 6.10%
Cash & cash equivalents
(exc. restricted balances) 818 1,050 1,380 2,430 3,332
Net Cash / (Debt) (excl.
Of IFRS16) (6,935) (6,567) (3,642) (516) 1,486
Summary performance
The 12 months to June 2023 ("P1 FY23") was another period of
significant growth for the Group. Revenue of GBP33.2 million was up
50% from FY22, driving a 54% increase in Adjusted EBITDA to GBP4.7
million and delivering Profit Before Tax of GBP1.1 million (FY22
Loss Before Tax: GBP2.2 million).
Net Debt increased by GBP3.3 million in the period, funded by an
additional GBP2.5 million in debt funding through a new
Subordinated Bond in November 2022. The increase in Net Debt was
largely a consequence of a GBP5.0 million increase in working
capital. This was primarily driven by an increase in net accrued
revenues, representing future contracted cash due to the business,
repayment of legacy (non-trade) liabilities and a reduction in the
provision for earnout consideration relating to the acquisition of
UtilityTeam.
The six-months to June 2023 ("H2 FY23") saw the working capital
position improve as a result of management actions, with an
increase in Net Debt of GBP0.4 million after settling GBP0.9
million of legacy overdue HMRC balances. Whilst this represented a
significant improvement on previous periods (GBP2.9 million
increase for H1 FY23) and demonstrated that underlying operating
cash flows are starting to come through, it was below the internal
cash generation targets set.
The business has successfully built strong market positions
across its product set giving a good platform for growth. It is a
key focus for management to deliver on this growth opportunity in a
way which is more cash generative.
Divisional Performance
Energy Services
The strong momentum in new contract wins continues to drive
accelerated revenue growth. Revenues of GBP19.5 million for P1 FY23
represented growth of 87% compared to FY22 and drove substantial
growth of 131% in Adjusted EBITDA to GBP2.3 million (FY22 GBP1.0
million).
Strong execution and focus on cost management helped the Group
deliver a 0.9% improvement on Gross Margins to 35.1% (FY22 34.2%),
despite inflationary pressures and a changing product mix with
growing eSolar and eCharge revenues generating lower product Gross
Margins. Energy Services is segmented into three verticals -
Measure (primarily MY ZeERO), Reduce (primarily lighting) and
Connect (eSolar and eCharge). Target Gross Margins vary from 50% in
Measure, 38% in Reduce to 25%-30% in Connect (depending on the
product).
GBP26.4 million of new contract signings were delivered during
the period, representing an increase of 76% on FY22. This
accelerating momentum has continued into the final period of FY23,
in particular with the award of the eSolar contract worth GBP3.0
million in TCV and GBP1.9 million in revenues with Tudor Grange
Academies Trust in September 2023.
The Group has built a strong pipeline of solar opportunities
over the last 12 months and had 29.0 MW under signed contracts or
Heads of Terms as at 30 June 2023 (up from 8.9 MW at 30 June 2022).
Lead times on eSolar projects are long given the number of
stakeholders involved and consents required. After a long
development cycle these projects are now converting into revenue,
accelerating growth during the remainder of FY23 and into FY24.
Energy Management
The Energy Management business has continued to perform well
despite a challenging market backdrop of unprecedently high
volatility in energy prices and a period where the primary focus
has been on integration rather than growth.
Underlying organic revenue growth of 5% was boosted by
annualisation of the UtilityTeam acquisition (completed September
2021) to record overall 17% revenue growth to GBP13.6 million
(FY22: GBP11.6 million). Adjusted EBITDA of GBP4.4 million
represented robust 20% growth (FY22: GBP3.7 million).
A significant majority (c.95%) of revenue is generated from
commissions paid by energy suppliers linked to long-term customer
supply contracts with a retention rate on renewal of 85%+. The
Board believes this dynamic gives the business unit an attractive
quality of earnings.
Service delivery continues to be a key focus of the Company
following completion of the UtilityTeam integration. The Group has
invested in both the enlarged team and the delivery platform to
ensure a best-in-class customer experience through the life of the
relationship which should maintain and enhance retention rates, as
well as giving a differentiated proposition for new business
acquisition. This investment is now delivering returns and EBITDA
margin has increased to 32.4% in the period (FY22: 31.6%).
Cash Flow and Working Capital
Net cash outflow from operating activities for the period was
GBP1.2 million (FY22 net cash outflow: GBP6.2 million). Management
actions during the period, as detailed below, have improved
operating cash flows, delivering a cash inflow from operating
activities of GBP0.7 million for H2 FY23 (H2 FY22 net cash outflow:
GBP3.0 million). Nevertheless, this was below the internal cash
generation targets set for the business.
The operating cash outflow was a result of a GBP5.0 million
increase in net working capital. Whilst this represents a
strengthened Balance Sheet which should support improved cash
generation going forward, it led to a funding requirement for the
business in the period.
The single biggest contributor to this was an increase in net
accrued revenue of GBP6.2 million. This increase partly reflects
longer project lead times in eSolar, with strong contract signings
in the final quarter of the reporting period, together with the
organic growth of the business in both Energy Management and Energy
Services. Accrued revenue is recognised where revenue generating
activity within a given period is rewarded by cashflow in future
periods. Accrued revenue therefore represents contracted future
cash receipts for the business.
The increase in accrued revenue was mitigated by increases in
accruals and trade payables, which have scaled as revenues have
increased, resulting in a net increase in trade working capital of
GBP1.3 million.
Payments of GBP1.8 million were made against legacy (non-trade
and non-recurring) liabilities during the period. GBP1.6 million
related to historical Time-to-Pay arrangements with HMRC, clearing
historical overdue amounts, and GBP0.2 million related to legacy
liabilities in Ireland.
There was also a largely non-cash reduction of GBP0.9 million in
contingent consideration, relating to the acquisition of
UtilityTeam.
Cash flow also reflected a GBP0.8 million investment in the
period in continuing to develop the Group's proprietary technology
platforms, including a new self-service client portal in Energy
Management and MY ZeERO's cloud analytics.
Initiatives implemented by management in the period have
improved working capital during H2 FY23.
Operating cash conversion in Energy Management is on an
improving trajectory as a result of improved contract terms
negotiated with energy suppliers and growing contracted cash flows
from customer contracts signed in previous periods. Operating cash
conversion increased from 34% for the 12 months to March 2023 to
63% for the 12 months to June 2023 and is targeted to improve
further to 75% in FY24.
Energy Services is now the key focus area for improving cash
generation, with a clear plan to increase operating cash conversion
from 50% for P1 FY23 to a targeted 75% for FY24.
The Group is now working with a range of funding partners able
to fund all customer and product types. Off-balance sheet funding
has been secured for MY ZeERO eMeters with the first drawdowns
against this facility being made post period end. In addition, post
period end, a funding partner in Solas has been secured for eSolar
projects.
There is also a focus on improving operating margins, for
example by consolidating operational delivery teams.
Borrowings and Funding
The increase in Net Working Capital during the period was
principally financed through the issue of GBP2.5 million of
Subordinated Bonds in November 2022.
The Group's senior secured revolving credit facility with HSBC
Innovation Finance (previously known as Silicon Valley Bank) is
scheduled to be repaid in February 2024. The Subordinated Bonds are
scheduled to be repaid in May 2024. The Board is working to
complete a refinancing of these facilities ahead of the scheduled
repayment dates.
During the reporting period the Company has achieved
profitability, improved its working capital position and has made
substantial reductions in legacy liabilities. Management are now
focusing on delivering further improvements to cash generation in
order that the business can continue to scale. The Board is
reviewing a number of strategic options to further strengthen the
balance sheet to support growth.
H3 FY23 Outlook
Momentum across both parts of the business means that, going
into Q6, the foundations are in place to meet the Board's
expectations for the full-year out-turn. As at 27 September 2023,
there is visibility on 90% of the revenue expectation for the full
period.
Energy Services continues to benefit from accelerating momentum
and has developed a strong pipeline of revenues in attractive new
market segments, in particular eSolar. It is important that this
momentum is converted in a way which improves cash generation.
Continued investment in capabilities and infrastructure in
Energy Management is delivering an enhanced customer proposition
and user experience, supporting retention and new business
wins.
The final quarter of FY23 is expected to benefit from strong
revenue growth in eSolar, now converting the pipeline of
opportunities built over the last 12 months and leveraging off the
existing Group cost base.
Crispin Goldsmith
Chief Financial Officer
28 September 2023
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 30 June 2023
Year to Year to
30 June 30 June
2023 2022
Note GBP'000 GBP'000
----- ---------- ----------
Continuing operations
Revenue from contracts with customers 33,159 22,096
Cost of sales (15,474) (9,131)
--------------------------------------------------- ----- ---------- ----------
Gross profit 17,685 12,965
Operating expenses (14,163) (12,233)
--------------------------------------------------- ----- ---------- ----------
Included within operating expenses are:
* Other exceptional items 4 1,143 2,289
Adjusted operating expenses (13,020) (9,944)
----------
Adjusted earnings before interest, taxation,
depreciation and amortisation 4,665 3,021
--------------------------------------------------- ----- ---------- ----------
Earnings before interest, taxation, depreciation
and amortisation 3,522 732
Depreciation and amortisation (1,387) (2,636)
Finance costs (1,050) (323)
Profit (Loss) before taxation 1,085 (2,227)
Income tax (485) 736
--------------------------------------------------- ----- ---------- ----------
Profit (Loss) for the year from continuing
operations attributable to the owners of
the company 600 (1,491)
=================================================== ===== ========== ==========
Attributable to:
Owners of the company 608 (1,431)
Non-controlling interest (8) (60)
--------------------------------------------------- ----- ---------- ----------
600 (1,491)
--------------------------------------------------- ----- ---------- ----------
Other comprehensive income - items that
may be reclassified subsequently to profit
and loss
Translation of foreign operations 11 (125)
--------------------------------------------------- ----- ---------- ----------
Total other comprehensive profit (loss) 11 (125)
--------------------------------------------------- ----- ---------- ----------
Total comprehensive profit (loss) for
the year 611 (1,616)
=================================================== ===== ========== ==========
Total comprehensive profit (loss) attributable
to:
Owners of the company 619 (1,556)
Non-controlling interest (8) (60)
--------------------------------------------------- ----- ---------- ----------
611 (1,616)
--------------------------------------------------- ----- ---------- ----------
Basic earnings (loss) per share from continuing
operations 5 0.17p (0.44)p
Diluted earnings (loss) per share from
continuing operations 5 0.14p (0.44)p
--------------------------------------------------- ----- ---------- ----------
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 30 June 2023
As at As at
30 June 30 June
2023 2022
Note GBP'000 GBP'000
----- ---------
NON-CURRENT ASSETS
Property, plant and equipment 492 458
Intangible assets 6 28,812 28,733
Right of use assets 680 777
Deferred Tax Asset 745 1,071
Total non-current assets 30,729 31,039
------------------------------------------ ----- --------- ---------
Inventories 1,116 809
Trade and other receivables 22,876 16,022
Financial assets at fair value through
profit or loss 44 21
Cash and cash equivalents 1,305 1,802
------------------------------------------ ----- --------- ---------
Total current assets 25,341 18,654
------------------------------------------ ----- --------- ---------
TOTAL ASSETS 56,070 49,693
------------------------------------------ ----- --------- ---------
NON-CURRENT LIABILITIES
Lease liability 456 399
Borrowings 7 - 5,011
Other non-current liabilities 2,125 2,252
Deferred Tax Liability 1,477 1,318
Provisions 860 860
Total non-current liabilities 4,918 9,840
CURRENT LIABILITIES
Trade and other payables 18,972 16,802
Lease liability 365 492
Borrowings 7 7,753 11
Total current liabilities 27,090 17,305
------------------------------------------ ----- --------- ---------
TOTAL LIABILITIES 32,008 27,145
------------------------------------------ ----- --------- ---------
NET ASSETS 24,062 22,548
========================================== ===== ========= =========
Equity attributable to owners of the
parent
Issued share capital 16,386 16,373
Share premium 47,667 47,360
Other reserves 844 261
Reverse acquisition reserve (35,246) (35,246)
Foreign currency translation reserve (127) (138)
Accumulated losses (5,377) (5,985)
------------------------------------------ ----- --------- ---------
Total equity attributable to owners
of the parent 24,147 22,625
------------------------------------------ ----- --------- ---------
Non-controlling interest (85) (77)
------------------------------------------ ----- --------- ---------
Total equity 24,062 22,548
========================================== ===== ========= =========
CONSOLIDATED STATEMENTS OF CASHFLOWS
For the year ended 30 June 2023
Year to Year to
30 June 30 June
2023 2022
GBP'000 GBP'000
--------- ---------
Cash flow from operating activities
Operating profit (loss) - continuing operations 600 (1,491)
Adjustments for:
Depreciation and amortisation 1,383 2,636
Finance cost (net) 672 264
Share based payment 583 520
Gain on derecognition of contingent consideration (448) (1,032)
----------------------------------------------------- --------- ---------
Operating cashflow before working capital
movements 2,790 897
(Increase) in trade and other receivables (6,902) (9,857)
Increase in trade and other payables 2,777 165
(Increase) in inventories (308) (95)
Decrease in deferred income 404 2,650
Net cash outflow from operating activities (1,239) (6,240)
----------------------------------------------------- --------- ---------
Cash flow from investing activities
Cash acquired on acquisition of business - 4,007
Cash paid to acquire subsidiaries - (11,081)
Expenditure on intangible assets (1,067) (401)
Purchase of property, plant and equipment (124) (294)
----------------------------------------------------- --------- ---------
Net cash (outflow) from investing activities (1,191) (7,769)
----------------------------------------------------- --------- ---------
Cash flows from financing activities
Interest (paid) received (316) (188)
Repayment of lease liabilities (510) (347)
Net proceeds from the issue of shares - 11,382
Proceeds from loans and borrowings 2,775 4,891
Repayment of borrowings (10) (3,287)
----------------------------------------------------- --------- ---------
Net cash inflow from financing activities 1,939 12,451
----------------------------------------------------- --------- ---------
Net decrease in cash and cash equivalents (491) (1,558)
Effect of exchange rates on cash (6) 28
Cash and cash equivalents at the start of
the period 1,802 3,332
Cash and cash equivalents at the end of
the period 1,305 1,802
===================================================== ========= =========
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 30 June 2023
Reverse Foreign Non
Share Share Acqn. Other Currency Accum. Control Total
Capital Premium Reserve Reserves Reserve Losses Interest Equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 July 2021 16,071 33,014 (35,246) 601 (13) (4,554) - 9,873
Other comprehensive
loss - - - - (125) - - (125)
Profit for the
period - - - - - (1,431) (60) (1,491)
--------------------- --------- --------- --------- ---------- ---------- -------- ---------- --------
Total comprehensive
loss for the
period - - - - (125) (1,431) (60) (1,616)
Issue of shares
for cash 240 11.760 - - - - - 12,000
Issue of shares
for acquisition
of subsidiary 55 2.903 - - - - - 2,958
Issue of shares
in exchange
for loan notes 7 301 - - - - - 308
Acquisition
of non-controlling
interest - - - - - - (17) (17)
Acquisition
of put-option
relating to
non-controlling
interest - - - (3.921) - - - (3.921)
Utilisation
on acquisition
of non-controlling
interest - - - 3,061 - - - 3,061
Share based
payments - - - 520 - - - 520
Cost of share
issue - (618) - - - - - (618)
--------------------- --------- --------- --------- ---------- ---------- -------- ---------- --------
Total transactions
with owners 302 14.346 - (340) - - (17) 14,291
At 1 July 2022 16,373 47,360 (35,246) 261 (138) (5,985) (77) 22,548
Other comprehensive
loss - - - - 11 - - 11
Profit for the
period - - - - - 608 (8) 600
--------------------- --------- --------- --------- ---------- ---------- -------- ---------- --------
Total comprehensive
loss for the
period - - - - 11 608 (8) 611
----------
Issue of shares
during the period 13 307 - - - - - 320
Share based
payments - - - 583 - - - 583
Total transactions
with owners 13 307 - 583 - - - 903
--------------------- --------- --------- --------- ---------- ---------- -------- ---------- --------
Balance at
30 June 2023 16,386 47,667 (35,246) 844 (127) (5,377) (85) 24,062
===================== ========= ========= ========= ========== ========== ======== ========== ========
SELECTED NOTES TO THE FINANCIAL INFORMATION
For the year ended 31 June 2023
1. BASIS OF PREPARATION
The condensed consolidated interim financial statements of
eEnergy Group plc (the "Group") for the six month period ended 31
December 2023 have been prepared in accordance with Accounting
Standard IAS 34 Interim Financial Reporting.
The interim report does not include all the notes of the type
normally included in an annual financial report. Accordingly, this
report is to be read in conjunction with the annual report for the
year ended 30 June 2022, which was prepared under UK adopted
international accounting standards (IFRS), and any public
announcements made by eEnergy Group plc during the interim
reporting period and since.
These condensed consolidated interim financial statements do not
constitute statutory accounts as defined in Section 434 of the
Companies Act 2006. The Group's statutory financial statements for
the year ended 30 June 2022have been prepared under IFRS and have
been filed with the Registrar of Companies. The auditor's report on
those financial statements was unqualified and did not contain a
statement under Section 498(2) of the Companies Act 2006. These
condensed consolidated interim financial statements have not been
audited.
During the period, the Group changed its accounting reference
date to 31 December and consequently will report again for the 18
month period ending 31 December 2023.
Basis of preparation - going concern
The Directors have a reasonable expectation that the Company and
Group have sufficient resources to continue to operate for the
foreseeable future. The Group continues to show improvement in
revenue and operating profitability over the past several periods.
The scale of organic growth and associated working capital
requirement, particularly in the Energy Services business,
continues to be a key focus area of management action to continue
to improve the operating cash flow of the business going forward.
The Group expects to be able to refinance its existing GBP7.8
million borrowing, repayable within the next 12 months (see Note
7), before the scheduled repayment dates. At 30 June 2023 the Group
had unrestricted cash reserves of GBP0.8 million (30 June 2022:
GBP1.4 million).
In assessing whether the going concern assumption is
appropriate, the Directors have taken into account all relevant
information about the current and future position of the Group and
Company. These include the current level of resources, the ability
to trade within the terms and covenants of its loan facility, the
assumed success of the debt refinancing and the ability of the
Group to raise additional equity or debt capital if required. After
taking these matters into consideration, the Directors consider
that the continued adoption of the going concern basis is
appropriate. The interim financial statements do not reflect any
adjustments that would be required if they were to be prepared
other than on a going concern basis.
Accounting policies
The accounting policies adopted are consistent with those of the
previous financial year and corresponding interim reporting
period.
2. SEGMENT REPORTING
The following information is given about the Group's reportable
segments:
The Chief Operating Decision Maker is the Board of Directors.
The Board reviews the Group's internal reporting in order to assess
performance of the Group and has determined that in the year ended
30 June 2023 the Group had three operating segments, being Energy
Services, Energy Management and Central.
Energy Energy
Mgmt Services Central Group
---------------------------------- -------- ---------- --------- ---------
30 June 2023 GBP'000 GBP'000 GBP'000 GBP'000
---------------------------------- -------- ---------- --------- ---------
Revenue - UK 13,619 17,746 31,365
Revenue - Ireland - 1,794 - 1,794
-------- ---------- --------- ---------
Revenue - Total 13,619 19,540 - 33,159
Cost of sales (2,784) (12,690) - (15,474)
-------- ---------- --------- ---------
Gross Profit 10,835 6,850 - 17,685
Operating expenses (6,426) (4,595) (1,999) (13,020)
-------- ---------- --------- ---------
Adjusted EBITDA 4,409 2,255 (1,999) 4,665
Depreciation and amortisation (347) (141) (899) (1,387)
Finance and similar charges (38) (86) (926) (1,050)
-------- ---------- --------- ---------
Profit (loss) before exceptional
items 4,024 2,028 (3,824) 2,228
Exceptional items (239) (299) (605) (1,143)
-------- ---------- --------- ---------
Profit (loss) before tax 3,785 1,729 (4,429) 1,085
-------- ---------- --------- ---------
Taxation credit - - (485) (485)
-------- ---------- --------- ---------
Profit (loss) after tax 3,785 1,729 (4,914) 600
======== ========== ========= =========
Net Assets
Assets 35,667 18,396 2,007 56,070
Liabilities (8,971) (12,431) (10,606) (32,008)
--------
Net assets 26,696 5,965 (8,599) 24,062
======== ========== ========= =========
Energy Energy
Mgmt Services Central Group
---------------------------------- --------- ---------- -------- ---------
30 June 2022 GBP'000 GBP'000 GBP'000 GBP'000
---------------------------------- --------- ---------- -------- ---------
Revenue - UK 11,634 8,518 - 20,152
Revenue - Ireland - 1,944 - 1,944
--------- ---------- -------- ---------
Revenue - Total 11,634 10,462 - 22,096
Cost of sales (2,251) (6,880) - (9,131)
--------- ---------- -------- ---------
Gross Profit 9,383 3,582 - 12,965
Operating expenses (5,709) (2,607) (1,628) (9,944)
--------- ---------- -------- ---------
Adjusted EBITDA 3,674 975 (1,628) 3,021
Depreciation and amortisation (789) (124) (159) (1,072)
Finance and similar charges (82) (244) 3 (323)
--------- ---------- -------- ---------
Profit (loss) before exceptional
items 2,803 607 (1,784) 1,626
Impairment of brands (1,564) - - (1,564)
Exceptional items (797) (346) (1,146) (2,289)
--------- ---------- -------- ---------
Profit (loss) before tax 442 261 (2,930) (2,227)
--------- ---------- -------- ---------
Taxation credit 736 - - 736
--------- ---------- -------- ---------
Profit (loss) after tax 1,178 261 (2,930) (1,491)
========= ========== ======== =========
Net Assets
Assets 33,930 12,930 2,833 49,693
Liabilities (10,483) (8,702) (7,960) (27,145)
---------
Net assets 23,447 4,228 (5,127) 22,548
========= ========== ======== =========
3. EXCEPTIONAL ITEMS
Operating expenses include items that the Directors consider to
be exceptional by their nature. These items are:
Year to Year to
30 June 30 June
2023 2022
GBP'000 GBP'000
----------------------------------------------- --------- ---------
Acquisition related expenses - 1,273
Changes to initial recognition of contingent
consideration (435) (1,032)
Incremental restructuring and integration
costs 995 1,181
Share based payment expense 583 520
Other strategic investments - 347
Total exceptional expenses 1,143 2,289
--------- ---------
Acquisition expenses from the prior period are the costs
incurred in completing the "Buy and Build" strategy associated with
acquisitions and strategic investments. The costs incurred in
completing the acquisition of UtilityTeam in September 2021 are
described in Note 8.
The share based payment charge reflects the non cash cost of the
Management Incentive Plan awards made on 7 July 2020 and the award
of options made to the senior management team on 7 December 2021
which are being amortised over their three year vesting period.
4. EARNINGS PER SHARE
The calculation of the basic and diluted earnings per share is
calculated by dividing the profit or loss for the year by the
weighted average number of ordinary shares in issue during the
year.
Year to Year to
30 June 2023 30 June 2022
---------------------------------------------- -------------- --------------
Profit / (loss) profit for the year from
continuing operations attributable to
owners of the Company - GBP 608,000 (1,431,000)
Weighted number of ordinary shares in
issue 350,406,333 323,783,394
---------------------------------------------- -------------- --------------
Basic earnings per share from continuing
operations - pence 0.17p (0.44)p
---------------------------------------------- -------------- --------------
Weighted number of dilutive instruments
in issue 83,991,424 -
---------------------------------------------- -------------- --------------
Weighted number of ordinary shares and
dilutive instruments in issue 434,397,757 323,783,394
---------------------------------------------- -------------- --------------
Diluted earnings per share from continuing
operations - pence 0.14p (0.44)p
---------------------------------------------- -------------- --------------
Share options and warrants could potentially dilute basic
earnings per share in the future but were not included in the
calculation of diluted earnings per share in the prior period year
as they are anti-dilutive.
5. INTANGIBLE ASSETS
Customer Trade
Goodwill Software relation-ships names Total
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
------------------------- --------- --------- ---------------- --------- ---------
Cost
At 1 July 2022 23,816 1,258 4,311 1,594 30,979
Adjustment to goodwill
on acquisition (215) - - - (215)
Additions in the
period - 1,063 - - 1,063
At 30 June 2023 23,601 2,321 4,311 1,594 31,827
========= ========= ================ ========= =========
Amortisation
At 1 July 2022 - (219) (433) (1,594) (2,246)
Amortisation in
the period - (381) (388) - (769)
At 30 June 2023 - (600) (821) (1,594) (3,015)
--------- --------- ---------------- --------- ---------
Net book value
at
30 June 2022 23,816 1,039 3,878 - 28,733
--------- --------- ---------------- --------- ---------
Net book value
at
30 June 2023 23,601 1,721 3,490 - 28,812
========= ========= ================ ========= =========
6. BORROWINGS
30 June 30 June
2023 2022
GBP'000 GBP'000
------------- --------- ---------
Current
Borrowings 7,753 11
7,753 11
------------- --------- ---------
Non-current
Borrowings - 5,011
- 5,011
------------- --------- ---------
During the current period the Group secured a further GBP2.5
million in Subordinated Debt which has been structured as secured
discounted capital bonds. The Bonds are being issued at a 21.29%
discount to their face value (equivalent to a discount rate of
1.25% per month plus a 2% repayment fee) and are due to be redeemed
by the Company (through the payment of in aggregate GBP3.2 million)
on or before 24 May 2024 (in respect of GBP2.0 million) and on or
before 21 June 2024 (in respect of GBP0.5 million).
In February 2022 the Group refinanced substantially all of its
existing bank indebtedness and consolidated its borrowings into a
single GBP5.0 million, three year, revolving credit facility
provided to eEnergy Holdings Limited, an intermediate holding
company in the Group. A term of the additional Subordinated Debt
requires the business to refinance this loan in February 2024, one
year earlier than originally planned. The facility is secured by
way of debentures granted to the lender by all of the Group's
trading subsidiaries. The facility includes covenants relating to
debt service cover and gearing.
Maturity of the borrowings as of 30 June 2023 are as
follows:
GBP'000
----------------------- --------
Current 7,753
Due between 1-2 years -
Due between 2-5 years -
Due beyond 5 years -
----------------------- --------
7,753
----------------------- --------
7. RELATED PARTY TRANSACTIONS
Key management personnel are considered to be the Board of
Directors. The amount payable to the Board of Directors for the 12
months ended 30 June 2023 was GBP0.9 million (FY22: GBP0.8
million).
Directors' remuneration includes contractual payments to the
former Chief Financial Officer after he left the Board.
8. EVENTS AFTER THE BALANCE SHEET DATE
There were no significant events that occurred after the balance
sheet date.
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END
IR UBOUROOUKUUR
(END) Dow Jones Newswires
September 28, 2023 02:00 ET (06:00 GMT)
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