TIDMSMS
RNS Number : 9271I
Smart Metering Systems PLC
17 December 2020
17 December 2020
Smart Metering Systems plc
Update announcement
Smart Metering Systems plc (AIM: "SMS", "the Group"), which
installs and manages smart meters and carbon reduction assets
("CaRe(1) ") to facilitate effective energy management, provides an
update on the Group's operational and financial performance.
Key highlights:
-- Smart meter installations at >80% of pre-Covid run rate despite local lockdowns
-- Continued development in CaRe pipeline, having secured rights
to 117.5MW of grid scale batteries with an additional 150MW under
exclusivity
-- FY2020 underlying PBT marginally ahead of Board's
expectations, with forecast year-end net cash position of
c.GBP30m
-- Board remain confident of the current FY2021 consensus expectations
-- SMS to become net zero carbon emissions by 2030
Meter installation run rate improving steadily despite local
lockdowns
SMS has continued to see a progressive recovery in the
installation run-rates since the first national lockdowns, despite
continued local restrictions. SMS is currently operating at >80%
of the pre-Covid run-rate and is positively geared for the
continued increase in installation activity to deliver the mandated
smart meter roll-out and the contracted order pipeline.
The Group continues to provide all supporting control measures
to ensure the safety of our engineers, support staff and end
consumers.
Continued development in CaRe assets, strong pipeline in grid
scale batteries
In addition to the focus on the UK smart meter market, the
Group's strategy also includes the development of CaRe assets as
the economy transitions towards net zero carbon. SMS continued to
make strong progress in developing its pipeline of CaRe assets
across several verticals, including grid scale battery storage,
Behind the Meter smart solar and storage (BTM), ADMTM(2) Australia,
EV charging infrastructure and heat networks and meters.
SMS is pleased to announce that it has secured an initial
pipeline of 117.5MW of grid scale battery storage projects. These
projects are under construction and expected to be energised by Q4
2021. The Group is also under exclusivity to acquire an additional
150MW which, if successful, will start construction in 2021 and be
energised by mid-2022.
The Group continued to make good progress on BTM, with trials
with four local authorities underway. The Group intends to launch
the fully funded BTM products early next year. SMS's proposition is
to provide turnkey smart solar and storage assets and services to
local authorities and housing associations backed by long term
secured revenues. SMS's BTM proposition will significantly reduce
tenants' energy costs (up to 25%) and decarbonise housing stocks
(up to 90% of electricity supply).
The Group is also in early stage discussions with certain
Australian water utilities to undertake trials of its ADM(TM)
devices, and sees potential, over time, for significant water
metering opportunities in Australia. SMS's proprietary ADM(TM)
devices are a proven reliable data logger solution, through which
water utilities and customers are able to access water consumption
data via its cloud-based utility analytics software.
SMS continues to evaluate the funding options for these
opportunities, including through its existing partner, ESIF(3) ,
and other potential funding sources.
FY2020 underlying PBT marginally ahead of expectations
In the light of recent trading, the Board expects FY2020
underlying PBT to be marginally ahead of its expectations, with
forecast year-end net cash position of c.GBP30m.
FY2021
The Board acknowledges that the current macroeconomic
uncertainties make forecasting challenging but remains confident of
achieving the current FY2021 consensus expectations.
Business model
The Group's trading performance highlights the resilience of the
Group's business model and its infrastructure asset classes, which
generates long-term, predictable and index-linked revenue streams.
The existing recurring cash flows support an annual 10% increase in
dividends, from 25p per share in FY2020 until 2024.
2030 Net zero target
ESG and sustainability remain at the heart of SMS's operations
and culture. Earlier this year the Group announced the
establishment of a dedicated Health, Safety & Sustainability
Board Committee headed by the Group's Chair. The Group is now
pleased to announce a net zero carbon emissions target by 2030
which will see SMS's scope 1 and 2 emissions reduced to zero
through actions taken across both its fleet and buildings. The
Group will provide further details in due course.
Alan Foy, Chief Executive Officer, commented:
"We have demonstrated strong resilience throughout 2020 and our
performance is testimony to the commitment and dedication of the
entire SMS team.
"Our meter installation run rate continues to show steady
improvement despite local lockdowns. We also continue to make
tangible progress in developing a strong pipeline of Carbon
Reduction assets.
"I'm delighted to unveil today our ambition to achieve net zero
carbon emissions by 2030. Our CaRe assets and technology solutions
are at the heart of the low-carbon, smart energy revolution that is
pivotal to realising a greener, more sustainable world."
FY2020 Results
SMS intends to release its full year results for FY2020 in the
week commencing 15 March 2021.
(1) All carbon reducing assets including energy efficiency
systems, metering, lighting, battery storage, distributed
generation, EV charging, data and control, etc.
(2) The ADM(TM) is a cost effective and reliable data collection
and smart metering solution developed by SMS. The ADM(TM) is a
'plug and play' device which could be fitted on the existing
metering assets making the assets smart and enabling transmission
of half hourly consumption data to the water utilities.
(3) ESIF: Columbia Threadneedle European Sustainable Infrastructure Fund
For further information:
Smart Metering Systems plc 0141 249 3850
Alan Foy, Chief Executive Officer
Dilip Kejriwal, Head of Investor Relations
Cenkos Securities plc (Joint Broker 0131 220 6939 / 020
and Nomad) 7397 8900
Neil McDonald / Pete Lynch
Investec Bank plc (Joint Broker) 020 7597 5970
Christopher Baird / Henry Reast
RBC Capital Markets (Joint Broker) 020 7653 4000
Matthew Coakes / Evgeni Jordanov
Instinctif Partners sms@instinctif.com
Adrian Duffield / Kay Larsen / Chantal
Woolcock
Notes to Editors
SMS plc (www.sms-plc.com) installs and manages smart meters,
data and carbon reduction assets ("CaRe") to facilitate effective
energy management. The Group manages and optimises these assets
through its in-house technology and data analytical platform. As at
30 June 2020 SMS had 3.74 million meter and data assets under
management.
Established in 1995, SMS provides a full end-to-end service,
from funding and installation to management and maintenance, with a
highly skilled workforce, deep engineering expertise and
well-established industrial partnerships.
SMS is leading the smart energy revolution and the assets
deployed remain at the heart of delivering and accelerating the UK
government's net zero carbon ambition. In 2019, SMS was awarded the
London Stock Exchange Green Economy Mark.
SMS plc is headquartered in Glasgow with a national presence
across twelve UK locations.
SMS's shares are listed on AIM.
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