Yu Group revenue surges in 2024

(Sharecast News) - Yu Group reported a strong 2024 financial performance on Tuesday, with revenue rising 40% to £645.5m, driven by a 78% increase in energy volumes supplied. The AIM-traded company said it expanded its market share to 2.7%, up from 1.3% in the prior year.

Adjusted EBITDA grew 11% to £48.8m, while profit before tax increased 12% to £44.5m.

The company said it maintained strong cash generation, with net cash rising to £80.2m following the successful implementation of a hedging agreement with Shell Energy Europe, which removed the need for cash collateral.

Earnings per share increased to 210p on an adjusted, fully diluted basis.

The board recommended a final dividend of 41p per share, bringing the full-year payout to 60p, a 50% increase year-on-year.

Operationally, Yu Group increased the number of supplied meter points by 65% to 88,000 and installed 22,900 smart meters, up 14,400 from the prior year.

It said its smart meter asset ownership continued to build long-term annuity income, with index-linked annual recurring revenue reaching £1.3m.

The company said it also expanded its in-house technical training and development centre to support national engineering coverage.

Yu Group entered 2025 with £566m in contracted revenue, a 9% increase from the previous year.

Management expects total revenue to reach between £730m and £760m, with adjusted EBITDA, earnings per share, and closing net cash in line with market expectations.

While energy prices were expected to act as a headwind in the short term, the company remained focused on maintaining profitability through disciplined margin control, strong customer collections, and operational efficiencies.

The board reiterated its commitment to a progressive dividend policy, with a long-term target of 3x dividend cover on earnings per share.

"The team and I continue to focus on delivering our strategy, which has delivered another new set of record results, with further strong growth in revenue, profit and cash terms," said chief executive officer Bobby Kalar.

"I'm particularly pleased that this is our 6th year of profit growth, and we have taken revenue from £81m in 2018 to £646m in 2024.

"This growth is set to continue, although at a slower pace in percentage terms due to the larger base."

Kalar said the company's disciplined approach to growth and the focus on its core target market remained, adding that its smart metering business was starting to bear considerable fruits.

"Whilst softened commodity markets provide a lower revenue per customer, our 78% growth in delivered energy volume demonstrates the opportunity being taken.

"We continue to grow market share, nearly doubling year-on-year to 2.7%, and we have a huge addressable market available and are set-up to scale."

Bobby Kalar said the firm's smart metering business was continuing to perform well, noting that from standstill in 2023, the firm now had a fully functioning engineering capability across the country, with its own training centre and a "highly skilled and driven" management team.

"We are again increasing our dividend payment, which has increased by 50% in year, reflecting our progressive dividend policy and confidence in the future with over £1bn of forward revenue already contracted."

Reporting by Josh White for Sharecast.com.