TIDMUTW
RNS Number : 6537T
Utilitywise plc
05 July 2018
5 July 2018
Utilitywise plc
("Utilitywise" or the "Company" or the "Group")
Strategy Update
Utilitywise plc (AIM: UTW), a leading independent utility cost
management consultancy, announces an update to its Strategy for
Growth.
Strategy for Growth
On 2 March 2017, the Group announced its Strategy for Growth
2021, which included the following targets, to be delivered by the
year ended 31 July 2021 ("FY21"):
-- Increase in share of SME market from 2% to 7%
-- Increase in SME customer numbers from c. 30,000 to c. 130,000
-- 5% share of the UK & Ireland corporate controls market
These strategic targets remain in place, notwithstanding the
challenges the Company has had to overcome during the last 12
months. With the Group's 2017 audit process now complete, the Board
has been focusing its efforts on the strategic initiatives required
to deliver against its Strategy for Growth 2021.
Evolving the proposition channel strategy
As previously announced, the Group intends to significantly
increase its market share of both the micro SME market and the
larger corporate market, in addition to its historically core SME
market. This will require the evolution of the Group's proposition
and channel strategy in order to penetrate the volume opportunity
provided by the micro SME market, predominantly by focusing on
driving inbound sales channels and providing multiple utilities to
its customers.
The Group will focus on operational productivity to optimise its
margin in its historically core SME market, via differentiated
segment and channel propositions and process automation. In
addition, the Group will serve larger corporate customers through
its technology-led efficiency proposition, adopting a more
consultative sales approach.
Committed to serving customers in the way in which they wish to
purchase and engage, the Group will continue to invest in the
development of a multi-channel "go to market" strategy. Operating
outbound telesales, field sales and inbound teams, underpinned by a
team adding value "in-life" via upsell and cross-sell, the
direction of travel is toward a digital automated experience for
transactional sales, and a face-to-face account managed proposition
for customers demanding greater levels of service.
Enterprise Division
The Group's Enterprise Division Strategy comprises four key
stages:
1. Optimise core proposition by improving efficiencies,
optimising sales channels and focusing on margin targets
2. Grow a new inbound sales channel through a price comparison
website, which already exists and is generating order book and
revenue, albeit at a relatively modest scale, ahead of increased
investment during the year ended 31 July 2019
3. Offer other utilities - customers utilise many different
products and services to run their business and our model, skills
and partnerships can extend to some of those markets that customers
also find difficult to manage or understand. Following the addition
of water and broadband to our core offering of electricity and gas,
we will expect to add further utilities to our offering in the
coming months
4. In-life cross sell - using our customer relationships
carefully and intelligently, we aim to expose relevant products and
services to customers and add value in-life. This creates greater
lifetime value and customer retention than a transactional
model.
Corporate Division
The key drivers for the Group's Corporate division are:
-- The evolution of the internet of things ("IoT")
-- Strategic partnerships
-- Digital buildings
Further information on the key drivers was announced on 3 July
2018.
International
The Board believes there is a significant opportunity to develop
its core business in other geographical markets over the medium
term. However, the focus of the business during FY19 will be
primarily on the UK market and the targets, set out above and below
for FY21, are not dependent upon significant international
growth.
Cash flow
The Board recognises the need to focus on driving the operating
cash flow of the business in order to drive returns for
shareholders. In addition to the reiteration of its strategic
targets as noted above, the Group is therefore also introducing two
new financial targets, as follows:
-- Underlying Free Cash Flow(1) of the Group of at least GBP10m in FY21; and
-- A Group net cash(2) position by 31 July 2021, with the path
to that position being non-linear to allow for, in particular,
investments during the year ended 31 July 2019
Brendan Flattery, Chief Executive Officer of Utilitywise,
commented:
"Utilitywise is firmly focused on significantly increasing its
market share by broadening its target market and the services it
provides its customers, in order to drive returns for shareholders.
That means the Company will have to evolve its proposition and
channel strategy, as detailed above, while optimising operational
productivity. The strategy update outlined today will enable
Utilitywise to meet its two new financial targets, as well as
maximising the medium term potential from the business."
(1) Underlying Free Cash flow is defined as operating cash flow,
excluding exceptional items, less interest, corporate tax and
capital expenditure
(2) Net cash means cash less bank and other borrowings
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014
For further information
Utilitywise plc 0330 303 0233
Brendan Flattery (CEO)
Richard Laker (CFO)
finnCap (NOMAD and broker) 020 7220 0500
Matt Goode / James Thompson (Corporate Finance)
Andrew Burdis (Corporate Broking)
Liberum (Joint broker) 020 3100 2000
Robert Morton / Steve Pearce
Redleaf Communications 020 3757 6865
Robin Tozer / Elisabeth Cowell utilitywise@redleafpr.com
Utilitywise is a leading independent utility cost management
consultancy, which has established trading relationships with a
number of major UK and European energy suppliers and provides
services to its customers designed to assist them in achieving
better value out of their energy contracts, reduced energy
consumption and lower carbon footprint.
Utilitywise is a UK company quoted on the AIM market of the
London Stock Exchange. For more information, please visit
www.utilitywise.com.
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END
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