Water Intelligence (WATR) , a provider of water leak detection and related services, issued a trading update for the year ended December 31, 2023. The group also announced the re-acquisition of its Pittsburgh franchise by its American Leak Detection (ALD) subsidiary for US$0.5m.
Water Intelligence reported positive headline numbers. Revenue increased 7% to US$76m from US$71.3m in FY22. Pre-tax profit grew 13% to US$6.2m and adjusted pre-tax profit increased 12% to US$8.7m. Statutory EBITDA rose 7% to US$11.8m and adjusted EBITDA grew 9% to US$13.4m.
Margins also improved with adjusted PBT margins up to 11.5% from last year's 10.9%. Adjusted EBITDA margins increased to 17.7% from 17.3% in FY22. In terms of market capture, network sales grew approx. 3% to c. US$170m.
Water Intelligence's balance sheet remained strong with cash on December 31 of US$15.8m. Total debt was US$22.8m, with a net total debt to EBITDA ratio of 0.60 and net total debt to adjusted EBITDA ratio of 0.53.
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A positive trading update from Water Intelligence, detailing a year of solid growth, including revenue, pre-tax profit and margins. The group performed in line with expectations with strong momentum into FY24 and a comfortable cash position enabling further expansion.
Cash was deployed in FY23 for acquisitions and technology investments to drive organic sales growth, which is expected to accelerate in FY24. In December, the group announced an increase of its line of credit with M&T Bank by US$5m. Additionally, free cashflow should increase in FY24 as the group's prior investments, such as Salesforce and related applications, are expected to reduce in 2H24 when they complete integration.
Already this year, Water Intelligence has followed through on its ambitious M&A strategy with recently announced insurance wins and now the re-acquisition of its Pittsburgh franchise by wholly-owned ALD and conversion to a corporate-operated location.
WATR's audited full-year results are expected in early June 2024.
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