SHARES in Smart Metering Systems jumped 9% yesterday when the Glasgow-based firm said it expects to achieve further growth in 2012 after almost doubling trading profits in 2011.
The Aim-listed meter technology specialist said it expects its results for the year to December will be ahead of market expectations. The company achieved strong growth in revenues and profitability on the back of increased take-up of its gas meter services.
Smart Metering Systems provides meters and related customer and administration services for a range of gas suppliers. The customer base includes Centrica and Gazprom.
The company is run by two Scottish engineers, Steve Timoney and Alan Foy, who netted windfalls totalling around £17 million when it floated in July. Mr Timoney is deputy-chairman of the company while Mr Foy is chief executive.
In a trading update, Smart Metering Systems said unaudited management accounts for the company show adjusted earnings before interest, tax, depreciation and amortisation increased by 97% in 2011, to £5.7m, from £2.9m in 2010.
Revenue increased by 29% in 2011, to £16m, compared with £12.4m in 2010.
The company added D-ENERGI and Vayu Limited as contracted customers during the year, bringing the total number of gas suppliers under service contracts for the operation and management of gas meters to 14.
Analysts at Cenkos Securities told clients revenues were 6.7% ahead of the house broker's forecast while EBITDA was 11.8% ahead.
Mr Foy said the company had made "solid progress" since the flotation in July 2011. He added: "We have also strengthened the senior management team and are confident of further growth during 2012."
Kevin Lyon, who ran the old central Scotland operations of the 3i private equity business, became chairman last year.
Finance director Glen Murray joined in May.
The company is trialling a new advanced metering system, ADM, which will allow suppliers to read meters remotely and get regular updates about consumption patterns.
Customers could use information from meters to highlight potentially wasteful spikes in consumption.
It expects to enjoy strong demand for these. Suppliers are required to make smart meters available to all commercial and industrial consumers by 2014 and all domestic users by 2019.
Shares in Smart Metering Systems closed up 8.5p at 100p. That gave the firm a market capitalisation of £83m. It was valued at £50m when its shares listed on Aim in July.
Before the listing, the company completed a placing that raised £10m expansion funding which Mr Foy said was "substantially oversubscribed" in very difficult market conditions.
It will announce full-year results in mid-April.
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