In a trading update for the first quarter of 2021,Yu Group (YU. ) said it has seen continued momentum from FY20 into the period as overall performance falls in line with expectations.
The Company, which is a supplier of gas, electricity and water to the UK SME and corporate sector, reported a good start to 2021 with average monthly bookings for the four months to 30 April 2021 at £7.2m, an increase of 26% compared to the same period in 2020.
It said it is further encouraged by the UK Government's roadmap out of lockdown and signs of improvement in the economy which is lifting broader market uncertainty. The group says, however, that it will continue to remain ‘vigilant and prepared for all future scenarios.’
“I am pleased to report a strong start to the year, with Group performance delivering in line with expectations. Positive momentum continues as we see improved booked revenue in the first four months of 2021 compared to the same period last year,” said CEO, Bobby Kalar.
He said, “Our strategy is working well and as such the Board is confident that the business is on track to deliver its operational targets and to report profitable growth in FY2021.”
The company informed investors that it holds a strong balance sheet and that its strategic value enhancing acquisitions plan forms part of a wider ambitious scaling strategy.
In 2020, Yu Group acquired two cash generative customer books and successfully integrated around 5,000-meter points ‘quickly and seamlessly’, it said. The Group said it holds a compelling pipeline of opportunities and that it is confident that it is well placed to continue acquiring value creating opportunities where this meets the company’s strategic criteria.
Commenting on Yu’s outlook, Kalar added, “I am pleased to be able to look forward to the future with confidence. From the 'hard yards' of recent times I see good times ahead."
Addressing shareholders, Yü Group noted that it will provide a further update to its trading, in the ordinary course, in its July trading update covering the period to 30 June 2021.
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In its final results for the year to 31 December 2020 released in March 2021, Yu said it was “primed and ready for profitable growth” in 2021 following a strong performance in 2020.
Yu said its strong top line performance and earnings in FY20 had exceeded market expectations and that this was “a clear indicator of its positive trajectory and speed of travel.”
At the time, Yu Group also described its two successful acquisitions in 2020 as immediately earnings-enhancing, saying this was “a clear demonstration” of both intent and capability.
On the back of its final results, CEO, Bobby Kalar said 2020 had been a “defining year” for the company “underscoring the strength, maturity and momentum” of the overall business.
As a result of a strong performance, Yu told investors that it expects revenue in FY21 to be ‘significantly above’ the £101.5 million delivered in FY20 and ahead of market expectations.
Shares in Yu Group have seen an almost three-fold increase since the beginning of 2021. The stock was trading 9.72% lower this morning at 239.25 following the announcement.
Reasons To YU.
Yü Group is an independent supplier of gas, electricity and water focused on servicing the corporate sector throughout the UK. It has no involvement in the domestic retail market. The Group was listed on the AIM market of the London Stock Exchange in March 2016.
“The growth objective for 2020 was very clear that, having strengthened the business for significant sustainable growth, we would begin to rapidly scale,” Yu wrote back in January.
The company told investors that having achieved upward momentum in its performance, it is now focused on the next phase of its evolution which includes, inter alia, delivering organic growth, driving profitability and utilising digital technologies and innovation.
In short, the company highlighted that it is now ready to launch “a period of sustainable growth as it scales up to address and increase its rightful share of a £35bn market.”
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