Interim Results: Stronger Growth; Competitive Differentiation
Results are in-line with market expectations with continued revenue and EBITDA growth with momentum for 2H from a strong 2Q. The Group's focus is two-fold. First, further competitive differentiation and margin improvement driven by its technology-enabled services platform and second, going to market with its strategic StreamLabs partnership to deliver accelerated organic revenue growth.
Financial Highlights
· Revenue increased by 8% to
o Franchise Royalty income decreased by 10% to
o Franchise Related sales decreased 15% to
o
§ US Corporate sales grew 7% to
§ International Corporate sales grew 64% to
· PBT Adjusted* increased by 8% to
· EBITDA Adjusted** increased by 16% to
· Statutory Profit Before Tax decreased by 11% to
· Statutory EBITDA increased by 4% to
· PBT Margin Adjusted* remained the same at 13% (1H 2024: 13%)
· EBITDA Margin Adjusted** increased to 20% (1H 2024: 19%)
· EPS Basic Adjusted* increased by 8% to
· EPS Fully Diluted Adjusted* increased by 8% to
· Cash and equivalents at 30 June of
o
o Net Debt (including both Bank Debt and Deferred Acquisition Payments) to EBITDA Adjusted** ratio: 1.24
*PBT Adjusted (adjusted for amortisation, share based payments and non-core costs/gains including IFRS treatment of earn-out gains)
**EBITDA Adjusted (adjusted for share-based payments and non-core costs/gains including IFRS treatment of earn-out gains)
*** See 2024 Accounts, Strategic Report, Table (vii) for further explanation; Irish acquisition occurred in 2H 2024 so 1H 2024 Interims did not have conforming treatment of
Corporate Development / Capital Allocation
· Strategic partnership with StreamLabs. Inc., a Chubb company for "white label" resale of high quality water monitoring products by the Group's core
· Repurchase of Group shares: 60,000
Subsequent to Period
· Repurchase of Group shares: 88,000 for Total Year to Date of 148,000
· Reacquisition of
Dr.
"We are enthusiastically executing our 2025-26 plan to drive accelerated organic growth and to realize gains from investments previously made, such as our Salesforce operating platform. We have momentum from a strong 2Q. Over the next couple of quarters, we will be publishing new KPIs reflecting such gains.
Our Technology Enabled Services model positions us well. Preventive maintenance solutions for aging water infrastructure, as opposed to restoration after an unattended to water leak, is increasingly sought after by the residential, commercial and municipal customers as the price of water continues to rise. Our StreamLabs partnership executed during 1H enables us to provide end-to-end products and services from monitoring to leak detection and repair to aftercare and to help our customers via a subscription model to get ahead of any potential problem.
We are now the only nation-wide company in the US in a fragmented market for service providers that can provide the end-to-end set of preventive maintenance solutions directly. Moreover, with our latest proprietary leak detection equipment to be unveiled at our forthcoming annual
While building out our multinational platform and continuing to meet expectations in terms of profitability, we have preserved a strong balance sheet and credit capacity. As a result, we have the resources both to be opportunistic through acquisitions but also to provide some liquidity for shareholders through share repurchases. We are confident in our ability to deliver results in the near-term."
The information contained within this announcement is deemed to constitute inside information as stipulated under the retained EU law version of the Market Abuse Regulation (EU) No. 596/2014 (the "
Enquiries:
Philip Secrett
Harrison Clarke
Ciara Donnelly
Simon Bridges
Harry Gooden
Elizabeth Halley-Stott
Chairman's Statement
During 1H, we began to execute against our Next 50 Growth Plan that we launched in
Starting with ALD's 1H performance, we invested in the final piece of the platform vision during 1H with our StreamLabs partnership to introduce wireless monitoring capabilities. We have tested the new offering during 1H in certain pilot cities with positive customer reaction. In addition, pleasingly we have also observed different indicators that prior investments in the platform are delivering efficiencies and scale. Now, as we approach our 2025
Our new KPIs will focus on three key concepts - Preventive Maintenance, Technology Enabled Solutions Platform and the Dallas Operating Template. All three reinforce our core technology-driven, minimally-invasive, leak detection value proposition and create a coherent economic model that is scalable. Importantly, we believe we are the only nationwide provider in the US that can bring such a comprehensive technology profile to bear on leak detection problems in water infrastructure. As outlined below, our new KPIs are geared to show the yield from our investments.
First, as a matter of competitive strategy, market demand for end-to-end Preventive Maintenance solutions for water infrastructure - whether residential, commercial or municipal - is rapidly growing. Customers - whether homeowners, property management or insurance companies - are recognizing the need to be proactive rather than wait for serious losses and greater damages. The current revolution in data science enables better capture and quantification of water data to show the return on investment for preventive maintenance. Some of the Group's collection of proprietary technologies, especially LeakVue 2, already leverage such data about water flow to pinpoint leaks. As a result, our combination of proprietary tools and wireless products, an installed base of household customers across the US and a national services footprint mapped to a national insurance channel structure enable both the collection of first party data and its exploitation for winning competitive differentiation.
Over the last six months, we have built out our StreamLabs partnership to create further competitive advantage for such a new world of preventive maintenance. StreamLabs, a company owned by Chubb insurance, has what we have evaluated to be the highest quality water monitoring product that can provide wireless data alerts of a water leak and an ability to shut-off water flow. We are pleased that ALD is able to "white label" the StreamLabs products to our customers and to own dashboards so that we can be a first responder for our customers and seamlessly leverage our proprietary leak detection technology and highly-trained professionals to pin-point leaks, remediate them in minimally-invasive fashion and provide aftercare based on data. During 1H we have trained our technicians in StreamLabs products, set-up proprietary workflow routines in our Salesforce operating system and sold StreamLabs units in pilot cities. Customer feedback has been outstanding. Coincident with our
Second, over the last several years we have invested in building out a Technology Enabled Solutions (TES) business model so that we could scale efficiently. Our Salesforce operating system and various applications from web forms to SEEEN video moments gather and store data securely in the Salesforce cloud to improve leak detection services, the training of technicians and even the care of customers. We have integrated such data flows from our national insurance channels with our Salesforce system and automatically produce service level customer records. We are now tying together StreamLabs monitoring technology to service level agreements from insurance channels such as Chubb. In terms of KPIs, now that we have various data flows integrated, we can reduce unnecessary software licenses linked to each of our 150 locations as well as certain administrative headcount since job information is routed directly to technicians and service level reports generated more efficiently. Such efficiencies will underpin further subscription offerings. EBITDA Adjusted margins have improved during 1H and we will be developing KPIs on operating efficiencies and margin expansion.
Third, with respect to the Dallas Template, as previously discussed, we reacquired during Q4 2024 ALD's highly successful Dallas franchise led by Will Knell, then appointed Will as CEO of ALD and are now cloning the Dallas unit's operating model - one that has generated significant sales growth and 30% margins - across the other forty-five corporate locations. During 1H, we started making various changes including the introduction of performance-based incentives used in Dallas. Such performance-based incentives include assisting with the sale of StreamLabs products. We will be developing KPIs based on corporate store operating efficiencies and additional revenue yield from technician-led sales. We expect to see corporate store operating margins increase from 2024's yield of 18% to a target level of 22% during 2026 which, if we are successful, should unlock at least
1H Financial Results. As described above, 1H was marked by significant investment and management attention to completing a TES platform. In parallel, the business continued to grow both top-line and bottom-line with added momentum for 2H with a strong 2Q. Group revenues grew 8% to
While we report both statutory and adjusted EBITDA and profit before tax, as a result of IFRS 3 treatment of 2H 2024's acquisition in Ireland and conforming treatment of a Las Vegas acquisition, we believe the adjusted numbers are more relevant for comparisons. With respect to Ireland, because of the earn-out structure of the transaction - designed to reduce transition risk - profits are treated as a remuneration expense. In Las Vegas, because the former franchise owner did not meet an earnings target as part of his deferred payments, again to minimize risk, the Group's gain from non-payment of this liability was excluded from income for year-over-year comparisons.
Hence Profit before Tax Adjusted for amortization, share-based payments and non-core costs/gains increased by 8% to
Our balance sheet remained strong and under-levered. The Group has sufficient resources to execute its Next 50 Plan. Cash at 30 June was
Strategic Direction.
The Group's focus going forward is on monetizing its investments that underpin its competitive strategy of preventive maintenance. Because of our TES platform, we are uniquely positioned to accelerate revenue growth by selling a suite of products, services and analytic data that provide end-to-end solutions to reduce water loss from leakage because of failing infrastructure whether residential, commercial or municipal. Moreover, given the scalability of our "One Stop Shop" we can execute such sales more efficiently leading to improved operating margins. In a fragmented market for solutions providers, our platform approach is valued by customers who want one service provider to seamlessly integrate all needs from wireless monitoring to pinpoint leak detection to minimally invasive repair to continued aftercare..
Our capital allocation policy remains the same: a priority of feeding organic growth but with an eye toward opportunistic acquisitions (especially franchisees and plumbing) that reinforce our growing operating footprint. To be sure, we recognize that we are undervalued and have allocated capital to enable liquidity through share repurchases. Year-to-date, we have reacquired 148,000 shares. We have a strong balance sheet and have the available resources to support our Next 50 Plan.
We remain confident about our growth prospects over the coming quarters as we capture data for KPIs informing our Next 50 Plan and, as always, appreciate the support of our shareholders.
Interim Consolidated Statement of Comprehensive Income
For the six months ended
|
|
|
Six months ended 30 June 2025 |
Six months ended 30 June 2024 |
Year ended 31 December 2024 |
|
|
Notes |
$ |
$ |
$ |
|
|
|
Unaudited |
Unaudited |
Audited |
|
Revenue |
4 |
45,025,419 |
41,525,858 |
83,291,649 |
|
|
|
|
|
|
|
Cost of sales |
|
(4,346,322) |
(4,992,886) |
(9,795,325) |
|
|
|
|
|
|
|
Gross profit |
|
40,679,097 |
36,532,972 |
73,496,324 |
|
Administrative expenses |
|
|
|
|
|
- Other income |
|
96,780 |
737,289 |
974,355 |
|
- Gain on bargain purchase |
|
- |
- |
356,464 |
|
- Share-based payments |
|
(174,915) |
(151,138) |
(379,343) |
|
- Amortisation of intangibles |
|
(455,240) |
(427,026) |
(854,878) |
|
- Other administrative costs |
|
(34,974,440) |
(31,442,024) |
(65,941,266) |
|
|
|
|
|
|
|
Total administrative expenses |
|
(35,507,815) |
(31,282,899) |
(65,844,668) |
|
|
|
|
|
|
|
Operating profit |
|
5,171,282 |
5,250,073 |
7,651,656 |
|
|
|
|
|
|
|
Finance income |
|
227,773 |
186,835 |
395,729 |
|
Finance expense |
|
(1,222,090) |
(731,327) |
(1,690,900) |
|
|
|
|
|
|
|
Profit before tax |
4 |
4,176,965 |
4,705,581 |
6,356,485 |
|
|
|
|
|
|
|
Taxation expense |
|
(1,075,568) |
(1,412,117) |
(1,572,490) |
|
|
|
|
|
|
|
Profit for the period |
|
3,101,397 |
3,293,464 |
4,783,995 |
|
Attributable to: |
|
|
|
|
|
Equity holders of the parent |
|
3,038,919 |
3,300,966 |
4,680,130 |
|
Non-controlling interests |
|
62,478 |
(7,502) |
103,865 |
|
|
|
3,101,397 |
3,293,464 |
4,783,995 |
|
|
|
|
|
|
|
Other comprehensive income |
|
|
|
|
|
Exchange differences arising on translation of foreign operations |
|
292,711 |
(103,159) |
(173,851)
|
|
Cash flow hedge movement not subsequently reclassified to the P&L |
|
(485,817) |
11,765 |
(128,528)
|
|
Fair value adjustment on listed equity investment (net of deferred tax) |
|
(32,186) |
(173,597) |
215,558 |
|
Total comprehensive income for the period |
|
2,876,105 |
3,028,473 |
|
|
|
|
|
|
|
|
Earnings per share |
|
Cents |
Cents |
Cents |
|
Basic |
5 |
17.5 |
19.0 |
26.9 |
|
Diluted |
5 |
17.1 |
18.5 |
26.3 |
Consolidated Statement of Financial Position as at
|
|
|
At 30 June 2025 |
At 30 June 2024 |
At 31 December 2024 |
|
|
Notes |
$ |
$ |
$ |
|
|
|
Unaudited |
Unaudited |
Audited |
|
ASSETS |
|
|
|
|
|
Non-current assets |
|
|
|
|
|
Goodwill |
|
68,928,861 |
52,473,874 |
64,996,704 |
|
Listed equity investment |
|
255,558 |
237,304 |
292,067 |
|
Other intangible assets |
|
13,916,811 |
8,959,620 |
11,632,065 |
|
Interest rate swap |
|
6,007 |
288,030 |
491,824 |
|
Property, plant and equipment |
|
15,121,544 |
12,883,938 |
12,991,015 |
|
Trade and other receivables |
|
288,694 |
297,707 |
250,500 |
|
|
|
98,517,475 |
75,140,473 |
90,654,175 |
|
|
|
|
|
|
|
Current assets |
|
|
|
|
|
Inventories |
|
882,747 |
870,648 |
930,439 |
|
Trade and other receivables |
|
13,182,487 |
11,737,242 |
10,934,817 |
|
Investments |
|
4,207,544 |
4,446,570 |
6,683,089 |
|
Cash and cash equivalents |
|
4,211,873 |
6,665,581 |
5,452,479 |
|
|
|
22,484,651 |
23,720,041 |
24,000,824 |
|
TOTAL ASSETS |
4 |
121,002,127 |
98,860,514 |
114,654,999 |
|
|
|
|
|
|
|
EQUITY AND LIABILITIES |
|
|
|
|
|
Equity attributable to holders of the parent |
|
|
|
|
|
Share capital |
6 |
143,192 |
143,192 |
143,192 |
|
Share premium |
6 |
35,417,072 |
35,226,469 |
35,417,072 |
|
Shares held in treasury |
6 |
(1,149,538) |
(752,140) |
(883,549) |
|
Merger reserve |
|
1,001,150 |
1,001,150 |
1,001,150 |
|
Share based payment reserve |
|
2,997,281 |
2,405,485 |
2,822,366 |
|
Foreign exchange reserve |
|
(1,186,178) |
(1,408,196) |
(1,478,888) |
|
Reverse acquisition reserve |
6 |
(27,758,088) |
(27,758,088) |
(27,758,088) |
|
Equity investment reserve |
|
(826,855) |
(839,737) |
(794,668) |
|
Cash flow hedge reserve |
|
6,007 |
288,030 |
491,823 |
|
Retained profit |
|
59,057,225 |
54,796,780 |
56,018,304 |
|
|
|
67,701,266 |
63,102,945 |
64,978,714 |
|
|
|
|
|
|
|
Equity attributable to Non-Controlling interest |
|
|
|
|
|
Non-controlling interest |
|
359,213 |
343,642 |
455,007 |
|
|
|
|
|
|
|
Non-current liabilities |
|
|
|
|
|
Borrowings and lease liabilities |
|
27,981,083 |
13,681,567 |
26,361,482 |
|
Deferred consideration |
|
3,956,104 |
501,720 |
5,332,269 |
|
Deferred tax liability |
|
4,246,026 |
3,988,963 |
3,212,788 |
|
|
|
36,183,213 |
18,172,250 |
34,906,539 |
|
|
|
|
|
|
|
Current liabilities |
|
|
|
|
|
Trade and other payables |
|
7,228,104 |
5,685,245 |
6,749,312 |
|
Borrowings and lease liabilities |
|
3,964,092 |
7,078,714 |
3,787,362 |
|
Deferred consideration |
|
5,566,238 |
4,477,718 |
3,778,065 |
|
|
|
16,758,435 |
17,241,677 |
14,314,739 |
|
TOTAL EQUITY AND LIABILITIES |
|
121,002,127 |
98,860,514 |
114,654,999 |
Interim Consolidated Statement of Changes in Equity
For the six months ended
|
|
Share Capital |
Share Premium |
Shares held in treasury |
Reverse Acquisition Reserve |
Merger Reserve |
Share based payment reserve |
Foreign exchange reserve |
Equity investment reserve |
Cash Flow Hedge Reserve |
Retained Profit |
Total |
Non-controlling interest |
Total Equity |
|
|
$ |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
$ |
|
As at |
143,192 |
35,417,072 |
(1,139,404) |
(27,758,088) |
1,001,150 |
2,254,347 |
(1,305,037) |
(666,140) |
276,265 |
51,495,814 |
59,719,171 |
610,375 |
60,329,546 |
|
Share based payment expense |
- |
- |
- |
- |
- |
151,138 |
- |
- |
- |
- |
151,138 |
- |
151,138 |
|
Share buyback |
- |
- |
(39,114) |
- |
- |
- |
- |
- |
- |
- |
(39,114) |
- |
(39,114) |
|
Issue of Treasury Shares |
- |
(190,603) |
426,377 |
- |
- |
- |
- |
- |
- |
- |
235,774 |
- |
235,744 |
|
Distribution to non-controlling interest |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
(259,231) |
(259,231) |
|
Profit for the period |
- |
- |
- |
- |
- |
- |
- |
- |
- |
3,300,966 |
3,300,966 |
(7,502) |
3,293,464 |
|
Other comprehensive income |
- |
- |
- |
- |
- |
- |
(103,159) |
(173,597) |
11,765 |
- |
(264,991) |
- |
(264,991) |
|
As at |
143,192 |
35,226,469 |
(752,140) |
(27,758,088) |
1,001,150 |
2,405,485 |
(1,408,196) |
(839,737) |
288,030 |
54,796,780 |
63,102,945 |
343,642 |
63,446,587 |
|
Share-based payment expense |
- |
- |
- |
- |
- |
228,205 |
- |
- |
- |
- |
228,205 |
- |
228,205 |
|
Options granted as part of the purchase price |
- |
- |
- |
- |
- |
188,676 |
- |
- |
- |
- |
188,676 |
- |
188,676 |
|
Share buyback |
- |
- |
(131,409) |
- |
- |
- |
- |
- |
- |
- |
(131,409) |
- |
(131,409) |
|
Issue of Treasury Shares |
- |
190,603 |
- |
- |
- |
- |
- |
- |
- |
(157,640) |
32,963 |
- |
32,963 |
|
Profit for the period |
- |
- |
- |
- |
- |
- |
- |
|
- |
1,379,164 |
1,379,164 |
111,367 |
1,490,531 |
|
Other comprehensive income |
- |
- |
- |
- |
- |
- |
(70,692) |
45,069 |
203,793 |
- |
178,170 |
- |
178,170 |
|
As at |
143,192 |
35,417,072 |
(883,549) |
(27,758,088) |
1,001,150 |
2,822,366 |
(1,478,888) |
(794,668) |
491,823 |
56,018,304 |
64,978,714 |
455,007 |
65,433,721 |
|
Share based payment expense |
- |
- |
- |
- |
- |
174,915 |
- |
- |
- |
- |
174,915 |
- |
174,915 |
|
Share buyback |
- |
- |
(265,989) |
- |
- |
- |
- |
- |
- |
- |
(265,989) |
- |
(265,989) |
|
Distribution to non-controlling interest |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
- |
(158,272) |
(158,272) |
|
Profit for the period |
- |
- |
- |
- |
- |
- |
- |
- |
- |
3,038,919 |
2,797,231 |
62,478 |
3,101,297 |
|
Other comprehensive income |
- |
- |
- |
- |
- |
- |
292,711 |
(32,186) |
(485,817) |
- |
(225,292) |
- |
(225,292) |
|
As at |
143,192 |
35,417,072 |
(1,149,538) |
(27,758,088) |
1,001,150 |
2,997,281 |
(1,186,179) |
(826,855) |
6,007 |
59,057,223 |
67,701,262 |
359,216 |
67,060,478 |
Interim Consolidated Statement of Cash Flows
For the six months ended
|
|
Six months ended |
Six months ended |
Year ended 31 December 2024 |
|
|
$ |
$ |
$ |
|
|
Unaudited |
Unaudited |
Audited |
|
Cash flows from operating activities |
|
|
|
|
Profit before tax |
4,176,965 |
4,705,581 |
6,356,484 |
|
|
|
|
|
|
Adjustments for non-cash/non-operating items: |
|
|
|
|
Depreciation of plant and equipment |
2,547,496 |
2,164,749 |
4,568,406 |
|
Amortisation of intangible assets |
455,240 |
427,026 |
854,878 |
|
Share based payments |
174,915 |
151,138 |
379,343 |
|
Gain from reversal of contingent consideration |
- |
- |
(700,000) |
|
Gain on bargain purchase |
- |
- |
(356,464) |
|
Non cash employment costs |
- |
- |
268,737 |
|
Interest paid |
1,222,090 |
731,327 |
1,690,900 |
|
Interest received |
(227,773) |
(186,835) |
(395,729) |
|
Operating cash flows before movements in working capital |
7,931,639 |
7,992,987 |
12,666,555 |
|
(Increase)/Decrease in inventories |
47,693 |
(147,333) |
(207,124) |
|
(Increase)/Decrease in trade and other receivables |
(2,275,154) |
(763,706) |
1,634,614 |
|
Decrease in trade and other payables |
625,580 |
(811,844) |
127,689 |
|
Cash generated by operations |
6,747,052 |
6,270,103 |
14,221,734 |
|
Income taxes |
(38,008) |
(5,430) |
(1,739,725) |
|
Net cash generated from operating activities |
6,709,044 |
6,264,674 |
12,482,009 |
|
|
|
|
|
|
Cash flows from investing activities |
|
|
|
|
Purchase of plant and equipment |
(608,449) |
(904,971) |
(2,108,307) |
|
Disposal of plant and equipment |
66,845 |
- |
200,554 |
|
Purchase of intangibles |
(2,682,026) |
(1,491,522) |
(3,813,954) |
|
Acquisition of subsidiaries |
- |
- |
(571,246) |
|
Reacquisition of Franchises |
(2,900,000) |
(2,000,000) |
(6,511,890) |
|
Sale of investments |
2,475,545 |
2,428,680 |
192,161 |
|
Interest received |
227,773 |
186,835 |
395,729 |
|
Net cash used in investing activities |
(3,420,312) |
(1,780,978) |
(12,216,953) |
|
|
|
|
|
|
Cash flows from financing activities |
|
|
|
|
Share buy-back |
(265,990) |
(39,114) |
(170,522) |
|
Distribution to non-controlling interest |
(158,272) |
(259,232) |
(185,733) |
|
Interest paid |
(1,087,157) |
(610,059) |
(1,635,600) |
|
Proceeds from borrowings |
- |
2,000,000 |
26,628,000 |
|
Repayment of borrowings |
(1,074,804) |
(2,759,300) |
(18,410,090) |
|
Repayment of notes |
(1,009,324) |
(3,726,079) |
(8,098,116) |
|
Repayment of lease liabilities |
(933,790) |
(1,306,955) |
(1,823,143) |
|
Net cash used in financing activities |
(4,529,337) |
(6,700,739) |
(3,695,204) |
|
|
|
|
|
|
Net decrease in cash and cash equivalents |
(1,240,605) |
(2,217,043) |
|
|
Cash and cash equivalents at the beginning of period |
5,452,479 |
8,882,627 |
|
|
Cash and cash equivalents at end of period |
4,211,875 |
6,665,581 |
5,452,479 |
Notes to the Interim Consolidated Financial Information
for the six months ended
1 General information
The Group is a leading provider of minimally-invasive leak detection and remediation services and products for water and wastewater infrastructure. The Group's strategy is to be a provider of "end-to-end" solutions - a "one-stop shop" for residential, commercial and municipal customers.
The Company is a public limited company domiciled in the United Kingdom and incorporated under registered number 03923150 in England and Wales. The Company's registered office is
2 Significant accounting policies
Basis of preparation and changes to the Group's accounting policies
The accounting policies adopted in the preparation of the interim consolidated financial information are consistent with those of the preparation of the Group's annual consolidated financial statements for the year ended
This interim consolidated financial information for the six months ended
The interim consolidated financial information for the six months ended
This interim consolidated financial information is presented in US Dollars ($), rounded to the nearest dollar.
Foreign currencies
(i) Functional and presentational currency
Items included in this interim consolidated financial information are measured using the currency of the primary economic environment in which each entity operates ("the functional currency") which is considered by the Directors to be the Pounds Sterling (£) for the
Critical accounting estimates and judgments
The preparation of interim consolidated financial information requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities and the reported amounts of income and expenses during the reporting period. Although these estimates are based on management's best knowledge of current events and actions, the resulting accounting estimates will, by definition, seldom equal the related actual results.
In preparing this interim consolidated financial information, the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied to the consolidated financial statements for the year ended
3 Significant events and transactions
As detailed in Footnote 7 the Group launched its StreamLabs Partnership; reacquired its West Georgia franchise and has repurchased 148,000 shares year to date.
4 Segmental information
In the opinion of the Directors, the operations of the Group currently comprise four operating segments: (i) franchise royalty income, (ii) franchise-related activities including sale of franchise territory, business-to-business sales and product and equipment sales, (iii) US corporate-operated locations led by the Group's U.S.-based American Leak Detection subsidiary and (iv) international corporate locations led by the Group's UK-based Water Intelligence International subsidiary.
The Group mainly operates in the US, with operations in the UK, Canada and Australia. In the six months to 30 June 2025, 84.8% (1H 2024: 87.6%) of its revenue came from the US-based operations; the remaining 15.2% (1H 2024: 12.4%) of its revenue came from its international corporate operated locations.
No single customer accounts for more than 10% of the Group's total external revenue.
The Group adopted IFRS 8 Operating Segments with effect from 1 July 2008. IFRS 8 requires operating segments to be identified on the basis of internal reports about components of the Group.
Information reported to the Group's Chief Operating Decision Maker (being the Executive Chairman), for the purpose of resource allocation and assessment of division performance is separated into four income generating segments that serve as key performance indicators (KPI's):
- Franchise royalty income;
- Franchise-related activities (including sale of franchise territory, product and equipment sales and Business-to-Business sales);
- US corporate operated locations; and
- International corporate operated locations.
Items that do not fall into the four segments have been categorised as unallocated head office costs and non-core costs.
The following is an analysis of the Group's revenues, results from operations and assets:
|
Revenue
|
|
Six months ended 30 June 2025 |
Six months ended 30 June 2024 |
Year ended 31 December 2024 |
|
|
|
$ |
$ |
$ |
|
|
|
Unaudited |
Unaudited |
Audited |
|
Franchise royalty income |
|
3,212,811 |
3,554,456 |
6,503,134 |
|
Franchise related activities |
|
6,479,930 |
5,534,301 |
10,665,512 |
|
US corporate operated locations |
|
30,337,393 |
28,298,872 |
55,854,674 |
|
International corporate operated locations |
|
6,795,286 |
4,138,228 |
10,268,329 |
|
Total |
|
45,025,420 |
41,525,858 |
83,291,649 |
|
Profit before tax |
|
Six months ended 30 June 2025 |
Six months ended 30 June 2024 |
Year ended 31 December 2024 |
|
|
|
$ |
$ |
$ |
|
|
|
Unaudited |
Unaudited |
Audited |
|
Franchise royalty income |
|
1,124,483 |
1,138,459 |
2,296,003 |
|
Franchise related activities |
|
333,608 |
541,415 |
870,187 |
|
US corporate operated locations |
|
5,378,814 |
5,134,673 |
10,005,806 |
|
International corporate operated locations |
|
(167,683) |
(161,386) |
(601,899) |
|
Unallocated head office costs |
|
(1,867,259) |
(1,972,580) |
(5,684,612) |
|
Net Non-core costs/gains |
|
(625,000) |
25,000 |
(529,000) |
|
Total |
|
4,176,963 |
4,705,581 |
6,356,485 |
|
Assets |
|
Six months ended 30 June 2025 |
Six months ended 30 June 2024 |
Year ended 31 December 2024 |
|
|
|
$ |
$ |
$ |
|
|
|
Unaudited |
Unaudited |
Audited |
|
Franchise royalty income |
|
25,435,882 |
21,827,215 |
26,022,309 |
|
Franchise related activities |
|
3,429,417 |
3,495,142 |
3,142,406 |
|
US corporate operated locations |
|
74,788,134 |
57,389,619 |
68,349,942 |
|
International corporate operated locations |
|
17,348,694 |
16,148,538 |
17,140,342 |
|
Total |
|
121,002,127 |
97,860,514 |
114,654,999 |
Geographic Information
The Group has two wholly-owned subsidiaries - American Leak Detection (ALD) and Water Intelligence International (WII). Operating activities are captured as both franchise-executed operations and corporate-executed operations. ALD has both US franchises and corporate-operated locations. It also has international franchises, principally located in Australia and Canada. Operations focus on residential and commercial water leak detection and remediation with some municipal activities. By comparison, WII has only corporate operations located outside the United States. These WII international operations are principally municipal activities with some residential leak detection and remediation. As noted herein, the Group's vision is to become a multinational growth company and a "One Stop Shop" for residential, commercial and municipal solutions to water and wastewater infrastructure problems.
Total Revenue
|
|
Six months ended 30 June 2025 Unaudited |
Year ended 31 December 2024 Audited |
||||
|
|
US |
International |
Total |
US |
International |
Total |
|
|
$ |
$ |
$ |
$ |
$ |
$ |
|
Franchise royalty income |
3,179,120 |
33,692 |
3,212,811 |
6,407,529 |
95,605 |
6,503,134 |
|
Franchise related activities |
4,679,930 |
- |
4,679,930 |
10,665,512 |
- |
10,665,512 |
|
US corporate operated locations |
30,337,393 |
- |
30,337,393 |
55,854,674 |
- |
55,854,674 |
|
International corporate operated locations |
- |
6,795,286
|
6,795,286
|
- |
10,268,329 |
10,268,329 |
|
Total |
38,196,442 |
6,828,978 |
45,025,420 |
72,927,715 |
10,363,934 |
83,291,649 |
5 Earnings per share
The earnings per share has been calculated using the profit for the period and the weighted average number of Ordinary shares outstanding during the period, as follows:
|
|
|
Six months ended 30 June 2025 |
Six months ended 30 June 2024 |
Year ended |
|
|
|
|
|
|
|
|
|
Unaudited |
Unaudited |
Audited |
|
Earnings attributable to shareholders of the Company ($) |
|
3,038,919 |
3,300,966 |
4,680,130 |
|
Weighted average number of ordinary shares |
|
17,333,707 |
17,402,288 |
17,391,205 |
|
Diluted weighted average number of ordinary shares |
|
17,756,887 |
17,823,584 |
17,825,495 |
|
Earnings per share (cents) |
|
17.5 |
19.0 |
26.9 |
|
Diluted earnings per share (cents) |
|
17.1 |
18.5 |
26.3 |
Earnings per share are computed based on Ordinary shares. There is a class of B Ordinary Shares discussed in Footnote 6 that are not admitted to trading.
6 Share capital
The issued share capital at the end of the period was as follows:
|
Group & Company |
Ordinary Shares of 1p each |
Shares held in treasury Number |
|
|
|
Number |
|
Total Number |
|
At 30 June 2025 |
17,311,538 |
176,150 |
17,487,688 |
|
At 30 June 2024 |
17,398,688 |
89,000 |
17,487,688 |
|
At 31 December 2024 |
17,371,538 |
116,150 |
17,487,688 |
The net number of options including the new grants and leavers from the Company at 30 June 2024 is 2,773,000. On 29 September 2025 the Company expects to issue options for 275,000 shares to satisfy 2024 Board Compensation. The options have an exercise price of 345p which was the share price at end of the 1Q after 2024 books were closed. The compensation expense is already accrued in the 2024 Accounts.
|
Group & Company |
Share Capital |
Share Premium |
Shares In Treasury |
|
|
$ |
$ |
$ |
|
At 30 June 2025 |
143,192 |
35,417,071 |
(1,149,538) |
|
At 30 June 2024 |
143,192 |
35,226,469 |
(752,140) |
|
At 31 December 2024 |
143,192 |
35,417,071 |
(883,548) |
Reverse acquisition reserve
The reverse acquisition reserve was created in accordance with IFRS3 Business Combinations and relates to the reverse acquisition of Qonnectis Plc by ALDHC in July 2010. Although these Consolidated Financial Statements have been issued in the name of the legal parent, the Company it represents in substance is a continuation of the financial information of the legal subsidiary ALDHC. A reverse acquisition reserve was created in 2010 to enable the presentation of a consolidated statement of financial position which combines the equity structure of the legal parent with the reserves of the legal subsidiary. Qonnectis Plc was renamed Water Intelligence Plc on completion of the reverse acquisition on 29 July 2010.
7 Transactions in the Period and Subsequent Events
On 26 February, the Group announced a strategic partnership with StreamLabs, Inc., a Chubb company. StreamLabs is a leading provider of high quality wireless water monitoring devices that can provide alerts to the presence of water leaks and also a capability of remotely shutting-off water flow to pipes. Under the preferred partnership agreement, ALD has preferred pricing for reselling StreamLabs products, the ability to "White Label" StreamLabs products under the ALD brand and the rights to data and dashboards to provide subscription-based aftercare to customers.
On 6 August, the Group announced the reacquisition of its West Georgia franchise for an initial payment of $350,000 in cash and additional payment based on an earnout formula with a maximum aggregate price of four times profits. The transaction enables the Group to create a regional hub in the Southeast US aggregating existing corporate locations in Georgia and South Carolina.
Year to Date (Issuance of this Interim Report) the Group has repurchased 148,000 shares as part of its capital allocation policy.
8 Publication of announcement and the Interim Results
A copy of this announcement will be available at the Company's registered office (27-28 Eastcastle Street, London, W1W 8DH) from the date of this announcement and on its website - www.waterintelligence.co.uk. This announcement is not being sent to shareholders.
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