Smart Metering Systems plc (AIM: SMS, the “Group”, “SMS”) has conditionally sold a minority of the Group’s meter assets (the “Disposed Portfolio”) to funds managed by Equitix Investment Management Limited (the “Purchaser”) for a total gross cash consideration of £291 million (the “Disposal”). The Group expects to receive net cash consideration of £282 million, after expenses.

The Disposal will enable the implementation of an enhanced long-term, sustainable dividend payment policy and results in a significant reshaping of SMS’s capital structure.

As previously notified the Group is announcing its FY2019 results on 17 March 2020 and can confirm FY2019 results continue to be in line with market expectations.



  • Disposal
    • Attractive valuation for a minority of the Group’s meter assets
    • The cash consideration will result in positive net cash position for the Group overall on completion
    • SMS to continue to manage the Disposed Portfolio on behalf of the Purchaser
  • Revised dividend policy
    • Proposed dividend of 25p per share for FY2020, increasing at least in line with RPI p.a. until FY2024
    • Proposed scrip alternative for up to 30% of dividend
    • Prudent cash cover expected in all years; earnings cover grows over time
  • Ongoing capital structure
    • Existing debt fully repaid; amended £300 million RCF on the same terms
    • Intention to maintain a prudent net debt / EBITDA ratio through the remainder of the roll-out
    • Flexibility in funding further growth in a capital efficient way
  • UK smart meter roll out opportunity
    • Existing portfolio of over 1.2 million domestic smart meters at 31 December 2019
    • Order book of a further 2 million meters expected to add c.£40 million to the Group’s ILARR
    • Additional opportunities beyond order book with contracted and potential customers
    • Following BEIS’ proposed consultation to extend the deadline to 2024, the smart meter roll-out profile is expected to be more evenly spread, enabling SMS to manage its cost base more efficiently 

This transaction realises considerable cash returns and demonstrates the substantial value of our smart meter portfolio.

It also will enable us to enhance greatly shareholder value with significant and sustainable increase in dividends - underpinned by our asset-backed, inflation-linked, recurring revenue stream.

With a strengthened balance sheet, we will also be in a much stronger position to invest in the sizeable UK smart meter rollout programme, which is central to the establishment of a decentralised and decarbonised energy system.

Alan Foy Chief Executive Officer

We are very pleased to participate in the UK smart metering programme whilst creating a long-term partnership with SMS. This acquisition aligns with our business objectives of investing in the country’s sustainable energy transition initiatives, which we are excited to be part of.

Achal Bhuwania Deputy Chief Investment Officer for Equitix

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For further information:

Smart Metering Systems plc
Alan Foy, Chief Executive Officer
David Thompson, Chief Financial Officer
Dilip Kejriwal, Head of Investor Relations
0141 249 3850

Cenkos Securities plc (Joint Broker and Nomad)
Neil McDonald/Pete Lynch
0131 220 6939/020 7397 8900

Investec Bank plc (Joint Broker)
Christopher Baird/Henry Reast
020 7597 5970

Instinctif Partners
Adrian Duffield/Kay Larsen/Chantal Woolcock
020 7457 2077

Notes to editors

1. Smart Metering Systems plc (“SMS”):

SMS plc (www.sms-plc.com) installs smart meters and data loggers that facilitate effective energy management and a low carbon future. Established in 1995, SMS provides a full end-to-end service for metering financing, installation, management and maintenance, with a highly skilled workforce and deep engineering expertise.

SMS had installed 3.7 million meter and data assets as of 31 December 2019. SMS’ smart meter expertise also enables the Company to provide consultancy services that allow organisations and corporates to enhance long term efficiency and effectiveness in the management of energy.

SMS’s energy management and asset installation services also include infrastructure design, installation, consultancy and project management services for new gas, electricity, water and telecoms connections for licensed energy and telecoms suppliers, end consumers and the UK's licensed electricity Distribution Network Owners (DNO's).

SMS employs in excess of 1,200 people across the UK who support the installation and ongoing management of metering assets.

SMS plc is headquartered in Glasgow with 12 locations across the UK.

SMS’s shares are listed on AIM.

2. Equitix Investment Management Limited (“Equitix”):

Founded in 2007 and headquartered in London, Equitix is a leading infrastructure investment firm that manages over £5 billion on behalf of long term investors, including a large proportion of UK pension funds.  We manage six core infrastructure flagship funds, 15 co-investment funds which are dedicated to larger infrastructure projects, and a number of segregated managed accounts providing customized solutions.  Our investment strategy focuses on core infrastructure projects, predominantly located in the UK and covering a wide range of sectors with a particular focus on social infrastructure, transportation, regulated utilities and renewables.  Across all of our core funds, we seek to hold assets for the life of the fund, which is typically 25 years.  We have acquired over 280 core infrastructure projects since our inception, thereby establishing a strong reputation as a trusted partner, operator and fiduciary fund manager.