International leak detection company Water Intelligence (WATR:AIM) gushed better than expected third quarter revenue growth of 35% to $24.7m, lifting its shares by 11% to 294.5p.
Established in 1974 and based in Palm Springs, California, Water Intelligence specialises in the non-invasive detection of leaks. It operates a mix of franchised and corporately-owned businesses across many territories.
The franchised business operates from 41 states covering 92% of the US, while it manages its own operations in Palm Spring, San Bernardino, Boston and Ft. Lauderdale. Internationally the company operates non-franchised businesses across the UK, Canada, Australia, Spain, Belgium and Saudi Arabia.
The largest segment is the company-owned operations which saw revenue growth of 47% to $10.7m while the business-to-business insurance channel saw franchise sales grow by 45% to $6.1m. Franchised royalties were 4% higher at $5.1m, and the international operations grew by 27% to $2.8m.
Executive chairman Dr. Patrick DeSouza said, ‘we seek a leadership role in providing solutions for the critical problems of water loss and contamination for our global stakeholders in creating a more sustainable world.’
The company said that profit before tax is ‘comfortably in-line’ with expectations. Broker WH Ireland has penciled in a 24% increase to $2.43m.
On the corporate development front, the company’s previously announced roll-out of its proprietary sewer and wastewater diagnostic products in the UK and the US are expected to start generating revenues during the final quarter.
It announced an investment in Entertainment AI and an acquisition of e-commerce and video search technology to enable the company to offer insurance companies water-monitoring and leak-detection services.
The company ended the third quarter to 30 September 2019 with net cash of $2.7m.
