14th Nov 2006 T&G Comment in Post 3 : Link Back to posts Click Here



Group Web Site : http://www.xko.co.uk/

Powerdebt Web Site : http://www.powerdebt.co.uk/home.php

UBM Web Site : http://www.utilitybilling.co.uk/

Shares in Issue : 42.68m

Following the sale of the Software Services side, which on a pro-forma basis reduces debt to basically nothing, XKO is now all about Revenue Assurance. This should be an area of high growth, and XKO should soon reflect this in terms of performance put in so far and prospects to come, by a re-rating.

What is it ? The Revenue Assurance division specialises in complex Revenue Assurance and debt management for major utilities. There are two units in this Division, UBM ( current customers include giants like npower, Centrica etc..) and then Powerdebt (which is a specialist Revenue Assurance and Debt Management business based in Solihull.

So XKO is now in basic terms debt free, putting in decent earnings, with good prospects going forward, UK based and with a nice dividend to boot.

Add on to that some earnings enhancing acquisitions in the Revenue Assurance side, and a strong growth high margin business is building nicely.

From a post on AFN :

zho - 16 Nov'06 - 16:20 - 38 of 38


http://www.growthcompany.co.uk/recommendations/30077/revenue-assurance-services.thtml

Companies: XKO
14/11/2006

November marks the dawn of a new era for the company formerly known as XKO Group, with a new name, a new sector and a new focus 'revenue assurance'.

It has appropriately been re-named Revenue Assurance Services (RAS), having sold the last part of its erstwhile divisions for 15m in October making for a gross 28.5m for the sum of the old business. This allows chief executive Simon Beart and his management to concentrate on the revenue assurance businesses acquired last year.

The group provides three services to its utility company customers: consultancy, where experienced consultants and proprietary software identify and secure un-billed debts; collections, which is telephone-based debt collection of existing debt; and metering services, where a meter-reader is sent to business premises to physically check gas meters. RAS has around 30% of the gas utility market at the moment, including customers Shell, eOn and Centrica but at three times the size, the electricity market is a significant target.

Utilities face ever more pressure to keep their costs down and RAS offers a great outsourcing option, with no clear competition yet. Although there is some opposition to their adoption from the utilities in-house collection departments (and contracts can therefore take around two years to win), Beart stresses that his consultants levels of success are incomparable and he is confident of adding contracts in both gas and electricity. He says the balance sheet is under-geared and is pondering acquisitions.

The business is achieving 40% margins, taking 3.3m cash from 7.9m sales in the half year to September, with profits before tax of 2.1m. House broker Bridgewell has upgraded year-end numbers to sales of 16m, profits of 5.66m and earnings of 9p per share.

Growth Company Investor recommended buying the shares at 106.5p in June but, with earnings upgraded to provide a prospective p/e ratio just over 11, its worth adding to your holding.

RAS is the main buy recommendation on IfG this weekend its said. I do not have access myself, anyone with can they advise if it is.

http://www.investing-for-growth.com/

This was the summary on Friday from the I.C. after the results ( http://www.investorschronicle.co.uk/ ) :

"Its name may be different, but neither the story, share price, nor forward PE ratio have changed much since our last buy advice, which we reiterate. Buy."

2 MM's blue so far, now 2 v 1 on L2 so we might be in for another steady blue week, as people realise what good value RAS is below 130p given the sector and growth and the fundies behind RAS now.

Nice day, apart from the fundamentals behind this deserving a higher price, it would appear from small talk a deal with Centrica is near to happening. News on that might be a spark to a quicker rerating.

IMO, DYOR !!

L2 up and now 3 v 1 @113/115

are u talking to yourself papal?

Yep :)

On todays free email from GCI ( http://www.growthcompany.co.uk ):

November marks the dawn of a new era for the company formerly known as XKO Group, with a new name, a new sector and a new focus on 'revenue assurance'. It has appropriately been re-named Revenue Assurance Services (RAS), having sold the last part of its erstwhile divisions for 15 million in October - making for a gross 28.5 million for the sum of the old business. This allows chief executive Simon Beart to concentrate on the revenue assurance businesses acquired last year.
The group provides three services to its utility company customers: consultancy, where experienced consultants and proprietary software identify and secure un-billed debts; collections, which is telephone-based debt collection of existing debt; and metering services, where a meter-reader is sent to business premises to physically check gas meters. RAS has around 30 per cent of the gas utility market at the moment, including customers Shell, eOn and Centrica - but at three times the size, the electricity market is a significant target.

Utilities face ever more pressure to keep their costs down and RAS offers a great outsourcing option, with no clear competition - yet. Although there is some opposition to their adoption from the utilities' in-house collection departments (and contracts can therefore take around two years to win), Beart stresses that his consultants' levels of success are incomparable and he is confident of adding contracts in both gas and electricity. He says the balance sheet 'is under-geared' and is pondering acquisitions.

The business is achieving 40 per cent margins, taking 3.3 million cash from 7.9 million sales in the half year to September, with profits before tax of 2.1 million. House broker Bridgewell has upgraded year-end numbers to sales of 16 million, profits of 5.66 million and earnings of 9p per share.

Growth Company Investor recommended buying the shares at 106.5p in June but, with earnings upgraded to provide a prospective p/e ratio just over 11, it's worth adding to your holding.

Market cap: 48.44 million Ticker: RAS Share price: 113.5p

No you are not talking to yourself.
I am following this. It climbed 6p today to 119.
Has it run out of steam?
FDP just finished a climb.

News is due on contract renewals.

I am hoping for 125p to 130p as a new support level once it goes through it.

Up we go again :)

Good news today :)

Creeping upwards....

Any idea why the riser P..

Guesses are news on Centrica deal, or some other deal in the offing.

thanks mate.

Nice update today :)

Nice news today :)

Lovely set of results and a contract win too :)