Update of business strategy of Apator Group in the perspective to 2025
The Management Board of Apator S.A. ("the Company") informs that on 11.10.2022 the Supervisory Board of the Company approved "Update of Strategy of the Apator Group in the perspective to 2025" adopted by the Management Board of the Company.
The ambition of the Apator Group invariably remains to maintain its position as a European leader in the provision of hardware and software solutions in Smart Metering and Energy Management. Apator is also upholding its past directions in solutions that enable effective management of natural resources and support innovative energy companies in meeting the challenges of energy transition.
The mission of the Apator Group is to disseminate advanced technologies to a wider audience including, in addition to the utilities, businesses and the public. Apator Group wants to create tomorrow's solutions for active and conscious market participants who care about the environment, the planet and future generations, supporting them in self-production, management and sharing of green energy and conservation of natural resources.
In the face of growing challenges related to climate change, the energy crisis and the need to accelerate the energy transition process, supported by European Union policies and financial programs, the Apator Group identifies the following strategic opportunities for business development:
1. Continue organic growth by maintaining and continuously developing high technical competence in providing the following solutions:
- smart metering (smart electricity meters, gas meters, water meters and heat meters),
- ultrasonic technologies in water measurement,
- specialized switchgear, automation and telemechanics services and products for existing customers (mainly utilities),
- comprehensive solutions for managing utilities, resources and processes for a wider group of business customers, including those outside the energy sector, i.e. small and medium-sized enterprises, industry and local government units, for whom the Group is preparing a dedicated offer from its traditional products.
2. Development of a new portfolio of solutions for the areas of distributed energy, electromobility and RES, among others:
- energy storage facilities,
- EV charging stations,
- Grid Edge solutions: systems, next-generation meters and controllers to support energy self-consumption and energy efficiency management, including for residential customers.
3. New business areas in the Gas segment coordinated with growth in the Electricity segment - development of product offerings in the HVAC business including hybrid home solutions for efficient heating, air conditioning and ventilation.
4. Development of a comprehensive range of solutions for managing water consumption and conservation, including:
- Building reading networks and providing remote reading services based on a wide range of communication technologies,
- billing services,
- Remote leak location systems and autonomous water loss mitigation systems.
As part of the updated Strategy, the Apator Group plans to achieve the following financial targets:
- Consolidated sales revenue of PLN 1.4 billion in 2025
- Consolidated EBITDA of about PLN 200 million in 2025
According to the Company's management, the level of the Group's capital expenditures will be maintained at the current ratio to the level of annual revenues (i.e. 5-7%) and a significant portion of the investment funds will be allocated to the development of new technologies and products, as well as investments in maintaining modern production potential.
The Board of Directors has set a target ratio of consolidated net financial debt/consolidated EBITDA of less than 2x, with the caveat that the DN/EBITDA ratio may temporarily remain at a higher level over the next 3-4 quarters. The assumed target EBITDA profitability level and the impact of new product initiatives will allow the Company to grow sustainably and continue its adopted dividend policy.
Further consolidation of the organization and adaptation of the Apator Group structure to the business environment and effective implementation of new strategic directions are also important elements of the implementation of the updated Strategy. These goals will be achieved in stages, taking into account the business diversity of each Group company.
The Company's Management Board indicates that despite the exercise of due diligence, due to the possibility of external factors (especially in view of the high unpredictability of the macroeconomic environment) that may significantly affect the objectives presented in the Strategy, they cannot be treated as operational or financial forecasts, but only as measures of the Strategy's implementation, which the Company will strive to achieve during the period of the updated Strategy.
Article 17 (1) of Regulation EU 596/2014 of the European Parliament and of the Council of April 16, 2014 on market abuse Regulation on market abuse and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/W.
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