Homeserve plc Continues To Expand Its US Operations With Two New Utility Agreements
March 15, 2011 (PRLEAP.COM) Business NewsHomeServe plc, the international home emergency and repairs business is pleased to announce the continued expansion of its US operation, HomeServe USA which has 0.8m customers holding 1.2m policies (September 2010).
Firstly HomeServe USA has acquired 135,000 home assistance policies of South Jersey Energy Services Plus ("SJESP") as they become due for renewal and secondly has signed a long-term agreement with Millennium Energy Holdings ("Millennium") for the marketing of home emergency policies to 580,000 domestic customers of Millennium's utility affiliates.
These agreements continue to build on the momentum gained in 2010 with HomeServe USA now having access to over 21m affinity partner households, including an extra 900,000 households as a result of these two new agreements. HomeServe USA remains on track to deliver an operating profit of £6m in the current financial year ending 31 March 2011 (FY 2010: £1.5m).
Acquisition of SJESP home assistance policies
HomeServe USA has acquired the home assistance policies of SJESP as they become due for renewal from the start of the second quarter of our financial year. SJESP currently have around 60,000 home assistance customers holding 135,000 policies.
SJESP is part of South Jersey Industries Inc who through its South Jersey Gas subsidiary, service around 325,000 domestic households in Southern New Jersey. As part of the agreement HomeServe USA has also signed a long term agreement to use the 'South Jersey Energy Services Plus' brand in future marketing material in the region.
Marketing agreement - Millennium Energy
HomeServe USA has signed long-term agreements with Millennium for the marketing of home emergency policies to residential customers of Tucson Electric Power (TEP) and UniSource Energy Services (UES). All three companies are subsidiaries of UniSource Energy Corporation (NYSE: UNS).
TEP provides electric services to approximately 366,000 domestic customers in the Tucson and Arizona metropolitan areas. UES provides gas or electric services to approximately 214,000 domestic customers elsewhere in Arizona.
There will be no impact on earnings for the current financial year or 2012 as the business invests in additional marketing to capitalise on these two new agreements. HomeServe will finance the SJESP acquisition using its existing banking facilities, with an initial payment to SJESP of $3.0m in the current financial year, and a further $6m in future performance based payments.
Jonathan King, Chief Executive HomeServe USA commented:
"These agreements with Millennium Energy and South Jersey Energy Services Plus take the total number of partners we are working with in the US to 17, who between them have over 21m households. We are looking forward to working with these new partners and replicating the success we are already achieving with our existing gas and electric partners. Signing up more affinity partners and acquiring more policy books in the US remains a key goal for us in the future and we continue to be excited by the pipeline of opportunities."
March 15, 2011
Richard Harpin, Chief Executive
Martin Bennett, Chief Financial Officer
Mark Jones, Head of Investor Relations
Tel: 01922 427979
Tel: 020 7353 4200
More information on HomeServe plc can be found on our corporate website: www.HomeServeplc.com
HomeServe's Preliminary Results for the 12 months ended 31 March 2011 will be announced on Tuesday 24 May 2011.
This information is provided by RNS
The company news service from the London Stock Exchange