Investment case

Calisen is a leading Meter Asset Provider (MAP), having provided 5.2 million smart meters to households with a further MAP pipeline of 6.5 million meters as at 31 December 2019. The acquisition of Lowri Beck, scalable operations and seasoned management team mean Calisen has exciting growth prospects, with further scope to capture opportunities in adjacent areas.

Calisen is the holding company for the combined Calvin Capital and Lowri Beck business. Following Calvin Capital’s acquisition of Lowri Beck, the business has grown to over 1,800 highly-skilled professionals in green jobs. Calisen, the combined business, now provides customers with packages encompassing smart-meter procurement, installation, ownership and management

Calisen has a diversified and established customer base, holding MAP contracts with the Big 6 energy retailers as well as independent energy retailers. This allows Calisen to continue building up its presence and capture market share.
Acquisitions have boosted its ability to capture further market share by seamlessly providing a combined suite of procurement, installation, ownership and management services to its customers.

Calisen expects to enjoy significant growth in the near and medium term. Calisen’s MAP pipeline as at 31^st December 2019 consisted of approximately 6.5 million meters, which represents future growth that is reasonably certain.
Calisen is well placed to take advantage of British government policy, which requires energy retailers to offer smart meters to all homes and small non-domestic settings by 31st December 2020. Currently, Calisen has approximately a 22% share of the 51.2 million smart meters that are estimated to be installed by the end of the government-mandated roll-out.

Calisen’s superior meter tracking capabilities, key contractual relationships, funding structure and low meter fault rates contribute to efficient operations. The business has been able to leverage on these strengths to continue winning MAP contracts, allowing the business to build its position and generate scale to operate more efficiently.
The business’s ability to continuously track its meters and to accurately bill the correct energy retailer further contributes to its efficiency. The high-quality meters with low fault rates that Calisen uses allows it to avoid potential disruptions, while its proprietary IT system ensures customers are billed accurately and on-time.

Calisen’s business produces high-quality, “annuity-like” cash flow which allows Calisen to enjoy downside protection in the context of a significant market decline.
Because of the contractual structure, Calisen’s revenues are predictable. Even with consumer churn, Calisen continues to receive revenue from meters, and if a meter removal were to take place, contracts often provide compensation for Calisen from the relevant energy retailer.
Calisen’s customers tend to have high credit quality, with all Big 6 energy retailers rated investment grade. The business faces no consumer credit risk as customers are all energy retailers.