Water Intelligence sells franchise territory in US state of Georgia
Water Intelligence
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16:55 18/04/24
Leak detection and remediation solutions provider Water Intelligence announced the sale of franchise territory covering the middle and southern part of the state of Georgia in the United States on Thursday.
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The AIM-traded firm said the purchase price for the territory was $168,750, with it representing the previously undeveloped southern half of the South Atlanta franchise that Water Intelligence reacquired in early March.
It said the new franchise owner had experience with the American Leak Detection franchise system, and was expected to put trucks on the road immediately.
It added that importantly, the new owner also had professional experience with sewer and wastewater operations, and would also be helpful in cross-selling municipal solutions from Water Intelligence International.
The board said the sale of a franchise territory optimised the commercial exploitation of the South Atlanta and Southern Georgia region, and accelerated the unlocking of shareholder value.
It explained that the sale of the South Georgia territory did not cannibalise the sales of the newly-launched South Atlanta corporate territory, with the company still expecting the baseline of $0.32m of 2018 sales for South Atlanta to grow during 2019.
Now, however, the effective purchase price for the reacquisition had dropped due to the sale of territory.
Additionally, Water Intelligence said the sale of a new franchise for the undeveloped Southern Georgia area enabled royalty income to supplement South Atlanta corporate revenue and earnings, and thus “fully exploit” the entire geography.
Strategically, the company said the South Atlanta and Southern Georgia transactions could be a model for optimisation of franchise territory across the US, enabling more sales coverage in support of the firm’s national channels and incentivising ever greater collaboration among corporate and franchise operations towards the execution of the board’s growth plan.
“As previously highlighted, the first quarter was very productive in reinforcing last year's strong revenue and profits trajectory,” said Water Intelligence executive chairman Patrick DeSouza.
“Today's sale is fully accretive to revenue and earnings.
“With the recent announcement of the reacquisition of Orlando and now the sale of Georgia territory, we believe that the second quarter will continue along the same exciting path.”