Inspired warns of £3m hit if Gazprom UK ceases trading

21st Mar 2022 12:50

(Sharecast News) - Energy management technology company Inspired updated the market in response to press speculation that Gazprom Marketing and Trading could cease trading in the UK.

The AIM-traded firm said the Russian state-owned subsidiary is a "significant" gas supplier to UK businesses, including some of its clients and businesses within its clients' supply chains.

It estimated that about 5% of its revenue, all within its energy assurance services division, were dependent on clients that were contracted with Gazprom.

Should Gazprom cease trading, and the resulting disruption not be mitigated in the short term, it said the potential impact to 2022 EBITDA could be up to £3m.

The board stressed that in "such an extreme scenario", it would still "comfortably" be able to meet its banking covenant and liquidity tests, and thus continue to operate as a going concern.

More widely, Inspired said it was taking "every opportunity" to help all customers mitigate the cost of energy and manage their energy consumption during the current crisis.

Maintaining client relationships, and helping those in need to secure alternative supply contracts, would help to mitigate the revenue at risk if Gazprom ceased to trade in the UK market.

"Whilst the potential impact on the financial performance of the group should Gazprom cease to trade in the UK would be disappointing, these factors are unfortunately outside of the group's control," said chief executive officer Mark Dickinson.

"We have proactively considered the impact of this event in its entirety and are already focused on the mitigating actions we can take by supporting clients with contract replacement."

Dickinson said Inspired remained "focussed" on helping clients manage costs and sustainability challenges through the crisis.

"With regard to the invasion of Ukraine, I am sure many share our shock at the abhorrent actions of the Russian regime and our hope that the war and resulting humanitarian crisis ends soon with a peaceful resolution."

Inspired Energy said it would announce its full-year results for the 12 months ended 31 December on 30 March.

At 1210 GMT, shares in Inspired were down 14.48% at 14.11p.