Envirosuite Limited (ASX: EVS) and (FRA: 57P) is a small-cap Australian based company with global ambitions. The company is valued at around AUD $189 million as at November 2020. The company has traded relatively flat since listing in 2015 however that could be about to change.
EVS is a global leader in environmental intelligence with operations in more than 15 countries, working with many of the worlds leading companies in airports, cities, construction, mining, heavy industry, waste and water.
The company’s Ip and technical solutions include leading-edge science and predictive technology with industry expertise to produce actionable insights, allowing customers to optimise their operations whilst managing the environmental impact.
EVS works across three main pillars of solutions
· Air – air quality, odour, dust and weather
· Noise – noise and vibrations
· Water – wastewater, water-quality, water-flow and groundwater conditions
The diagram below explains exactly how environmental intelligence works.
The company acquired EMS Brüel & Kjær Holdings Pty Ltd (EMS), a noise and vibration monitoring technology company in January 2020 – creating a global leader in environmental technology.
At the time of the acquisition the CEO of Envirosuite, Mr. Peter White said the environmental technology sector was accelerating globally, with the Global Continuous Environmental Monitoring market forecast to grow by 9.4% annually and reach a market size of US$7.7 bn annually by 2021.
“The increase of urbanisation and high-density living, public community consultation, rising regulatory concerns and adoption of industry best practice is driving demand for continuous environment monitoring around the world. This acquisition allows us to continue to drive innovation through R&D and new solutions in a growing market.
“Australia has been at the forefront of environmental monitoring technology and we will now have the people and footprint to be able to establish a world-leading offering.”
To fund the acquisition EVS undertook a successful capital raise of $75 million in January 2020 with the combined entity having an estimated revenue of AUD$55–60 million.
Significantly, Macquarie Capital became a major shareholder of the company and will assist the company’s growth through a referral agreement utilising its global businesses in areas such as renewable energy, infrastructure and real estate including airports, windfarms, construction sites and greenfield developments. We expect this to contribute significantly to EVS earnings in 2021 and beyond.
The company is experiencing solid revenue growth for 2021 with sales for Q1 increasing to AUD $14.7 million. This included sales across all sectors including airports, resources, infrastructure, wastewater, and waste management.
The November 2020 EVS presentation can be uploaded below
We expect significant share price upside for this company from 2021.