Fulcrum Utility Services - delayed results flatter to deceive
Having delayed the announcement of its results for several months, we feared the worst for this provider of utility services. While the final numbers may not be as bad as many were expecting, the complex accounting and flattering narrative does not instil much confidence. Here is our take on things.
As its name implies, Fulcrum Utility Services (LON: FCRM), which was spun out of National Grid in 2010, started off life as a services provider, whose primary business was the installation of gas and electric connections for residential, commercial and industrial customers around the UK. The installations in question connect properties to the main UK gas and electricity networks. However, as a licensed Independent Gas Transporter and Independent Distribution Network Operator, Fulcrum has evolved from being a mere installer into an owner of gas pipelines and electric cables, which means receives an ongoing revenue stream based on the usage of these long-term…