Fortune of SMS gas meter duo expands to £40m after float

TWO directors at Glasgow-based gas meter supplier Smart Metering Systems (SMS) have made a joint paper fortune of more than £40 million since floating their company on the stock market almost a year ago.

Shares in the Aim-quoted firm have nearly trebled in value since debuting at 60p last summer, closing at 175p on Friday.

SMS’s market value has risen from £50m to about £146m last week, buoyed by deals to supply its meters to Contract Natural Gas and French energy giant Total.

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Founder and deputy chairman Steve Timoney’s 30 per cent stake in the firm has risen in value by nearly £29m in the past year, while chief executive Alan Foy’s 16 per cent holding has risen in value by about £15m.

The pair’s paper profit comes on top of the £17m they pocketed between them when they sold shares during the flotation.

Shares surged last week following the deal to rent the firm’s ADM meters to Total, which Foy said “marks a step change in the adoption of the ADM as an industry standard”.

Energy regulator Ofgem requires 300,000 industrial and commercial gas customers to switch to smart meters by 2014 – creating a £300m market, according to SMS.

The company’s ADM meters can be read remotely via mobile and landline connections, saving companies the cost of sending staff out to read meters. Perth-based utilities giant SSE has also chosen SMS to run its gas meter operations in the UK, apart from in Scotland and the south-east of England, replacing a rival firm.