Trading Update & Dividend Restoration
5 July 2021
Restore plc
("Restore" or the "Group" or "Company")
Trading Update and Confirmation of Dividend
Trading above expectations in Q2
Restore plc (AIM: RST), the UK's leading provider of integrated information and data management services, secure technology recycling, and commercial relocation solutions , today issues a trading update for Q2 2021, ahead of its Half Year results on 27 July 2021.
In addition, as a result of the strong first half performance and continued confidence in the Group's outlook, the Board confirms its intention to reinstate its progressive dividend and pay an interim dividend payment for FY21.
TRADING UPDATE
Further to the announcement on 27 May 2021, Restore is pleased to report that trading continued to strengthen through the first half, with second quarter performance ahead of the Board's previous expectations.
· With the benefit of the increasing activity levels, the accretion from acquisitions made in 2021 and further new business wins, the Group continued its good momentum from Q1 into Q2
· The positive trend is evident across all of the Group's business units, with each showing strong revenue growth in Q2, both sequentially and over prior year
· As a result of this progress, the Group's run rate revenue for the 8 week period since the acquisition of EDM is more than £250m pa (FY20: £182.7m, FY19: £215.6m)
· Underlying cash generation in the first half continued to be strong, with net debt anticipated to be in line with expectations at the half year
The Group has made significant strategic progress during H1 and a solid platform is in place for continued development in H2, with further growth potential from increasing activity levels in the economy, sales expansion and further acquisitions expected to be completed during Q3 and Q4.
The combination of activity recovery, market share gains and focussed acquisitions means that the Group is already emerging from the pandemic as a larger business, with enhanced positions in its key target structural growth markets. In addition, management's focus on operational effectiveness and financial discipline have also created a stronger organisation, capable of generating sustainably higher returns.
ACQUISITION UPDATE
Restore also provides the following update on the Group's recent acquisitions and pipeline of further opportunities:
· EDM has performed ahead of expectations in the 8 week period since acquisition . The integration of EDM into the business is on track and synergies are expected to be line with previous guidance of at least £2m
· The two larger acquisitions in Restore Technology executed in the last 8 months, Euro Recycling and Computer Disposals Ltd, are delivering results well above expectations and their full integration is progressing in line with plans and nearing completion
· The pipeline of acquisition opportunities across all business units in the medium term totals >100 companies with active discussions with more than 25 potential targets. Restore remains confident in its ability to close a number of acquisitions in H2 2021 and also to improve the pipeline quality for potential acquisitions in 2022
RESTORATION OF DIVIDEND
Reflecting the Group's continued strong trading momentum and its confidence in the outlook, the Board intends to resume dividend payments. As such Restore will return to its previous progressive dividend policy and the level of interim dividend for FY21 shall be announced at the half year results on 27 July 2021.
Charles Bligh, CEO, commented:
"I am delighted to report that the Group is emerging from the pandemic not only larger but better and with strong momentum. This is borne out by current trading which is ahead of the Board's expectations with the prospect of increasing activity in H2. Our recent acquisitions, including EDM, have made impressive starts within the Restore Group. What is particularly pleasing is the positive response and motivational impact to these developments from both existing and new staff members. We have over 2,500 staff in the Group and continue to hire with the expected growth."
Certain information contained in this announcement would have constituted inside information (as defined by Article 7 of Regulation (EU) No 596/2014) ("MAR") prior to its release as part of this announcement and is disclosed in accordance with the Company's obligations under Article 17 of those Regulations.
Restore plc www.restoreplc.com
Charles Bligh, CEO 020 7409 2420
Neil Ritchie, CFO
Peel Hunt LLP www.peelhunt.com
Mike Bell 020 7418 8900
Ed Allsopp
Buchanan Communications www.buchanan.uk.com
Charles Ryland 020 7466 5000
Victoria Hayns
Stephanie Watson
Tilly Abraham
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