TIDMRST
RNS Number : 8936E
Restore PLC
16 March 2022
16 March 2022
Restore plc
("Restore" or the "Group" or "Company")
Full Year 2021 Audited Results - Exceeding expectations
Strategic M&A and organic growth driving Restore
Restore plc (AIM: RST), the UK's leading provider of digital and
information management and secure lifecycle services, is pleased to
provide its audited results for the year ended 31 December
2021.
Restore reached a record financial performance in 2021 through
the successful delivery of its strategy centred on strong organic
growth, margin expansion and eight acquisitions across four
business units.
SUMMARY OF RESULTS
Continuing operations 2021 2020 Change
------------------------------- --------- --------- -------
Revenue GBP234.3m GBP182.7m +28%
Statutory profit before tax GBP23.0m GBP4.0m +475%
Adjusted profit before tax(1) GBP38.1m GBP23.2m +64%
EBITDA(2) GBP74.2m GBP57.4m +29%
Net debt GBP100.8m GBP66.1m (52%)
Adjusted earnings per share(3) 23.2p 15.0p +55%
Earnings per share 8.7p 0.2p +4,250%
Dividend per share 7.2p - (n/a)
-------------------------------- --------- --------- -------
BUSINESS AND STRATEGIC HIGHLIGHTS
-- Good performance across all business units contributing to
growth, with strong underlying organic growth and eight successful
acquisitions driving increased scale and capability across the
Group
-- Exit run rate revenue of GBP260 million based on Q4, 21% higher than pre pandemic levels
-- Restore Digital's transformative acquisition of EDM in April
2021 doubles exit run rate revenue to GBP46 million, enhances
capability (Cloud, BPO, Software) and delivers scale margin
benefit
-- Restore Technology completed three strategic acquisitions
doubling exit run rate revenue to GBP34 million with strong demand
and margin momentum building through the year
-- Restore Records Management gained further market share with
strong organic revenue growth of 5.6%, alongside acquisition
revenue growth of 5.9% and COVID-19 repair of 4.2%
o Positive net box growth momentum in line with expectations at
1.3% (2020: 0.9%)
o Property consolidation strategy progressed with new high
density storage facilities in Heywood and Sittingbourne
-- Restore Datashred continued steady recovery to 84% of
pre-pandemic activity levels by Q4, with significant progress in
underlying productivity although profit behind 2019 levels
-- Restore Harrow Green activity levels strong throughout the UK
with a new site in Cambridge addressing the life sciences sector
and delivering record profitability
-- Development of significant pipeline of further acquisition
opportunities across the Group to support the ambitious growth
plans
-- The Group announced its new ESG strategy, 'Restoring our
World' with ambitious targets including our Net Zero commitment by
2035
FINANCIAL HIGHLIGHTS
-- Revenue up +28% to GBP234.3 million (2020: GBP182.7 million) driven by:
o Organic growth +5.0%
o COVID19 repair +5.6%
o In year acquisitions +16.4% plus full year effect of prior
year acquisitions +1.2%
-- Adjusted profit before taxation up +64% to GBP38.1 million
(2020: GBP23.2 million) and operating margin increasing from 18.5%
in H1 to 20.7% in H2
-- Statutory profit before tax up 475% to GBP23.0 million
-- Strategic acquisitions successfully completed totalling
GBP86.3 million during 2021, delivering a post synergy ROIC(4) of
13.0%
-- Strong Cash conversion(5) at 85% with closing net debt at
GBP100.8 million and leverage(6) of 1.8x
-- New increased debt facility agreed post year end at enhanced
terms, providing further capacity for continued investment
-- Proposed final dividend of 4.7 pence, taking total dividend
for 2021 to 7.2 pence (2020: nil pence)
CURRENT TRADING AND OUTLOOK
2021 saw delivery of record revenues and profit demonstrating
strong strategic progress and the resilience of our revenue and
markets despite a challenging economic backdrop.
The new financial year has started well, in line with our
expectations, and we are expecting further financial and strategic
progress in 2022, which will benefit from:
-- Further underlying organic growth, market share gains and new
customer wins from a significant commercial pipeline;
-- Ongoing cost reduction and productivity programmes which,
together with effective pricing discussions, should help mitigate
further inflationary cost pressures;
-- The contribution from accretive acquisitions completed in
2021, with additional synergies realised during 2022; and
-- A substantial and high-quality strategic acquisition pipeline
with several transactions already in exclusivity or with verbal
commitments and over 10 deals strongly progressed with more in the
pipeline.
Strong activity and momentum has continued into the new
financial year with underlying demand for our mission critical
services continuing to build and we will continue to further extend
our capability and offering in line with the long term structural
growth trends that underpin our markets. Against this backdrop, we
have an ambitious but achievable medium-term target to grow annual
revenue to GBP450-500 million and double EBITDA to more than GBP150
million (2021: GBP74.2 million).
Charles Bligh, CEO, commenting on the results and outlook,
said:
"Our strong organic growth and eight successful strategic
acquisitions have delivered an outstanding performance with record
results for 2021. The new businesses we have acquired are improving
margins and there is no doubt the quality of Restore's services is
reflected in our sector leading positions in all of our
markets.
With excellent sales momentum, activity levels further
increasing across all our markets and a well progressed pipeline of
acquisitions, I am confident our success will build further in 2022
and beyond."
1) Adjusted profit before tax is stated before amortisation,
impairment, and exceptional items and after the effects of IFRS
16
2) EBITDA is earnings before interest, taxation, depreciation,
amortisation, impairment, and exceptional items
3) Adjusted earnings per share is calculated using adjusted
profit before tax and a standard tax rate of 19%
4) Calculated using pre-IFRS16 EBITDA adjusted for management's
expectations of post-acquisition synergies, and consideration net
of cash acquired plus exceptional costs
5) Calculated using net cash generated from operating activities
after capital expenditure and lease payments, but before
exceptional items, divided by adjusted operating profit with a
standard tax rate of 19%, with an amendment to exclude the impact
of the VAT deferral from 2020 to 2021
6) Calculated using pre-IFRS16 EBITDA adjusted for share-based
payments, including a pro-forma adjustment for acquisitions in line
with financial covenants
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
Stephanie Whitmore
Tilly Abraham
Chair's Introduction
I am pleased to report that Restore achieved an excellent
all-round performance for 2021 with significant financial growth,
substantial strategic progress made and further enhancement on the
quality of the business overall.
The business is performing well, and I was delighted that the
Board invited me to take on the role of Chair from Martin Towers on
his retirement from the Board during October 2021. I would like to
thank Martin on behalf of the Board and shareholders for his
significant contribution to the substantial growth of the business
during his tenure.
As I look ahead, I am highly confident in Restore's prospects
and that our team will continue to transform and evolve the Group
and the critical services it provides to the organisations we
serve.
2021 has been an important year for the Group with strategic
development and expansion of the Technology and Digital businesses,
continued growth in Records Management, solid performance in Harrow
Green and stabilisation in Datashred as we exit the pandemic. With
a clear strategy for growth, set out at our Capital Markets Day
event in November 2021, shareholders should be assured that the
Group is in good health and well positioned for future
expansion.
Over the last two years, the pandemic has required an
extraordinary response from the nation and the team at Restore. Our
people have shown tremendous resilience and relentless commitment
to our customers and to one another, maintaining full service
throughout the disruption of the past two years. I feel incredibly
proud of the positive response from our front-line teams, the
supporting functions, and our leadership group as they navigated
the uncertain events of the past two years. I would like to thank
them for their outstanding contribution on behalf of the Board,
shareholders, and our customers.
2021 Performance
Restore has delivered strong revenue and profit growth in 2021
with a 28% increase in revenues to GBP234.3 million and a 64%
increase in adjusted profit before tax to GBP38.1 million compared
with 2020. This growth is from the restoration of revenues impacted
in 2020 by extensive disruption, through acquisition and from
underlying organic revenue growth. With a strong exit rate from
2021 and an annualised GBP260 million exit run rate revenue, the
business is 21% larger when compared to the pre-pandemic revenue of
GBP215.6 million in 2019.
Whilst 2021 was subject to further restrictions, particularly in
the first quarter and at the end of the year with the emergence of
the Omicron variant, the underlying business environment for
Restore has been more predictable with the embedding of adapted
working patterns across the organisations we serve. As a result of
this high confidence in the performance of the business, the Board
approved investment in eight acquisitions during the course of the
year. These acquisitions continued to build the Records Management
business and have transformed the Digital and Technology
businesses, more than doubling their scale and significantly
enhancing our product capability.
To support this investment, the Group raised GBP40 million
through an equity raise in May and the Board thanks shareholders
for their support in this over-subscribed offer.
As a result of the improved profits of the Group and reflecting
the increase in shares issued, adjusted earnings per share
increased to 23.2 pence for the year, an increase of 55% compared
to 15.0 pence achieved for 2020.
The Group continues to demonstrate its strong cash generative
nature and despite the substantial level of investments during
2021, the closing leverage of 1.8x EBITDA provides plenty of
capacity to continue to invest in 2022.
Strategic progress
In addition to the strong financial performance for the year,
Restore has made strategic progress across a number of commercial
and operational areas adding further depth and capability to the
Group.
Records Management continues to grow in scale and is providing
an excellent platform for extension of the Group's digital and
information management services. Over the course of the last year
the business has won, and is executing, a number of substantial
client service contracts supporting the increasing requirement to
extract value from existing and newly created data in both hard
copy and digital formats.
The investment in Restore Digital, and its subsequent expansion
of scale and product lines, is a significant step in the
development of the business. It is well on its evolutionary journey
from high volume processor of scanning and digitisation to become a
value-add digital services partner, focussed on business process
outsourcing, digital storage, digital data management and enhanced
software capabilities.
The Board and I are also pleased to report on the successful
steps in executing on the substantial opportunity Charles and the
team have previously presented in relation to the IT and Technology
asset lifecycle support sector. Restore Technology reached number 1
status in this sector during the year with 6% market share and the
team are successfully driving a fast growth acquisition and organic
growth strategy.
Management have also been very active in deepening the quality
of the business. In addition to the continued digitisation of the
business and internal operational enhancements, the Board was
pleased to formally launch the Group's Environmental, Social and
Governance ('ESG') strategy in November 2021.
The 'Restoring Our World' strategy can be found on the Group's
recently updated website at www.restoreplc.com. Our management team
and the Board is fully committed to the balanced objectives set out
in the strategy and in achieving the headline target to become a
Net Zero organisation by 2035.
The Board received an unsolicited, non-binding and equity-based
offer from Marlowe plc during the year. Whilst the Board took time
to seek external guidance and invested significant resources to
properly assess the offer, the bid was unanimously rejected by the
Board. We considered that it fundamentally undervalued the Group,
lacked strategic rationale or logic and the financial consideration
proposed, in the form of Marlowe shares, would have been a very
poor outcome for shareholders. The Board would like to thank our
shareholders for their overwhelming support of the Board in their
rejection of this offer.
Health and Safety
During the last quarter of the year, the Board engaged a third
party to perform an independent audit of the Group's health and
safety environment and to assess progress since the last external
audit performed in 2019.
The audit highlighted significant progress in Restore's Health
and Safety operating framework and recognised the high priority
given to Health and Safety matters across the Group's management.
The report also highlighted additional areas to focus on, in
particular more advanced skills training and reporting, and these
will be taken forward and actioned.
In addition to the development of the Health and Safety
structure I would extend my gratitude to the health and safety and
management team for their excellent navigation of the COVID-19
period and for guiding us in the constant evolution of our safe
working practices through the whole period.
Finally, I would like to mention the investment we have made in
our deep-storage mine facilities which I visited with the Board in
October. Over the course of the last two years the Group has made
significant investment into enhancing the environmental quality of
our deep-storage facilities and in 2021 successfully installed
extensive networking within the mines, creating a safer and more
productive work environment.
Dividends
Your Board is recommending a final dividend of 4.7 pence,
payable on 8 July 2022. This brings the total dividend for the year
to 7.2 pence (2020: nil pence due to pandemic risk mitigation).
The restoration of the dividend during 2021 is consistent with
the Board's high degree of confidence in the business and a return
to its previous progressive dividend policy.
CEO's Statement
I am delighted to report that 2021 was a transformational year
for the company with record adjusted profit before tax of GBP38.1
million (+64% vs 2020 and +7% vs 2019) and a significant expansion
of the services we provide to customers which will continue in 2022
as we make progress on our ambitious growth strategy. We completed
eight acquisitions in the year across Records Management, Digital,
Datashred and Technology which has increased both the scale and the
capability of these business units in what continue to be high
growth, mission critical services.
I reported last year that the business showed great resilience
in the face of the pandemic and that during the second half of 2020
the business rebounded, quickly regaining momentum after the
initial impact of the pandemic in Q2. This recovery continued to
build through 2021, with both underlying growth and bounce back
effects, despite the significant lockdowns that were imposed in Q1
of 2021. The strong bounce back beyond pre-pandemic levels
demonstrates the resilience of the business and the critical nature
of the services we provide to our customers despite any social or
business restrictions posed by COVID-19.
Health and Safety (H&S) is the number one priority in the
Group for our employees, suppliers and customers. I am delighted to
report improving results in all business units throughout the year.
With the increasing activity in the business a key focus was around
new employees and their correct H&S induction. We increased the
number of surveillance audits with encouraging results because our
focus is to continue to improve our operations and to invest
strongly in H&S, training, education and drive a culture of
H&S first in all that we do.
During the year all business units started to deliver on
investments in technology and organisational changes which will
yield benefits in 2022 and beyond. These changes and further
investments in 2022 will transform the digital experience for
customers and also create significant productivity benefits. In
most of the business units our portals and customer digital
experience are very good, but our goal is to have an industry
leading experience from initial engagement, through the sales
process to the day-to-day operational management.
With the increasing activity across the Group, we end the year
with record number of employees in the business to further expand
in 2022. The end of year employee numbers are 2,760 permanent
employees with a further 300-400 agency workers which is overall an
increase of over 25% on pre-pandemic levels. I have been
particularly delighted with the improvement in the leadership
talent across the group as we invest in leadership cognisant of
delivering improving profit in the year but also investing heavily
in talent for the next stage in the scaling of the business. In the
top 62 leaders over 75% are new in role or new to the company
through hiring or acquisition of businesses and in the Executive
Committee there have been two new appointments in the year.
We made good progress on our high growth strategy and we have
further announced ambitious but achievable medium-term goals to
increase our exit run rate revenues from c.GBP260 million towards
GBP450- 500 million with EBITDA doubling to over GBP150 million.
This will deliver significant shareholder value creation.
Results
I am delighted to report record revenues of GBP234.3 million
which is 28% up on 2020 and 9% above pre-pandemic levels. Our
profit performance is strong with a record adjusted profit before
tax of GBP38.1 million, strong operating margin performance across
the businesses and EBITDA of GBP74.2 million for the year (+29%).
We continue to show a disciplined approach to cash management with
debtor days and aged debt in line with our expectation, net debt
finishing the year at GBP100.8 million and a leverage ratio of
1.8x. From the Group's continued high cash generation and with
increased capacity from our newly expanded bank facility, the
Restore Group has substantial capacity for further investment
growth.
As well as driving earnings accretive acquisitions our
disciplined approach demands a strong Return On Invested Capital
(ROIC) from our investments. With GBP86.3 million invested in 2021,
delivering a post-synergy ROIC of 13.0%, the returns from our
investments are proving to be very strong and well above our cost
of finance. As the business expands and matures, the scale benefit
of the investments we are making will substantially enhance the
ROIC from the business.
Organic revenue growth continues to compound and was 5.0% for
2021, which is a very good result considering 3-4 months of the
year were significantly disrupted with lockdowns delaying sales
decisions. We can see momentum in each of our sectors and
strengthening levels of cross selling and up-selling opportunity
across the Group with over 1,200 referrals from one business unit
to another.
We continue our focus on cost management and productivity across
the teams. I am delighted the business units have continued to
improve operational performance metrics while delivering
productivity and cost management initiatives.
The strong financial performance for 2021, and our confidence to
invest GBP86.3 million in acquisitions during the year,
demonstrates the team's successful progress in delivering our
strategy and confirms our strong conviction in our potential for
substantial growth in the future.
Customers and our Markets
The business has transformed over the last 3 years and this
change is reflected in the divisional structure and our evolution
from Document Management and Relocation to Digital and Information
Management and Secure Lifecycle Services.
We currently participate in markets with total size of at least
GBP1.9 billion with an overall market share of c.13%. We have
either a number one or number two position in each market and even
with these leading positions we have ample room to grow to a 25%+
share and towards our initial goal of GBP450-500 million in
revenues. The market forces which dominate the rate of change and
growth are 1) Digitisation, 2) Security of Data, 3) Flexible
working, and 4) Sustainable working. The pandemic is likely to
further accelerate momentum to these changes which as we have said
over the last three years (even before the pandemic) are very good
trends for the growth of Restore. We have embraced and are driving
these trends and actively evolving our offerings and creating new
ones with large public and private sector organisations to provide
commercial benefit, manage risk, address their ESG obligation and
expand their productivity.
One other key change in the markets we could see in the medium
term as a result of COVID-19 is customer evaluation of the
providers with whom they deal.
We prioritised customer responsiveness and experience during the
last 18 months and in a number of cases invested significant extra
effort to service those customers. We have also worked hard to
moderate price rises with cost management; the end result being
extremely favourable customer feedback and low customer churn
levels. The same cannot be said for our competitors in various
business units who either closed offices/service provision or
responded with, in our view aggressive pricing tactics.
In the first month of the pandemic, we said very clearly we
would prioritise 1) Health & Safety, 2) customer experience,
and 3) the bounce back of the business. Those decisions taken early
in 2020 are very evident in the performance of the business in
2021. I firmly believe that with our very strong customer
experience, value of our services, investment in continual
transformation and investment in new services we will be the net
beneficiary of customers looking to establish new long-term
relationships with our business.
ESG
We announced our new ESG Strategy in Q4 2021 called 'Restoring
our World'. We have taken the time to understand what matters to
all stakeholders in the business when developing this strategy from
shareholders, employees, customers, suppliers, and the wider
community. We have also worked hard to ensure we have specific
targets, actions, and timing for this first strategic plan with the
aim of delivering on these and also looking to improve the timing
and impact. At Restore we pride ourselves on being extremely
customer centric and pragmatic with the way we run our business for
the long term but also brave in transforming the business and using
the strong financial position of the company to deliver against the
plans.
We have set out a bold target to become a Net Zero organisation
by 2035 which requires real and sustained focus along with
technology based investments and we are endeavouring to work
towards even more ambitious achievements. We are also working on
the next version of the strategy to include more specific plans on
Waste, Scope 3 emissions and other areas that matter to our
stakeholders based on feedback from the inaugural strategy and
plans we have announced.
I can say with absolute certainty that the whole team at Restore
is motivated and energised by our commitment to do the best for our
environment and the communities we live in. We are committed to
deliver with the highest levels of integrity and governance you
would expect from a company entrusted with such critical services
to customers and the broader society in the UK.
Digital and Information Management
Our Digital and Information Management division comprises
Restore Records Management and Restore Digital. For 2021 revenue
was GBP138.3 million, up GBP32.2 million on 2020 with operating
profit of GBP42.5 million, an increase of GBP8.5 million on
2020.
Restore Records Management
Restore Records Management growth was substantial during 2021
with organic revenue growth of 5.6% and total revenue growth up
16%. Pricing was increased at ordinary inflation rates with total
box storage volumes up 11.6%, including organic growth at an
impressive 1.3% (vs 0.9% in 2020 and 1.9% in 2019). This
demonstrates that even with various lockdowns and interrupted
business activity in the wider economy we can grow strongly. Three
acquisitions in the year of 1BDM, EDM and The Document Warehouse
('TDW') contributed to this overall excellent result. Our total box
storage volume at the end of 2021 is now 22 million boxes which
means over the last three years we have increased our storage by
2.6 million boxes or 13.3%.
Storage revenue grew by 5.4% during the year and including
activity-based revenues the total revenue for the year was GBP101.4
million and we end the year with exit run rate revenue of GBP110
million. Although we experienced a strong recovery in activity
levels, we still have a number of customers in the private and
public sector that are yet to fully recover their delivery and
retrievals which will provide a positive further tailwind for the
business in 2022.
Occupancy rates closed the year at 89% (2020: 94%) with the
addition of capacity at our new Heywood site of c.1 million boxes
and capacity in the recently acquired TDW business in
Sittingbourne. We exited one large site at Transfessa, Paddock Wood
with a further 4-5 sites planned for consolidation in 2022. Over
the next 8 years we have a clear plan to reduce the number of
buildings in the estate by 50% while at the same time ensuring
increased capacity for the organic and acquisitive growth of the
business. We will invest in larger and higher density sites as we
have done in 2021 to drive down our property cost in the region of
c.25%. We will do this while staying close to our customers to
ensure excellent service levels with deliveries of records.
New customer wins included Department for Work & Pensions
('DWP'), a document services project of approximately GBP10 million
over 20 months which commenced in June 2021.
As part of the service, 95 employees transferred across to us
from the previous provider. We had several other significant wins
across the public sector, including NHS Hospitals, local councils,
and Clinical Commissioning Groups (CCG's). These entities are a new
opportunity for us, driven by funding by NHS commissioners to move
patient notes off site.
Across the private sector we had a 27% increase in new customer
wins compared to 2020 and our pipeline at the end of 2021 is 7%
bigger compared to the previous year. We have almost half of our
2022 new box target already confirmed.
The market trends are very positive for our Records Management
business. Organisations have been slow to adopt digital workflows
in the last 20 years and although some companies have rushed to
implement new digital experiences for customers in the last 12
months, we are still seeing significant growth in physical
documents for storage. If customers decide to invest in further
digitisation of their business (which we encourage) then we are
well placed to win this business because we can deliver both the
physical and digital service for customers. Flexible working also
drives more demand for those 'unvended boxes' held in customers'
premises. When customers move, whether it be downsizing,
rightsizing or upsizing their business it makes no sense to move
boxes to expensive new office facilities when we can offer a fast
turn around and cheaper service compared to inhouse provision with
additional benefits of inventory and asset tracking to provide
peace of mind. We estimate this un-vended market to be c. GBP50-100
million of revenues per year and we
experienced 185 new customers in 2021 with unvended boxes
demonstrating this growth opportunity. A significant customer trend
is towards sustainability in the Records Management market, this
means a focus on energy costs associated with storage of boxes. We
provide the lowest carbon offering to customers to reduce their
Scope 3 emissions. It is these trends coupled with our excellent
customer experience as shown by over 140 Trustpilot reviews (4.7
out of 5) that means we win against competition to drive an
increase in organic market share.
As demonstrated over the last few years (including during the
COVID-19 pandemic) our overall strategy in Records Management is to
drive capacity growth which will deliver significant revenue and
profit growth. We are delivering consistent organic growth with the
market drivers described while also focusing on the customer
experience and reduction in costs. There are substantial
acquisition opportunities in the market, supported by active
discussions with over 20 companies of a total number of 110 with
whom we have continual dialogue.
Restore Digital
Restore Digital helps customers in their digital journey with
services from Digitisation, Cloud, Consulting, Digital Mailroom and
Business Process Outsourcing ('BPO'). Restore Digital revenues
increased substantially from GBP18.5 million in 2021 to GBP36.9
million for 2021 with an exit run rate of GBP46 million. It was a
transformational year for the business with strong organic growth
coupled with two acquisitions, the largest being EDM which was
completed in April 2021 for GBP62.4 million (24% of the revenues
fall in the Restore Records Management business with 76% of the
revenues in Restore Digital). Importantly the capabilities of the
business have been transformed with the addition of EDM which
enhanced our position in the all-important Digital Mailroom space
to be the market leader, and enhanced our Cloud, BPO and software
assets and capabilities which have been outlined as strategic areas
of growth over the last 2 years. We operate nationally from 11
sites with over 800 employees and provide cloud hosting services of
c.GBP6 million in revenues and growing with c. 500 million cloud
hosted images.
With this increase in higher margin services and additional
scale driving efficiencies alongside operational improvement the
net margin of Restore Digital has improved materially in line with
our expectations and the strategy that we have outlined over the
last 2 years.
We are winning in the market with long term contracts
demonstrating the critical nature of the services we provide. In
addition, the sales pipeline at the end of 2021 was significantly
higher than 2020 (increase of 28%).
We have a 10 year contract in partnership with Canon; an awarded
tender through TCS (Tata Consultancy Services) in the DigiGOV
Framework where we will provide Digital Mailroom and Payment
Processing services commencing in September 2022. These services
are vital to support the delivery of a new smart mobility system
that will reimagine the administration of taxi and private hire
vehicles in London.
We were awarded a 3 year contract directly with Monzo bank, one
of the first online-only challenger banks in the UK. We have
successfully rolled out a digital inbound and outbound omnichannel
mailroom, and together we are looking to develop this further,
including cheque processing and wider electronic banking
services.
We signed a contract for 3 years with Dashly, the only 24/7
Mortgage Evaluation Platform. Restore Digital delivers intelligent
Capture and Data Perfection services that enable Dashly's own
revolutionary technology to evaluate individuals' mortgages against
the entire market 24/7 to find the right deal for every customer.
These services enable mortgage advisers to effortlessly onboard
their clients and are then alerted whenever Dashly identifies an
opportunity for them to save money, taking into account all fees
and early repayment charges.
Over the last 12 months we have made extensive preparations for
the upcoming delivery of critical elements of the Scottish Census
on behalf of National Records Scotland and in partnership with APS
Group we look forward to the start of service delivery at the end
of February 2022. The services provided illustrate the breadth of
Restore Digital's capability, from document digitisation, through
complex data capture and interpretation and including provision of
supporting systems.
The long term trends for Restore Digital are very positive with
customers looking to unlock the information in physical records to
support a digital transformation. We can help customers with both
of these challenges and so provide a one stop shop for customers
who want to simplify what are difficult changes for them. Changes
in the workplace are favourable with services like Digital Mailroom
which remove the need for customers to have onsite mailroom
employees and this also enhances their ability to change their
property portfolios. Hybrid working increases the need to be more
digital and we offer a complete physical to digital service and
with our consulting, cloud and software assets we help customers in
this journey. The services we provide come with attractive
financial profiles for Restore comprising a mixture of project and
multi-year subscriptions revenues.
Our strategy is to continue to grow aggressively with a mix of
organic growth and acquisitions for additional capability and
scale. The market size is at least GBP320 million and growing at a
minimum of 4% and with 15% market share we have significant room to
grow. After integrating EDM in 2021 and delivering strong organic
growth the business is ready for an even bigger year in 2022.
Secure Lifecycle Services
Our Secure Lifecycle Services Division comprises Restore
Technology, Restore Datashred and Restore Harrow Green. For 2021
revenue was GBP96.0 million, up GBP19.4 million on 2020 with
operating profit of GBP11.7 million, an increase of GBP8.5 million
on 2020.
Restore Technology
Restore Technology had a transformational year and exits 2021
with exit run rate revenues of GBP34 million. This means the
revenue from this business unit has trebled in size over the last
three years. Size and scale expansion has also resulted in
significantly improved margins, with further opportunities still to
pursue through operational efficiency. Scaling from GBP15.3 million
to GBP28.1 million, this business unit now operates across seven
sites, provides truly national coverage, employs almost 400 people,
serves 18,000 clients, handles over 1.4 million assets, and enjoys
the market leading position and is the largest UK owned IT
Lifecycle Services business.
Three new businesses were acquired in the year. Starting in
January 2021 we purchased Computer Disposals Limited, a scale IT
Asset Disposals ('ITAD') company with national coverage and
operational strength. We acquired a small business, The Bookyard
which increased our capability with Apple technologies, and in
August we acquired PRM Green Technology, another ITAD company with
operational strength, with significant penetration in the education
sector. I am delighted with the acquisitions in Restore Technology
this year. The inorganic growth from these businesses, combined
with the sales growth delivered by the team has contributed to both
a strengthening of performance and capability. Our pipeline of
future acquisitions is exciting and promises continued success in
this vein, particularly as we consider how expanding capability
throughout the technology lifecycle will offer yet more value to
our clients and differentiation of our portfolio.
In line with our overall growth, 2021 has been a year of success
with our clients. Organic and inorganic growth combined saw this
business welcome GBP9 million of new client opportunities, which is
a several fold increase YoY, incorporating many prestigious logos.
Our increasing scale and client base presented an opportunity to
evolve our sales strategy and coverage model. We increased our
focus on clients, new and existing, enterprise and SME, direct and
in partnership with our channel. We intensified our efforts around
client experience, eCommerce and digital transformation. Our
resilience and agility enabled our clients to rely on us as their
businesses evolved through 2021, despite the changing landscape of
COVID-19 restrictions.
Our brand's association with trust further strengthened
throughout 2021. Our clients already associate us with the highest
levels of accreditation and certification, giving them confidence
to trust us with the responsibility of handling their data
ethically and securely. Our PlanetMark certification achieved in
2021 underscores our commitment to environmental sustainability, a
core value of our technology business. Trusting Restore Technology
with the processing of technology ensures assets are always handled
securely, ethically and sustainably, whether that be for services
early in the lifecycle such as asset and imaging, services through
the lifecycle such as upgrading or moving, and services at the end
of the lifecycle such as reuse, remarketing, or destruction. The
Restore Technology business is now 'the' secure and sustainable
choice for technology lifecycle services.
As market dynamics continue to elevate the importance of these
values, the technology lifecycle market will only continue to grow
and our opportunity likewise. Technology spend is growing at least
6% pa. which in turn drives demand for the need to recycle
technology assets in a secure and sustainable way. Our ambition for
growth in this area reflects this growing demand and will see us
outpace the market. Our exciting medium-term goals are to build a
business with GBP80-100 million annual revenues with a services
portfolio designed to serve both our clients and our channel alike,
across all phases of the technology lifecycle. 2022 promises to be
another exciting year for this part of our business.
Restore Datashred
Restore Datashred our secure shredding and paper recycling
business was impacted in the H1 2021 with the UK wide lockdowns and
in H2 showed significant improvement in activity levels with
customers. Revenue increased to GBP30.2 million (2020: GBP28.0
million) with a 9% increase in service visits for the year.
Recycled paper prices increased during the year. Entering the year,
the average price per tonne was c GBP158 and the average for the
whole year was c.GBP185, with overall paper volumes on par with
2020 levels; we expect this volume to materially increase in
2022.
We carefully maintained our position as one of the top online
search choices for shredding services in the UK. This maximised the
inbound opportunity and delivered a consistent level of ad-hoc
destruction requirements across the UK. There were a number of key
wins across the year with a sizeable new national pharmacy
customer, operating over 1,400 sites across the UK. This
opportunity was successfully transitioned, on-boarded and
operations began servicing at the end of 2021. In addition, the
sales team on-boarded over 2,200 new customers into the Group. As a
result of cross selling the team supported some major new contracts
in Records Management and Digital, where having the capability to
destroy documents inhouse, formed a major part of the decision
criteria.
We have a clear plan to improve operational efficiency whilst
also improving our customer experience. Our 5-year operational
strategy is focused on delivering transformation aligned to the
Group ESG targets: optimising the number of customers we service
per route per vehicle, ensuring we utilise the right vehicles so we
match capacity with customers, reviewing our depot footprint to
make sure we are aligned to our customer density and have the
optimum destruction capability to service our customer needs. In
addition, over the last 2 years the team has focused on optimising
our fleet with a mix of different vehicles from vans to small and
large trucks to fit the profile of the work we do (onsite shredding
vs offsite) to drive more visits per day and overall utilisation.
We have also improved the routing of vehicles and the operations of
our 9 destruction sites and 3 collection sites across the UK. With
a focus on transformation whilst managing the complexities of the
pandemic, the team have improved the overall structural
productivity of the business. With the expected increase in volumes
across this year, this will generate improved returns from this
business.
Customer satisfaction was excellent throughout the year with
positive feedback and a continued strong Trustpilot score of 4.6/5.
We improved our market leading NPS score from an average across
FY20 of 70 to 72.5. Service levels into our customer base were also
maintained above 95%, which in a COVID impacted environment is
testament to our robust processes and professionalism across our
operations teams.
Our digital transformation drive continues, with a focus on
automation to streamline our processes, enhancing our customer
experience. We launched a new online service, Homeshred for
consumer home collections during the pandemic and expanded the
service to now the most comprehensive range in the market. We also
launched a pilot demonstrating our new automated customer reports,
to which feedback has been excellent, and it is now part of our
mainstream business.
We completed one small acquisition in Q4 2021 which is now fully
integrated, and we are in early stage discussions with a number of
companies. We expect over the next 12 months to see increasing
activity which will help us scale up the business on the stronger
foundations we have created over the last 18 months.
The paramount concern of our customers is the security of data
with their shredding service but increasingly the environmental
impact of the service including carbon emission, waste management
and the recycling of material is becoming a key buying criterium,
which is a positive trend for our business.
Our strategy is to grow the business substantially both
organically and through acquisitions which increases our scale and
investment in new technologies to deliver a Net Zero service. I am
delighted with the progress of the team in the last 2 years. They
have weathered the uncertainties presented by COVID-19 and
continued to transform the business such that we are ready for the
bounce back with significantly improved sales and operational
performance and a lower cost base to generate good returns for the
business as activity and scale returns.
Restore Harrow Green
Restore Harrow Green delivered a very strong year despite the
volatility posed by COVID-19 with customer decision cycles changing
more than normal. Harrow Green achieved an increase in revenues to
GBP37.7 million (2020: GBP33.3 million) and also delivered record
profits with very strong cost control across the business.
In 2021 we saw a sharp increase in activity levels for quoting
of work which was up 24% vs 2020 but still lower than 2019 volumes
as we expected. The increase in opportunities did bring some very
significant wins throughout the year, with the following projects
secured: University of Exeter >GBP800k, University of Glasgow
>GBP190k, City of London Police >GBP350k and Victoria &
Albert Museum >GBP200k. Overall the larger scale corporate
projects have significantly reduced in terms of volume and size
however we expect this to come back in 2022 and beyond with pent up
demand.
We made significant progress in 2021 around our strategic goal
in increasing our presence in the Life Science market. We opened
our Cambridge site in Q1 of 2021 with its increased capability
supporting the pharmaceutical market. We have significant
capability already and on the back of this investment we have seen
very encouraging new wins for major office and laboratory moves
along with storage, delivery and installations of equipment for
OEMs supplying these customers. The additional storage capability
with this new site has meant we have achieved storage revenues of
GBP4.1 million across our 9 facilities which is 26.5% ahead of 2020
and 36% on 2019. We have seen strong long-term demand for this
value added service which also drives improvement in the margin. We
intend to invest further in new facilities in 2022 to increase our
storage capacity. In 2021 we were unsuccessful in renewing the DAS
contract (Defence Accommodation Service) of which we are a
sub-contractor (our portion is <15% of the overall contract)
through Amey. We will have at least 3 months of the contract in
2022 and will TUPE the affected employees at the end of the
contract.
The strong financial result was underpinned with excellent 'on
the day' execution by the team and continued cost control
throughout the year. Activity levels in the regions increased
strongly which offset a more subdued London market which we expect
to equalise during 2022.
Over the next 12-24 months our expectation is that there will be
pent up demand for office relocation and reconfiguration. A number
of companies and public sector organisations delayed lease breaks
and office changes that had been planned and this demand plus the
new demand posed by organisations needing to move offices with
lease breaks will mean a significant wave of activity. We have seen
in the last two months of 2021 increased proposal and quoting
activity, although we have seen a slower return to activity in
January following the latest restrictions. We are being cautious
with the addition of labour to meet this demand and we can flex
with our agency workforce as required.
Restore Harrow Green's strategy is to grow organically and
expand into new customer segments that value certainty of delivery
as demonstrated with our Life Sciences investment in Cambridge.
Although the strategy is focused on organic growth, we will look at
acquisition opportunities that may present themselves as we emerge
from COVID-19 to strengthen our regional footprint and also key
customer segments.
Outlook
Looking ahead we are seeing increasing demand for our mission
critical services and coupled with strong cost control and
acquisitions we expect to deliver further increases in EPS in-line
with our high growth strategy.
Despite macro uncertainty, we are well positioned for further
organic growth in 2022 and have an active pipeline of strategic
acquisitions to further build scale and capability. Inflation is a
headwind but with strong productivity gains and pricing, we are
confident in our ability to contain this risk.
In Records Management, we delivered 1.3% organic growth in boxes
in 2021 and we are determined to improve on this result in 2022 in
line with our guidance of between 1-2% organic volume growth, and
with price increases on the storage revenue increase in 2021.
Our margin expansion strategy over the medium term is very
clear, and, in the shorter term with continued scaling of the
business, higher margin services and tight cost control, we see a
good margin expansion opportunity on a business which is much
larger.
The financial strength stemming from strong recurring revenues
and long-term contracts coupled with high customer satisfaction
levels mean we can invest heavily for long term growth while
delivering in year increases in EPS. We operate in attractive
markets that are growing and also largely fragmented and so we have
significant organic and acquisition growth opportunity.
Our medium-term goal to increase run rate revenues from GBP260
million to between GBP450-500 million and double EBITDA of GBP74.2
million today to over GBP150 million is on track.
Trading since the start of the year has been in line with the
Board's expectations.
CFO's Statement
Restore has delivered a strong financial performance for 2021
with record levels of revenue and profit, positive organic growth
momentum and successful execution of a number of transformative
acquisitions.
The Group has delivered clear underlying business expansion and
successfully completed eight strategically aligned, high quality
business acquisitions at an investment cost of GBP86.3 million, net
of cash acquired, during the year to 31 December 2021. With
combined annualised revenues of c.GBP44 million and EBITDA of
c.GBP16 million after synergies, these investments are providing
strong returns and a post synergy ROIC of over 13.0%. These
investments have increased the number of boxes under management in
Records Management from 20 to 22 million boxes, more than doubled
the size of both Restore Digital and Restore Technology and further
enhanced the Group's scale, capability, and breadth of
products.
Reflecting this strong financial performance and confidence in
the Group's prospects, a final dividend of 4.7 pence per share is
proposed. Together with the interim dividend of 2.5 pence per
share, previously declared and paid, the total dividend for the
year to 31 December 2021 will be 7.2 pence per share (2020: nil
pence).
With revenues of GBP234.3 million for 2021, and an exit run rate
of GBP260 million, Restore has substantially increased in scale.
With a track record of strong cash generation, substantial balance
sheet capacity and significant opportunity for organic and
acquisition expansion, the Group is well placed for further growth
in 2022.
H1 H2 2021
Revenue GBPm GBPm GBPm
2021 106.1 128.2 234.3
2020 89.5 93.2 182.7
2019 106.2 109.4 215.6
2021 v 2020 119% 138% 128%
2021 v 2019 100% 117% 109%
------------- ------ ------ ------
Income Statement and profit performance
The Group's revenue for the year ended 31 December 2021 was
GBP234.3 million, an increase of 28% over 2020. This strong growth
reflects a return to largely normal activity levels during 2021
following the impact of COVID-19 on 2020 performance, underlying
organic expansion and the benefit of strategic acquisitions during
2021.
Revenue bridge GBPm
2020 Revenue 182.7
COVID-19 repair 10.2
Organic growth 9.2
Acquisitions in year 30.0
Full year effect of prior year acquisitions 2.2
2021 Revenue 234.3
--------------------------------------------- ------
As anticipated, 2021 saw a strong recovery from the impact of
COVID-19 restrictions on 2020 performance with revenues back to 95%
of pre-pandemic levels by the end of Q1 2021. The business
experienced a steady return of activity and underlying organic
expansion throughout the year although Restore Datashred was slower
to recover than other businesses repairing from 62% of pre-pandemic
revenue levels in Q1 2021 to 84% by Q4 2021.
Organic growth in the year, is estimated at GBP9.2 million with
identifiable, organic only effects derived from net box growth,
normal price increase and net contract wins. This represents an
organic growth rate of 5% and is in line with strategic objectives
as set out at the Capital Markets Day in November 2021.
Whilst COVID-19 recovery and organic expansion has been strong,
a number of headwinds remained in the year with potential to repair
further in the future. Notably, compared to the pre-pandemic
period, Restore Datashred revenues were down c.GBP10 million;
Restore Digital once again absorbed the cancellation of GCSE and A
level digital exam scanning at a revenue impact of c.GBP3 million;
and certain service income activities were lower in Harrow Green
(c.GBP4 million); and Records Management (c.GBP4 million).
Acquisitions in the year benefitted revenue by GBP30 million.
This annualises to GBP44 million and has driven a substantial
increase in the scale of the business from revenues of GBP215.6
million in 2019 to an exit run rate of GBP260 million by Q4 2021.
The returns on these investments have been excellent, achieving a
post synergy return in capital invested of 13.0%.
The business continued to focus on cost and margin improvement
during the year with a number of strategic cost initiatives
underway. Of note, the Group completed fuel supplier consolidation
in H1, entered into a strategic long-term lease in Heywood and
acquired a freehold in Sittingbourne to support Records Management
growth and reduce cost per box through increased storage density.
In Q4, the business commenced a strategic review of fleet
suppliers, in light of future ESG goals, and started to assess the
potential consolidation of security and facilities services across
the Group.
Using 2019 as a clean comparative, the key cost ratios have
remained flat through to 2021 with people costs at 43% of revenue
in 2021 and 2019, and with property lease payments at 8% of revenue
across the two periods.
As a result of the revenue expansion and productivity
improvements, the Group's adjusted profit before tax increased to
GBP38.1 million for the year to 31 December 2021 from GBP23.2
million for 2020, an increase of 64%. The operating margins also
showed positive momentum during 2021, growing from 18.5% in H1 to
20.7% for H2 to give a full year margin of 19.7% (2020: 17.4%).
The statutory profit before tax for the year to 31 December 2021
was GBP23.0 million (2020: GBP4.0 million). This increase results
from the positive trading reasons stated previously and the impact
of non-cash impairments in the prior year totalling GBP8.6
million.
Adjusted profit items
Due to the one-off nature of exceptional costs and the noncash
element of certain charges, the Directors believe that the
alternative performance measure of an adjusted profit before tax
and earnings per share provides shareholders and other stakeholders
with a useful representation of the Group's underling earnings and
performance. The adjusting items in arriving at the underlying
adjusted profit before tax are as follows:
2021 2020
GBPm GBPm
Statutory profit before tax 23.0 4.0
Adjustments
- Amortisation 10.7 8.3
- Impairment - 8.6
- Exceptional costs 4.4 2.3
Adjusted profit before tax 38.1 14.6
----------------------------- ----- -----
Amortisation has increased as a result of acquisition
investment. Details of exceptional cost movements are set out
below.
Exceptional costs
Restore's strategy is to grow through organic expansion,
strategic acquisition and margin enhancement through efficiency and
scale. To deliver these objectives, costs of a one-off or unusual
nature may occur and in order to give a suitable representation of
the underlying earnings of the Group, these costs are shown
separately.
2021 2020
GBPm GBPm
Acquisition transaction costs 1.2 0.1
Acquisition related restructuring costs 2.4 0.1
Restructuring and redundancy - 1.3
Other exceptional items 0.8 0.8
Total exceptional costs 4.4 2.3
----------------------------------------- ----- -----
Acquisition related transaction costs and restructuring costs
have increased from GBP0.2 million in 2020 to GBP3.6 million in
2021. This increase is as a result of the Group's eight
acquisitions during the year and represents 4% of the acquisition
investment during the year, in line with management
expectations.
Other exceptional costs in 2021 include legal and advisory costs
in respect of the unsolicited, non-binding, highly conditional
approach to the Group by Marlowe plc during the year (GBP0.5
million), and final adjustments to the penalty relating to an
incident at the Crayford site in 2018 (GBP0.3 million), with the
total fine finalised at GBP0.6 million.
Earnings Per Share (EPS)
Basic adjusted earnings per share are calculated by reference to
the adjusted profit for the year, less a standard tax charge, to
the weighted average number of shares in issue during the year.
The fully diluted adjusted earnings per share are calculated by
reference of the adjusted profit for the year, less a standard tax
charge, to the weighted average number of shares in issue and
options granted over the shares of the Group during the year.
2021 2020
Basic adjusted earnings per share from continuing
operations 23.2p 15.0p
Fully diluted adjusted earnings per share from
continuing operations 22.4p 14.6p
Basic earnings per share from continuing operations 8.7p 0.2p
----------------------------------------------------- ------ ------
The 55% year on year increase adjusted EPS reflects the 64%
increase in the Group's earnings in excess of the 6% increase in
the weighted average number of shares following the issue of equity
in support of acquisition activity in May 2021.
Interest cost 2021 2020
GBPm GBPm
Interest on bank loans and overdrafts 2.6 2.8
Interest on lease liabilities 5.2 5.4
Amortisation of deferred finance costs 0.3 0.3
Total 8.1 8.5
---------------------------------------- ----- -----
The bank interest cost for 2021 is slightly reduced compared to
2020 with the average debt balance broadly similar, although
generally increasing, through 2021.
Non-cash interest cost on the lease liability reflects the
application of IFRS16 and is slightly reduced from GBP5.4 million
in 2020 to GBP5.2 million for 2021 as the liability reduced during
the year from GBP120.7 million at 31 December 2020 to GBP117.0
million at 31 December 2021.
Taxation
The current tax charge for the period is GBP11.5 million.
Following the announcement on 3 March 2021 of a change to the UK
corporate rate to 25% in 2023, which has now been substantively
enacted, we have re-assessed the deferred tax position of the Group
which has resulted in an additional non-cash tax charge of GBP6.2
million being recognised in the income statement.
Cash generation and financing
The Group's cashflow continues to benefit from a high quality,
reliable customer base with very low levels of bad debt or late
payment. The free cashflow generation of GBP24.5 million for 2021
(2020: GBP29.6 million), reflects the continued high profit to cash
conversion characteristic of the Group and is after a working
capital outflow of GBP12.1 million primarily due to absorbing the
effect of the expansion of working capital in support of the
business growth of c.GBP2 million, working capital requirements
associated with acquisitions and full repayment of c.GBP8 million
of VAT deferred from 2020.
During the year, the Group substantially increased the pace of
business acquisitions and invested GBP86.3 million, net of cash
acquired, including deferred consideration. Whilst primarily funded
from the Group's debt facilities, the business also raised
additional capital of GBP38.1 million, net of issue costs, through
an equity placing in May 2021.
The Group continues to have significant headroom within its
borrowing facilities with the current Revolving Credit Facility
(RCF), which runs to April 2025, providing borrowing capacity of up
to GBP200 million plus a further uncommitted accordion of GBP50
million, leaving the Group with flexibility to invest as
opportunities arise.
Statement of Financial Position
The Group's balance sheet continues to be in good health with
key working capital ratios in line with previous years and further
expansion of the net assets of the business due to the profitable
nature of the Group's activities whilst balancing with returns to
shareholders.
2021 2020
GBPm GBPm
------------------------- ------ ------
Working capital* 12.8 3.3
Total Equity/Net Assets 265.2 218.6
Net Debt (post IFRS16) 217.8 186.8
Net Debt (pre IFRS16) 100.8 66.1
------------------------- ------ ------
*Trade and other receivables plus inventory less trade and other
payables
Working capital management remains a strength of the business
with debt ageing consistent at 51 days and the current asset to
current liability ratio improving from 1.2x to 1.4x. Total equity
has increased to GBP265.2 million (2020: GBP218.6 million) as a
result of the annual profit and the equity raise in May 2021.
The strength of the Statement of Financial Position is
indicative of the overall good health of the business and provides
substantial capacity to support future growth and investment
requirements.
Consolidated statement of comprehensive income
For the year ended 31 December 2021
Year ended Year ended
31 December 31 December
2021 2020
Note GBP'm GBP'm
=================================== ==== ============ ============
Revenue 2 234.3 182.7
Cost of sales (127.1) (105.9)
=================================== ==== ============ ============
Gross profit 107.2 76.8
Administrative expenses (61.1) (45.2)
Amortisation of intangible assets (10.7) (8.3)
Exceptional items 3 (4.4) (2.3)
Movement in trade receivables loss
allowance 0.1 0.1
Impairment of intangible assets - (7.0)
Impairment of investment - (1.6)
----------------------------------- ---- ------------ ------------
Operating profit 31.1 12.5
=================================== ==== ============ ============
Finance costs (8.1) (8.5)
=================================== ==== ============ ============
Profit before tax 23.0 4.0
=================================== ==== ============ ============
Taxation 4 (11.5) (3.8)
=================================== ==== ============ ============
Profit after tax 11.5 0.2
=================================== ==== ============ ============
Other comprehensive income - -
=================================== ==== ============ ============
Total comprehensive income for
the year and
profit attributable to owners of
the parent 11.5 0.2
=================================== ==== ============ ============
Earnings per share attributable
to owners
of the parent (pence)
=================================== ==== ============ ============
Total - basic 5 8.7p 0.2p
Total - diluted 5 8.4p 0.2p
=================================== ==== ============ ============
All the Group's results are from continuing operations.
The reconciliation between the statutory results shown above and
the non-GAAP adjusted measures are shown below:
Year ended Year ended
31 December 31 December
2021 2020
Note GBP'm GBP'm
========================================= ==== ============ ============
Operating profit - continuing
operations 31.1 12.5
Adjustments for:
Amortisation of intangible assets 8 10.7 8.3
Exceptional items 3 4.4 2.3
Impairment of intangible assets - 7.0
Impairment of investment - 1.6
Adjustments 15.1 19.2
========================================= ==== ============ ============
Adjusted operating profit 46.2 31.7
========================================= ==== ============ ============
Depreciation of property, plant,
and equipment and right of use
assets 28.0 25.7
========================================= ==== ============ ============
Earnings before interest, taxation,
depreciation, amortisation, impairment,
and exceptional items (EBITDA) 74.2 57.4
========================================= ==== ============ ============
Profit before tax 23.0 4.0
========================================= ==== ============ ============
Adjustments (as stated above) 15.1 19.2
========================================= ==== ============ ============
Adjusted profit before tax 38.1 23.2
========================================= ==== ============ ============
Consolidated statement of financial position
At 31 December 2021
Company registered no. 05169780
31 December 31 December
2021 2020
Note GBP'm GBP'm
=============================== ===== =========== ===========
ASSETS
Non-current assets
Intangible assets 8 327.2 247.4
Property, plant, and equipment 78.8 70.6
Right of use assets 102.5 107.1
Investments - -
Deferred tax asset 5.9 3.4
=============================== ===== =========== ===========
514.4 428.5
=============================== ===== =========== ===========
Current assets
Inventories 1.4 0.9
Trade and other receivables 56.9 41.2
Corporation tax receivable - 0.3
Cash and cash equivalents 10 32.9 26.4
=============================== ===== =========== ===========
91.2 68.8
=============================== ===== =========== ===========
Total assets 605.6 497.3
=============================== ===== =========== ===========
LIABILITIES
Current liabilities
Trade and other payables (45.5) (38.8)
Financial liabilities - lease
liabilities (18.2) (16.7)
Current tax liabilities (1.5) -
Provisions (0.9) (0.4)
=============================== ===== =========== ===========
(66.1) (55.9)
=============================== ===== =========== ===========
Non-current liabilities
Financial liabilities - borrowings 10 (133.7) (92.5)
Financial liabilities - lease liabilities (98.8) (104.0)
Deferred tax liability (33.9) (19.8)
Provisions (7.9) (6.5)
------------------------------------------ ------- -------
(274.3) (222.8)
------------------------------------------ ------- -------
Total liabilities (340.4) (278.7)
------------------------------------------ ------- -------
Net assets 265.2 218.6
------------------------------------------ ------- -------
EQUITY
Share capital 6.8 6.3
Share premium account 187.9 150.3
Other reserves 7.0 6.0
Retained earnings 63.5 56.0
------------------------------------------ ------- -------
Equity attributable to the owners
of the parent 265.2 218.6
------------------------------------------ ------- -------
Consolidated statement of changes in equity
For the year ended 31 December 2021
Attributable to owners of the parent
------------------------------------------------------
Share Share Other Retained Total
capital premium reserves earnings equity
GBP'm GBP'm GBP'm GBP'm GBP'm
----------------------------- --------- --------- ---------- ---------- --------
Balance at 1 January
2020 6.2 150.3 6.1 55.9 218.5
Profit for the year - - - 0.2 0.2
----------------------------- --------- --------- ---------- ---------- --------
Total comprehensive income
for the year - - - 0.2 0.2
----------------------------- --------- --------- ---------- ---------- --------
Transactions with owners
Issue of shares during
the year 0.1 - - (0.1) -
Current tax on share-based
payments - - 0.8 - 0.8
Deferred tax on share-based
payments - - (1.3) - (1.3)
Share-based payments
charge - - 1.2 - 1.2
Purchase of treasury
shares - - (0.8) - (0.8)
Balance at 31 December
2020 6.3 150.3 6.0 56.0 218.6
----------------------------- --------- --------- ---------- ---------- --------
Balance at 1 January
2020 6.3 150.3 6.0 56.0 218.6
Profit for the year - - - 11.5 11.5
----------------------------- --------- --------- ---------- ---------- --------
Total comprehensive income
for the year - - - 11.5 11.5
----------------------------- --------- --------- ---------- ---------- --------
Transactions with owners
Issue of shares during
the year 0.5 39.5 - - 40.0
Issue costs - (1.9) - - (1.9)
Dividends - - - (3.4) (3.4)
Current tax on share-based
payments - - 0.2 - 0.2
Deferred tax on share-based
payments - - 0.6 - 0.6
Share-based payments
charge - - 2.2 - 2.2
Transfer* - - (0.2) 0.2 -
Purchase of treasury
shares - - (2.6) - (2.6)
Disposal of treasury
shares - - 0.8 (0.8) -
Balance at 31 December
2021 6.8 187.9 7.0 63.5 265.2
----------------------------- --------- --------- ---------- ---------- --------
* In 2021 a net amount of GBP0.2m was reclassified from
share-based payments reserve to retained earnings in respect of
lapsed and exercised options.
Consolidated statement of cash flows
For the year ended 31 December 2021
Year ended Year ended
31 December 31 December
2021 2020
Note GBP'm GBP'm
========================================== ==== ============ ============
Cash generated from operating activities 9 59.9 66.9
Net finance costs (7.0) (8.0)
Income taxes paid (5.2) (7.2)
========================================== ==== ============ ============
Net cash generated from operating
activities 47.7 51.7
Cash flows from investing activities
Purchase of property, plant and
equipment and applications software (8.8) (7.3)
Purchase of subsidiary undertakings,
net of cash acquired (85.8) (3.4)
Purchase of trade and assets (0.9) (0.3)
Cash flows used in investing activities (95.5) (11.0)
Cash flows from financing activities
Net proceeds from share issue 38.1 -
Dividends paid (3.4) -
Purchase of treasury shares (2.6) (0.8)
Repayment of revolving credit facility (65.0) (13.0)
Drawdown of revolving credit facility 106.0 -
Lease principal repayments (18.8) (17.1)
========================================== ==== ============ ============
Net cash used in financing activities 54.3 (30.9)
========================================== ==== ============ ============
Net increase in cash and cash equivalents 6.5 9.8
========================================== ==== ============ ============
Cash and cash equivalents at start
of year 26.4 16.6
========================================== ==== ============ ============
Cash and cash equivalents at end
of year 10 32.9 26.4
========================================== ==== ============ ============
Notes to the preliminary financial information
For the year ended 31 December 2021
1. Basis of Preparation
The financial information in this preliminary announcement has
been extracted from the audited consolidated financial statements
for the year ended 31 December 2021 and does not constitute the
statutory accounts for the Group.
The consolidated financial statements of Restore plc have been
prepared in accordance with UK-adopted International Accounting
Standards in conformity with the requirements of the Companies Act
2006 as applicable to companies reporting under those
standards.
The consolidation financial statements have been prepared on a
historical cost basis, except for certain financial assets and
liabilities which are held at fair value. The accounting policies
have been consistently applied, other than where new accounting
standards have been adopted. The preparation of financial
statements in conformity with IFRS requires the use of certain
accounting estimates. It also requires management to exercise its
judgement in the process of applying the Group's accounting
policies.
The consolidated financial statements are presented in pounds
sterling and, unless stated otherwise, shown in pounds million to
one decimal place.
2. Segmental Analysis
During the year, the Directors have reviewed the Group's
operating segments, which has resulted in the classification of two
new operating segments: Digital & Information Management, and
Secure Lifecycle Services. The prior year comparatives have
therefore been restated in accordance with these new segments.
The vast majority of trading of the Group is undertaken within
the United Kingdom. Segment assets include intangibles, property,
plant, and equipment, right of use assets, inventories,
receivables, and operating cash. Central assets include deferred
tax and head office assets. Segment liabilities comprise operating
liabilities. Central liabilities include income tax and deferred
tax, corporate borrowings and head office liabilities. Capital
expenditure comprises additions to computer software and property,
plant, and equipment. Segment assets and liabilities are allocated
between segments on an actual basis.
Revenue
The revenue from external customers was derived from the Group's
principal activities primarily in the UK (where the Company is
domiciled) as follows:
(Restated)
2021 2020
Revenue - Continuing operations GBP'm GBP'm
================================= === ====== ==========
Restore Records Management 101.4 87.6
Restore Digital 36.9 18.5
Digital & Information Management 138.3 106.1
====================================== ====== ==========
Restore Technology 28.1 15.3
Restore Datashred 30.2 28.0
Restore Harrow Green 37.7 33.3
====================================== ====== ==========
Secure Lifecycle Services 96.0 76.6
====================================== ====== ==========
Total Revenue 234.3 182.7
====================================== ====== ==========
For the year ended 31 December 2021 no customers individually
accounted for more than 3% (2020: 3%) of the Group's total
revenue.
Segmental information:
(Restated)
2021 2020
Profit before tax GBP'm GBP'm
=============================================== === ====== ==========
Digital & Information Management 42.5 34.0
Secure Lifecycle Services 11.7 3.2
Head office (5.2) (4.5)
Amortisation of intangible assets (10.7) (8.3)
Impairment of intangible assets and investment - (8.6)
Exceptional items (4.4) (2.3)
Share-based payments charge (including
related NI) (2.8) (1.0)
---------------------------------------------------- ------ ----------
Operating profit 31.1 12.5
Finance costs (8.1) (8.5)
---------------------------------------------------- ------ ----------
Profit before tax 23.0 4.0
==================================================== ====== ==========
Digital & 31 December
Information Secure Lifecycle Head 2021
Management Services Office Total
GBP'm GBP'm GBP'm GBP'm
============================== ============ ================== ======= ===========
Segment assets 341.2 255.5 8.9 605.6
Segment liabilities 154.1 57.3 129.0 340.4
Capital expenditure 5.7 2.7 0.4 8.8
Depreciation and amortisation 26.2 12.1 0.4 38.7
============================== ============ ================== ======= ===========
(Restated)
Digital & (Restated) 31 December
Information Secure Lifecycle Head 2020
Management Services Office Total
GBP'm GBP'm GBP'm GBP'm
============================== ============ ================== ======= ===========
Segment assets 347.4 136.3 13.6 497.3
Segment liabilities 132.2 59.4 87.1 278.7
Capital expenditure 5.8 1.3 0.2 7.3
Depreciation and amortisation 22.6 11.3 0.1 34.0
============================== ============ ================== ======= ===========
3. Exceptional Items
2021 2020
GBP'm GBP'm
================================== ====== ======
Acquisition - transaction
costs 1.2 0.1
Acquisition related restructuring
costs 2.4 0.1
Restructuring and redundancy - 1.3
Other exceptional 0.8 0.8
------------------------------------ ------ ------
Total 4.4 2.3
==================================== ====== ======
Restore's strategy is to grow organically, through acquisition
and from unlocking margin expansion opportunities, particularly the
development of synergies across the Group. To deliver these goals,
costs of a one-off or unusual nature may occur and in order to give
a suitable representation of the underlying earnings of the Group,
these are shown separately.
Acquisition related transaction costs and restructuring costs
have increased from GBP0.2 million in 2020 to GBP3.6 million in
2021 as a result of the Group's eight acquisitions during the year.
Acquisition related exceptional costs represent 4% of the
acquisition investment during the year, net of cash acquired.
Other exceptional costs in 2021 include defence costs in respect
of a takeover proposal of the Group (GBP0.5 million), and the final
adjustment to the legal liability in 2018 (GBP0.3 million), for
which the total fine was GBP0.6 million, as disclosed in Group's
interim results. Other exceptional costs in 2020 include the first
part of legal liability above, employer's national insurance on
legacy share option exercises (GBP0.3 million) and the costs
associated with a corporate restructure (GBP0.2 million).
Restructuring costs in 2020 were as a result of the COVID-19
pandemic, where the Group sought to reduce costs in the business on
an ongoing basis through redundancies and site closures but had to
incur some one-off costs to implement this (GBP1.3 million).
4. Taxation
2021 2020
GBP'm GBP'm
========================================== ====== ======
Current tax:
UK corporation tax on profit for the year 6.8 4.1
Adjustment in respect of previous periods - (0.4)
=========================================== ====== ======
Total current tax 6.8 3.7
------------------------------------------- ------ ------
Deferred tax:
Current year 4.7 0.6
Adjustment in respect of previous periods - (0.5)
=========================================== ====== ======
Total deferred tax 4.7 0.1
------------------------------------------- ------ ------
Total tax charge 11.5 3.8
=========================================== ====== ======
The charge for the year can be reconciled to the profit in the
Consolidated statement of comprehensive income as follows:
2021 2020
GBP'm GBP'm
=========================================== ====== ======
Profit before tax 23.0 4.0
Profit before tax multiplied by the rate
of corporation tax of 19.0% (2020:19.0%) 4.4 0.8
Effects of:
Expenses not deductible 0.9 2.0
Adjustment in respect of corporation tax
for previous periods - (0.4)
Adjustment in respect of deferred tax for
previous periods - (0.5)
Share-based payments - 0.2
Effect of change in rate used for deferred
tax 6.2 1.7
Tax charge 11.5 3.8
============================================ ====== ======
The tax charge for the year is higher than the profit before tax
multiplied by the rate of corporation tax (2020: higher).
An increase in the UK corporation tax rate from 19% to 25%,
effective 1 April 2023, was substantively enacted on 24 May 2021.
This will increase the company's future current tax charge
accordingly. Deferred tax at the balance sheet date have been
measured using these enacted rated and reflected in these financial
statements.
5. Earnings Per Ordinary Share
Basic earnings per share have been calculated on the profit for
the year after taxation and the weighted average number of ordinary
shares in issue during the year.
2021 2020
======================================== =========== ===========
Weighted average number of shares in
issue 132,932,784 125,214,737
========================================= =========== ===========
Total profit for the year GBP11.5m GBP0.2m
======================================== =========== ===========
Total basic earnings per ordinary share 8.7p 0.2p
========================================= =========== ===========
Weighted average number of shares in
issue 132,932,784 125,214,737
----------------------------------------- ----------- -----------
Share options 4,736,714 3,543,950
========================================= =========== ===========
Weighted average fully diluted number
of shares in issue 137,669,498 128,758,687
========================================= =========== ===========
Total fully diluted earnings per share 8.4p 0.2p
========================================= =========== ===========
Continuing profit for the year GBP11.5m GBP0.2m
======================================== =========== ===========
Continuing basic earnings per share 8.7p 0.2p
========================================= =========== ===========
Continuing fully diluted earnings per
share 8.4p 0.2p
========================================= =========== ===========
Adjusted earnings per share
The Directors believe that the adjusted earnings per share
provide a more appropriate representation of the underlying
earnings derived from the Group's business. The adjusting items are
shown in the table below:
2021 2020
GBP'm GBP'm
=============================================== ====== ======
Continuing profit before tax 23.0 4.0
Adjustments:
Amortisation of intangible assets 10.7 8.3
Exceptional items 4.4 2.3
Impairment of intangible assets and investment - 8.6
Adjusted continuing profit for the year 38.1 23.2
================================================ ====== ======
The adjusted earnings per share, based on the weighted average
number of shares in issue during the year, 132.9m (2020:125.2m) is
calculated below:
2021 2020
========================================== ===== =====
Adjusted profit before tax (GBP'm) 38.1 23.2
Tax at 19.0% (GBP'm) (7.2) (4.4)
=========================================== ===== =====
Adjusted profit after tax (GBP'm) 30.9 18.8
=========================================== ===== =====
Adjusted basic earnings per share 23.2p 15.0p
=========================================== ===== =====
Adjusted fully diluted earnings per share 22.4p 14.6p
=========================================== ===== =====
6. Dividends
The Directors recommend a final dividend of 4.7p per share for
the year ended 31 December 2021 (2020: nil per share). The dividend
will be paid on 8 July 2022 to shareholders on the register at 6
June 2022. An interim dividend of 2.5p, amounting to GBP3.4
million, was paid during the year (2020: GBPnil).
7. Business Combinations
The Group's strategy seeks to target the substantial acquisition
opportunities that exist in all of the markets in which it
operates, whilst applying strict investment discipline. The Group
has completed eight acquisitions during the year.
On 8 January 2021, the Group acquired 100% of the share capital
of Computer Disposals Ltd ("CDL"), a Technology business, which
provides leading IT recycling and asset disposition (ITAD)
services. CDL operates from a state-of-the-art facility, which
provides further capacity for Restore's operations in the North
West of England. The acquisition has enhanced Restore Technology's
market share within the highly fragmented ITAD market.
On 1 March 2021, the Group acquired 100% of the share capital of
The Bookyard Ltd ("The Bookyard"), a Technology business, which
provides leading Apple recycling and spare parts services. The
Bookyard also operates two market-leading eCommerce sites,
www.mac2cash.com and www.click4mac.com which respectively, offer
trade-in and recycle options for Apple products throughout the UK.
The acquisition has further strengthened Restore Technology's
capability in the growing recycling market for Apple products.
On 15 April 2021, the Group acquired 100% of the share capital
of Big Data Management Ltd ("1BDM"), a leading high-quality Records
Management business. 1BDM is recognised as a high-quality operator,
and will increase Restore Record Management's market share in the
South East of England.
On 30 April 2021, the Group acquired 100% of the share capital
of Rainbow HoldCo Limited, which trades as EDM Group Limited
("EDM"). This acquisition is additive to the Group's core Records
Management business and transformational for its growing Digital
business. Digital is a core growth segment for Restore with a
sizeable UK addressable market, which is continuing to grow,
underpinning the long-term structural growth trends which have been
accelerated by COVID, with digitisation, flexible working and
security of data becoming increasingly necessary for all
businesses. The acquisition doubles Restore's existing market share
and creates a stronger business which will benefit from operating
as a larger platform, with the ability to deliver both cost
synergies and cross-selling opportunities through accessing the
wider service offerings.
On 9 August 2021, the Group acquired 100% of the share capital
of PRM Green Technologies Ltd ("PRM"), a Technology business, which
provides leading IT recycling and asset disposition (ITAD)
services. The business is located in Cannock in the Midlands, where
all processing is carried out. The acquisition has enhanced Restore
Technology's market share within the highly fragmented ITAD
market.
On 6 October 2021, the Group purchased the trade and assets of
PS Management Solutions Ltd ("PSMS"). The acquisition is additive
to the Group's Shredding business.
On 12 October 2021, the Group acquired 100% of the share capital
of The Document Warehouse (UK) Ltd ("TDW"), a Records Management
business which provides an additional, strategically well-located
freehold site with capacity to service the key London and the south
of England markets.
On 30 November 2021, the Group acquired 100% of the share
capital of Capture All Ltd ("Capture All"), a Digital business
based in Falkirk. Capture All is one of the UK's leading providers
in document scanning, storing, and archiving. The facilities will
be retained, and the business will continue to operate from this
location, providing an additional outpost for Restore Digital.
As the Group is still in the process of establishing the fair
value of the assets and liabilities acquired, the fair values
presented below are provisional .
The Bookyard
CDL GBP'm Capture
GBPm 1BDM EDM PRM PSMS* TDW All Total
GBP'm GBP'm GBP'm GBP'm GBP'm GBP'm GBP'm
----------------------- ------ ------------ ------- ------- ------- ------- ------- --------- -------
Intangibles - customer
relationships 4.6 - 1.1 27.6 4.7 0.8 1.7 0.2 40.7
Intangibles - software - - - 1.1 - - - - 1.1
Property, plant,
and equipment 1.3 - - 3.3 0.3 0.1 4.9 0.2 10.1
Right-of-use
Assets 0.4 - - 5.3 0.4 - - 0.2 6.3
Trade and other
receivables 0.5 - 0.2 6.1 0.9 - - 0.1 7.8
Inventories - 0.2 - - - - - - 0.2
Cash 4.7 0.1 0.1 4.8 0.3 - - 0.2 10.2
Trade and other
payables (1.7) (0.1) (0.1) (8.0) (0.7) - (0.2) (0.1) (10.9)
Lease liabilities (0.4) - - (5.3) (0.4) - - (0.2) (6.3)
Corporation tax (0.2) - - 0.3 (0.4) - - - (0.3)
Deferred taxation (1.0) - (0.2) (4.6) (1.1) - (0.6) - (7.5)
Provisions (0.2) - - (1.3) (0.1) - - - (1.6)
----------------------- ------ ------------ ------- ------- ------- ------- ------- --------- -------
Net assets acquired 8.0 0.2 1.1 29.3 3.9 0.9 5.8 0.6 49.8
----------------------- ------ ------------ ------- ------- ------- ------- ------- --------- -------
Goodwill 7.8 0.6 0.9 33.1 3.3 - 0.7 0.3 46.7
----------------------- ------ ------------ ------- ------- ------- ------- ------- --------- -------
Consideration 15.8 0.8 2.0 62.4 7.2 0.9 6.5 0.9 96.5
----------------------- ------ ------------ ------- ------- ------- ------- ------- --------- -------
Satisfied by:
Cash to Vendors 15.3 0.8 1.9 62.4 7.2 0.9 6.2 0.9 95.6
Deferred / contingent
consideration 0.5 - 0.1 - - - 0.3 - 0.9
----------------------- ------ ------------ ------- ------- ------- ------- ------- --------- -------
Total consideration 15.8 0.8 2.0 62.4 7.2 0.9 6.5 0.9 96.5
----------------------- ------ ------------ ------- ------- ------- ------- ------- --------- -------
*Trade and assets purchase
The fair value of acquired receivables is GBP7.8 million, which
is equivalent to the gross contractual amount of acquired
receivables due. The loss allowance recognised on acquisition is
not considered to be material. The Goodwill arising across the
acquisitions primarily represents the potential synergies and
cross-selling to the Group's existing operations; an extension of
the Group's national coverage, increasing the Group's market share;
access to new markets; and the skilled workforce and knowledge
acquired.
During the year, deferred consideration of GBP1.3 million was
paid, in relation to the acquisitions of Computer Disposals Ltd,
Euro-Recycling Ltd and Secure IT Disposals Ltd (2020: GBP0.1
million).
Post-acquisition results
The table below gives the revenue and profit for the
acquisitions completed in the year and included in the consolidated
results.
2021 2020
GBP'm GBP'm
================================================ ====== ======
Revenue 30.0 0.5
================================================ ====== ======
Profit before tax since acquisition included
in the Consolidated statement of comprehensive
income 6.3 0.1
================================================ ====== ======
If the acquisitions had been completed on the first day of the
financial year, Group revenue would have been GBP248.4m and Group
continuing profit before tax would have been GBP25.4m.
The acquisitions made during the year were to further extend
national coverage, increase customers and sites and increase the
Group's market share in its Records Management, Digital, Technology
and Shredding services.
8. Intangible Assets
Goodwill Customer Trade Applications Total
GBP'm relationships names software GBP'm
GBP'm GBP'm GBP'm
========================== ======== ============== ====== ============ ======
Cost
1 January 2020 164.1 125.9 4.3 6.1 300.4
Arising on acquisition of
subsidiaries 1.7 2.0 - - 3.7
Arising on acquisition of
trade and assets - 0.2 - - 0.2
Additions - external - - - 1.3 1.3
Disposals - - - (0.2) (0.2)
31 December 2020 165.8 128.1 4.3 7.2 305.4
-------------------------- -------- -------------- ------ ------------ ------
Arising on acquisition of
subsidiaries 46.7 39.9 - 1.1 87.7
Arising on acquisition of
trade and assets - 0. 8 - - 0. 8
Additions - external - - - 2.0 2.0
31 December 2021 212.5 168.8 4.3 10.3 395.9
========================== ======== ============== ====== ============ ======
Accumulation amortisation
and impairment
1 January 2020 10.6 26.4 2.2 3.7 42.9
Charge for the year - 7.1 0.3 0.9 8.3
Impairment 7.0 - - - 7.0
Disposals - - - (0.2) (0.2)
31 December 2020 17.6 33.5 2.5 4.4 58.0
-------------------------- -------- -------------- ------ ------------ ------
Charge for the year - 9.1 0.3 1.3 10.7
31 December 2021 17.6 42.6 2.8 5.7 68.7
========================== ======== ============== ====== ============ ======
Carrying amount
31 December 2021 194.9 126.2 1.5 4.6 327.2
-------------------------- -------- -------------- ------ ------------ ------
31 December 2020 148.2 94.6 1.8 2.8 247.4
========================== ======== ============== ====== ============ ======
9. Cash generated from operating activities
2021 2020
Continuing operations GBP'm GBP'm
================================================== ====== ======
Profit before tax 23.0 4.0
Depreciation of property, plant and equipment
and right-of-use assets 28.0 25.7
Amortisation of intangible assets 10.7 8.3
Net finance costs 8.1 8.5
Share-based payments charge 2.2 1.2
Impairment of intangible assets and investment - 8.6
Gain on disposal of property, plant and equipment
and right-of-use assets - (0.1)
(Increase) / decrease in inventories (0.3) 0.5
(Increase) / decrease in trade and other
receivables (7.8) 7.8
(Decrease) / increase in trade and other
payables (4.0) 2.4
--------------------------------------------------- ------ ------
Net cash generated from operating activities 59.9 66.9
=================================================== ====== ======
10. Financial Liabilities - Borrowings
2021 2020
GBP'm GBP'm
========================= ====== ======
Non-current
Bank loans - secured 134.0 93.0
Deferred financing costs (0.3) (0.5)
========================== ====== ======
133.7 92.5
========================= ====== ======
At 31 December 2021, the bank debt was due to The Royal Bank of
Scotland plc, Barclays Bank plc, Bank of Ireland, Clydesdale Bank
plc and Allied Irish Bank and was secured by a fixed and floating
charge over the assets of the Group. Under the bank facility the
Group was required to meet quarterly covenant tests in respect of
interest cover and leverage.
On 18 January 2022, the Group extinguished its financing
arrangement in place at 31 December 2021, and replaced it with a
new GBP200 million revolving credit facility
All covenant tests were met during the year and the Directors
expect to continue to meet the covenant tests under the new
facility.
2021 2020
Analysis of net debt GBP'm GBP'm
=============================== ======= ======
Cash at bank and in hand 32.9 26.4
Bank loans due within one year - -
Bank loans due after one year (133.7) (92.5)
================================ ======= ======
(100.8) (66.1)
=============================== ======= ======
11. Post Balance Sheet Events
On 18 January 2022, the Group extinguished its GBP160 million
financing arrangement in place at 31 December 2021, and replaced it
with a new RCF which runs to 30 April 2025, providing borrowing
facilities of up to GBP200 million plus a further uncommitted
accordion of GBP50 million. The Group has significant headroom
within its borrowing facilities which provides flexibility to
invest as opportunities arise.
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END
FR UVRRRUOUOAUR
(END) Dow Jones Newswires
March 16, 2022 03:00 ET (07:00 GMT)
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