REG - RA Intnl Group PLC - Trading Update

Ra InternationalAnnouncement

16/02/2022 07:00

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RNS Number : 7929B  RA International Group PLC  16 February 2022

 

This announcement contains inside information

 

 

RA INTERNATIONAL GROUP PLC
("RA International", the "Group" or the "Company")

 

Pre-Close Trading Update

 

RA International Group PLC (AIM: RAI), a specialist provider of complex and
integrated remote site services to Humanitarian, Governmental and Commercial
organisations globally, provides a pre-close trading update for the 12-month
period to 31 December 2021.

 

The Company expects to report revenue for the year to December 2021 of
approximately USD 54m and an Underlying EBITDA of approximately USD 7m. While
revenue is in line with management expectations, reduced revenue in comparison
with the prior year impacted gross margin. Gross margin in the period was also
impacted by the general inefficiencies of operating under COVID-19, including
travel restrictions, quarantine requirements and supply chain delays. G&A
costs increased by USD 2m in the year, reflecting the full year impact of
investment undertaken in 2020 to support anticipated growth.

The Company order book as at 31 December 2021 was USD 100m, reflecting revenue
drawdown in the period and ongoing delays connected to new contract wins and
tenders. These projects remain in the pipeline, and we remain confident of
awards, however timelines are beyond our control.

The Group closed the year with cash on the balance sheet of USD 9m, resulting
in a modest net debt position of USD 1m. This reflects an additional USD 4m
tranche of debt raised under the Medium-Term Note programme and elevated
levels of Mozambique-related inventory which have not yet unwound due to
delays in commencing alternative projects.

 

Soraya Narfeldt, CEO of RA International, commented:

"This has been a frustrating period, with client and COVID-19 related
operating constraints continuing to cause inefficiencies and exceptional
delays in executing projects, in tender issues, awards and in project
mobilisations. This has impacted our profitability for the last six months of
2021 and also stalled our order book momentum. However, the underlying
business has remained profitable through this disruption and our solid balance
sheet supports our forward looking requirements.

 

As a management team we are not going to react passively waiting for these
headwinds to abate. We have reflected on our strong track record supporting
blue-chip customers in the Humanitarian and Government sectors relative to the
emerging opportunity we have in the Commercial sector. Over the last two years
or so, through the pandemic and other events, we have seen particular risks
and delays with new business activity in the Commercial sector. As a result,
going forward, we will be more selective in the projects we look to undertake
in this sector, and it will be less of a focus of our business development
activities.

 

Our confidence in our core business supporting our Humanitarian and Government
clients remains high. We are particularly encouraged about the opportunity we
have in the Government space, where we are building a specialist capability
with respect to supporting US government activity overseas, including with our
partner Cherokee Nation. We are also looking to prioritise work with UK
government departments including the MoD and the FCDO as well as other
international government agencies. Overall, we expect Government clients to
become an increasingly important part of our business over time, decreasing
the risk profile of our clients and diversifying geographically into markets
to mitigate operational risks. We will align our resources with these high
quality clients alongside our continued focus on securing high quality IFM
contracts.

 

We will update shareholders more fully with respect to our strategic focus and
outlook when we report our 2021 audited results, which we expect to announce
in late April 2022."

 

Enquiries:

 
 RA International Group PLC                                         Via Bamburgh Capital

 Soraya Narfeldt, Chief Executive Officer

 Lars Narfeldt, Chief Operating Officer

 Andrew Bolter, Chief Financial Officer

 Canaccord Genuity Limited (Nominated Adviser and Broker)           +44 (0)207 523 8000

 Bobbie Hilliam

 Alex Aylen

 Bamburgh Capital Limited (Financial PR & Investor Relations)       +44 (0)191 249 7442

 Murdo Montgomery                                                   investors@raints.com (mailto:rainternational@hudsonsandler.com)

 

 

About RA International

RA International is a leading provider of services to remote locations. The
Company offers its services through three channels: construction, integrated
facilities management and supply chain, and services three main client groups:
humanitarian and aid agencies, governments and commercial customers,
predominantly in the oil and gas and mining sectors. It has a strong customer
base, largely comprising UN agencies, western governments and global
corporations.

 

The Company provides comprehensive, flexible, mission critical support to its
clients enabling them to focus on the delivery of their respective businesses
and services. Focusing on integrity and values alongside making on-going
investment in its people, locations and operations has over time created a
reliable and trusted brand within its sector.

 

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