REG - React Group PLC - Trading Update

ReactAnnouncement

24/04/2023 07:15

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RNS Number : 1375X  React Group PLC  24 April 2023

24 April 2023

 

REACT Group plc

 

("REACT", the "Group" or the "Company")

 

Trading Update

 

REACT Group plc (AIM: REAT.L), the leading specialist cleaning, hygiene, and
decontamination company, is pleased to announce a trading update for the six
months ended 31 March 2023.

 

Trading in the six months period has been strong and the positive contract win
momentum has continued with good sales growth in all three divisions of the
business. As a result, revenues for the period are expected to be
approximately £9.3m (2022: £5.1m) achieving a gross profit of approximately
£2.5m (2022: £1.2m) and an Adjusted* EBITDA of approximately £925k (2022:
£133k). The improved margins reflect a continuing improvement in mix of
business, to higher margin repeat business, and operational improvements made
within the Group.

 

LaddersFree, one of the largest commercial window cleaning businesses in the
UK, continues to strengthen its pipeline of repeat business with well-known
brands. In addition to the previously announced notable contract wins,
LaddersFree has been awarded contracts to provide services for retailers,
restaurants, hotels and car dealerships amongst others. The division continues
to attract higher margin contracts helping to deliver a considerable
contribution to Group profits.

 

As reported in the AGM statement, Fidelis experienced a slightly slower start
to the period however it has recovered significantly, achieving record
revenues in recent months. The division has been awarded both sizeable new
contracts and renewals including two material projects with schools, numerous
NHS Trusts and a specialist property services business that will generate
approximately £500k of revenue per year.

 

The REACT business, which primarily provides a solution to emergency and
specialist cleaning situations, both through long-term framework agreements
and on a one-off basis, has continued its steady progress and its bespoke
services remain in demand.

 

Commenting on the trading update Shaun Doak, Chief Executive Officer of REACT,
said: "We are delighted by the performance in the period with the Group
achieving record revenue and profit growth. The improved mix of recurring
revenue as well as higher margins provides the business with greater
visibility and a more dependable revenue stream. The pipeline for the
remainder of the year is strong, which provides cautious optimism and
underpins the Board's confidence in full year results being in line with
market expectations."

 

* Adjusted EBITDA represents earnings before separately disclosed acquisition
and other restructuring costs (as well as before interest, tax, depreciation
and amortisation).  This is a non-IFRS measure.

 

 

For more information:

 

 REACT Group Plc                             Tel: +44 (0) 1283 550 503

 Shaun Doak, Chief Executive Officer

 Andrea Pankhurst, Chief Financial Officer

 Mark Braund, Chairman

 Singer Capital Markets                      Tel: +44 (0) 207 496 3000

 (Nominated Adviser / Broker)

 James Moat / Philip Davies

 IFC Advisory                                Tel: +44 (0) 20 3934 6630

 (Financial PR / IR)

 Graham Herring / Zach Cohen

 

 

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