REG - React Group PLC - Trading Update

ReactAnnouncement

16/11/2023 07:00

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RNS Number : 6142T  React Group PLC  16 November 2023

16 November 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 year
ended 30 September 2023.

 

·    Revenue of £19.6m (2022: £13.7m) - an increase of 43%

Ø Organic like-for-like revenue growth of 21%

·    Adjusted EBITDA in excess of £2.2m (2022: £953k) - an increase of
more than 130%

·    Net cash, less bank debt and finance leases of £0.7m (2022: -£0.1m)

 

Trading in the year has continued to be strong despite the economic headwinds
facing our industry. Subject to audit, revenue for the year will be
approximately £19.6m (2022: £13.7m), an increase of 43%. Organic
like-for-like revenue growth increased 21% on last year. The Group will report
an Adjusted EBITDA in excess of £2.2m (2022: £953k) an increase of more than
130%.

 

The award of new contracts has been consistently robust across the Group with
all divisions contributing to the significant growth in revenues. Amongst
many, these have included being awarded a £1.8m contract over three years
with a new customer to provide cleaning services to five shopping centres in
the West Midlands; a multi-year contract to perform deep cleaning, window and
façade cleaning across c.350 mainland UK locations for a prestigious
high-street fast-food chain worth £800k; and post period end a £3.8m
contract extension to provide contracted maintenance, cleaning and hygiene
services within the education sector for a major university.

 

Each division has performed well throughout the year which is testament to the
Group's acquisition strategy. LaddersFree has added its first full year of
trading to the Group and has made a considerable contribution to Group
profitability. Fidelis has more than doubled its revenue since its acquisition
two years ago whilst demand for REACT's dedicated services has returned and
remains buoyant.  Success cross-selling and upselling amongst the Group's
customers continues to build momentum, increasing share of customer wallet and
driving organic growth.

 

Key industry sectors driving growth include Facilities Management, where the
Group provides a valuable role performing specialist work through an
increasing number of FM providers; Retail, where the Group has seen growth in
the number of customers, although some have reduced frequency of cleans in
response to the current economic environment; Education, where the Group
continues to be selective to ensure quality of service and margins; and
Industrial, where the Group's contract and specialist cleaning capability is
in high demand.

 

Shaun Doak, Chief Executive, commented: "We are delighted with the trading
performance of the Group, achieving record revenue and profit growth in the
year. The pipeline for the new year is healthy and we are seeing strong demand
for all of our divisions. Our cross-selling ability throughout the business
not only enhances our offering but also improves and increases our sales
pipeline."

 

About Us:

REACT Group plc is the UK's leading specialist and contract cleaning business
and operates with three divisions: LaddersFree, one of the largest commercial
window cleaning businesses in the UK; Fidelis Contract Services ("Fidelis"), a
contract cleaning and facilities maintenance business; and REACT business,
which primarily provides a solution to emergency and specialist cleaning
situations, both through long-term framework agreements and on an ad-hoc
basis.

 

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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