This was a solid out-turn for Restore (RST) as the records management and archive service expanded organically and through acquisition. Core document management revenues were up by a third on the back of the ongoing integration of Wincanton Records Management, which it bought from the road haulier parent at the tail-end of 2015. And the group's existing businesses also performed creditably; a double-digit rise in relocation revenues fed through into a 37 per cent hike in half-year cash profits to £12.3m.
Management will be pleased with the group's operational progress including an improved showing in document scanning and margin expansion at the relocations segment. Restore Scan, the group's document scanning business, made a promising start to its long-term contract with the Nuclear Decommissioning Authority and beat its historic average by achieving operating margins in excess of 10 per cent during the period.
Full-year prospects were given a boost post period-end through an £83m deal to acquire PHS Data Solutions. This has transformed the scale of Restore's document shredding activities, leaving the group as the second-largest player in a growing market.
Analysts at Cenkos expect cash profits of £29.2m for the year to December 2016, giving way to adjusted EPS of 17.8p, rising to £38.1m and 21.6p in 2017.
| RESTORE (RST) | ||||
|---|---|---|---|---|
| ORD PRICE: | 356p | MARKET VALUE: | £399m | |
| TOUCH: | 355p-356p | 12-MONTH HIGH: | 367p | LOW: 246p |
| DIVIDEND YIELD: | 1.0% | PE RATIO: | 44 | |
| NET ASSET VALUE: | 101p* | NET DEBT: | 26% | |
| Half-year to 30 June | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2015 | 43.9 | 2.9 | 2.9 | 1.00 |
| 2016 | 55.4 | 3.7 | 3.8 | 1.33 |
| % change | +26 | +28 | +31 | +33 |
Ex-div:13 Oct Payment:11 Nov *Includes intangible assets of £118m, or 105p a share | ||||
