Restore eyes public sector expansion

Revenue for records management – which accounted for 45 per cent of the group total – rose almost a quarter to £47.8m, largely thanks to last year's acquisition of TNT. The 4 per cent organic growth was driven by net box growth from new business wins, ongoing intake from existing customers and large contracts secured last year. Reflecting its increasing public sector presence, the group implemented a contract from a large London NHS Trust awarded in the third quarter of 2018. 

Datashred put in a comparatively subdued performance with just 1 per cent increase in sales, but that was set against a tough comparison period that saw elevated document destruction due to the introduction of the general data protection regulation (GDPR). Additionally, the business has experienced weaker recycled paper prices, primarily driven by reduced quotas into China. While 30 per cent of the division's revenue is derived from selling paper downstream, the group sees opportunities to gain overall shredding services market share from smaller operators more vulnerable to pricing pressures.

Incorporating the adoption of new lease accounting standards, Peel Hunt expects adjusted pre-tax profit of £38.8m and EPS of 24.9p for the full year, up from £37.5m and 24.2p, respectively, last year.