Restore eyes more acquisitions

Data management and recycling specialist Restore has confirmed it is reinstating its dividend and is mulling over more acquisitions.

The firm issued a trading update covering its second quarter, ahead of full half-year results earlier this month, that revealed it would pay an interim dividend for FY21 and it has now followed that up with official confirmation and more details of the progress made so far this year.

The company said revenue increased by 19% to £106.1m and pre-tax profit for the six months to the end of June were £8.9m, which compared well to a loss of £3.1m a year ago.

Restore indicated that its first-half performance was above expectations and the market had started to recover and the business was in a strong position.

“These strong results demonstrate the commitment of our people to deliver the increasing demands from customers safely and, as a result, we have emerged larger, stronger and, in a lot of ways, a much better business from before the pandemic,” said Charles Bligh, CEO of Restore.

“The drive towards more flexible and sustainable ways of working in the public and private sectors is a significant positive for Restore and combining this with the ongoing focus on digitisation, security of data and certainty of delivery means the demand for our mission-critical services is growing.”

The firm also said it has plans to continue with its strategy of using acquisition as a means of growth, having already seen the benefits of previous deals. The business spent £80.9m in purchases during H1 and said it is engaged in more than 25 ongoing discussions, with several deals expected to be completed during the second half.

“Our current run rate revenue has expanded to £250m, which is 16% more than pre-Covid-19 and is set to continue to increase as a result of our clear growth strategy of strong organic expansion, strategic acquisitions and margin enhancement through synergy and efficiency,” said Bligh. “The strategic opportunity for Restore is compelling and the management team is committed to delivering a fast-growing business that exceeds our customers’ expectations and results in further excellent shareholder value creation.”

Restore hit the headlines earlier this year with two acquisitions, picking up Liverpool-based Apple recycling and spare parts specialist The Bookyard and Runcorn-based Computer Disposals. Those deals have already started to add to the bottom line, making a contribution to the business in the second quarter, and the firm has seen increased activity across the business.

Those deals included EDM, a digital and document management business, for £62.4m, which resulted in the significant expansion of Restore Digital and Restore Records Management, a bolt-on acquisition in Records Management, and The Bookyard and CDL acquisitions in Restore Technology, all contributing to the H1 performance.