Slide 1: 2024 Half year results
v 2024 Half year results Simple but not easy
Slide 2: Overview
Overview Our expectations for the Group’s full year performance remain unchanged Positives • Increased operating margin in Records Management • Stronger operating performance in Datashred • £70m 6-year contract win in Digital with DWP Headwinds • Very slow relocation market has reduced revenue at Ha
Slide 3: Overview (continued)
Overview (continued) Achievements over the last 9 months Ongoing action • Revitalisation of BUs through decentralisation • Digital to be integrated into Records Management with Digital locations reducing to 2 primary sites in • Reduced head office cost and renewed focus on treasury Wolverhampton man
Slide 4: Financial overview
Financial overview 44
Slide 5: Financial overview
Financial overview Solid revenues of £139.4m • Broadly flat with HY23 • Strong performance in Records Management, driven by RPI/CPI linked price rises on stable box numbers (22.5m at HY24, unchanged from FY23) • Technology is starting to benefit from the global IT hardware sales recovery • Offset by
Slide 6: Financial overview (continued)
Financial overview (continued) Adjusting items of £7.7m (HY23: £41.0m) • Adjusting items include £6.1m of non-cash items (primarily amortisation); £1.6m of cash adjusting items • HY23 included a non-cash impairment relating to Datashred goodwill of £32.5m Interim dividend of 2.0p (HY23: 1.85p) • Inc
Slide 7: HY24 revenue bridge
HY24 revenue bridge HY24 revenue broadly flat • Strong performance in Records Management, principally driven by RPI/CPI linked price rises • Headwinds from non-recurring one-off contracts in Digital in HY23 • Signs of improvement in Technology, in line with recovery in global IT sales • Headwind in
Slide 8: HY24 adjusted PBT bridge
HY24 adjusted PBT bridge 8% increase in adjusted PBT • Improved pricing, principally in Records Management • Inflation of £2.5m, mainly in people and property • Lower paper pricing (vs HY23) dropping through to profit (£65/tonne difference) • Cost savings in the business units combined with a scaled
Slide 9: HY24 finance charges
HY24 finance charges £0.2m increase in finance charges • Significant headwinds from higher base rates, c100bps increase relative to HY23 • Active treasury management has mitigated most of the headwinds: – removed surplus cash held which was not attracting interest (cash down from £23m at FY23 to £10
Slide 10: Divisions – Digital & Information Management
Divisions – Digital & Information Management Revenue HY24 HY23* Change Records Management (£’m) 64.0 59.3 8% Records Management Digital (£’m) 23.5 25.8 (9%) 22% 87.5 85.1 3% Profit and margin 7% £ 64.0 m Adjusted operating profit** (£’m) 24.6 20.9 18% Adjusted operating margin** (%) 28% 25% 300bps 7
Slide 11: Divisions – Secure Lifecycle Services
Divisions – Secure Lifecycle Services Technology Revenue HY24 HY23* Change 3% Technology (£’m) 17.0 16.3 4% 22% Datashred (£’m) 17.5 18.6 (6%) Harrow Green (£’m) 17.4 19.6 (11%) £ 17.0 m 51.9 54.5 (5%) 75% Profit and margin Adjusted operating profit** (£’m) 2.4 3.7 (35%) Datashred Storage income Adj
Slide 12: Cashflow
Cashflow HY24 HY23 Variance (£’m) (£’m) (£’m) Adjusted EBITDA* 38.9 38.3 0.6 • Strong free cash generation with a resulting cash Adjusting items – excluding amortisation (1.7) (2.2) 0.5 conversion* of 84% Share-based payments 0.8 (1.1) 1.9 • Working capital outflow principally due to normalisation o
Slide 13: Adjusting items
Adjusting items HY24 HY23 (£’m) (£’m) Cash adjusting items of £1.6m Impairment of non-current assets - 32.5 • Restructuring and redundancy costs of £0.7m: Amortisation of intangible assets 6.0 6.3 – finalisation of the Group-wide organisational restructuring and Acquisition related transaction/advis
Slide 14: Summary and outlook
Summary and outlook 14
Slide 15: Business outlook
Business outlook • Continued stability from recurring revenues. Digital & Information Management • Records Management continuing to increase operating margin, partly through the ongoing property consolidation project • Integration of Records Management and Digital expected to improve combined operat
Slide 16: Group outlook
Group outlook • Current focus is on improving operating margins, with a view to the Group targeting 20% adjusted operating margins in the medium term • Leading market position and recurring revenues underpin the profitability and cash generation of the Group • Cash generation expected to be healthy,
Slide 17: Appendix
Appendix 17
Slide 18: Glossary
Glossary Term Definition & calculation Adjusted operating profit Calculated as statutory adjusted operating profit before adjusting items. Net operating profit after tax Calculated as adjusted operating profit with a standard tax charge applied. APM used for calculation of cash (“NOPAT”) conversion.
Slide 19: Capital allocation framework
Capital allocation framework Targeted investments, with emphasis on organic growth Pay down debt, decreasing leverage whilst keeping the range 1.5-2x adjusted EBITDA Maintain dividends, increasing relative to our profits albeit at a measured and sustainable rate Limited share purchases, principally
Slide 20: For more information please visit: www.restoreplc.com
For more information please visit: www.restoreplc.com 7-10 Chandos Street, London, W1G 9DQ T: 020 7409 2420 E: info@restoreplc.com 20