Restore Plc · LSE:RST
Restore — Investor Day (November 2021)
44 slides from Restore's investor day presentation, Nov 11, 2021
Slide 1: 2021 Capital Markets Day
2021 Capital Markets Day 11th November 2021 Transforming, Growing with Strong ESG Commitments
Slide 2: Welcome
Chair – Sharon Baylay Welcome O Introduction O Board update O Clear strategy for significant growth in the short and long term O Strong leadership team 2021 Capital Markets Day Presentation 2
Slide 3: Agenda
Agenda O Growth & Profit Roadmap Todays Objective O ESG Strategy and Net Zero commitments O Business Unit Growth Strategy ESG Strategy & ambitious • Restore Records Management Net Zero targets • Restore Digital • Restore Technology Growth strategy of three O Trading Update transformed businesses uni
Slide 4: Introduction
Introduction Nigel Dews Sharon Baylay Charles Bligh Neil Ritchie, FCA Managing Director – Mark Horrocks Athena Ainsworth Non-Executive Chair CEO CFO Records Management Managing Director – Digital Managing Director – Technology Sharon Baylay was appointed Chair Charles Bligh was appointed CEO Neil wa
Slide 5: Excellent momentum in the business delivering record profits
Excellent momentum in the business delivering record profits We have growing momentum in all business units Run Rate Revenue is now at c.£255m* and EBITDA at c.£74m* demonstrating: 1 The critical nature of the services we provide 2 We are winning in the market 3 The 7 acquisitions of £84.8m are inte
Slide 6: Large, growing and fragmented markets with a strategy to deliver significant growth
Large, growing and fragmented markets with a strategy to deliver significant growth £1.9b market and growing Market Position No.2 No.1 No.2 No.1 No.1 Market Size £485m £320m £200-210m £350m £550m £1.9b Market Growth c.1-2% c.4% c.0-1% c.1% c.6% c.3% Market Share 22% 15% 19% 12% 6% c.13% Market Struc
Slide 7: ESG
ESG We’re delighted to launch our strategy “Restoring our World” 2021 Capital Markets Day Presentation 8
Slide 8: A strong foundation today
ESG A strong foundation today Environmental Social Governance Internal contribution Internal contribution Internal contribution • Sustainable land use • Sophisticated and well invested health and • QCA code adoption • Zero landfill objective safety team • Effective Board and sub-committee framework
Slide 9: Engaged external advisors and stakeholders to develop a new ESG Strategy
ESG Engaged external advisors and stakeholders to develop a new and comprehensive ESG Strategy which is action oriented with measurable KPI’s Our Strategy Restoring our World Our Vision To be game changers in safely leading businesses to a secure and sustainable future Focus areas Our Planet Our Peo
Slide 10: Our Planet – Restore's ESG Commitments
ESG Our Planet – Restore’s ESG Commitments Our Planet Net Zero TCFD Accreditation Waste Net Zero by 2035 Adoption of best Planet Mark To identify and across Scope 1 & 2 in class impact accreditation across reduce our waste reporting all Business Units Reduce 50% Scope 3 To assist out by 2030 Annual
Slide 11: Net Zero by 2035: A fleet and energy plan
ESG Net Zero by 2035: A fleet and energy plan Our Planet Our philosophy is to eradicate carbon emissions It is about being Zero Carbon NOT Carbon Neutral We know our Carbon footprint (Scope 1&2) and we will use 2019 as the base Group Business units Other Fuel Other Fuel Electricity 33% Natural Gas E
Slide 12: Net Zero by 2035: A fleet and energy plan
ESG Net Zero by 2035: A fleet and energy plan Our Planet We have a plan with known technology to get us 90% there... we need new technologies for HGV Trucks to emerge to beat our goal Electricity Fleet Waste Our journey to Net Zero £3m 540+ TBC Annual spend Vehicles and growing Single Use Plastic 80
Slide 13: Summary
ESG Summary O We have made good progress in the past across ESG O We have a much bolder and ambitious plan with measurable KPI’s O We will be transparent in reporting our progress O It is embedded in the way we run the business O It is an opportunity for the business 2021 Capital Markets Day Present
Slide 14: Restore Records Management
Restore Records Management A year of significant growth and investment c.£109m Revenue Run Rate – Up 14% vs 2019 54 sites. 5 freehold. 3 mines Over 10m scan on demand images Images scanned to support customer home working 2021 Capital Markets Day Presentation 16
Slide 15: A year of strong growth and delivering the strategy
A year of strong growth and delivering the strategy Run Rate Revenue is now c.£109m and growing which is a 14% increase on pre pandemic Activity levels strong Number of boxes stored (m) O Activity levels at 93% of pre pandemic levels and rising 25 20 O Public sector project revenue doubled on 2019 l
Slide 16: We are winning in the market and delivering consistent organic growth
We are winning in the market and delivering consistent organic growth Organic Growth We are winning in the market: O 154 new customers across public and private sectors • 132 (86%) with un-vended storage O £9.5m Department of Work and Pensions contract win O New contract with West Hertfordshire Hosp
Slide 17: Market trends are very positive for us
Market trends are very positive for us Organic Growth Physical Records O Organisations slow to adopt digital in the last 20 years and current customer feedback shows this is not likely to change O Strong pipeline for 2022 , customers continue to need safe, secure and close-by physical storage Digiti
Slide 18: Excellent progress with site consolidation to reduce costs
Excellent progress with site consolidation to reduce costs Margin expansion We have a clear strategy which is being delivered Organic growth means need capacity of Site capacity commitment this year c.25m boxes and with acquisitions c.30m boxes O increased by c.1.8m or 7% ready for further growth (i
Slide 19: We have significant acquisition opportunity
We have significant acquisition opportunity Acquisition Growth O Market continues to be fragmented with significant opportunity O Over 110 companies we are in contact with and c.17 active discussions O Acquisitions deliver synergies and improved margin O Significant benefits to customers with our in
Slide 20: Restore Digital
Restore Digital National large-scale information management and digital transformation business. £46m+ Run Rate Revenue 10 Processing sites >750 Staff c.2 bn Cloud hosted images 2021 Capital Markets Day Presentation 23
Slide 21: In the last 9 months we have transformed in size and capability
In the last 9 months we have transformed in size and capability Doubled in size: grown from £21m pa to £46m+ Run Rate Revenue Strong sales momentum Revenue (£’m) O New Sales Director 50 O Strengthening Business Development and 40 Inside Sales teams 30 O Focused on cross-sell of new services to other
Slide 22: Market leader with significant new and unique capability
Market leader with significant new and unique capability New and expanded capability helping clients in a hybrid physical/digital, pure digital or high tech world Digitisation Records Cloud Consulting Process Business process Preservation outsourcing automation Highly efficient and Preservation, Clo
Slide 23: Examples of what we do for clients
Examples of what we do for clients New and expanded capability helping clients in a hybrid physical/digital, pure digital or high tech world Complex scalable Cloud Consulting Process Business process digitisation outsourcing automation >35m images per month Secure, scalable cloud-hosted Archive reco
Slide 24: We operate in a large and growing market
We operate in a large and growing market Market size is £320m+ growing at least 4% O Hybrid working • Flexible, digital workflows to accommodate both We have c.14% market share with significant home and office working room to grow • Increasing demand in digital mailroom The long term trends are very
Slide 25: A clear growth strategy to deliver above market growth
A clear growth strategy to deliver above market growth Organic Growth Acquisition Growth Organic Growth O Physical to Digital consulting and other services O NHS scanning – increasing demand and market leader O Digital mailroom – increasing demand and wide ranging expertise O Digital solutions – inc
Slide 26: Restore Technology
Restore Technology The secure and sustainable choice for IT lifecycle services c.£30m+ Run Rate Revenue 7 Sites nationally with >400 staff 18,000 Clients served regularly >1.3m Assets processed annually 2021 Capital Markets Day Presentation 30
Slide 27: The market opportunity is significant and growing
The market opportunity is significant and growing A large market, in long term growth A market, with assured long term demand O Technology market spend, £500-600m and growing O Clients subject to increasing regulatory pressure at 6%+ pa which require our services O Demand for IT Recycling is directl
Slide 28: We have transformed our capability and size
We have transformed our capability and size £1bn+ TRIPLED IN SIZE: £30m+ Run Rate Market size Revenues with margin expansion O Increased operational scale O Increased value from integration O Increased efficiency Expanded capability and enhanced £325m Market size value proposition O Services opportu
Slide 29: Our business model is about scale, the foundation is built on trust
Our business model is about scale, the foundation is built on trust A scale brand, nationally known… O 7 sites distributed across the country Clients O 100 vehicles serving sites nationally Collect Assets from Clients 40% of Recycling revenues O More than 18,000 clients engaged regularly O Over 1.3m
Slide 30: We have exciting growth opportunities
We have exciting growth opportunities Organic Growth Our ambition will see us outpace the market O Drive growth in all aspects of our business; client, customer, operations, etc O Increased focus on client growth; new, existing, cross sell, client experience etc O Assess emerging demand in an evolvi
Slide 31: We have exciting growth opportunities
We have exciting growth opportunities Acquisition Growth A large number (>200) of companies to engage with. Significant active discussions with c.20 companies to acquire further scale and capability. Time to acquire is 2-4 months giving certainty to vendors. A continued ambition to scale through A p
Slide 32: Financial Review
Financial Review Restore is larger, stronger and growing 2021 Capital Markets Day Presentation 37
Slide 33: Trading update for 10 months to 31 October 2021
Trading update for 10 months to 31 October 2021* O Revenue run rate improved to £255m*, 19% ahead of pre COVID-19 levels, with annualised EBITDA tracking at £74m O Margins in line with expectations with increased scale offsetting inflationary pressure O Business Unit performance tracking well and de
Slide 34: Track record of consistent growth with strong momentum in FY21
Track record of consistent growth with strong momentum in FY21 O Strong track record of Revenue Track Record profitable growth Analysts projection with organic expansion only** £400m O Restore is exiting 2021 Current run rate £255m* Larger, Stronger and in excess of pre COVID19 levels £300m (+19% ov
Slide 35: Strong financial foundation with predictable, contracted income and strong cashflows
Strong financial foundation with high proportion of predictable, contracted income and strong cashflows Recurring profit Revenue mix Free cashflow (before dividend and acquisition) 100% Restore Technology 35 Adhoc 7% 90% Recurring activities 30 80% 25 70% Harrow Green Long term contracts 19% 60% 20
Slide 36: Substantial financial capacity to execute on strategic acquisition opportunity
Substantial financial capacity to execute on strategic acquisition opportunity Restore has an excellent £30m free cashflow reputation in acquiring generation high quality businesses and per year integrating these into its decentralised model. Plus Increasing £150m cash debt generation capacity O Hig
Slide 37: Strategic acquisitions delivering strong returns and value enhancement
Strategic acquisitions delivering strong returns and value enhancement Strategy Market Structure 2021 Delivery Highly addressable £84.8m deployed YTD acquisition October 2021 opportunity of £800M+ Partial Consolidation Highly Fragmented Highly Fragmented Fragmented Extremely Fragmented Others Restor
Slide 38: Investment case is clear and compelling
Investment case is clear and compelling O Leading positions in growth markets O Long standing customer relationships with high levels of customer satisfaction/retention O Business model based on high levels of long term contracted and recurring revenues O Attractive operating margins O Fragmented ma
Slide 39: For more information please visit
For more information please visit: 15/19 Cavendish Place London, W1G 0QE T: 020 7409 2420 E: info@restoreplc.com W: www.restoreplc.com
Slide 40: Appendix
Appendix 2021 Capital Markets Day Presentation
Slide 41: Restoring our world: Our ESG strategy
Restoring our world: Our ESG strategy To be a game changer in providing a safe, secure and sustainable future. www.restoreplc.com
Slide 42: Our Planet
Our Planet Climate action Becoming a net zero organisation by 2035 • Fleet electrification • Transition to 100% renewable energy • Seek opportunities to create renewable power Resource use Using sustainable resources across our organisation • Conversion to sustainable cardboard • Target zero single
Slide 43: Our People
Our People Safety and well being Ensure culture of safety and well being first • Safety and well being primacy on the agenda from Board to depot management • Engage collegues in developing health and safety culture • Review mechanisms assess well-being and to provide support • 100% of collegues rece
Slide 44: Our Business
Our Business Customer engagement Partner with our customers to deliver our ESG goals and enable them to deliver theirs • Work with our customers to help adapt to new operational method towards our ESG goals • Develop Net Zero products that support customers in reaching their scope 3 emissions • Impr