Restore trading in line as performance improves post-lockdown

Document management, commercial relocation and technology recycling company Restore updated the market on the first 10 months of its financial year on Thursday, reporting that overall activity levels in October were in line with the expected improvement in its trajectory

The AIM-traded firm said cash collection remained “strong”, adding that it was on track to deliver reduced net debt at year end of between £65m and £69m, pre-acquisitions.

Building on its growth in the third quarter, Restore said net box growth in its records management business continued to be positive in October.

It said the restructuring of the business would result in around 250 staff leaving the business, with that process beginning during August and running to November.

Following completion of the planned restructuring, about 7% of staff would remain furloughed on the government's Job Retention Scheme, which the board said underlined the “strong increase” in customer activity levels over the last six months.

Restore also noted the acquisition of high-security technology asset recycling company E Recycling on Thursday, which it said would further enhance its “strong position” in the “large and rapidly-growing” IT recycling market.

“Restore's strategy is to drive significant growth in shareholder value and we have clear priorities to deliver,” said chief executive officer Charles Bligh.

“We continue to see good activity levels across all business units and although it is too early to understand the impact of the recently implemented lock-down restrictions across the UK, we anticipate activity levels being similar to those experienced over the last few months.”

Bligh said the company had maintained strict cost management, adding that he expected to report strong cash generation for the year, with second half profits larger than those in the first half.

“Restore's recent acquisition is reflective of the increasing opportunity we see to accelerate our strategic delivery through a disciplined inorganic strategy, and we are well positioned to bounce back strongly in 2021.”

At 1154 GMT, shares in Restore were down 1.92% at 353.1p.