React Share Discussion Threads

[yump] 29/10/2020 13:46

Thats a good point - a pre-takeover tactic.

[zico01] 29/10/2020 11:17

REACT is still an early stage company but is generating accelerating traction in sales which has been reflected in strong growth in FY2020 and an encouraging outlook. We therefore remain very enthusiastic regarding prospects for the Group.

[zico01] 29/10/2020 10:57

Brokers note after the recent Trading Update;

www.allenbycapital.com/research_1088_2411331195.pdf

[superhoop2] 29/10/2020 04:43

In regards to subcontracting, could it not be a case of doing so and seeing how they get on, with the view of maybe making an approach to that company to become part of React? May be a smarter move than it initially appears.

[zico01] 28/10/2020 21:58

CEO of React Group :

interview with the CEO



What is your business looking to achieve?

We aim to be the go to and best in class specialist cleaning and decontamination business within the United Kingdom. React will continue to push the boundaries of methodology and set benchmark standards for the specialist cleaning sector. Despite our modest size, we have very strong customer advocacies which we aim to leverage further as we strengthen our brand and customer base.

Ultimately, we want the REACT brand to be synonymous with sector leading quality and expertise

What plans do you have for REACT over the next two years?

We aim to continue strengthening the sales and marketing function to scale the business through organic growth and carefully selected M&A. Our focus will remain on markets where REACT have clear differentiation, so that we strengthen customer relationships and secure reoccurring revenue streams.

[yump] 28/10/2020 20:24

I’m still quite interested in this stock so the chances of me going are small.

As I said I’m not sure what value to put on it and I’m sure others aren’t either.

Subcontracting isn’t a normal small company growth path, so I’m curious about the reason for that. It implies a temporary requirement which avoids permanently taking on staff.

[zico01] 28/10/2020 19:37

The compnay has been very bullish on it's social media platform;

ReactSC
@react_sc
·
As stated in our RNS update last week, both Covid-19 related decontaminations and other projects boosted our performance in the year ending 30 Sept 2020 - and we're still going strong

<<<<< we're still going strong >>>>>


ReactSC
@react_sc
·
As demand for our services is growing, we need to expand and find new ways of working. That’s why we’re looking to add to our partner network of #SubContractor cleaning specialists

<<<<< demand for our services is growing >>>>>

The current year has started very strongly

[zico01] 28/10/2020 18:55

!FOLLOWFEED
A profitable micro cap valued at £5.9m @ 1.175p with over £1.8m in cash at the end of September 2020.

In it's latest trading update on 21/10/2020 the company said it's revenue, profit before tax and cash generated are all ahead of market expectation.

The company will be growing it's revenue,profits and eps for the foreseeable future this in turn will increase the share price significantly

interviews with the CEO







"We are the extreme cleaning company that goes beyond the everyday to tackle cleaning problems that non-specialists just can’t cope with. From hotels to prisons, crime scenes to cruise ships, public spaces to private hospitals, we do what others can’t do – going beyond cleaning."

"REACT are the experts at decontamination of premises exposed to Coronavirus (Covid-19). Routine decontamination is insufficient and may spread rather than reduce contamination.


Key Infection Control Cleaning features

Rapid response 24/7/365.
Secure the area, protecting staff and public.
Test for contaminates pre- and post-clean.
Deploy BS EN 1276 chemical cleaners.
Superior quality PPE.
Clean and thoroughly disinfect.
Licensed to remove hazardous waste.
Experts in the specialist cleaning sector."

"The REACT business is experiencing high demand to provide decontamination and infection control services in all sectors particularly healthcare,rail,facilities management, education and care homes including the thorough deep cleaning of premises thought be harbouring SARS-CoV-2, the virus responsible for CV-19 (2019 novel coronavirus/COVID-19)."

A potential mutibagger or likely to be over taken by larger company

At the current price of 1.175p the company is trading on a prospective P/E of 10.
This is not taking in the cash £1.8m or any future acquisition(s).

For year just ended 30/09/20

revenue will be £4,400,000

For H1 revenue was £2,091,000 @ 33.2% margin giving GP £695,000 less admin exp.£632,000 and finance cost £13,000 giving a profit £50,000

For H2 revenue will be £2,309,000 @ 36%(est) margin giving GP £831,240 less admin exp £650,000 and finance cost £15,000 giving a profit of apprx. £166,000.

(admin could be slightly +/-)

Full year profit of apprx. £216,000 and eps of 0.049 (on 443.11m shares)
P/E at 1.175 of 24

There's no forecast from Allenby for current.The company stated in the recent T/U that momentum has continued in to the current year ending 30/09/21.

Assuming revenue increases by a modest 25%

Full revenue could be apprx. £5,500,000 @ 36.5%(est) margin giving a GP of £2,007,500 less admin exp. £1,325,000 and finance cost £30,000 (less £52,000 for any other exp) giving a profit of £600,000

A profit of £600,000 and eps of 0.12 (based on 495m shares)
We could exceed these numbers with acquisition(s)

A prospective P/E of 10
very cheap for a growth company that will be growing for the foreseeable future


Applying a P/E 30 for one year from now gives a price target of 3.6p

[investographer] 28/10/2020 15:47

Zico now filtered as I believe they are all the same person just clogging up this board.

[zico01] 28/10/2020 15:46

ReactSC
@react_sc
·
10m
We’ve worked with FM companies across multiple industries throughout the pandemic delivering #SpecialistCleaning.

They must be getting a lot business in the FM sector

[zico01] 28/10/2020 15:30

You don't get it do you
You pea size brain i criticize you when you post inaccurate and misleading information on this BB.
I'm not here to help you or answer your questions.You get this through your thick skull.

As you don't hold any shares and you do not contribute anything useful to investors on BB i'm requesting you to move on.

By all means come back and post much as you want to once you have BOUGHT the shares.

[yump] 28/10/2020 14:01

Why don't you do yourself a favour and actually address the two issues that I raised:

1. What the level of subcontracting was before, while margins were rising and what it might be going forward. NOT the past note: going forwards. It depends a lot on what sort of subcontracting they are talking about.

2. The problem of finding an acquisition, which you have repeatedly assumed will be earnings enhancing.

[zico01] 28/10/2020 09:28

I know what you posted you pea size brain.If you had read my post properly you would not have posted like you did.

You sold out 6 months ago and your still on this BB posting inaccurate information like low margins .

You read my posts but you cannot understand because your either thick or just plain stupid.

Margins have been increasing over the past 18 months even though they are subcontracting some work

Do us all a favour and MOVE ON

[yump] 28/10/2020 09:00

Zico

What I said was that partner network expansion is old news and that the margin for that work must surely be lower. Obviously the effect on total margin depends on how much subcontracted work they do. For all I know, up until now its been a very low proportion so has had little effect.

You could just try reading my posts instead of using what’s rattling around in your head.

You’re regarding all questions as opposition and avoiding anything that contradicts your view.

For instance you have assumed that an acquisition would be earnings enhancing and then completely avoided the problem of finding a worthwhile but cheap business.

That just undermines your bull case - which is your obvious ‘agenda’.

[rivaldo] 27/10/2020 23:02

Good to see 2m shares bought this afternoon and causing a tick up.

[investographer] 27/10/2020 22:36

Zico, do yourself & others on here a favour & block yump, safe & Sikh. They bring nothing to the table & have their own agenda.

[zico01] 27/10/2020 15:33

They're saying " demand for our services is growing " is todays tweet NOT old news
Yesterday they tweeted "we're still going strong"
These are indications that the business is trading very strongly which bodes well for current year.

Margins are about 36% and increasing
Since you don't own any shares you don't need to be concerned.

The company and business is just doing fine.

[yump] 27/10/2020 14:17

Partner network expansion is old news. The margin for that work is unknown afaik, apart from the fact that it must surely be lower.

[zico01] 27/10/2020 13:29

Another positive indication on their trading via the twitter;


ReactSC
@react_sc
·
53m
As demand for our services is growing, we need to expand and find new ways of working. That’s why we’re looking to add to our partner network of #SubContractor cleaning specialists

<<<<< demand for our services is growing >>>>>

[zico01] 27/10/2020 10:31

investographer

One has to make a decision when to buy(and sell)

The company is trading very strongly and will continue to trade very strongly for foreseeable future BUT this is not reflecting in the share price at the moment.The share price will start to re-rate. I'm convinced towards end of January after they published the final results more upgrades will follow and the share price will be a lot higher than todays.

I'm holding mine very strongly at the moment.

[investographer] 27/10/2020 09:42

Sounds very positive, but still lots of dumping going on here.A couple of one million sells gone through. No buys, no interest.My worst performer in m portfolio, so will now look to exit.

[zico01] 26/10/2020 16:06

from latest tweet ;

ReactSC
@react_sc
·
41m
As stated in our RNS update last week, both Covid-19 related decontaminations and other projects boosted our performance in the year ending 30 Sept 2020 - and we're still going strong

<<<<< we're still going strong >>>>>

October is coming to an end that's another month of strong trading and October being 1st month of new financial year

[safeone] 26/10/2020 10:58

They will not find any decent specialist company to acquire in the current market, or they will pay through the nose.

I advise this board to look at how their last acquisition went....

EPUK was acquired a few years ago, it was a totally mismanaged deal that ended up showing as a £400k write off in the accounts.

Do a little research and you will see that these small deals are fraught with dangers and given REACTS busy trading there will be little headroom to make sure this does not happen again.