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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| React Group Plc | LSE:REAT | London | Ordinary Share | GB00BPCTRB97 | ORD 12.5P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 73.50 | 72.00 | 75.00 | 73.50 | 73.50 | 73.50 | 14,469 | 08:00:29 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Bldg Clean & Maint Svc, Nec | 19.58M | 50k | 0.0000 | N/A | 784.72M |
From May 2019 to May 2024
TIDMREAT
RNS Number : 7175D
React Group PLC
28 June 2019
REACT Group PLC
INTERIM RESULTS FOR THE 6 MONTHSED 31 MARCH 2019
REACT Group plc is beginning to experience the benefits of recent restructuring, reporting an increase in turnover alongside rationalisation of the cost base and better debt collection, all of which has contributed to the reporting of improved financial results when compared on a like-for-like basis to the same period in the previous financial year, ending 31 March 2018.
We are delighted with the progress made on key appointments; the post-period appointment of Shaun Doak as Managing Director is the next step in developing the Company's sales and operational management strategy. Shaun's appointment is complemented by the arrival of Andrea Pankhurst as Group Financial Controller and the non-executive Board appointments of Michael Joyce, (BSc, ACA) and Rob Gilbert, all of whom joined the Company during the period.
Financial review
The financial performance of the Company is improving; revenues rose to GBP1.59m, up 8% on the prior year (GBP1.47m, 2018); gross profit rose to GBP419,000 up 23% (GBP340,000, 2018) and gross margins increased 330-bps to 26.4% (23.1%, 2018), as we improved resource scheduling and began to focus on more specialist work that produces higher margin. Administrative costs were GBP478,000, (GBP633,000 before the release of last year end's work in progress ("WIP") provision), a reduction of 5% (GBP667,000, 2018).
The overall operating loss of the Group for the period is GBP59,000 (loss of GBP327,000, 2018), an improvement of 82%. The Group loss of GBP59,000 includes net exceptional income of GBP107,000, which itself includes the release of GBP155,000 of the prior year's WIP provision, representing items now invoiced and paid.
In the previous year end accounts to 30 September 2018, the Company made provisions totalling GBP338,000, of which GBP268,000 was attributable to WIP and GBP70,000 of bad debt exposure. In the first six months of this financial year GBP155,000 of the WIP provision has been invoiced and paid. The remaining balance of WIP continues to be worked through, some has been invoiced awaiting payment and some has been written off as bad debt. The cash position at the period end was GBP446,000 (GBP464,000, 2018).
Strategy
REACT Group has core skills and experience in specialist cleaning beyond many of our competitors, allowing us to be a reliable solution to the challenging circumstances that arise across the Company's client base. We are an extreme cleaning company that tackles cleaning problems that non-specialists cannot or do not wish to cope with. Our highly trained operators deal with many difficult, yet essential cleaning tasks, across a broad range of circumstances, including on the UK's transport system, in prisons and custody cells, at crime scenes, clearing drug dens and property damaged by tenants and squatters, specialist vehicle cleans, clearing anti-social waste and damage in public spaces and both routine and specialist cleaning in hospitals and the health service.
Our strategy is to grow business in specialist markets that attract higher margins. We have a number of customers and prospects from both the Private and Public sectors who value the quality of service REACT Group provides; they in turn have potential for greater volumes of business geographically and for the additional services we provide.
We have cut ties with some organisations that have frustrated reasonable payment arrangements and/or are unwilling to acknowledge the value our services at an appropriate price. We believe the opportunity for growth with a number of both large and medium sized organisations, some of whom are already customers, is material; this is where the sales and business development efforts of REACT are now focused, whilst at the same time continuously improving operational quality and cost control.
Outlook
Through restructuring and strategic focus REACT is beginning to position itself well for future development. With the restructuring largely behind us and an experienced management team now in place, the focus is on building a scalable business producing profit and generating cash.
Gill Leates
Executive Chairman
28 June 2019
REACT Group PLC
Consolidated Statement of Comprehensive Income
For the six months ended 31 March 2019
Hot Features
Premium
Note 6 months 6 months Year ended
ended ended 30 September
31 March 31 March 2018
2019 2018
GBP'000 GBP'000 GBP'000
Continuing Operations
Revenue 1,588 1,470 3,295
Cost of Sales (1,169) (1,130) (2,602)
----------- ----------- --------------
Gross Profit 419 340 693
Administrative expenses (478) (667) (2,644)
Exceptional income/(costs)
included in administrative
expenses 107 (91) (1,337)
------------------------------------- ----- ----------- ----------- --------------
Operating loss (59) (327) (1,951)
Income tax credit - 21 21
Loss for the period from continuing
operations (59) (306) (1,930)
Loss for the period (59) (306) (1,930)
Other Comprehensive Income - - -
Loss for the financial period
attributable to equity holders
of the company (59) (306) (1,930)
=========== =========== ==============
Basic and diluted loss per
share 4
From continuing operations (0.01p) (0.11p) (0.67p)
=========== =========== ==============
REACT Group PLC
Consolidated Statement of Financial Position
As at 31 March 2019
As at 31 As at 31 As at 30 September
March 2019 March 2018 2018
Assets GBP'000 GBP'000 GBP'000
Non-current assets
Intangibles 174 1,378 174
Property, plant and equipment 80 182 116
------------ -------------------
254 1,560 290
------------ ------------ -------------------
Current assets
Trade and other receivables 994 888 1,141
Cash and cash equivalents 446 464 423
1,440 1,352 1,564
Total assets 1,694 2,912 1,854
============ ============ ===================
Equity
Shareholders' Equity
Called-up equity share
capital 1,039 689 1,039
Share premium account 4,926 4,889 4,926
Reverse acquisition reserve (5,726) (5,726) (5,726)
Capital redemption reserve 3,337 3,337 3,337
Merger relief reserve 1,328 1,328 1,328
Share based payments 20 22 20
Accumulated losses (3,922) (2,241) (3,863)
Total Equity 1,002 2,298 1,061
------------ ------------ -------------------
Liabilities
Current liabilities
Trade and other payables 692 614 793
Total liabilities 692 614 793
------------ ------------ -------------------
Total Liabilities and Equity 1,694 2,912 1,854
============ ============ ===================
REACT Group PLC
Consolidated Statement of Cash Flows
For the six months ended 31 March 2019
6 months 6 months Year
ended ended ended 30
31 March 31 March September
2019 2018 2018
GBP'000 GBP'000 GBP'000
Net cash generated from/ (used
in) operating activities 14 (150) (625)
Cash flows from financing activities
Proceeds of share issue - - 420
Expenses of share issue - - (33)
Other loans - - 69
Other loan repayments - - (21)
Net cash inflow from financing
activities - - 435
---------- ---------- -----------
Net cash from investing activities
Purchases of property, plant
and equipment 9 (17) (18)
Net cash outflow from investing
activities 9 (17) (18)
---------- ---------- -----------
Net increase / (decrease) in
cash, cash equivalents and
overdrafts 23 (167) (208)
Cash, cash equivalents and
overdrafts at beginning of
period 423 631 631
Cash, cash equivalents and
overdrafts at end of period 446 464 423
========== ---------- -----------
REACT Group PLC
Reconciliation of operating
loss to net cash outflow from
operating activities
6 months 6 months Year
ended ended ended 30
31 March 31 March September
2019 2018 2018
GBP'000 GBP'000 GBP'000
Operating loss from continuing
activities (59) (327) (1,951)
Depreciation and amortisation 29 79 1,350
Loss/(Profit) on disposal of
fixed assets (3) 10 10
Operating cash flows before
movements in working capital (33) (238) (591)
(Increase)/decrease in receivables 165 (128) (649)
Increase/(decrease) in payables (118) 216 615
---------- ---------- -----------
Net movement in working capital 47 88 (34)
---------- ---------- -----------
Net cash inflow / (outflow)
from operating activities 14 (150) (625)
========== ========== ===========
REACT Group PLC
Consolidated Statement of Changes in Equity
Six months ended 31 March 2019
Share
Merger Capital Reverse Based
Share Share Relief Redemption Accumulated Acquisition Payments Total
Capital Premium Reserve Reserve Deficit Reserve Reserve Equity
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 October
2016 689 4,889 1,328 3,337 (1,497) (5,726) 22 3,042
Loss for the
period - - - - (192) - - (192)
At 31 March
2017 689 4,889 1,328 3,337 (1,689) (5,726) 22 2,850
Loss for the
period - - - - (246) - - (246)
At 30 September
2017 689 4,889 1,328 3,337 (1,935) (5,726) 22 2,604
--------- --------- --------- ------------ ------------ ------------- ---------- --------
Loss for the
period - - - - (306) - - (306)
At 31 March
2018 689 4,889 1,328 3,337 (2,241) (5,726) 22 2,298
--------- --------- --------- ------------ ------------ ------------- ---------- --------
Issue of shares 350 70 - - - - - 420
Share issue
expenses - (33) - - - - - (33)
Loss for the
period - - - - (1,624) - - (1,624)
On lapse of
options - - - - 2 - (2) -
At 30 September
2018 1,039 4,926 1,328 3,337 (3,863) (5,726) 20 1,061
--------- --------- --------- ------------ ------------ ------------- ---------- --------
Loss for the
period - - - - (59) - - (59)
At 31 March
2019 1,039 4,926 1,328 3,337 (3,922) (5,726) 20 1,002
--------- --------- --------- ------------ ------------ ------------- ---------- --------
REACT Group PLC
Notes to the interim financial statements
1. Basis of preparation
These consolidated interim financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") as adopted by the European Union and on a historical basis, using the accounting policies which are consistent with those set out in the Group's annual report and accounts for the year ended 30 September 2018. The interim financial information for the six months ended 31 March 2019, which complies with IAS 34 'Interim Financial Reporting' were approved by the Board of Directors on 27 June 2019.
The unaudited interim financial information for the six months ended 31 March 2019 does not constitute statutory accounts within the meaning of Section 435 of the Companies Act 2006. The comparative figures for the year ended 30 September 2018 are extracted from the statutory financial statements which have been filed with the Registrar of Companies and contain an unqualified audit report and did not contain statements under Section 498 to 502 of the Companies Act 2006.
2. Principal Accounting Policies
The principal accounting policies adopted are consistent with those of the annual financial statements for the year ended 30 September 2018 and are those expected to be applied for the year ending 30 September 2019. There are no IFRSs or IFRIC interpretations that are effective for the first time in this financial period that would be expected to have a material impact on the Group.
3. Segmental Reporting
In the opinion of the directors, the Group has one class of business, being that of specialist cleaning and decontamination services. The Group's primary reporting format is determined by the geographical segment according to the location of its establishments. There is currently only one geographic reporting segment, which is the UK. All costs are derived from the single segment.
4. Loss per Share
The loss per ordinary share has been calculated on the loss on ordinary activities after taxation of GBP59,000 (30 September 2018: GBP1,930,000; 31 March 2018 GBP306,000) using the weighted average number of ordinary shares in issue during the period being 415,407,753 (30 September 2018: 287,298,164; 31 March 2018: 275,407,753).
Basic and diluted earnings per share are the same, since where a loss is incurred the effect of outstanding share options and warrants is considered anti-dilutive and is ignored for the purpose of the loss per share calculation. As at 31 March 2019 there were 5,134,077 (30 September 2018: 5,134,077; 31 March 2018: 18,904,564) outstanding share warrants and options which are potentially dilutive.
Copies of this Interim Report are available from the Company Secretary, 115 Hearthcote Road, Swadlincote, Derbyshire DE11 9DU and on the Company's website www.reactsc.co.uk/react-group-plc
This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
END
IR UBOVRKOANUAR
(END) Dow Jones Newswires
June 28, 2019 02:00 ET (06:00 GMT)
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