RE: Investors presentations10 Jun 2020 23:39
Cheers nims - here's my notes from the presentation too. Any corrections welcomed, but they seem to chime with yours!
- REAT have around 120 active customers, with a further 25 targeted at present
- to understand what the new management are achieving, there are three example clients in particular:
(1) rail client, used to spend £300k per annum,now spending £1m per annum with REAT
(2) FM client, used to spend £20k, now spends £150k per annum with more to come
(3) FM client, used to spend £13k, now spends £350k per annum and again more to come
- REAT provide essential, valued and higher margin work, NOT basic janitorial services
- focus is rail, FM and health, largely tier 1 customers
- roughly 50/50 split between recurring and reactive work. The market LOVES recurring income, and 50% is an impressively high number
- REAT were only England-based, but now looking to Scotland and Wales for contracts
- carried out thirty-five COVID-19 related deep cleans/disinfections per month since March, covering trains, jhudiciary transport vehicles, London offices, manufacturing plants etc at "strong margins"
- this work has more than offset any weakness in reactive work due to COVID-19
- the 23/1 £500k rail contract went exceptionally well with excellent closing reports
- the 14/5 £400k contract was won from a competitor
- the cash pile had increased from 31/3 even before the placing, and REAT are generating cash, with usually 30 days payment terms
- 20%-25% of revenues are delivered by subcontractors, who are audited and fitted out by REAT and effectively treated as employees to fit the high quality ethos
- the CFO stated REAT "continues to trade strongly"
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