Last checked at 15 Dec 2020 07:00
This announcement contains inside information
RA INTERNATIONAL GROUP PLC
("RA International" or the "Company")
Trading Update
Appointment of NOMAD and Sole Broker
RA International Group PLC (AIM: RAI), a specialist provider of complex and integrated remote site services to Humanitarian, Governmental and Commercial organisations globally, provides an update on current trading and announces it has appointed Canaccord Genuity Limited as NOMAD and sole Broker to the Company with immediate effect. Additionally, RA International management will host an online investor update and Q&A session on Thursday, 17 December 2020 at 1pm GMT. Further details for this event and how to register are set out below.
Trading Update
The Company expects to report revenue for the second half of 2020 of at least USD 28.0m and gross profit margin at least consistent with the 29.1% reported for the first half of the year. This reflects positive contract momentum during the period supporting a growing order book into 2021. A breakdown in revenue by service channel is set out below:
Integrated Facilities Management revenue for the second half is expected to be broadly consistent with H1'20 where the Company reported record IFM revenue for a six-month period of USD 15.9m. IFM revenue constitutes the majority of the Company's order book and continues to show resilience with minimal disruption despite the global impact of COVID-19.
Construction revenue, as previously highlighted, has been the area whereby COVID-19 has had the largest financial impact on the business, primarily as a result of projects being suspended earlier in the year. These suspended contracts have all subsequently restarted and we continue to deliver this work, however, as highlighted in September, the delays have led to a significant deferral of revenue to 2021. We expect to report revenue for the second half of 2020 of at least USD 7.0m, compared with first half revenue of USD 10.7m.
Supply Chain Services revenue has held up well in the second half of 2020. As previously highlighted, Supply Chain Services revenue in H1'20 included USD 2.7m of contracts relating to the provision of COVID-19 related PPE. We expect to report revenue for the second half of 2020 of at least USD 5.0m, compared with first half revenue of USD 6.1m, adjusted for the above-mentioned benefit.
The current order book of USD 187m highlights the positive contract momentum which has been a feature of 2020, particularly in the second half of the year. In terms of recent new contract wins, of particular note is a three-year IFM contract award in East Africa with a value of USD 5.4m.
Soraya Narfeldt, CEO of RA International, commented: "We exit 2020 encouraged by our financial performance during the year, our contract momentum and growing order book. Reported revenue for the second half of 2020 will be lower than the first half, which we expected in an environment where the COVID-19 pandemic has continued to present varied challenges for us and our customers. Looking ahead, we expect COVID-19 uncertainty to continue to influence customer decision-making, and this may affect the timing of commencement of new projects.
However, the risks associated with potential delays are increasingly offset by our growing order book, providing a stronger contractual baseline for the business year over year. This combined with the nature of our bid activity gives us confidence in our growth prospects going forward. We are growing with our customers, with clients recognising our global reach, and we are bidding on large, high value contracts, including a number of potentially significant bids in the commercial sector, a key growth area for us which is building real momentum."
Online Investor Presentation
RA International management will host an online investor update and Q&A session on Thursday, 17 December 2020 at 1pm GMT.
Anyone wishing to participate should register with PI World at:
https://bit.ly/RAI_Investor_update_webinar_piworld
A replay will be available subsequently on the Company website.
Enquiries:
RA International Group PLC Soraya Narfeldt, Chief Executive Officer Lars Narfeldt, Chief Operating Officer Andrew Bolter, Chief Financial Officer
| Via Bamburgh Capital |
Canaccord Genuity Limited (Nominated Adviser and Broker) Bobbie Hilliam Alex Aylen
| +44 (0)207 523 8000 |
Bamburgh Capital Limited (Financial PR & Investor Relations) Murdo Montgomery | +44 (0)191 249 7442 investors@raints.com |
About RA International
RA International is a leading provider of services to remote locations in Africa and the Middle East. The Company offers its services through three channels: construction, integrated facilities management and supply chain, and services three main client groups: humanitarian and aid agencies, governments and commercial customers, predominantly in the oil and gas and mining sectors. It has a strong customer base, largely comprising UN agencies, western governments and global corporations.
The Company provides comprehensive, flexible, mission critical support to its clients enabling them to focus on the delivery of their respective businesses and services. Focusing on integrity and values alongside making on-going investment in its people, locations and operations has over time created a reliable and trusted brand within its sector.