Restore plc Raises FY26 Outlook After Strong Trading Update and Strategic Moves

Restore lifts FY26 outlook after strong 11-month trading: what’s new and why it matters

Restore has delivered a punchy trading update for the 11 months to 30 November 2025, signalling a strong FY25 and raising confidence for FY26. The group is simplifying, integrating and executing across its core divisions, with margins stepping up and cash generation staying healthy.

The headline: adjusted profit before tax (PBT) for FY25 on a continuing basis is expected to be ahead of consensus, and the group now expects to exceed its medium-term adjusted operating margin target of 20% in FY25. Looking into FY26, management expects adjusted PBT to be ahead of current market consensus despite a £1.0 million business rates headwind and the disposal of Harrow Green.

Information Management: storage growth, scanning synergies and NHS momentum

Storage pricing and property consolidation

Storage revenues continued to rise, helped by inflation-linked pricing now in place for most contracts. Restore is entering the final phase of its property consolidation programme, taking two new leases to complete the plan:

• Rainham: 0.3 million box capacity warehouse near its existing 2.0 million box capacity site (acquired with the bolt-on purchase of Archive Warehouse).
• Stroud: 0.4 million box capacity warehouse adjacent to its existing facility.

Boxes start moving in early 2026, which should help optimise footprint and cost. A reminder: consolidation reduces property costs, though the group notes business rates will rise from April 2026.

Digital scanning integration and contract wins

The digital scanning business integration is largely complete, with annualised savings in excess of £5.0 million – roughly double the original estimate. Delivery is everything in integration; this is a meaningful outperformance that supports margins.

Operational momentum is backed by wins: the previously announced Oxford University Hospitals medical records contract, plus a new award from North-West London GP Practices to be delivered in 2026. Restore also bought a scanning business from NEC Software that manages several NHS patient record contracts and local council mailrooms, deepening its footprint in regulated public-sector workloads.

Synertec: framework access for NHS Notify

Synertec continues to trade in line with expectations and has been included on a new four-year NHS Notify framework. That should add volumes from the first half of 2026, supporting growth in outbound communications.

Datashred: steady prices, higher visits and bolt-ons feed growth

Datashred saw strong revenue growth driven by increased visit numbers, largely stable paper prices and four acquisitions completed in 2025. The stability has been underpinned by hedging around half of volumes – essentially pre-arranging pricing to smooth volatility.

Integration work is mostly done for Shred-on-Site and three smaller bolt-ons. Management expects synergies to further improve profitability in 2026. That reads well for margin progression next year.

Technology: leaner, focused, and rebuilding margins

The Technology division is now leaner and refocused on larger customers with more uniform, higher-quality IT assets. Demand is firming as hardware refresh cycles normalise and more clients outsource their IT requirements, including via value-added resellers.

Divisional profitability is improving and moving towards the medium-term 15% adjusted operating margin target. Not there yet, but the direction of travel is positive.

Harrow Green disposal: cleaner portfolio, modest upfront cash

Restore has sold Harrow Green to Pickfords for £5.5 million cash, of which £2.0 million is contingent on FY26 performance. The disposal simplifies the group and removes a non-core business ahead of the next phase of growth. Note that consensus had included £2.2 million of adjusted PBT from Harrow Green in FY26, which will now be absent – yet management still expects to beat FY26 consensus at group level.

Financing: new £150m RCF boosts flexibility at better pricing

Restore has refinanced with a new five-year revolving credit facility (RCF) of £150 million, plus a £50 million accordion. An RCF is a flexible credit line the company can draw down and repay as needed. The facility, provided by a five-bank syndicate, replaces the previous RCF that was due to expire in April 2027 and comes at improved pricing, increasing balance sheet flexibility for organic and M&A opportunities.

Guidance, consensus and cash: the numbers that matter

Adjusted PBT is a non-GAAP measure that strips out certain items to give a clearer view of underlying performance. Restore’s guidance and the company-compiled consensus imply further upside:

Metric	Figure / Guidance
FY25 adjusted PBT (company-compiled consensus)	£41.2 million (range £39.3m-£43.6m)
FY25 adjusted PBT on a continuing basis (ex-Harrow Green)	£39.6 million consensus; company expects to be ahead
FY26 adjusted PBT (company-compiled consensus)	£46.5 million (range £43.1m-£49.0m); company expects to be ahead
Medium-term adjusted operating margin target	20%; expected to be exceeded in FY25 and sustained above in FY26
Technology medium-term margin target	15% adjusted operating margin
Cash conversion in the Period	In excess of 80%
Business rates increase from April 2026	~10% increase, c.£1.0 million annualised
Harrow Green sale proceeds	£5.5 million cash, of which £2.0 million contingent on FY26 performance
New RCF	£150 million, five-year term, £50 million accordion

Year-end net debt is expected to be in line with market expectations when adjusted for H2 M&A activity, although the precise figure is not disclosed.

My take: momentum is broad-based, with sensible de-risking

This is one of Restore’s cleaner updates in recent years. The group is getting simpler, integration is ahead of plan, and the balance sheet has been future-proofed with a larger, cheaper facility. Exceeding a 20% operating margin in FY25 – on a continuing basis – is a big statement and underpins the FY26 confidence.

Information Management is doing the heavy lifting: pricing is indexed, capacity is being rationalised, and scanning is landing high-quality NHS and council workloads. Datashred looks set for another leg up in 2026 as synergies land, and Technology is improving as customers resume refresh cycles. The sale of Harrow Green shows discipline; losing the FY26 profit contribution is acknowledged, but still covered by core growth.

Balanced view: what could go right – and what could bite

• Positives: higher-margin mix in Information Management, better-than-expected £5.0 million-plus annualised savings, NHS Notify framework access for Synertec, paper price hedging in Datashred, and >80% cash conversion.
• Negatives: April 2026 business rates increase (~£1.0 million) partially offsets property savings; integration risk after seven acquisitions in the year; continued reliance on public-sector volumes in scanning; and the Technology margin rebuild is still in progress.

What to watch next

• FY25 results confirmation: adjusted PBT “ahead” of the £39.6 million continuing basis consensus and operating margin above 20%.
• Box moves to Rainham and Stroud in early 2026 and any quantified property cost benefits.
• Synertec volumes under the NHS Notify framework from H1 2026.
• Datashred synergies flowing through in 2026 following integrations.
• Technology margin progression towards the 15% target.
• Year-end net debt and leverage metrics – not disclosed today.

Overall, this is an upbeat update: Restore is guiding to beat in FY25 and to be ahead again in FY26 even after allowing for the rates rise and the Harrow Green disposal. Execution remains key, but the mix, momentum and margin profile are moving in the right direction.