| Valuation method | Value, £ | Upside, % |
|---|---|---|
| Artificial intelligence (AI) | 113.76 | -57 |
| Intrinsic value (DCF) | 88.78 | -67 |
| Graham-Dodd Method | 0.13 | -100 |
| Graham Formula | 0.69 | -100 |
Restore plc is a leading UK-based provider of office and workplace services, specializing in digital and information management as well as secure lifecycle services. Operating primarily in the UK, the company serves both public and private sectors through its two core segments. The Digital & Information Management segment focuses on document storage, retrieval, and digital transformation services, including scanning, workflow automation, and AI-driven solutions. The Secure Lifecycle Services segment manages technology asset lifecycles, relocations, and secure shredding. With a strong presence in the specialty business services sector, Restore plc plays a critical role in helping organizations transition from paper-based to digital workflows while ensuring data security and compliance. The company's diversified service offerings position it as a key player in the UK's growing document management and workplace solutions market.
Restore plc presents a stable investment opportunity with moderate growth potential in the UK's business services sector. The company's diversified revenue streams across digital transformation and secure lifecycle services provide resilience against economic fluctuations, as evidenced by its low beta of 0.222. While the net income margin appears modest at 4.5%, strong operating cash flow of £58.5 million supports dividend payments (6p per share) and debt servicing. However, investors should note the relatively high debt-to-equity position (£237m debt vs £8m cash) and capital-intensive nature of the business. The stock may appeal to income-focused investors seeking exposure to the digital transformation trend in corporate services, though growth prospects may be limited by the company's UK-centric operations.
Restore plc competes in the fragmented UK business services market with a differentiated dual-segment approach. In Digital & Information Management, its comprehensive offering from physical storage to AI-driven automation creates stickiness with clients undergoing digital transformation. The Secure Lifecycle Services segment benefits from regulatory tailwinds around data security and sustainability. The company's competitive advantage stems from its national UK footprint and integrated service model that few competitors can match. However, it faces pricing pressure from smaller regional players in commoditized services like shredding, while competing with larger multinationals in digital transformation. Restore's middle-market positioning allows it to offer more personalized services than global competitors while maintaining better scalability than local providers. The main challenge lies in maintaining margins while investing in digital capabilities to stay ahead of tech-savvy competitors. The company's 2024 performance will depend on its ability to upsell digital services to its existing physical storage customer base while managing debt levels.