Repaired and better than new
Regenersis Plc. (LONDON:RGS) combines a robust services business with the potential for margin expansion and revenue growth from new services and software offered to the mobile phone and pay TV markets, most notably remote diagnostics. Additionally, in Blancco, it possesses exciting technologies and market positions in data erasure – an area that is becoming increasingly important for the public, enterprises and governments. However, the valuation remains more in line with a support services business than a high-growth, technology-driven business.
Repairs provide platform for technology growth
Management has transformed Regenersis from a Western Europe-focused repairs business to an international provider of services and software for diagnostics, repair and data erasure. The Depot Solutions repairs business provides a solid platform that management has built upon, providing extra services in the form of insurance solutions, in field testing and remote diagnostics systems. With the acquisition of Blancco last year, it has taken this one stage further, acquiring a leading position in the exciting data erasure software market.
Interim results reaffirm progress
The interim results, released on 17 March, showed the group’s strong progress. Depot Solutions demonstrated a solid performance, and the higher-margin Software and Advanced Solutions businesses produced strong growth in revenue and adjusted operating profit (equivalent to the company’s own headline operating profit (HOP). More importantly, there was encouraging news on the progress being made by Digital Care, IFT, Xcaliber and Blancco – the elements that we see as the main drivers to value growth.
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