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Renew - QTS acquisition takes rail segment to 60% of profit

June 2018

Investing in shares may lose you all or some of your money. Past performance is no indication of future performance. Some of the shares recommended here may be small company shares, which can be relatively illiquid and hard to trade and this makes such shares more risky than other investments.

  • Epic Code:
  • RNWH
  • Price:
  • 400p
Renew has announced the acquisition of QTS for £80m and is funding it through a £45m placing of new shares at 355p and £35m of new debt facilities.Established in 1992, QTS’ historical mainstay was the removal of vegetation from Network Rail sites and although it still holds 10 of the 12 National Vegetation frameworks through to 2021, this is now only 20% of total sales. Instead, it has grown into a specialist engineer for Network Rail with services including civil works (with 10 frameworks representing 30% of sales); geotechnical and earthworks services (25% of sales); fencing (framework through to 2022 and 15% of sales) and plant hire (10%). In the year to March it had sales of £69.6m and generated a ...

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With small companies there is an above average degree of risk compared to buying blue chips. Please be aware that we have not assessed the suitability of any of these investments for you. The newsletter simply states a personal view and diarises the editor’s investment decisions. Please speak to your stockbroker or other qualified individual to ascertain whether any of these companies mentioned would form useful additions to your own portfolios. Past performance is no indication of future success.

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