RC Fornax PLC (AIM:RCFX) finance director Rob Shepherd joined Proactive earlier this week after posting a strong trading update, pointing to accelerating revenue growth and improving sales visibility.
The company has already exceeded its previous full-year revenue within seven months, supported by a growing pipeline and repeat business.
Shepherd also highlighted a supportive backdrop from rising defence spending, alongside internal operational improvements that are beginning to translate into stronger commercial performance.
Proactive: I'm joined by RC Fornax finance director Rob Shepherd. It's very good to speak with you. What does this trading update tell retail investors?
Rob Shepherd: It’s very positive. What we’ve been trying to do is improve the quality of communications and demonstrate building order book, repeat business and suchlike. Those that followed us through IPO will know we had a tough period last year, but we’re now starting to see the benefits of the changes. There’s a bright future ahead for the company.
Proactive: Why is having over £5.1 million of sales visibility significant?
Rob Shepherd: It provides visibility and helps people understand forward momentum. We delivered just over £4 million in sales for the previous 12 months, and now seven months in we’re already in excess of that with a number of months to go. It’s all pointing in a positive upward direction.
Proactive: You highlight a growing mix of recurring and new orders. Why does that matter?
Rob Shepherd: Recurring revenue is really important. Our contracts tend to be up to 12 months, but we’ve identified customers we started with three years ago and are still working with. That repeatability shows customers value what we do. On new orders, bringing in a new sales director has improved processes, and we’re now seeing strong momentum from both existing and new clients.
Proactive: What’s driving improvements in commercial performance?
Rob Shepherd: There are two sides. Externally, there’s a positive macro environment given global uncertainty and defence demand. Internally, changes post-IPO, including new personnel, a new managing director and improved processes, mean we’re better positioned to take advantage of opportunities.
Proactive: How should investors think about the outlook given uncertainty around defence policy?
Rob Shepherd: We’re growing within the current budget environment. UK defence spending is around £64-65 billion, and we estimate an addressable opportunity of about £1.5 billion. We currently have a small share, so there’s significant upside. While clarity on defence spending will help, we’re already busy and seeing strong demand.
Proactive: Great speaking with you again.