REACT’s FY25 year-end update is stronger than expected and should be welcomed by investors. We make four key points. (1) The Group delivered a clear beat to expectations, with revenue growth ahead of forecast and EBITDA at least 9% above consensus, marking a turnaround from May’s downgrade and the cautious interims. (2) Net debt of £5.3m (vs our £2.5m forecast) was higher than expected, reflecting strong Q4 trading and a temporary working capital outflow. (3) Trading momentum strengthened through H2, supported by resilient recurring revenues and strong execution at 24hr Aquaflow, driving renewed confidence in further margin progress into FY26. (4) We adjust our FY25 forecasts to reflect the beat but for now leave outer years unchanged, save for net debt. With improving earnings visibility, growing scale and disciplined capital allocation, REACT’s mix of essential, cash-generative services underpins a recovery case. Shares remain oversold on just 6x FY26 P/E reiterate Buy, 76p TP (10x Sep-26 P/E).
