LONDON (Alliance News) - React Group PLC on Friday reported a sharp rise in its annual loss due to higher administrative costs.
Shares in React were down 14% at 0.18 pence each.
For the year ended September 30, the cleaning services firm widened its loss to GBP1.9 million from a GBP438,000 loss the year before.
React said the loss includes a non-impairment cash charge of GBP1.1 million against a purchased goodwill of GBP1.3 million in the balance sheet.
The company's revenue increased 27% to GBP3.3 million from GBP2.6 million. React's administrative expenses more than doubled to GBP2.6 million from GBP1.2 million in the same period a year prior.
Executive Chair Gill Leates said financial 2018 was a year of "significant change" for React. During the period, the company "severed the final administrative ties" with its previous owner Autoclenz.
Leates said the company has "re-engineered" its business and established its own administration and office infrastructure. React "simplified" its business model moving to one operating business from three.
The company expects a "material reduction" in operating costs going forward as it re-structures its fleet of vans and "begins to eliminate poorly priced" contracts.
Leates said: "With a rationalised infrastructure, a fit-for-purpose and well-motivated management team and a competitive service proposition in an area of the market often left well alone by competitors, we have established a solid platform from which we can now grow and begin our return to profit.
"Work on greater financial controls means that the company is moving closer to establishing a sound financial outlook in the current year."
React Group (REAT)