Renew Holdings (RNWH) CMD 2024 summary

Strategic direction and market positioning

• Maintains disciplined focus on non-discretionary UK infrastructure maintenance and renewals, targeting sectors with high barriers to entry and resilient long-term demand, supported by £600bn government investment planned until 2029.

• Achieved a 17% CAGR over five years, with balanced organic and inorganic growth, including 11 acquisitions and a strong M&A pipeline targeting consolidation, service expansion, and entry into new sectors like transmission, distribution, renewables, and environmental infrastructure.

• Holds market-leading positions in rail and water, deeply embedded in national programs, leveraging a direct delivery, asset-light model with high returns on capital (27–31% average ROCE over recent years).

• Positioned to benefit from the green infrastructure agenda, net zero 2050 targets, and increased climate resilience requirements.

• Ambitious yet cautious M&A approach, supported by a strong balance sheet, dedicated M&A director, and recent acquisitions expanding capabilities in highways, nuclear, and water.

Rail sector growth and innovation

• Largest supplier of asset renewals and maintenance to Network Rail, with 100% growth over two control periods and 50% growth in the last five years, now exceeding £400 million in rail revenue and holding major framework positions across all five devolved regions.

• Addressable market for CP7 (2024–2029) is £31.9bn, a 9% increase over CP6, with a total commitment of £45.4bn.

• Secured new and extended frameworks in CP7, including electrification and plant, with a focus on efficiency, innovation, and in-house design and manufacturing.

• Rail innovation includes bespoke equipment and methods, such as the QTS Mega Chipper and Soot Scabler, reducing carbon, improving safety, and supporting Network Rail’s decarbonization and efficiency targets.

• Collaboration through ARQ enables delivery of electrification projects, with a secured £240m framework for Wales & Western CP7.

Water sector expansion and AMP8 opportunity

• Water frameworks now contribute over 20% of group revenue, with national coverage and direct delivery capability exceeding 1,700 staff, and frameworks secured or extended with 10 of 12 UK water and waste companies.

• Strategic acquisitions, notably Enisca, enable a fully multidisciplinary service offering and off-site manufacturing, enhancing collaboration and national reach.

• Addressable market in AMP8 (2025–2030) expected to nearly double to £46 billion, driven by regulatory, climate, and population pressures, with an 87–100% increase in total spend proposed by water companies.

• Secured or extended 29 frameworks into AMP8, providing a strong pipeline for the next 10–12 years, and actively bidding for additional frameworks worth £150 million annually.

• Water sector growth driven by regulatory targets: 28% leakage reduction, new reservoirs, and £11bn to eliminate sewerage spills.