A Scottish firm that developed pioneering technology to tackle health risks faced by construction workers has recorded a surge in sales after generating strong interest in the USA.
Edinburgh-based Reactec grew revenues by 40% in the latest year, to £5.6 million, from £4m in the preceding period helped by the launch of its R-Link smart watch.
The watch features technology that can monitor construction workers’ exposure to hand arm vibration. This can cause nerve damage and trigger debilitating conditions such as vibration white finger.
The growth in sales helped Reactec to move into the black in 2023. It made £66,000 profit after tax compared with a loss of £360,000 in the current year.
Chief executive Jacqui McLaughlin said the company enjoyed a strong first half to 2024, and has continued to achieve good sales growth.
She noted: “We are also encountering rising international interest, particularly from the US, which now accounts for 23% of the traffic on our website.”
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Ms McLaughlin said the growth in US business prompted the company to launch a US data centre earlier this month to provide analyses of the information gathered by its smart watches for customers.
Reactec’s success will be welcomed by technology sector watchers in Scotland. It underlines the potential of Scotland’s universities to develop world-class technology and the fact that the country has built the infrastructure required to help commercialise it.
Reactec was founded in 2001 as a spin out from the University of Edinburgh.
The company secured early stage backing from members of the Archangels investment syndicate. Scottish Enterprise provided funding alongside private investors.
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Reactec’s products are manufactured in Scotland.
It has updated its technology and service offering over the years to respond to market developments and the changing expectations of users.
In addition to recording exposure to vibration, the R-Link smart watch can alert users when they enter areas of potential risk. It provides data that employers can use to help monitor injury risk and to develop appropriate policies to reduce it.
The company said: “The R-Link watch, with its supporting fully integrated digital eco-system, and the powerful Reactec Analytics software, to transform the data, enables Reactec to deliver an unprecedented view of an employee’s risk environment to allow employers to refine controls and prevent future risk.”
Reactec said the growth in sales was supported by the company’s decision to introduce a “Safety as a Service” plan, under which customers can spread the cost of products over three years.
Some 50% of orders the company secured in 2023 were on a “Safety as a Service” basis. Orders increased by 50% in the year.
In October Reactec struck a sales deal with US-based pneumatic tools producer Honsa Ergonomic Technologies.
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The average number of people employed by the firm increased to 43 in the latest year from 40.
Reactec cut operating losses to £115,000, from £562,000.
Accounts filed at Companies House show the losses were offset by £222,000 credits in respect of tax in both years.
Archangels was founded in 1992 by estate agency entrepreneur Mike Rutterford and whaling sector veteran Barry Sealey, who passed away in May. The organisation says it has 120 members. These typically invest more than £10m per year in early stage Scottish companies.
Members have shown they are prepared to stay invested in firms for longer than the average of around five years for the private equity industry. The 20 firms in Archangels' current portfolio also include Speech Graphics, which supplies facial animation technology to the entertainment industry, and dental imaging specialist Calcivis.
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