Rentokil Initial PLC Q3 Trading Update (8825M)

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RNS Number : 8825M

Rentokil Initial PLC

19 October 2016

RENTOKIL INITIAL PLC (RTO)

THIRD QUARTER TRADING UPDATE

19 October 2016

 
  (GBPm)               Q3 2016         Growth 
                           AER     AER     CER 
 Revenue                 578.3   32.1%   15.7% 
 Revenue - ongoing 
  operations(1)          576.7   33.1%   16.6% 
 

Performance Overview (CER)

Revenue from ongoing operations increased by 16.6% in Q3, of which 3.1% was organic (H1 2016: 2.5%) and 13.5% was from acquisitions. Year to date we have delivered organic growth of 2.7%. Pest Control delivered an excellent performance in the quarter, growing organically by 5.9%, and our Hygiene business demonstrated further improvement, growing organically by 3.2%. Growth in our Emerging (+20.4%) and Growth (+26.3%) markets was once again particularly strong. Our operations within the Manage for Value quadrant grew by 2.3% while the rate of revenue decline in our Protect and Enhance markets was largely unchanged from Q1 and Q2 at 1%.

The majority of our regions have performed well in the period reflecting good performances in Asia, Pacific, Latin America, the UK and in our largest market, North America. While conditions remain tough in parts of Europe, particularly in France, overall the region delivered modest revenue growth in Q3.

Also in the quarter Rentokil was proud to provide in partnership with the Rio de Janeiro health authorities, Pest Control, including innovative mosquito elimination, in advance of and during the very successful Rio 2016 Olympic and Paralympic Games.

M&A

The Company acquired 13 businesses in the quarter including ten in Pest Control and two in Hygiene, as well as the acquisition of Residex, a Pest Control and Turf Products Distribution business, as announced on 7 July. All of the acquisitions were in Emerging or Growth markets. Combined annual revenues of the businesses acquired totalled GBP88m in the 12 months immediately prior to acquisition. For the nine months to 30 September we have acquired 33 businesses with combined annual revenues of GBP109m. The integrations of Steritech and Residex are both progressing well.

Commenting on today's announcement Andy Ransom, Chief Executive, said:

"I am pleased with our performance in the third quarter. Pest Control grew organically by almost 6%, reflecting good performances in Asia, Pacific, Latin America, the UK and our key growth market of North America. I am also encouraged by ongoing traction in our Hygiene business which delivered organic growth of 3.2%. Our guidance for the full year is unchanged."

Enquiries:

 
                                  Rentokil 
 Investors       Katharine         Initial 
  / Analysts:     Rycroft          plc              07811 270734 
 
                                  Rentokil 
                 Malcolm           Initial 
 Media:           Padley           plc              07788 978 199 
  John Sunnucks    Bell Pottinger                   0203 772 2549 
 
 

AER - actual exchange rates; CER - constant 2015 exchange rates

(1) ongoing revenue excludes the financial performance of disposed and closed businesses but includes results from acquisitions

This announcement contains statements that are, or may be, forward-looking regarding the group's financial position and results, business strategy, plans and objectives. Such statements involve risk and uncertainty because they relate to future events and circumstances and there are accordingly a number of factors which might cause actual results and performance to differ materially from those expressed or implied by such statements. Forward-looking statements speak only as of the date they are made and no representation or warranty, whether expressed or implied, is given in relation to them, including as to their completeness or accuracy or the basis on which they were prepared. Other than in accordance with the Company's legal or regulatory obligations (including under the Listing Rules and the Disclosure and Transparency Rules), the Company does not undertake any obligation to update or revise publicly any forward-looking statement, whether as a result of new information, future events or otherwise. Information contained in this announcement relating to the Company or its share price, or the yield on its shares, should not be relied upon as an indicator of future performance. Nothing in this announcement should be construed as a profit forecast.

This information is provided by RNS

The company news service from the London Stock Exchange

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October 19, 2016 02:00 ET (06:00 GMT)