Rentokil revenues rise as pest control, acquisitions lend a hand
By Michele Maatouk
Date: Thursday 18 Apr 2019
(Sharecast News) - Rentokil reported a rise in first-quarter organic growth on Thursday, driven by its pest control business and acquisitions, as it said full-year results should be in line with market expectations
Ongoing revenue in the first quarter was up 8.9%, with 4% organic growth, up from 3.2% in the first quarter of 2018 and 3.7% for the full year, with 4.9% from acquisitions.
In the pest control division, ongoing revenue was 12% higher, or 5% stronger on an organic basis, with good performances across both growth and emerging markets, which rose 12.1% and 11.5%, respectively.
In the hygiene segment, meanwhile, ongoing revenue growth was 7.2% with organic growth of 4.3% versus 1.8% in the first quarter of last year. The group said ongoing revenue in its Protect & Enhance markets was in line with the corresponding period last year.
During the period, Rentokil signed eight acquisitions, four in pest control - primarily in North America and Latin America - and four in hygiene, with combined annualised revenues of around £29m in the year prior to purchase.
The group's guidance for M&A spend in 2019 remains in the range of £200m to £250m.
Chief executive Andy Ransom said: "We have had a good start to 2019 and I'm pleased with our performance in the first three months of this year. I am confident of another year of successful growth for the company, in line with market expectations."
The company also said it now expects a £40m surplus from the full-buy-out of the pension scheme.
At 0820 BST, the shares were up 0.5% at 369.90p.
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