Rentokil keeps the growth rolling for 12-year record: Securiguard evens out Australian and European disappointments
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Your support makes all the difference.RENTOKIL, the office cleaning and pest control group, has produced 20 per cent profits growth for the 12th year running.
However, the advance was only achieved at the interim stage thanks to the acquisition a year ago of Securiguard, the security group.
Without it, Rentokil's profit advance would have been 13 per cent. The company blamed disappointing experiences in Australia and the European continent for the underperformance. The shares fell 11.5p to 222p after the announcement.
Overall taxable profit for the half-year to 30 June was pounds 80.6m compared to pounds 67.1m last time. Clive Thompson, chief executive, said that Australia contributed an unchanged pounds 4.25m as the business had suffered intense competition.
He said the Australian companies' managements also fared poorly but that most senior managers had been replaced. In Europe Rentokil earned 9 per cent better profits at pounds 20.4m.
Mr Thompson said: 'Belgium, Spain, Switzerland and Sweden produced good results. Growth in Germany improved but performances in Italy and France were disappointing.'
In the UK - where most of the Securiguard business is located - Rentokil increased profit by 30 per cent to pounds 34.7m.
Securiguard, in the half-year under Rentokil's control, made operating profits of pounds 6.4m. In its last six months as an independent it made pounds 3.5m.
Mr Thompson said the improvement was won on broadly static sales. The margin improved from 3.8 per cent to 6.8 per cent.
He said most of the advance at Securiguard had been won as costs, mainly as cuts in fees to senior management. He also said that Rentokil had sold off less profitable businesses such as escorting court case defendants.
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