Rentokil Initial 3Q Pretax Profit More Than Doubles
06 November 2009 - 6:52PM
Dow Jones News
Pest control and cleaning specialist Rentokil Initial PLC
(RTO.LN) Friday reported third-quarter pretax profit more than
doubled amid difficult trading conditions and said in the fourth
quarter it would continue to focus on delivering service, cutting
costs and generating cash.
Chief Executive Alan Brown said he would continue to drive
operational excellence through service productivity and reducing
administration and overhead costs but, above all, "we are focusing
on the development of a strong growth agenda."
Third-quarter pretax profit rose to GBP24 million from GBP11.1
million in the same period a year ago while revenue fell 3.2% to
GBP583 million. Rentokil's earnings were boosted by the
strengthening of the euro against sterling as some 70% of its
earnings are denominated in the common currency.
The company revised its guidance for its troubled parcels
business City Link, which is expected to make an operating loss of
GBP7 million for the full year, compared with GBP12 million
previously forecast.
Rentokil is undergoing a three- to five-year restructuring
process after the performance of its City Link business sparked
several profit warnings and a change of management. The company cut
its dividend as part of this process but CEO Brown said in July
that the company would reconsider its dividend in 2010.
Rentokil shares closed Thursday at 112 pence, giving the company
a market capitalization of GBP2.03 billion. They have more than
doubled in value since the start of the year on optimism about the
company's turnaround strategy.
-By Anita Likus, Dow Jones Newswires; +44 20 7842 9407;
anita.likus@dowjones.com
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