Rentokil have announced they will be increasing their interim dividend by 15.2% to 1.51p per share.
Other financial highlights include:
● Revenue, profit and cash in excess of medium-term targets: Ongoing Revenue up 8.8%, Organic Revenue up 4.2%, Ongoing Operating Profit up 11.6% and Free Cash Flow conversion of 93% (over last 12 months)
●Strong Organic Revenue growth of 4.2% equals our highest growth rate in the first half for over a decade, despite wet weather in North America in Q2
●11.4% Ongoing Revenue growth in Pest Control (4.8% Organic), driven by strong innovation and digital performance (H1 2018: 4.0% Organic)
●6.5% Ongoing Revenue growth in Hygiene (4.3% Organic), reflecting very good results in UK, Europe and Pacific and ongoing contributions from acquisitions (H1 2018: 2.1% Organic)
●0.4% pts improvement in Group Net Operating Margin at 11.9%, 0.5% pts improvement in North America Net Operating Margin at 12.1%
●Free Cash Flow of £95.9m, a £22.9m increase on the prior year (H1 2018: £73.0m)
●1.1% pts improvement in customer retention at 87.1% (1.8% pts improvement in Pest Control at 86.1%), 2.8% pts improvement in colleague retention at 87.0% (over the last 12 months)
●Continuing strong M&A performance:
17 businesses - 12 Pest Control, 5 Hygiene - acquired in Growth (9 deals) and Emerging (8 deals) markets with combined annualised revenues of c. £55m. Cash spend on current and prior year M&A of £120.9m.
7 pest control acquisitions in North America with c. $59m annualised revenues in H1 (vs Full Year 2018: c. $53m) including a Top 40 US pest control company, Active Pest Control, in Atlanta. New city entries in Jordan (Amman) and Sri Lanka (Colombo). Given progress in H1 and ongoing strength of pipeline, M&A spend for FY 2019 now expected to exceed £250m
●Sale of stake in JV with Haniel:
o Divestment of 17.8% interest in CWS-boco International GmbH to Haniel agreed on 30 July 2019 for cash consideration of €430m
o Carrying value of investment in JV at 30 June 2019 €290m, resulting in estimated profit on disposal of ~€140m
o Proceeds from the sale to initially reduce debt and then redeployed to support the Group's M&A programme
