Rentokil Initial (LSE:RTO)
Historical Stock Chart

From Apr 2019 to Apr 2024

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