2nd Nov 2021 10:01
(Alliance News) - IWG PLC on Tuesday said it is set for recovery in 2022 after a double-digit revenue fall in the first nine months of 2021 as it mulls splitting off its digital and technology assets.
The Luxembourg-based flexible workspace provider said momentum in trading performance has accelerated during the third quarter of 2021, with progress made in all major territories, and the outlook for the remainder of the year remains encouraging.
"The order book for 2022 is building and, if market conditions remain favourable, continued progress is expected," IWG said.
IWG signed more than 1,100 new clients in the three months to September 30, it said, and more than 670 existing customers expanded their workplace commitments.
Total system-wide revenue in the third quarter increased 0.3% year-on-year to GBP620.7 million. Total revenue for the group - including closed centres - was GBP550.8 million compared with GBP571.8 million in the same period last year, a decrease of 0.3% at constant currency.
For the nine months ended September 30, revenue across all IWG's open centres declined 5.4% at constant currency to GBP1.56 billion, reflecting the impact of Covid-19 on the first quarter relative to the same period in 2020. Total group revenue decreased to GBP1.60 billion compared with GBP1.87 billion for the same period last year, a decrease of 11% at constant currency.
"Although we remain suitably cautious during this period of heightened macro-economic uncertainty, the occupancy and pricing run-rate achieved in the third quarter and in September in particular, underpin our confidence in delivering results for 2021 in line with management's expectations," the company said.
IWG also said it has undertaken a preliminary review to assess the "strategic and commercial rationale" for separating its digital and technology assets into a separate business. These assets include systems and processes to originate sales demand, manage inventory, and deliver services in an "efficient and cost-effective" manner.
It added: "Similarly, the potential to more broadly leverage the intellectual property of the group, together with the ownership structure of the property portfolio, is the subject of further review to fully assess the options available to reorganise the assets of the group."
IWG said it expects to be able to update on progress in the first half of 2022.
The FTSE 250-listed stock was trading 0.2% lower in London on Tuesday morning at 306.60 pence each.
By Evelina Grecenko; [email protected]
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