3rd May 2016 06:28
LONDON (Alliance News) - Office provider Regus PLC on Tuesday said it traded in line with management expectations in its first quarter, reporting improved margins, increased revenue and strong profit growth thanks to cost efficiencies and following the development of 554 locations in 2015.
Regus said its revenue grew to GBP532.5 million for the three months to March 31, compared with GBP452.3 million for the same period a year earlier, representing an increase of 15% at constant currency rates or 18% at actual rates, as prevailing exchange rates provided a "modest tailwind".
However, Regus added that cost efficiency continued through the quarter and resulted in a good margin performance, strong profit growth and robust cash generation.
Regus said its underlying cash generation during the period was double what it saw the same period a year earlier, at GBP56.4 million from GBP25.2 million, adding that the first quarter is normally the weakest for cash generation.
Regus said it added 42 new locations to its network during the period, and as at March 31 had a total of 2,799 locations. As of April 27, Regus said it had visibility on net growth capital expenditure for 2016 of around GBP120.0 million and represent approximately 350 locations.
Regus said its pipeline includes "a number of larger co-working locations in major cities, which have a higher associated net capital investment, excluding these, the average net capital cost per location continues to fall, demonstrating that we are being increasingly successful in achieving partnership deals".
Its year-on-year mature occupancy for the three months to March 31 was up 1.6 percentage points on a like-for-like basis to 79.1%, Regus said, with mature profit margins remaining strong and ahead of the previous year.
Regus said it remains condifent in delivering a full year result in line with management's expectations.
By Hannah Boland; [email protected]; @Hannaheboland
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