28th Sep 2021 09:12
(Alliance News) - Rentokil Initial PLC on Tuesday lifted its medium-term targets as it plans expansion of the Hygiene category from the start of 2022.
The FTSE 100-listed pest control company said it now expects to achieve medium-term organic revenue growth of between 4% to 5%, up from previous guidance of 3% to 4% growth. Acquisitions could add another 2% to 5% growth to this, it said.
Rentokil said it expects to achieve higher growth in all of its units, but planned some reorganisation of them.
The Crawley, England-based company said it is expanding the Hygiene category with effect from January 2022. The enlarged category, called Hygiene & Wellbeing, will comprise its current Hygiene operations together with its Ambius, Dental Hygiene and Cleanroom services operations, previously part of the Protect & Enhance category.
In addition, Rentokil said its UK Property Care business - formerly a part of Protect & Enhance - will join the Pest Control category. France Workwear will become the company's third business category, meaning the Protect & Enhance division has been eliminated.
The Pest Control unit is targeted to increase organic revenue by between 4.5% and 6.5% over the medium-term. Hygiene & Wellbeing is seen growing by between 4% and 6%, and Workwear by between 3% and 4%.
The company's previous expectations were for organic revenue growth at the Pest Control unit of between 4% and 6%, while the Hygiene unit was expected to show between 2% and 3% growth.
It said no changes have been made to its capital allocation or dividend policy. Medium-term guidance for operating profit growth was edged up to "10%+" from "about 10%".
Rentokil said it will publish its third-quarter trading statement on October 21.
Shares were trading 1.8% lower in London on Tuesday at 567.20 pence each.
By Evelina Grecenko; [email protected]
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