Half-year Report

2025 Interim Results

Performance and outlook in line with expectations

Improved cashflows. Cost savings on track. Encouraging recent lead generation

"We delivered a solid first half performance, in line with expectations, with Revenue growth of 3.1% and Adjusted Group Profit before tax (including discontinued operations) of $444m. We also delivered a strong free cash flow performance, with conversion of 93%, ahead of our guidance of 80%. Our sales and marketing initiatives in North America are starting to have an impact, with organic revenue growth of 1.4% in the second quarter up from 0.7% in the first quarter. We are refocusing our marketing budget towards driving organic lead flow and we are seeing encouraging results, including from our satellite branches, where we now have 100 in operation. While it is still early, we are encouraged with our progress, with residential and termite lead flow growing in June for the first time this year, up 6.6%. We are also encouraged by the early results that we are seeing from the door to door pilot that we started in the second quarter.

Improving our data analytics and insights is allowing us to more precisely target our underperforming branches with our new sales and marketing initiatives. Together with our integration experience, it is also helping us refine our integration plans and timelines. In H2 we will re-start integration with standalone, mainly commercial branches. Our expectations of the c.$100m cost reduction opportunity and attaining an operating margin in North America above 20% post 2026 remain unchanged, but our refined timelines may mean not all branches are fully integrated by that time.

Current trading is in line with expectations and our outlook for the remainder of the year remains unchanged. We expect to deliver FY25 results in line with market expectations."

H1 2025 Financial Highlights

H1 2025 Strategic Highlights

2025 Outlook and H2 current trading

A management presentation and Q&A for investors and analysts will be held virtually today, 31 July 2025 at 9.15am (UK time). Dial-in details will be provided on the website (https://www.rentokil-initial.com/investors.aspx). A recording will be made available following the conclusion of the presentation.

Notes

With effect from 1 January 2025 the Group changed its presentation currency from sterling to US dollars. All comparatives from 2024 have been represented in USD. In addition and following the acquisition of the Terminix business whereby the majority of the Group's revenues are now in North America, the Group's remaining regions have been combined into an International segment and reporting is on this basis. In order to help understand the underlying trading performance, unless otherwise stated, all commentary and comparable analysis in the summary and operating review relates to the continuing operations of the Group on a constant currency basis. The France Workwear business has been classified as a discontinued operation following the announcement of the intended sale of the business, and all comparatives have been represented accordingly.

1 Organic Revenue growth represents the growth in Revenue excluding the effect of businesses acquired during the year. Acquired businesses are included in organic measures in the year following acquisition, and the comparative period is adjusted to include an estimated full year performance for growth calculations (pro forma revenue).

2 Excludes costs to achieve which are one-off by nature. Non-IFRS measures - This statement includes certain financial performance measures which are not measures defined under International Financial Reporting Standards (IFRS). These measures include Adjusted Operating Profit, Adjusted Profit Before Tax, Adjusted Profit After Tax, Adjusted EBITDA, Adjusted Interest, Adjusted Earnings Per Share, Free Cash Flow, Adjusted Free Cash Flow, Adjusted Free Cash Flow Conversion, Adjusted Effective Tax Rate and Organic Revenue. Management believes these measures provide valuable additional information for users of the financial statements to aid better understanding of the underlying trading performance. Adjusted Operating Profit, Adjusted Profit Before/After Tax and Adjusted EBITDA exclude certain items that could distort the underlying trading performance of the business. An explanation of all the above non-IFRS measures used along with reconciliation to the nearest IFRS measures is provided in Use of Non-IFRS measures in the financial statements.

Summary of financial performance

Regional Performance

Category Performance

Revenue

Group Revenue increased 3.1% to $3,364m in H1. Group Organic Revenue grew 1.6%. Revenue growth in North America was up 2.0% (+1.1% organic). The International business performed well with Revenue up 5.1% in H1 (+2.7% Organic) with growth across the region.

Our Pest Control category grew Revenue by 2.9% (1.8% Organic) to $2,791m, driven mainly by 3.8% Organic Growth in our International region. Hygiene & Wellbeing Revenue increased by 4.3% (0.9% Organic) to $566m, driven principally by increased pricing.

Profit

Adjusted Operating Profit in H1 reduced by 4.5% compared to the prior period, to $511m, driven principally by the reduced profitability in North America from lower volumes more than offsetting profit growth in our International business. The period saw a 120bps decrease year on year in Group Adjusted Operating Margin to 15.2%. Within business categories, Adjusted Operating Margin for Pest Control was 18.0% (H1 24: 19.2%). Hygiene & Wellbeing Adjusted Operating Margin was 17.2% (H1 24: 17.2%).

Adjusted Profit before Tax of $418m, which excludes one-off and adjusting items and amortisation costs, decreased by 7.8% predominantly due to reduced profitability in North America. Adjusted interest of $98m at actual exchange rates was $15m higher year on year. One-off and adjusting items of $110m includes an increase to the provision for Termite Damage claims of $79m (H1 24:$nil), $30m (H1 24: $39m) of integration costs related to the Terminix acquisition and a net $1m (H1 24: $8m) of other M&A costs. Statutory Operating Profit was $304m (H1 24: $380m) with the decrease principally due to the $79m increase to the provision for Termite Damage claims. Statutory profit before tax was $216m (H1 24: $294m).

Cash Flow

Cash generation continues to be an important priority with a strong focus on operational cash conversion as well as a disciplined approach to working capital management, yielding improved results in the half year.

Net cash flows from operating activities were $412m. Free Cash Flow of $282m was $67m higher than in H1 24 due to an improved working capital performance. The $66m (H1 24: $5m) one-off and adjusting items is predominantly the increase in the provision for Termite Damage claims, offset by deferred consideration releases. 

The Group had a $51m working capital outflow in the first six months of the year, an improvement of $64m compared to the comparable period. The movement on provisions of $40m predominantly reflects the increase in the provision for Termite Damage claims. Capital expenditure of $89m was incurred in the period (H1 24: $89m), with lease payments at $90m, compared to $87m in the prior period.

Cash interest payments of $106m were $25m lower than in the prior year, principally reflecting changes in timing of bond interest payments. Cash tax payments for the period were $43m, an increase of $7m compared with the corresponding period last year. Adjusted Free Cash Flow Conversion was 93%, ahead of guidance.

Cash spend on current and prior year acquisitions was $70m, dividend payments were $198m and the cash impact of one-off and adjusting items was $48m, largely related to the costs associated with the Terminix integration.

For FY 25 we now expect c.$200m of M&A expenditure and capital expenditure of c.$210-220m. In addition to reducing net debt from the sale proceeds, the pending sale of the France Workwear business would reduce capital expenditure by c.$100m on an annualised basis.

Regional performance review

North America

North America includes Pest Control and Hygiene & Wellbeing and Business Services.

North America Pest Control Services is Pest Control excluding Business Services.

Half year Revenue was up 2.0%, with Organic Revenue up 1.1%. There was an improved performance during the half year with 1.4% Organic Revenue growth in Q2 (0.7% in Q1). Overall, good price realisation and contributions from acquisitions have more than offset volume reductions to deliver revenue growth. Organic Revenue growth in Pest Control Services for our commercial, residential, and termite customers was 0.1%, with Q2 driven by a stronger performance in June (0.3% in Q2, -0.2% in Q1).

North America Business Services has seen positive momentum during H1, with Revenue of $400m and Organic Growth of 5.8%.

During the period we saw ongoing price inflation, particularly in relation to labour. Consequently, Adjusted Operating Margin in North America declined to 16.9% and Adjusted Operating Profit of $356m was down 7.3%. Statutory Operating Profit was $213m.

In-bound residential lead flow remained weak until April but has seen substantial improvements since then as a result of our new sales and marketing strategies, with June lead flow up 6.6%.

Customer retention improved over H124, from 79.8% to 80.5%. Technician participation in the Trusted Advisor lead programme improved to 64% (FY 24: 50%), supported by stronger alignment between Sales and Service under Field Operations leadership, helping drive improved customer engagement.

Total North America colleague retention increased 2.9ppts to 80.7% (H1 24: 77.8%).

Our North American bolt-on M&A programme continued, with the purchase of 8 businesses with combined revenues of c.$18m in the year prior to purchase. We continue to selectively pursue high quality M&A assets in the North America region.

Integration update

Improving our data analytics and insights is allowing us to more precisely target our underperforming branches with our new sales and marketing initiatives. Together with our integration experience, it is also helping us refine our integration plans and timelines. In H2 we will re-start integration with standalone, mainly commercial branches and complete a detailed programme of work to make process, system and execution improvements in previously migrated branches, where lead flow and customer retention are not yet at their required levels. Our expectations of the c.$100m cost reduction opportunity from the integration and attaining an operating margin in North America above 20% post 2026 remain unchanged, but our refined timelines may mean not all branches are fully integrated by that time.

We continue to achieve cost synergies in 2025, whilst also continuing our investments in salary and benefit harmonisation, safety, innovation and IT. A number of efficiency programmes are underway to deliver the c.$100m cost reduction including a headcount reduction programme during the period, procurement initiatives to benefit from purchasing scale and back-office role outsourcing.

We continue to expect total one-time integration costs to be c.$350m. This encompasses c.$250m incurred to 2024 and c.$100m across 2025 and 2026.

Legacy termite warranty obligations

The methodology for assessing the appropriate provision in relation to termite warranty claims looks out over a sixteen year period and is sensitive to movements in the underlying assumptions relating to the number, location and severity of those claims. In the first half of the year we saw an increase in the number of complex litigation claims, outside of Mobile Alabama, when compared to similar claims in the same period of 2024. We also saw a 9% increase in the cost per warranty claim in the period, as a proactive strategy to solve customer problems and reduce litigation continues. As a result, the provision in relation to such claims has been increased from $236m at 31 December 2024 to $276m at 30 June 2025.

International

Revenue

Half year Revenue was up 5.1%, Organic Revenue was up 2.7%, with growth across the business.

Growth in Europe was particularly strong, driven by price increases and resilience in overall demand, predominantly from the Southern European countries of Portugal and Spain.

In Asia, we saw strong growth in Indonesia and India, supported in the latter by the acquisition and successful integration of the Hi Care business.

However, International growth was impacted by a weaker revenue performance in the UK, where strong performance in core Pest was offset by our Property Service business being impacted by the slowdown of the UK commercial property market and tightening Local Authority spending.

In our Pacific region, organic revenue growth was slightly below the average for International, with good growth in Pest Control and Ambius mitigating a flat organic performance in Hygiene. Within Pest Control, our contract business performed well, offsetting a subdued jobbing market, which was impacted by weather delays due to both flooding and droughts.

Profit

Adjusted Operating Profit of $242m was up 4.6%, broadly in line with revenue growth. Adjusted Operating Margin in our International division remained at 19.3%. Statutory Operating Profit was $214m, compared to $194m in the prior period.

Europe adjusted profit was slightly up, despite a small decrease in margin. While there has been ongoing inflationary pressure throughout the period, we have continued to be successful at mitigating its impact by pass-through pricing.

The UK and Sub-Saharan Africa region delivered resilient profit growth despite revenue headwinds against a continued subdued macro-economic backdrop. Adjusted Operating Profit increased ahead of the divisional average with operating margins also showing good growth in the period. The Hygiene and Wellbeing category showed good margin growth through price and yield management, continual focus on higher margins sectors, and continual process improvement

Within Asia and MENAT, operating profit increased ahead of the regional average. Margin was modestly up as a result of continued increasing scale in India and Indonesia, investment in Singapore in 2024 supporting margin improvement in 2025 and pricing continuing to improve in India.

Within the Pacific region, operating profit grew slightly below the overall International region, consistent with the revenue growth.

The International region acquired 10 businesses with total revenues in the year prior to purchase of $17m.

Category performance review

Pest Control

Our Pest Control business is the largest operator in both the US, the world's biggest pest control market, and the world overall, providing services in around 90 markets. We are a leading global player in a resilient and non-cyclical industry characterised by positive and strong long-term structural growth drivers.

Market

According to latest industry reports, published in H1 25, over the past 10 years the global pest control market has grown from a value of $14.4bn in 2014 to $27.3bn in 2024 at a CAGR of 6.6%. Industry forecasts for the next 10 years deliver a CAGR of 6.2% - with the value of the global market expected to reach around $50bn by 2034.

H1 2025

In H1 25, our Pest Control category grew Revenue by 2.9% (1.8% Organic) to $2,791m. Within the International business, good Revenue growth of 5.7% (3.8% Organic) was driven principally by the performance in Europe (3.8% Organic Growth) and Asia and MENAT (4.8% Organic Growth). In the UK our core Pest Control business grew 7.5% organically, held back by lower growth in Property Care. Pest Control Revenue growth in the International region of 5.7% was partially offset by growth of 1.9% in North America.

Adjusted operating profit of $501m declined by 4.2%, with International growth offset by decline in North America.

We acquired 16 Pest Control businesses in the period, with revenues in the year prior to acquisition of c.$32m.

Innovation and Technology

We lead our industry in the use of digital technologies in pest control, and we are continuing to build upon this competitive advantage. Our smart technology is providing more remote monitoring solutions and increased transparency of data.

Our digital Pest Control programme continues to move forward. An additional 106,000 PestConnect devices, which offer 24/7 monitoring, were installed in customers' premises over the last 12 months to 30 June 2025, and we now have around 540,000 devices operating in customers' premises. The number of connected customer sites has reached 32,500.

In H1, we began to roll out our first AI-enabled pest control services. Our new PestConnect Optix service utilises AI and motion-detection camera technology to identify individual rodents. Now in operation in the UK, France and Netherlands, it is adding predominantly one-time job revenue to existing customer accounts. We're also piloting this new service in Belgium, Norway, Portugal, Australia and the US.

Our Innovation teams have continued to explore ways to expand the AI-enabled Optix service to other services and different pest types and are currently piloting the new Lumnia Optix service - a digital insect light trap solution with camera and AI analysis. Launches are planned in the International region and then will be expanded initially into US key accounts.

Hygiene & Wellbeing

Rentokil Initial is a leader in the provision of hygiene and wellbeing services, operating in around 70 markets around the world. Inside the washroom we provide hand hygiene (soaps and driers), air care, in-cubicle (feminine hygiene units), no-touch products and digital hygiene services. In addition to core washroom hygiene, we deliver specialist services outside the washroom such as premium scenting, plants, air quality monitoring, green walls and specialist waste collection services.

Market

According to latest industry reports, published in H1 25, over the next 10 years the global Core Hygiene market is expected to grow at a CAGR of approximately 4%, driven by macro factors including the needs of an ageing population, the rise of urban populations and middle classes, and increasing hygiene expectations.

H1 2025

In H1 25, Hygiene & Wellbeing Revenue increased by 4.3% (0.9% Organic) to $566m, driven principally by increased pricing. Within Europe and LATAM revenue grew organically by 2.6% led equally by Core Hygiene and Enhanced Environments.

Within the UK and Sub-Saharan Africa region, a more challenging environment led to Organic Revenue decrease of 1.6%, while in our Pacific region market conditions remain challenging, with heightened price competition and lower customer retention resulting in low contract revenue growth in H1.

Adjusted operating profit increased by 5.0%, broadly in line with revenue growth as the pricing benefit and contribution from acquisitions more than offset the impact of cost inflation. Adjusted operating profit margins remained flat as pricing and tight cost control mitigated cost inflation.

We acquired two Hygiene and Wellbeing companies with revenues of c.$4m in the year prior to purchase.

Operational excellence

The Hygiene & Wellbeing business continues to focus on operational excellence, product development, disciplined sales activity and dedicated Hygiene digital marketing. It has shared overheads with Pest Control and areas of operational efficiency including density (route and product), improved colleague retention, deploying technology, and procurement - materials and product costs.

Disposal of France Workwear

On the 28 May 2025, we announced our agreement with H.I.G Capital for the intended sale of France Workwear which values France Workwear at a gross enterprise value of approximately €410m (c.$465m) on a cash-free debt-free basis including an earn-out mechanism with a maximum value of €30m (c.$34m) linked to the performance of the business in 2026. Total net cash proceeds are expected to be approximately €370m (c.$420m), subject to customary closing adjustments and the final earn-out outcome. Completion is expected to occur in late Q3 / early Q4 25. The business has been accounted for as a discontinued operation since 31 May 2025. In FY 24, France Workwear, including flat linen textile and clean room business, generated Revenue of $324m, Adjusted Operating Profit of $57m and had associated capital expenditure of $93m.

Good contributions from bolt-on M&A

In H1, we acquired 18 businesses, comprising 16 in Pest Control and two in Hygiene & Wellbeing for a total consideration of $68m, with revenues of c.$36m in the year prior to purchase. We added eight new businesses in North America during the period with c.$18m revenues acquired, and 10 businesses in our International region (annualised revenues of c.$17m).

M&A remains relevant for our strategy for growth. We continue to seek attractive bolt-on deals, both in Pest Control and Hygiene & Wellbeing, to build density in existing and new markets. Our pipeline of prospects remains strong and our current guidance on spend on M&A for FY25 is now c.$200m.

Employer of Choice

Rentokil Initial is committed to being a world-class Employer of Choice, with colleague safety and the attraction, recruitment and retention of the best people from the widest possible pool of talent, being key business objectives globally.

Group colleague retention continued to rise at 87.0% (H1 24: 85.9%).

Financial review

Central and regional overheads of $85m were up 8.5% on a constant currency basis predominantly as a result of inflationary increases.

With the exception of integration costs for significant acquisitions, the Group reports restructuring costs within Adjusted Operating Profit. Costs associated with significant acquisitions are reported as one-off and adjusting items and excluded from Adjusted Operating Profit. Restructuring costs of $2m were in line with the prior year.

Adjusted interest of $98m includes $15m of lease interest charges and a $24m offsetting reduction from the impacts of hyperinflation and net interest received. In the year, hyperinflation of $1m was $6m lower than the prior year (HY 24: $7m) due to a drop in hyperinflation in Argentina and devaluation of the Argentinian peso. Cash interest in HY 25 was $106m (HY 24: $131m), with the year on year reduction principally reflecting changes in timing of bond interest payments.

The income tax charge for the period on continuing operations at actual exchange rates was $52m on the reported profit before tax of $216m, giving an effective tax rate (ETR) of 24.2% (HY 24: 22%). The Group's ETR before amortisation of intangible assets (excluding computer software), one-off and adjusting items and the net interest adjustments for HY25 was 25.0% (HY 24: 23.1%). This compares with a blended rate of tax for the countries in which the Group operates of 25.2% (HY 24: 25.3%).

Group Free Cash Flow was $288m, $66m better than the prior period, predominantly due to an improved working capital performance and lower interest payments. After M&A spend of $70m, dividends of $198m and net debt related cash inflows of $562m, there was an increase in cash and cash equivalents of $534m compared to a decrease in the prior period of $125m. However, the weakening of the USD had a translational impact on our EUR and GBP denominated bonds carrying value as well as a positive impact on our EUR denominated derivatives leading to a net c.$175m adverse foreign exchange impact. This resulted in net debt of $4,220m, up $204m from the year end.

The debt related cash inflows of $562m resulted from the issuance of the Group's inaugural USD bond transaction in April, raising $1.25bn across two tranches; $750m 5 year bond at 5.0% and a $500m 10 year bond at 5.625%. Subsequently the Group repaid its $700m term loan which was falling due in October 2025.

As at 30 June 2025, the Group had liquidity headroom of $2,003m, including $1,000m of undrawn revolving credit facilities, with a maturity date of October 2029. The net debt to Adjusted EBITDA ratio was 2.8x at 30 June 2025 (31 December 2024: 2.7x).

An interim dividend payment of 4.15c per share, will be paid on 22 September 2025 to shareholders on the register at the close of business on 15 August 2025. The last day for DRIP elections is 1 September 2025. These interim financial statements do not reflect this dividend payable.

* For Continuing Operations

** For Group (prior to the announcement of the sale of France Workwear)

*** Reported as one-off and adjusting items and excluded from Adjusted Operating Profit and Adjusted PBTA

**** Based on maintenance of current FX rates

Consolidated Statement of Profit or Loss and Other Comprehensive Income

For the period ended 30 June 2025

1. With effect from 1 January 2025 the Group changed its presentation currency from sterling to US dollar. All comparatives from 2024 have been represented in US dollar (see Note 2). Comparatives have also been represented following the announcement of the intention to sell the France Workwear operations (see Note 6).

The weighted average number of ordinary shares in issue is 2,522m (30 June 2024: 2,521m). For the diluted EPS calculation the adjustment for share options and LTIPs is 9m (30 June 2024: 9m).

Consolidated Balance Sheet

Consolidated Statement of Changes in Equity

1. $21m net loss (2024: $6m net gain) on cash flow hedge includes a $44m gain (2024: $45m loss) from the effective portion of changes in fair value and a $65m loss (2024: $51m gains) reclassification to the income statement due to changes in foreign exchange rates.

Shares of $nil (2024: $nil) have been netted against retained earnings. This represents 10.3m (2024: 11.9m) shares held by the Rentokil Initial Employee Share Trust. The market value of these shares at 30 June 2025 was $50m (2024: $69m). Dividend income from, and voting rights on, the shares held by the Trust have been waived.

Consolidated Statement of Changes in Equity (continued)

Analysis of other reserves

1. $21m net loss (2024: $6m net gain) on cash flow hedge includes a $44m gain (2024: $45m loss) from the effective portion of changes in fair value and a $65m loss (2024: $51m gains) reclassification to the income statement due to changes in foreign exchange rates.

Consolidated Cash Flow Statement

1. Interest paid includes the interest element of lease payments of $15m (2024: $16m).

Explanatory notes to the unaudited interim financial statements

1. General information

The Company is a public limited company incorporated in England and Wales and domiciled in the UK with listings on the London Stock Exchange and the New York Stock Exchange. The address of its registered office is Rentokil Initial plc, Compass House, Manor Royal, Crawley, West Sussex, RH10 9PY.

The consolidated half-yearly financial information for the half-year to 30 June 2025 was approved on 30 July 2025 for issue on 31 July 2025.

On page 83 and 84 of the 2024 Annual Report we set out the Group's approach to risk management and on pages 85 to 89 we define the principal risks that are most relevant to the Group. These risks are described in detail and have mitigating actions assigned to each of them. In our view the principal risks remain unchanged from those indicated in the Annual Report 2024. A summary of the risks is laid out in the table below:

These interim financial results do not comprise statutory accounts within the meaning of Section 435 of the Companies Act 2006, and should be read in conjunction with the Annual Report 2024. Those accounts have been audited and delivered to the registrar of companies. The report of the auditor was unqualified, did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying their report and did not contain statements under section 498(2) or (3) of the Companies Act 2006.

For all information relating to 2024 results please refer to the Annual Report 2024 which can be accessed here: https://www.rentokil-initial.com/investors/annual-reports.aspx

2. Basis of preparation

The condensed consolidated financial statements have been prepared in accordance with the Disclosure and Transparency Rules of the Financial Conduct Authority and in accordance with IAS 34 Interim Financial Reporting as contained in UK-adopted international accounting standards. The condensed consolidated financial statements should be read in conjunction with the annual financial statements for the year ended 31 December 2024 which have been prepared in accordance with UK-adopted International Accounting Standards and with the requirements of the Companies Act 2006 as applicable to companies reporting under those standards. The annual financial statements for the year ended 31 December 2024 and the condensed consolidated financial statements also comply fully with International Financial Reporting Standards (IFRSs) as issued by the International Accounting Standards Board (IASB).

Going concern

The Directors have prepared Board-approved cash flow forecasts that demonstrate that the Group has sufficient liquidity to meet its obligations as they fall due for the period of at least 12 months from the date of approval of these Financial Statements.

Additionally, the Directors have assessed a severe but plausible downside scenario. The downside scenario includes a 20% revenue decline for 12 months which is considerably worse than the actual impact of the COVID-19 pandemic in 2020. Following the issuance of $1.25bn bonds in H1 to finance the $700m Term Loan maturity, headroom increased to approximately $1.9bn (excluding c.$100m of cash subject to exchange controls) at June 2025. In the downside scenario, the minimum headroom modelled was approximately $1.1bn (excluding c.$100m of cash subject to exchange controls) before the inclusion of mitigating actions (adjusting the level of M&A activity, and/or dividends paid) which are all within the Group's control and were used during the COVID-19 pandemic.

The Directors have therefore concluded that the Group will have sufficient liquidity to continue to meet its liabilities as they fall due for this period and therefore have prepared the Consolidated Financial Statements on a going concern basis.

Foreign currency translation

The results and financial position of Group entities are translated into the presentation currency using the following rates for key currencies.

GBP balances were translated at a closing GBP/USD rate of 0.7290 (June 2024: 0.7915) and an average GBP/USD rate of 0.7706 (June 2024: 0.7900).

EUR balances were translated at a closing EUR/USD rate of 0.8497 (June 2024: 0.9338), and an average EUR/USD rate of 0.9183 (June 2024: 0.9242).

Change in presentation currency

On 25 July 2024, the Group announced that with effect from 1 January 2025 it would be changing its presentation currency from sterling to US dollar. Within the Group's current portfolio of businesses, sterling denominated earnings, while sizeable, are a relatively small proportion of overall earnings. To reduce the potential for foreign exchange volatility in our future reported earnings, the Board determined that, with effect from 1 January 2025, the Group will present its results in US dollar.

Accordingly, to satisfy the requirements of IAS 21 The Effects of Changes in Foreign Exchange Rates, the reported results for the periods ended 30 June 2024, 31 December 2024 and 30 June 2025 have been translated from sterling to US dollar using the following procedures:

A change in presentation currency represents a change in accounting policy under IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors which is accounted for retrospectively. The £/$ rates used for this exercise are: average FY2024 1.2773, HY2024 1.2658; and closing FY2024 1.2519, HY2024 1.2635.

3. Accounting policies

The Group makes estimates and assumptions concerning the future. Estimates and assumptions are continually evaluated and are based on historical experience and other factors, including expectations of future events that are believed to be reasonable under the circumstances. Actual results may differ from these estimates and revisions to estimates are recognised prospectively. Sensitivities to the estimates and assumptions are provided, where relevant, in the notes to the financial statements.

The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are listed below:

Further detail can be found in the Annual Report 2024.

Significant seasonal or cyclical variations in the Group's total revenues are not experienced during the financial year.

Changes in accounting policies

Except as described below, the accounting policies applied in these interim financial statements are the same as those applied in the Group's consolidated financial statements as at and for the year ended 31 December 2024. The changes in accounting policies are also expected to be reflected in the Group's consolidated financial statements as at and for the year ending 31 December 2025.

The Group has adopted the following new standards and amendments to standards, including any consequential amendments to other standards, with effect from 1 January 2025:

The application of this amendments has had no material impact on the disclosures of the amounts recognised in the Group's consolidated financial statements. Consequently, no adjustment has been made to the comparative financial information. The Group has not early adopted any standard, interpretation or amendment that was issued but is not yet effective.

4. Segmental information

Segment reporting

Segmental information has been presented in accordance with IFRS 8 Operating Segments below. The Group's reporting segments are regions and this reflects management reporting structures and the way information is reviewed by the Chief Operating Decision Maker (CODM) (the Chief Executive). The businesses within each reporting segment operate in a number of different countries and sell services across two business segments with the Workwear segment currently held as a discontinued operation (see Note 6).

Following the acquisition of Terminix, the majority of the Group's activity is in North America. With effect from 1 January 2025, the Group's reporting structure has been changed to combine Europe incl. LATAM, UK & SSA, Pacific and Asia & MENAT regions into a single reporting segment, International. The Chief Executive remains as CODM and reviews the results on a monthly basis for North America and International segments. All reporting to the Board is also done on this basis. Comparative segmental financial information for 2024 has been represented.

Disaggregated revenue under IFRS 15 is the same as the segmental analysis presented below. Restructuring costs, one-off and adjusting items, amortisation and impairment of intangible assets (excluding computer software), and central and regional costs are presented at a Group level as they are not targeted or managed at reportable segment level. The basis of presentation is consistent with the information reviewed by management.

Revenue and profit from continuing operations

Analysis of revenue by type

Other segment items included in the consolidated income statement are as follows:

5. Income tax expense

Analysis of charge in the period for continuing operations:

The tax charge for the period has been calculated by applying the effective tax rate which is expected to apply to the Group for the year ended 31 December 2025 using rates substantively enacted by 30 June 2025. A separate effective income tax rate has been calculated for each jurisdiction in which the Group operates, applied to the pre-tax profits for the interim period. The following tax disclosures and rates are presented in respect of continuing operations.

The reported tax rate for the period was 24.2% (June 2024: 22.0%). The Group's Adjusted Effective Tax Rate (ETR) before amortisation of intangible assets (excluding computer software), one-off items and the net interest adjustments for the period was 25.0% (June 2024: 23.1%). This compares with a blended rate of tax for the countries in which the Group operates of 25.2% (June 2024: 25.3%).

Total uncertain tax positions (including interest thereon) amounted to $45m as at 30 June 2025 (December 2024: $44m). Included within this amount is $6m (December 2024: $6m) in respect of interest arising on tax provisions, which is included within other payables.

Total tax payments for the period amounted to $43m (June 2024: $36m), an increase of $7m.

The Group is subject to Pillar 2 which aims to ensure all Group profits are taxed in each jurisdiction at a minimum rate of 15%. The additional top up tax charge for the Group is not expected to be significant, and for H1 2025 the top up charge is expected to be less than $1m (June 2024: less than $1m).

The movement on the deferred income tax account is as follows:

A deferred tax asset of $48m has been recognised in respect of losses (December 2024: $51m), of which $34m (December 2024: $38m) relates to UK losses carried forward at 30 June 2025. This amount has been calculated by estimating the future UK taxable profits, against which the UK tax losses will be utilised, progressively risk weighted, and applying the tax rates (substantively enacted as at the balance sheet date) applicable for each year. Deferred tax is fully recognised on UK tax losses (excluding capital losses) as at 30 June 2025 as it is considered probable that future taxable profits will be available against which the tax losses can be offset.

At the balance sheet date the Group had tax losses of $329m (December 2024: $303m) on which no deferred tax asset is recognised because it is not considered probable that future taxable profits will be available in certain jurisdictions to be able to benefit from those tax losses.

On 4 July 2025, the "One Big Beautiful Bill Act" (OBBBA) was signed by President Trump, making significant changes to US federal tax policy. The Group is still evaluating the impact of this bill and currently does not anticipate any material impact on its post tax earnings.

6. Discontinued operations

On 28 May 2025, the Group announced that it has entered into an agreement for the intended sale of its Workwear business in France with H.I.G. Capital (the 'proposed transaction'), for which approval was granted by the European Commission on 25 July 2025.

The proposed transaction values France Workwear at a gross enterprise value of approximately €410m (c.$465m), on a cash-free, debt-free basis, including an earn-out mechanism with a maximum value of €30m (c.$34m), linked to the performance of the business in 2026. Total net cash proceeds are expected to be approximately €370m (c.$420m), subject to customary closing adjustments and the final earn-out outcome. Completion of the proposed transaction is expected to occur in Q4 2025.

Financial information relating to the discontinued operations for the period is set out below:

A non-current asset or a disposal group is classified as held for sale if its carrying amount will be recovered principally through sale rather than through continuing use, it is available for immediate sale, and sale is highly probable within one year.

On initial classification as held for sale, non-current assets and disposal groups are measured at the lower of previous carrying amount and fair value less costs to sell with any adjustments taken to profit or loss, with the exception of inventories, financial assets, deferred tax assets and employee benefit assets, which continue to be measured in accordance with the Group's accounting policies. There were no impairments to the disposal group in the period to 30 June 2025. Intangible assets and property, plant and equipment once classified as held for sale or distribution are not amortised or depreciated.

Net assets of disposal group held for sale

The cumulative foreign exchange losses recognised in other comprehensive income in relation to the discontinued operation as at 30 June 2025 were $48m.

7. Dividends

Dividend distribution to the Company's shareholders is recognised as a liability in the Group's financial statements in the period in which the dividends are approved by the Company's shareholders. Interim dividends are recognised when paid.

1. Represented at exchange rate prevailing at AGM's date (2024 - 5.93 pence per share; 2023 - 5.93 pence per share)

The directors have declared an interim dividend of 4.15 cents per share amounting to $105m payable on 22 September 2025 to shareholders on the register at close of business on 15 August 2025. The last day for DRIP elections is 1 September 2025. These interim financial statements do not reflect this dividend payable.

8. Business combinations

During the period the Group purchased 100% of the share capital or trade and assets of 18 companies and businesses (2024: 23). An overview of the acquisitions in the year can be found under the 'Good contributions from Bolt-on M&A' heading. The Group acquires companies and businesses as part of its growth strategy.

The total consideration in respect of these acquisitions was $68m (2024: $143m). The provisional fair values of assets and liabilities arising from acquisitions will be finalised within 12 months of the dates of acquisition.

Details of goodwill and the provisional fair value of net assets acquired in the period are as follows:

Goodwill represents the synergies and other benefits expected to be realised from integrating acquired businesses into the Group, such as improved route density, expansion in use of best-in-class digital tools and back office synergies.

Deferred consideration of $7m and contingent consideration of $6m are payable in respect of the above acquisitions (2024: $37m and $32m respectively). Contingent consideration is payable based on a variety of conditions including revenue and profit targets being met. During the period $10m (2024: $nil) of contingent consideration liabilities were released.

The provisional fair values of assets and liabilities arising from acquisitions in the period are as follows: