Shares in Rentokil Initial (LSE: RTO) dropped 3.7% in early trading on Thursday, adding to a steeper 28% decline over the past year. This comes despite the pest control giant maintaining its full-year outlook after a “positive start” to 2024.
Rentokil reported a 0.9% rise in revenue to £1.27 billion for the first quarter of 2024, compared to £1.26 billion the year prior. At constant exchange rates, revenue grew 4.9%. The company attributed 3.1 percentage points of that growth to organic revenue increase, underlining “continued pricing momentum.”
In the crucial North American market, Rentokil specifically noted a “stabilising performance” with 1.5% organic revenue growth.
CEO Andy Ransom expressed confidence in achieving the company’s 2% to 4% organic revenue growth target for North America in 2024, citing a strong start to the year and the successful execution of the “right way 2” plan in the region.
The firm reported organic revenue growth across all categories during the quarter ending March 31st. Pest Control climbed 2.7%, Hygiene & Wellbeing rose 3.8%, and France Workwear saw a significant 7.7% increase.
Progress on integrating the £6.7 billion Terminix acquisition was also highlighted. The legal entities have merged into Rentokil North America Inc, paving the way for future resource sharing and standardised operations.
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