"Very few people wake up in the morning and say 'I'm going to outsource my washroom supplies'," says Berendsen (BRSN) chief executive Peter Ventress. Mr Ventress has a point, which is why the washroom and workwear supplier has been investing in its salesforce in order to help drive organic growth. However, strong sterling dampened reported sales in the first half, which on an underlying basis grew by a modest 3 per cent.
Operating profit at the group's higher-margin facilities business, which provides washroom solutions, doormats and clean-room clothing, fell 9 per cent to £27.7m, despite a 10 per cent rise in the headcount. Management attributes the fall-away to the weak euro, with the business focusing on northern European markets. In its emerging central European markets, however, the group achieved underlying double-digit revenue growth, with the more established Polish business delivering a 20 per cent increase.
The group also boosted its salesforce at the core workwear division, particularly in the high-growth German market. Management focused on transferring operating efficiencies to the UK from its best-practice countries - Denmark, Sweden and Holland. This involved converting its Norfolk plant to a more efficient workflow method, which is focused on customer-specific requirements.
Broker Peel Hunt expects adjusted EPS of 61.5p this year, down from 61.9p in 2014.
BERENDSEN (BRSN) | ||||
|---|---|---|---|---|
| ORD PRICE: | 1,006p | MARKET VALUE: | £1.74bn | |
| TOUCH: | 1,004-1,006p | 12-MONTH HIGH: | 1,161p | LOW: 896p |
| DIVIDEND YIELD: | 3.0% | PE RATIO: | 20 | |
| NET ASSET VALUE: | 266p* | NET DEBT: | 86% | |
| Half-year to 30 June | Turnover (£m) | Pre-tax profit (£m) | Earnings per share (p) | Dividend per share (p) |
|---|---|---|---|---|
| 2014 | 517 | 50.6 | 23.1 | 9.5 |
| 2015 | 494 | 48.5 | 21.5 | 10.0 |
| % change | -5 | -4 | -7 | +5 |
Ex-div: 10 Sep Payment: 9 Oct *Includes intangible assets of £390m, or 226p a share | ||||
