Interim Management Statement

RNS Number : 3390T

Intertek Group PLC

19 November 2013

 



Stock Exchange Release

19 November 2013, 7.00am London, UK

Interim Management Statement

Intertek Group plc (Intertek or Group), the leading quality solutions provider to industries worldwide, today releases its Interim Management Statement for the period from 1 July to date. Where stated, financial results are for the period from 1 January to 31 October 2013 ("period"). All comparative comments in this statement reflect comparisons with the corresponding period during 2012. The Group's full year results to 31 December 2013 will be announced on 3 March 2014.

Total revenue grew 7.6% in the period, including organic growth at constant exchange rates of 4.9%, the benefit of acquisitions made in 2012 and 2013 of 1.6% and favourable currency movements of 1.1%.

The industry-wide headwinds experienced in the first half of the year have persisted into the second half. The weakness of the minerals market and challenging conditions in Europe have continued, alongside lower growth in the industrial inspection market following two years of exceptionally high growth. The Group continued to see strong organic revenue growth from China, one of our largest markets, the Middle East, Latin America and the Indian sub-continent. The Group's total revenue grew 5% from 1 July to 31 October compared to the same prior year period; of which 3% was from organic growth.

The Consumer Goods division grew organic revenue strongly at high single digits in the ten month period, with the EU Toy Safety Directive taking effect in the middle of the year. All other divisions grew organic revenue by low to mid-single digits. The Industry & Assurance division benefitted from capital investment in the energy market partially offset by weakness in more discretionary spending in the US. The Commodities division saw mixed trading in oil cargo with weak demand in Europe and the on-going double digit decline in minerals. The Commercial & Electrical division experienced strong growth in the building products, telecoms and automotive markets whilst the markets in renewables and Europe were weak. The Chemicals & Pharma division slowed further principally due to weakening demand in Europe.

The Group continued to anticipate changing market needs and add complementary capabilities through internal and external investment, including continuing investment into the Tradegood platform. Since the half year results, the Group has completed two acquisitions. This includes the purchase of Global X-Ray and Testing for £45 million, a US based upstream and offshore energy focused non-destructive testing company to extend the Group's leading platform of technical services for oil and gas assets. Today Intertek has separately announced the agreement to purchase Architectural Testing Inc, a US based building products testing company for £59 million. This acquisition will position Intertek as the global leading building products testing and certification service provider in the market at a time of strengthening growth in this industry. Following this transaction, the total spend on acquisitions this year will be over £120 million.

The Group's restructuring programme is continuing, with a focus on Europe. Whilst growth has slowed during the second half, tight control of costs means that the decline in margin is expected to be significantly less than in the first half.

There has been no material change to the Group's financial position in the period since the last reported balance sheet date of 30 June 2013.

Wolfhart Hauser, Chief Executive Officer of Intertek, commented: 

"The headwinds experienced this year in particular in minerals, Europe and some US industrial inspection areas have continued for longer than expected, but will ease next year. The core structural growth drivers in many business lines and geographies remain in place and this will help the Group to return to high single digit organic growth rates through the economic cycle.

"We continue to invest in industries and markets that support our strategic goals and as markets recover these investments will support the continued development of our global quality network."

-ends-

Contacts

Aston Swift

Telephone: [phone]     

[e-mail]

Richard Mountain / Susanne Yule FTI Consulting

Telephone: [phone]

[e-mail] / [e-mail]

Corporate website: www.intertek.com 

About Intertek

Intertek is the leading quality solutions provider to industries worldwide.  From auditing and inspection, to testing, training, advisory, quality assurance and certification, Intertek adds value to customers' products, processes and assets.  With a network of more than 1,000 laboratories and offices and over 36,000 people in more than 100 countries, Intertek supports companies' success in a global marketplace. Intertek helps its customers to meet end users' expectations for safety, sustainability, performance, integrity and desirability in virtually any market worldwide.  Visit www.intertek.com

Intertek Group plc (LSE: ITRK) is listed on the London Stock Exchange and is a constituent of the FTSE 100 index.

This Interim Management Statement is prepared for and addressed only to the Company's shareholders as a whole and to no other person. The Company, its directors, employees, agents or advisers do not accept or assume responsibility to any other person to whom this Interim Management Statement is shown or into whose hands it may come and any such responsibility or liability is expressly disclaimed. Statements contained in this Interim Management Statement are based on the knowledge and information available to the Company's Directors at the date it was prepared and therefore the facts stated and views expressed may change after that date. By their nature, the statements concerning the risks and uncertainties facing the Company in this Interim Management Statement involve uncertainty since future events and circumstances can cause results and developments to differ materially from those anticipated. To the extent that this Interim Management Statement contains any statement dealing with any time after the date of its preparation such statement is merely predictive and speculative as it relates to events and circumstances which are yet to occur. The Company undertakes no obligation to update these forward-looking statements.

 

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