Interim Management Statement

RNS Number : 2854H

Intertek Group PLC

16 May 2014

 

Stock Exchange Release

16 May 2014, 7.00am London, UK 

Interim Management Statement

Intertek Group plc (Intertek or Group), a leading quality solutions provider to industries worldwide, today releases its Interim Management Statement for the period since 31 December 2013. Where stated, financial results are for the period from 1 January to 30 April 2014 ("period"). All comparative comments in this statement reflect comparisons with the corresponding period during 2013.

Group Performance

The variable market conditions in the second half of 2013 continued into the first four months of 2014, resulting in good growth in our key product-related business lines but weaker than anticipated activity in the energy infrastructure market.

At constant exchange rates, total revenue grew 3.6% in the period comprising organic growth of 0.3% and 3.3% growth from acquisitions made in 2013 and 2014. Excluding the effect of the strategic decision to exit certain low-value Industry contracts, organic revenue growth would have been 1.5%.  Sterling appreciated against many of the Group's currencies and at actual exchange rates total revenue declined by 4.9%. Operating margin improved slightly as expected on the same period in 2013 as the Group benefitted from its on-going restructuring activities.

Divisional Performance

In the Industry & Assurance division, we made good progress with our strategy to exit low-value contracts, which reduced Group revenue growth by 1.2% in the period. We also saw the deferral of some energy industry capital projects which reduced technical inspection activity during the period. Within the Commodities division the minerals business faced new export restrictions in Indonesia, whilst the cargo business in the US was impacted by the severe weather conditions at the start of the year.

We continued to see good growth in the Consumer Goods and Commercial & Electrical divisions, with positive trading in key industries such as toys, textiles and transportation technologies. The Chemicals & Pharma division reported solid growth.

Investment & Financial Position

Intertek continues to execute its strategy of organic investment and value-enhancing acquisitions to deliver long-term growth in key markets such as China. In the period, new testing laboratories were opened for high-tech lighting (Asia), Food (UK, the Philippines and Germany), consumer and commercial electrical products (Brazil), shale commodities (USA) and textiles (Sri Lanka). The Group also completed the acquisition of Inspec a non-destructive testing company supporting the oil and gas sector for £40 million.

Intertek's financial position remains strong, with no material change in the financial position since that reported in March.

Wolfhart Hauser, Chief Executive Officer of Intertek, commented: 

"Market conditions remain variable with good growth in our key product-related business lines but weak demand in certain other markets. We continue to anticipate improvement in growth and profitability in the second half of 2014 as market conditions are expected to improve and comparatives become easier."

AGM & Half Year Results

The Annual General Meeting of Intertek is held today 16 May 2014, at 12 noon at The Westbury Hotel, Conduit Street, London W1S 2YF.

The Group's half year results to 30 June 2014 will be announced on Monday 4 August 2014.

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Contacts:

Sarah Ogilvie, Intertek Group plc - Telephone: [phone]          

[e-mail]

Richard Mountain, FTI Consulting - Telephone: [phone]

[e-mail]

About Intertek

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

 

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