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Investment at Mitie hits operating profit

By BFN News | 07:54 AM | Thursday 07 June, 2018


Mitie said adjusted operating profit fell 6% to £77.1m, in line with guidance, after investing in customer service and internal capabilities in the year to 31 March 2018. Adjusted sales growth was up 2.8% at £2.2bn (FY 16/17: £2.1bn) and reported revenue increased 3.8% to £2.2bn. HIGHLIGHTS: - Reported operating profit before other items of £89.6m (FY 16/17: £(6.3)m) - Connected Workspace in deployment and increasingly impacting bid-wins - Transformation programme on track and progressing well - Commercial reorganisation and finance transformation complete; HR transformation ongoing; - IT and Engineering Services workflow technology transformation begun - Cost of change is £35m for FY 17/18, with associated in-year benefits of £13.2m, and run rate benefits of £27m - Net debt as at 31 March 2018 of £193.5m (31 March 2017: £147.2m); year-end leverage 1.98x, operating comfortably within debt covenants - Order book of £4.5bn, up 2.4%, reported under IFRS 15 guidelines Notable contract wins in the period include: - A Detention & Escorting contract for the Home Office (worth £525m over 10 years) - A large integrated FM technology-led contract with the Co-op - A 5-year contract with West Hertfordshire Hospitals NHS Trust worth £55m The Board is recommending a final dividend of 2.67p, making the total full-year dividend 4p per share (FY 16/17: 4p) Mitie CEO Phil Bentley commented: "We are one year into our transformation programme and we are where we need to be. "It has been a year of discovery, simplification and significant change, all set against a challenging market. "We have made much progress, building the foundations that will ensure that Mitie is at the forefront of the UK facilities management industry. "Our core business has demonstrated its strength and resilience and is performing well, our commitment to strong financial management remains unwavering and our focus on costs, customers, technology and our people is delivering tangible benefits. "With an uptick in revenue, a normalising balance sheet, a good order book, a focused execution plan, significant investment in technology and a settled management team, I believe Mitie is well positioned for growth." Story provided by StockMarketWire.com

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