27 March 2020 | Prithvi Pandya
Rentokil Initial has provided a coronavirus trading update.
The company said that the main impact at the end of February was on its operations in China, which saw business closures and employees unable to service their customers.
In other parts of the group, customer enquiries for hand hygiene services were strong and the company anticipates an overall strong performance in Q1.
Rentokil expects a much more "significant" impact on its operations and performance in Q2 and beyond. It said that it would release its Q1 trading performance and potential impact of coronavirus on 16 April.
Group trading to mid-March was not materially affected by the virus outbreak, it said. Trade in China was largely suspended in early February with a gradual return to service for 56 per cent of customers at the end of that month and it is now servicing around 75 per cent of customers. By mid-March Italy was the main country where the group took a hit as business closures and a national lockdown reduced service levels by around 40 per cent.
The virus impact on its businesses to date has been varied, dependent on factors including the rate at which the virus has spread, individual government responses and required levels of customer service.
The group said it anticipates increased demand throughout the pandemic and during the recovery phase. It is training staff to support this increased demand and by the end of March expects to have at least an additional 2,500 technicians trained across the world to undertake disinfection services.
After the crisis ends Rentokil envisages that there will be a significant demand for hygiene and pest control clean-up services.
Andy Ransom, chief executive of Rentokil, said: "Rentokil Initial is a strong and resilient company offering critical and essential pest control and hygiene services to customers. While we had made a good start to the year, the ongoing uncertainty and turmoil presented by the Covid-19 outbreak will mean we will have a difficult second quarter and potentially beyond. However, we are taking appropriate cost and cash action to protect the business and our liquidity, and to put us in the best position to support the recovery phase.
"I would like to thank my colleagues for the bravery and commitment they have shown as this crisis has unfolded and we will do everything we can to continue to protect our colleagues, customers and shareholders in these unprecedented times."