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Mite delivers a ‘strong performance’ in Q3

By 29/01/2021No Comments

Mitie’s Q3 trading update for the three-month period ending 31 December 2020 states the group achieved a “strong performance” in the third quarter of the year as the Covid-19 lockdown measures were eased.

Organic revenue for the three months ended 31 December 2020 was £573.9 million which was 6.7 per cent ahead of the same period last year.

Average daily net debt improved to net cash position of £31 million (£313 million net debt in the same period last year).

Year to date new contracts won and renewed are worth in excess of £770 million. These included new contract wins in the period included Bravissimo, Magnox Ltd, QBE Insurance and Manchester City Council, with contract renewals including Cornerstone Telecoms and expanded contracts with existing customers including Primark, Toyota and Euro Car Parts.

In addition, Mitie has been appointed to three new Crown Commercial Service agreements for Vehicle Charging Infrastructure Solutions, Heat Networks & Electricity Generation Assets and Building Cleaning Services.

The group’s Business Services division which represents half (50 per cent) of group organic revenue, reported revenue of £287.1 million, 14.8 per cent ahead of the same third quarter period last year. The key driver of this growth says Mitie was the provision of additional security and cleaning for its existing clients, particularly within food retail, logistics and non-aviation transport, as well as its work with the DHSC to help support the UK’s efforts in the battle against Covid-19 and supporting HMRC at the ports following the UK’s withdrawal from the EU. Mitie’s exposure to the property management and transport and logistics sectors, which accounts for 30 per cent of this divisions revenue, as well as the Office Services business, continues to be impacted by Covid-19.

Technical Services – representing 39 per cent of group organic revenue – continues to see the greatest impact from Covid-19 as discretionary variable work and demand for engineering projects has significantly reduced says Mitie. Reported revenue of £226.4 million, 0.6 per cent lower than the same third quarter period last year.

Specialist Services – representing 11 per cent of group organic revenue – reported revenue of £60.4 million, 0.8 per cent ahead of the same third quarter period last year. Care & Custody reported revenue of £28.2 million, up 3.5 per cent as three new contracts commenced in the period. Waste reported a 2.3 per cent increase in revenue to £20.6 million as variable projects picked up in the period. Landscapes saw a 5.7 per cent decline in revenue to £11.9 million as property managers, leisure and transport & logistics customers reduced services.

Interserve Facilities Management acquisition

Interserve’s contribution to Mite Group’s full year 2021 results will be for the four months of December 2020 to 31 March 2021.

Interserve Facilities Management revenue including share of JVs and associates for December 2020 of £109.2 million – the first month of ownership in this reporting period – highlighted resilience in many public sector contracts.

Operating profit before other items for FY20/21, including share of JVs and associates and including four months contribution from Interserve, is expected to be between £57 million and £61 million.

Looking ahead, Mitie has said that although the performance in the third quarter of the year was encouraging, the new national lockdown measures currently in place are likely to result in flat growth in the fourth quarter. Overall, Mitie added the second half performance will be stronger than the first half.


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