Rentokil to train 2,500 disinfectant specialists in response to virus

Pest control firm Rentokil said it is training 2,500 disinfectant specialists in response to the coronavirus outbreak.

The FTSE 100 firm said it is boosting resources in its hygiene business, which operates in 46 markets and contributed to slightly over one fifth of its earnings last year.

However, the company said it expects the virus to impact trading for its other operations.

It withdrew its financial guidance for the year as it warned the company expects “a much more significant impact on operations” than previously predicted.

Group trading up to mid-March was “not materially impacted” by the outbreak, although trading was largely suspended in China in early February.

Rentokil said it saw the largest impact to trading in Italy, where business closures and a national lockdown resulted in a 40% fall in service levels.

It said it has now been hit by substantial closures by its customer base, particularly in the hotels, restaurant and catering sectors.

However, demand for services in areas such as food production, food retailing and healthcare have been “strong” with increased demand for specialist hygiene services, it said.

Rentokil said it will cut costs to mitigate the impact of the outbreak by introducing pay cuts for the company’s board and senior management.

It said it will also freeze hiring and cut back the company’s marketing budget to preserve cash.

The firm said it hopes cost-cutting initiatives can save it around £100 million over the year.

Chief executive Andy Ransom 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.”

Read Full Story