Mitie Group PLC (“Mitie”), the strategic outsourcing company, releases its Interim Management Statement for the period from 1 April 2013 to date.
Trading update
Mitie has made a positive start to the year. We are well placed to achieve good levels of organic growth in the current financial year, particularly in our facilities management division, in line with management’s expectations. At 30 June 2013, 89% of budgeted revenues for this financial year had already been secured (30 June 2012: 87%).
Continued organic growth
Mitie continues to see good opportunities across its markets. The integration of Enara is progressing to plan and the business has been rebranded to MiHomecare. The investments we have made in our integrated facilities management capabilities will deliver further growth, underpinned by our record order book and significant pipeline of sales opportunities.
In the private sector the sales pipeline remains buoyant and we have been awarded and retained work across a range of markets and sectors. We have been awarded a contract with Mitchells & Butlers, the leading operator of restaurants and pubs in the UK, to deliver waste management, cleaning and environmental services, for a total value of £38m over three years. We have also been awarded a number of contracts with values ranging between £5m and £10m over three years. These include: BAE Systems, providing total security management; Cineworld, cleaning cinemas in the South of England and the London head office; Kellogg’s, providing facilities management and project support services at its head offices and manufacturing plant; and Capital One where we retained a technical FM contract.
In the public sector, we remain focused on the health, justice, local authority and social housing markets. We are pleased to have seen some new contract awards in the healthcare sector through MiHomecare, including a Continuing Healthcare programme in Leicestershire worth £2.5m over five years and we have been appointed to framework contracts in Worcestershire and Richmond upon Thames, with an expected total value of £3.3m over five years. We have seen a steady flow of contract awards and retentions elsewhere in the group, including a £6m technical FM and lighting contract with the Greater London Authority and the expansion of our technical FM contract with Transport for London, to include cleaning at a value of £4m over three years.
Supporting growth opportunities
On 5 July, we announced an investment of £1.2m in two 'Mitie Model' businesses. Mitie's existing waste management business will be set up as a stand-alone company, Mitie Waste and Environmental Services Limited. The management team will take an equity stake in the business, motivating them to grow the business and share in its future success. In addition, we have established Mitie's latest start-up business, Mitie Local Services Limited, which will provide cleaning services to small to medium size clients in the London area.
Financial position
There has been no material change in the group’s financial position since 31 March 2013.
Our strong balance sheet continues to provide us with capacity for the development of the business and for further value creating acquisitions should they arise, particularly in niche markets within the healthcare and energy sectors.
Board changes
Terry Morgan will step down as a Non-Executive Director of the Board on 31 October 2013. We thank him for his contribution to the Board and wish him well for the future.
Outlook
The financial year has started well and we have a growing order book as well as a strong pipeline of sales opportunities. We are positive about the range of outsourcing opportunities across our key markets and confident that we will continue to build on our long track record of sustainable profitable growth.
-ENDS-
Future reporting dates
Mitie Group PLC will announce its interim results on Monday 18 November 2013.
For further information, contact:
John Telling, Group Corporate Affairs Director, Mitie Group PLC
T: 0203 123 8673
M: 07979 701 006
E: john.telling@mitie.com
Erica Lockhart, Head of Corporate Affairs, Mitie Group PLC
T: 0203 123 8179
M: 07979 784 488
E: erica.lockhart@mitie.com
