Rentokil fails to exterminate bad news
RENTOKIL'S torrid year went from bad to worse today as executive chairman Brian McGowan unveiled a host of writedowns and warned the poor trading affecting the group would continue well into next year.
McGowan, who led the bloody boardroom coup that ousted former boss Sir Clive Thompson earlier this year, added that he had 'no specific news' regarding his search for a new chief executive.
Rentokil told the City in a devastating profit warning which accompanied Thomspon's departure in May that pre-tax profits this year would be down almost £50m, but no less than £350m.
But today it revealed that currency fluctuations will reduce this by a further £5m and that it would also be taking a £35m charge to cover writedowns across its business.
The group added that while the benefits of McGowan's cultural changes and investments would begin to seep through next year, 'the year as a whole is likely to give a weaker performance than in 2004'.
McGowan said: 'We are certain that we are taking the right actions to return the company to future sustainable growth. There is, however, no single easy, quickfix solution.'
The fresh warning is likely to infuriate investors, who have already seen shares in the rat-catching to security services group fall to as low as 136p this year - 35% below their highs.
