Rentokil Initial plc (LON:RTO) has issued a Trading Update for the first three months of the 2025 financial year covering the period from 1 January to 31 March 2025. As previously announced, Rentokil Initial now reports in US dollars to better reflect the geographic mix of its revenue and earnings.
Andy Ransom, Chief Executive of Rentokil Initial plc, said:
“Our International Pest Control business performed well. As already stated, North America had a slow first quarter with continued subdued lead flow. Our focus remains on building growth momentum and positioning the business to deliver on our strategic ambitions. Despite increased macro-economic uncertainties, we remain confident about the longer-term based on the resilience of our markets, our global reach, our diverse customer base and our recurring revenues.”
Q1 2025
The Group reported total Revenue of $1,635m in Q1 2025 (AER), representing year-on-year growth of 1.5% and Organic Revenue growth of 1.8%¹, held back by c.30bps due to one fewer trading day year-on-year.
North America
● Revenue growth in North America was 0.5% and Organic Revenue growth was 0.7%, with a c.50bps headwind from one fewer trading day.
● Pest Control Organic Revenue was up 0.5% and Pest Control services for residential, commercial and termite customers was down by 0.2% as it continued to be impacted by low inbound lead flow and contract sales.
● North America colleague retention increased to 79.8% (FY 24: 79.4%) and customer retention increased to 80.4% (FY 24: 80.1%), supported by our enhanced retention strategies. These favourable trends are positive for future organic growth prospects.
Growth Initiatives
● Digital inbound lead flow from our paid search activities returned to positive growth in March, following a decline in February as we transitioned to a new agency partner. While lead generation from our organic search initiatives remained subdued, we expect a positive shift supported by the rollout and full activation of the new satellite branches and brand strategy. 36 satellite branches across the region are now operational.
● Sales lead participation rates among technicians (The Trusted Advisor plan) improved by 9ppts in the quarter to 60%.
● Five-star reviews for Terminix, which serve as a critical component of Internet search visibility, increased by 71% in the quarter.
● The door-to-door sales pilot programme is set to launch in early Q2 with the participation of c.30 branches.
International (Group excluding North America)
Organic Revenue grew 3.3%, with good performances in Europe (incl. LATAM), Asia & MENAT and Pacific, offset by the UK, which lapped strong prior year comparatives in its specialist hygiene asbestos remediation business.
Category Performance
Pest Control Organic Revenue growth was 1.7% led by international, up by 4.7%. Hygiene & Wellbeing grew by 1.6%, with a drag from the UK. France Workwear was up 4.4%.
M&A
The Group’s bolt-on M&A programme continued to create value with 6 deals, delivering annualised revenue in the year before acquisition of $13m.
Rentokil Initial intends to publish its 2025 Interim Results on 31 July 2025.
Notes
¹ Organic Revenue growth is at CER. The revenue base used for North America Organic Revenue growth percentage also deducts revenue from 1 January 2024 to 31 March 2024 for the Paragon distribution business, closed with effect from 1 April 2024.
Summary of Financial Performance
| AER | CER | |||
| Q1 2025 $m | Q1 2024 $m | Change % | Organic Revenue Growth % | |
| North America | ||||
| Pest Control | 921 | 918 | 0.2% | 0.5% |
| Hygiene & Wellbeing | 30 | 28 | 9.3% | 5.9% |
| 951 | 946 | 0.5% | 0.7% | |
| International | ||||
| Pest Control | 358 | 345 | 3.5% | 4.7% |
| Hygiene & Wellbeing | 251 | 245 | 2.7% | 1.1% |
| France Workwear | 71 | 71 | 0.6% | 4.4% |
| 680 | 661 | 2.9% | 3.3% | |
| Europe (incl. LATAM) | ||||
| Pest Control | 164 | 163 | 0.4% | 3.8% |
| Hygiene & Wellbeing | 111 | 109 | 2.3% | 2.3% |
| France Workwear | 71 | 71 | 0.6% | 4.4% |
| 346 | 343 | 1.0% | 3.5% | |
| UK & Sub Saharan Africa | ||||
| Pest Control | 65 | 62 | 4.1% | 4.7% |
| Hygiene & Wellbeing | 73 | 67 | 8.5% | (1.2%) |
| 138 | 129 | 6.4% | 1.6% | |
| Asia & MENAT | ||||
| Pest Control | 85 | 78 | 8.5% | 5.7% |
| Hygiene & Wellbeing | 29 | 28 | 3.4% | 3.3% |
| 114 | 106 | 7.2% | 5.1% | |
| Pacific | ||||
| Pest Control | 44 | 42 | 4.9% | 6.1% |
| Hygiene & Wellbeing | 38 | 41 | (6.2%) | 0.3% |
| 82 | 83 | (0.6%) | 3.3% | |
| Central | 4 | 4 | – | 0.6% |
| Total | 1,635 | 1,611 | 1.5% | 1.8% |
Category Performance
| AER | CER | |||
| Q1 2025 $m | Q1 2024 $m | Change % | Organic Revenue Growth % | |
| Pest Control | 1,279 | 1,263 | 1.1% | 1.7% |
| Hygiene & Wellbeing | 281 | 273 | 3.4% | 1.6% |
| France Workwear | 71 | 71 | 0.6% | 4.4% |
| Central | 4 | 4 | – | 0.6% |
| Total | 1,635 | 1,611 | 1.5% | 1.8% |
Today, 17 April at 9:00am BST, Rentokil Initial Chief Executive, Andy Ransom and Chief Financial Officer, Paul Edgecliffe-Johnson will host a conference call for analysts and investors. A replay will be available on the Company website following the event.
To join via teleconference, please register in advance using the link below: https://registrations.events/direct/Q4I3868179
Alternatively, the live audio webcast can be accessed at: https://events.q4inc.com/attendee/543985772
