* Ongoing revenue up 1%
* Company plans to expand hygiene category
* Operating profit down 9.4%
* Shares hit record high
(Adds shares, analysts comments, detail on expansion)
By Yadarisa Shabong
July 30 (Reuters) - Revenues at pest-control and
deep-cleaning service provider Rentokil were boosted in
the first half by higher standards of hygiene and expansion of
its disinfection services as businesses reopen after the
coronavirus lockdowns.
Shares of the FTSE 100 company rose to a record high on
Thursday after profit and revenue beat analysts' expectations.
It said it hoped to resume dividends this year if the second
half performs in line with its expectations.
Operating in around 80 countries and employing roughly
40,000 people globally, Rentokil's services to hotels,
restaurants, schools and the airline industry were stalled by
lockdowns, forcing it to lay off some staff, suspend dividends
and cut back on spending.
"Our Hygiene business, which was more impacted by customer
shutdowns, has moved from being considered a low interest (but
nonetheless required service) to arguably one of the world's
most important business categories," Chief Executive Officer
Andy Ransom said.
The business, which operates across 46 markets, providing
hand soaps, sanitizers and deep cleaning services, saw revenue
grow 10.5% as reopening businesses implemented higher hygiene
standards. Ongoing group revenue rose 1% to 1.28 billion pounds
($1.66 billion).
Rentokil also said it was expanding its hygiene category
into new countries and introducing additional services such as
hand hygiene products and services, surface hygiene and
disinfection services.
The company said ongoing operating profit fell 9.4% to 138.8
million pounds, mainly due to costs related to bad debts and the
protective equipment for employees demanded by the crisis.
Rentokil added that a majority of its staff were now back at
work and it has repaid the Bank of England's Covid Corporate
Financing Facility and resumed its mergers and acquisitions
programme.
"Rentokil has become a much cleaner, sharper business under
its current management," analysts at HSBC said.
Shares rose 3.3% to 567.2 pence by 0753 GMT.
($1 = 0.7718 pounds)
(Reporting by Yadarisa Shabong in Bengaluru; editing by Rashmi
Aich, Larry King)