Mitie Group plc, the facilities management organisation which delivers a range of services across the UK, has announced its results for the year ending 31 March 2015. The FTSE 250 company’s headline results reflect “strong revenue and earnings growth” with revenues up 5.8% to £2,266.2 million in addition to sector-leading organic growth of 6.1% in FM. Operating profit before other items increased by 0.9% to £128.6 million. Profit before tax is up to £114.1 million.
Other headline figures issued in this morning’s announcement are as follows:
*4.9% of the 5.8% revenue growth has been organic
*The headline operating profit of £128.6 million has generated a 5.7% operating profit margin
*”Excellent” headline cash conversion of 95.1% (2014: 102.4%) and statutory cash conversion of 126.5% (2014: 107.3%), above target KPI of 80%
*Strong dividend growth of 6.4% to 11.7 pence per share
*Net debt of £177.8 million or 1.2x headline EBITDA (2014: £186.6 million or 1.3x headline EBITDA)
*Return on capital employed of 18.6% (2014: 16.9%)
In this period Mitie Group plc – a business employing approximately 70,000 people across the United Kingdom and Europe – was awarded new contracts including:
*an extension of the transformational partnership with Lloyds Banking Group until 2022
*a seven-year £90 million contract with Royal Cornwall Hospitals NHS Trust to deliver soft facilities management services
*a major bundled contract with Jones Lang LaSalle to deliver a range of FM services with an estimated value of £85 million across a three-to-five year period
Positioned for future growth
Mitie Group plc is well positioned for future growth. 85% of the 2015-2016 budgeted revenue has already been secured (prior year: 84%), while the sales pipeline is buoyant at £9.7 billion (2014: £8.2 billion). The order book remains “strong” at £9.0 billion (2014: £8.7 billion).
In addition, Mitie is launching a £20 million entrepreneurial fund to back management teams under ‘The Mitie Model’ such that they might start up new businesses or invest in and grow existing small businesses.
Speaking about this latest set of financials, Ruby McGregor-Smith CBE (CEO of Mitie Group plc) explained: “Mitie has made good progress this year. We have re-positioned the business and lowered our risk profile. Our Facilities Management business accounts for circa 85% of group revenue and is a UK market leader.”
McGregor-Smith continued: “We see considerable opportunities across our markets to provide clients with higher quality, innovative services that save them money. We also see this as a positive environment in which to start and grow new businesses. We are only as good as all of our people, though, and supporting and developing them is critical to our ongoing success.”
In conclusion, Mitie’s CEO stated: “We’re focused on generating profits backed by cash, maintaining strong margins and growing the dividend. With a substantial order book and sales pipeline in place, we’re well placed to deliver consistently strong growth. Mitie Group is looking ahead with confidence.”
*Further information on Mitie’s year end financial results can be found at: www.mitie.com/investors