Rentokil Initial PLC (LON:RTO) said trading has started well across its businesses in the first quarter of 2019, with strong growth in ongoing revenue helped by acquisitions.
In a trading update, the FTSE 100-listed firm reported an 8.9% increase in ongoing revenue at actual exchange rates to £603.6mln for the first quarter.
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The company noted that 4.0% of that total was organic revenue growth, up from 3.2% at the same stage in 2018, while 4.9% was from acquisitions.
Rentokil said ongoing revenue in its Pest Control business grew by 12.0%, with good performances being delivered across both growth and emerging markets, which rose by 12.1% and 11.5% respectively.
It added that Hygiene also made a very positive start to the year, with ongoing revenue growth of 7.2%, while ongoing revenue in its Protect & Enhance markets was in line with the first quarter of 2018.
The group signed eight acquisitions in the first quarter of 2019, four in Pest Control - primarily in North America and Latin America - and four in Hygiene, with combined annualised revenues of around £29mln in the year prior to purchase.
The company added that its guidance for M&A spend in 2019 remains in the range of £200mln to £250mln.
Rentokil also said that good progress is being made towards a bulk annuity insurance 'buy-in' for its UK Defined Benefit Pension scheme and it now anticipates a pre-tax cash surplus of around £40mln will be returned to the company on completion in early 2020.
Andy Ransom, Rentokil’s chief executive commented: "We have had a good start to 2019 and I'm pleased with our performance in the first three months of this year. I am confident of another year of successful growth for the Company, in line with market expectations."