Daily Archives: 14/05/2014

ISS Q1 2014 results: ‘Solid performance in line with expectations’

Facility services giant ISS has posted its Q1 2014 results, describing the figures therein as a “solid performance in line with expectations”.

Financial highlights
• Organic growth for the first three months of 2014 amounted to 2.8% (2013: 2.8%)
• Operating margin was 4.3% for the first three months of 2014 (2013: 4.4%). Adjusted for the impact of the divestment of the pest control activities in 2013, the margin increased from 4.2% in Q1 2013 to 4.3% in Q1 2014
• Profit before goodwill impairment and amortisation/impairment of brands and customer contracts was DKK 73 million. Adjusted for costs related to the IPO and the refinancing, this amounted to DKK 329 million (2013: DKK 234 million)
• Net loss in the first three months of 2014 was DKK 33 million, and adjusted for costs related to the IPO and the refinancing the net profit for the first three months of 2014 amounted to DKK 223 million (2013: DKK 71 million)
• The LTM (last twelve months) cash conversion for March 2014 was 98% (2013: 99%)
• Outlook for 2014 remains unchanged

Jeff Gravenhorst: Group CEO at ISS

Jeff Gravenhorst: Group CEO at ISS

Business highlights
• ISS successfully listed its shares on NASDAQ OMX Copenhagen on 13 March 2014
• Following completion of the IPO, ISS was upgraded to Investment Grade by two rating agencies
• The global IFS contract with HP was extended for an additional three years until the end of 2018
• Significant contract wins in the quarter included a large contract within the resources segment in Australia as well as a large IFS contract with a luxury superyacht hotel in London
• Significant divestments completed in the first quarter of 2014 included the landscaping activities in France and the commercial security activities in both Australia and New Zealand
• Refinancing of debt was completed and proceeds from the new unsecured senior facilities and certain of the net proceeds from the IPO were used to fully repay ISS’ senior secured facilities on 18 March 2014

Comment from the Group CEO

Speaking about this latest set of company results, Jeff Gravenhorst (Group CEO, ISS A/S) said: “ISS continued the solid performance in the first quarter of 2014. The organic growth, operating margin and cash conversion were in line with our expectations for 2014. We have been able to improve the underlying margin to 4.3% in 2014 from 4.2% in 2013 adjusted for the effect of the divestment of the pest control activities, continuing the trend from Q4 2013.”

Gravenhorst added: “We continued executing our strategy, and in the quarter we completed five divestments of non-core activities. Following the successful IPO we have completed the refinancing and significantly reduced our debt. Furthermore, we have won contracts with several new local and regional customers, and we also extended our largest global contract delivering integrated facility services to HP until 2018.”

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