City Link a drag on Rentokil group results

COVENTRY Airport-based logistics firm City Link impacted group revenues of its parent company Rentokil Initial.

The specialist cleaning firm saw revenue grow by 0.7% for the first half of this year.
This was impacted by -1.8% by its logistics division which stabilised at -13.5%.

There was 1% organic growth at Rentokil excluding City Link and its operations in Libya.

The report said: “City Link has stabilised its customer base and operations after a very difficult Christmas for the industry and has continued to invest heavily in new capability.

“It now has a strong infrastructure with a stable hub and depot network and an exciting stream of initiatives going live in the autumn.

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“Delivery of these initiatives will be key to winning new business and carrying more volume through the network.

“City Link has targeted profitable growth in the four key areas of healthcare, technology, media and retail/online.

“We remain encouraged by the strength of our new business pipeline.”

Across the parent company, adjusted profit before tax was down 6.8% or £5.2m, to £70.9m.

Cost savings of £24m are on track to deliver £60m by year end.

Chief executive officer Alan Brown said: “In City Link, I am encouraged by our strong operational progress and the new business pipeline, the combination of which should lead to improved year-on-year performance in Q4 though the full impact of our initiatives is unlikely to be felt this year.”