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They are still having major problems in Australia
'Hundreds of prisoners are being forced to flee Australia’s advancing mice plague after the rodents breached security and invaded a large jail.'
'The plague could last for up to two years if urgent action is not taken to kill millions of the rodents'
It will be interesting to see if, and by how much, RTO benefit from this.
Bloomberg-Giant Plague of Mice Forces Australia to Turn to Banned Poison
'Australia is looking to deploy normally outlawed high-grade poison to fight millions of mice, as farmers struggle to protect their crops from the worst rodent invasion in decades.'There should not be any shortage of work in Australia for RTO.
This is why I bought into RTO - it doesn't take long for nature to start reclaiming what is hers when people disappear, so I was thinking of all of the empty pubs, restaurants, business units and etc that are probably infested. IF we ever get out of lockdown and the other side of the business picks up too, it could be like a double whammy for RTO. Good luck all.
This is why I bought into RTO - it doesn't take long for nature to start reclaiming what is hers when people disappear, so I was thinking of all of the empty pubs, restaurants, business units and etc that are probably infested. IF we ever get out of lockdown and the other side of the business picks up too, it could be like a double whammy for RTO. Good luck all.
The initial response is that clearly other don't think the same as me. Not sure why, so I have just picked up another tranche at what I hope was a bargain price..
From elsewhere on LSE-
'For disinfection and pest control specialist Rentokil's first quarter results, UBS's Nicole Manion is forecasting a "relatively "strong" start to the year.
Nevertheless, while the contribution to sales from disinfection services was expected to have extended into the first three months of the year, her estimates called for a "dramatic fade" over the remainder of 2021.
Revenues from that business were seen declining to only £10m by the final quarter of the year.
For the first quarter on the other hand, she pegged disinfection revenues at £75m, for total growth in Hygiene sales of over 50%.
Full-year organic growth in pest control meanwhile was seen at more than 5%, albeit weighted towards the backhalf of the year due to the impact of business closures on commercial Pest at the beginning of the year.
She was spot on for disinfectant revenues, but undershot pest control growth (up 9.4% organic) by nearly 100%, she was also expecting the pest growth to be second half loaded. I can see an upgrade from UBS coming on the back of the actual results.
Well, much better than I was expecting. First quarter revenue 2021 (£713M), 2020 (£634M), 2019 (£607M).
No mention of cold snap in US or fx headwinds!
Next quarter should be strong with the vaccine roll out, lockdowns decreasing and moving into peak pest season. France workwear should pick up and should be ready to be sold off if the right offer comes along.
From story in Bloomberg-
‘As New Yorkers get back on their feet after a year of the pandemic, so are the rats that survived a once-in-a-generation food shock. The number of rodent complaints to a city hotline in March surged by 80% to 2,906 from last March, when calls dipped as New York City went into lockdown and indoor dining closed.’ The number is also higher than pre-pandemic levels. A total of 2,395 complaints were made in March 2019, according to New York City’s 311 service requests data.
‘In the U.K., where the rat population jumped 25% in 2020, the rat infestations in empty and closed buildings reached “biblical levels,” posing other risks as they chew wires and internet cables, according to Pest.co.uk.’
After he sold 250k in March Myers then gained an extra 225,110 shares for a performance payment - he only sold 83,474 to cover tax- so he has started to accumulate again. The CFO also kept just over half (27k) of his performance shares at the same time.
Gary Booker sold all of his performance shares (12k) at the start of April .
Not sure what it means- Myres sold a comparable amount last summer but there was no subsequent bad news and if anything the company did fairly well, although the price has drifted lower since.
I am not expecting great results for the first quarter, France work wear is going to have been hit quite hard and the cold spell in the US would have meant a slow start to the pest season (they mentioned this after the last bad winter in the US, 2018, so I am expecting the same - there was also a brief mention about it in the Q&A after the Year End results). The plague of mice in Australia may help, but overall much will depend upon how the revenues from Hygiene can compensate for the loss of work in covid impacted areas.
At the year end presentation they noted, that in Australia, revenues from disinfection dropped off very quickly as they got covid under control. I am not so sure that this will be the case in countries that are doing it by vaccination, as there will be a residual level of susceptible people and so disinfection services will be needed for longer than where it was essentially eliminated.
Their fortunes this year are going to be dependent the interplay between businesses opening up and the continued need for disinfectant services. Will they be able to generate the same (or greater) revenues for the latter this year? It is easy to see how they picked up work last year, as a big name they would have been a first port of call. I think that now there will be more competition and tighter margins.
After this quarter I am expecting things should pick up and that they will get back the regular work plus still be pulling in extra revenue from disinfecting. So, not great first quarter, reasonable second then strong third and final quarters.
One director has sold most of his shares?!
But no one else - why
DEUTSCHE BANK RAISES RENTOKIL INITIAL PRICE TARGET TO 565 (550) PENCE - 'BUY'
Wow, What a day, First up and then down over 4% and now back up ! Was starting to get a little worried.
No surprises. Plenty of M&A to keep the growth going. Also re- building in areas of Europe they previously had to exit hygiene. I think this quarter will be flat at best (lockdowns in Europe, freeze in the US) but it should pick up after this. They commented how quickly Australia/NZ have bounced back to normal levels.
Did you note, going forward, the fx headwind of £15-20 m (similar to 2018 predictions when sterling was up )?, OK fair enough, but then for last year ' Adverse foreign exchange translation and other items of £58.4m are primarily due to the weakening impact of sterling against the euro and dollar, as well as the impact of the closure of an instrument designed to reduce US interest rates on our US dollar debt'
So weak £, negative impact, strong £ negative impact- what exactly is the 'goldilocks' value of £ for RTO??
nothing pesky has come out in the results. I have to be honest with the falling SP- and it is down 3% today- I was starting to smell a rat here.
I am still here. I thought that even with the fx headwind it would stay up over 500, but clearly not. I have been slowly topping up at sub 500 whenever there is a dip.
Not that it means much, but the median broker target is 587. Results today, so it will be interesting to see what happens.
......oh on second thoughts this isn;t the safest board to post that. Where's the edit function? Anyone?
serious cheese to be made here. The recent director buy was at 491p for £75000ish of shares so can get under this price comfortably. The problem I have is the last person who recommended this disappeared like a rat up a drainpipe shortly afterwards.....
The outlook cannot be more uncertain than last year and it sailed through that quite well....#
You should have either brought at the drop in March or the dip in November- this stock is never heavily shorted , would be too risky as it has consistently performed well and usually surprises to the upside.
Yeah it would be terrible if investors fell into that trap LSE2000.
Good trading for last year... but outlook remain uncertain means this has more to fall! Stay away from this stock... This will soon be heavily shorted!
Looks good for Year End.
'we now expect the final outcome for the year to be slightly above the top end of the range of current market expectations for Adjusted PBTA'
They are clearly also taking advantage of their strength to expand the business which will be good for future earnings.
'For the full year ended 31 December 2020, we have acquired 23 new businesses, with annualised revenues of over £150m, for a cash spend of c.£180 m'
Who wouldn’t
Whilst RTO has always been a reasonable covid hedge the rational for holding it has increased as it has developed its disinfectant service since earlier this year. For the first three quarters -
Disinfection, Q1 -0, Q2 £49M, Q3 £75M.
It is hard to believe that these revenues will not increase further with increasing incidents in nearly all of its geographies.
This income should continue until covid starts to decline, but then their HORECA and Ambius sectors will be growing again to help replace this income stream. Pest control will jog along nicely as always.
And they look very good too..... group revenue up by 9.8%
I took a punt and picked up some more yesterday, this should start back on its usual upwards trajectory from now.
Just read broker upgrade to 580p.
Have they busy deep cleaning, sanitizing and disinfecting during COVID?