(Alliance News) - Intertek Group PLC on Friday reported strong growth in interim earnings and a resilient revenue performance in its first half results.
The London-based quality assurance firm booked interim pretax profit growth of 30%, climbing to GBP169.1 million from GBP130.8 million last year. Intertek tipped that performance management and capital allocation discipline helped protect profit in the half year.
Revenue slipped 1.0% to GBP1.32 billion in the six months ended June 30 from GBP1.33 billion a year earlier.
Shares in Intertek were down 7.2% at 5,198.00 pence in London in morning trade, making the stock the worst performer in the FTSE 100 on Friday.
Intertek left its interim dividend payout unchanged at 34.2 pence per share.
Hargreaves Lansdown analyst Steve Clayton said expectations were high going into Intertek's interim results.
"Full year forecasts are likely to edge down, so no surprise to see the market pushing the stock lower. But this risks missing the point. There is a quiet revolution going on in business, as firms start to put net zero [emissions] plans into place. Intertek has a vital role to play here," said Clayton.
Intertek remains confident it can post "robust like-for-like revenue growth at constant currencies" in 2021.
Assuming constant currency rates, the firm anticipates full year net debt between GBP350 million to GBP400 million. Its full year net debt in 2020 was GBP419.9 million.
"We expect our Products division to deliver robust like-for-like revenue growth and both Trade and Resources to deliver good like-for-like revenue growth," said Chief Executive Andre Lacroix.
"We are investing to seize the attractive growth opportunities in the global quality assurance market which we expect to grow faster in the post-Covid world, as companies have realised the need to increase investments to reduce risk in their supply chain."
Intertek on Wednesday unveiled its acquisition of JLA Brazil - a food, agriculture and environmental testing provider - to enter the Brazilian agri-food and beverage testing market.
By Josie O'Brien; josieobrien@alliancenews.com
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Intertek Group (ITRK)
