Last checked at 14 May 2010 07:00
Intertek Group plc
Interim Management Statement
Intertek Group plc ("Intertek"), the leading provider of quality and safety services to a wide range of industries around the world, today releases its Interim Management Statement for the period from 1 January 2010. The Annual General Meeting of Intertek will be held today at 11.30am at The Westbury Hotel, Conduit Street, London, W1S 2YF. The half year results to 30 June 2010 will be announced on Monday 2 August 2010. All comments in this statement reflect comparisons with the same period during 2009.
At constant exchange rates, organic revenue for the first four months of the year increased by 3%. After taking into account the effects of foreign exchange rates and acquisitions, reported revenue was broadly in line with the same period last year.
As expected, there was a small decline in Consumer Goods organic revenue in the first four months of 2010, principally due to the exceptionally high demand for toy testing in the comparable prior year period as a result of the enactment of the Consumer Product Safety Improvement Act in the US. This was more than offset by solid organic revenue growth from the other divisions.
Global trade and market conditions continue to be variable. There is good revenue growth coming from areas such as testing of textiles, food, home appliances, lighting, renewable energy, minerals and a better downstream oil and petrochemical market. Volume related businesses accounting for approximately 30% of group revenue, are recovering, with growth mainly in oil cargo inspection in Latin America, Asia and the Middle East and consumer goods inspection in Asia. Revenue from toy testing, industrial infrastructure services, building products testing and oil and petroleum services in North America are lower than the prior year period.
Adjusted operating margin was lower in the period, principally due to comparatively lower utilisation in the high margin Consumer Goods toy business. We expect by the full year to report a broadly stable margin compared to 2009, as the effect of the Consumer Goods prior year comparison recedes, and if, as we expect, market conditions in the second half of the year continue to improve.
Intertek has made two acquisitions this year and has a strong pipeline of opportunities.
The key growth drivers behind Intertek's business, which include increased quality, safety and environmental regulation in international markets, greater supply chain complexity and the outsourcing of in-house quality and safety services, are robust and continue to support growth in these challenging market conditions.
Wolfhart Hauser, Chief Executive Officer of Intertek, said: "Intertek has made a solid start to the year and our expectation for the full year remains to grow organic revenue at similar levels to 2009, with the second half improving on the first. While there are signs of recovering economic conditions, some of our markets remain challenging and are recovering at different speeds. Our key growth drivers remain intact and as markets recover further we expect to return to high single digit organic growth rates."
Contacts
Aston Swift / Sarah Ogilvie
Telephone: +44 (0) 20 7396 3400
aston.swift@intertek.com / sarah.ogilvie@intertek.com
Richard Mountain, Financial Dynamics
Telephone: +44 (0) 20 7269 7186
richard.mountain@fd.com
Notes to Editors
ABOUT INTERTEK
Intertek is a leading provider of quality and safety solutions serving a wide range of industries around the world. From auditing and inspection, to testing, quality assurance and certification, Intertek people are dedicated to adding value to customers' products and processes, supporting their success in the global marketplace. Intertek has the expertise, resources and global reach to support its customers through its network of more than 1,000 laboratories and offices and over 25,000 people in more than 100 countries around the world.
Intertek Group plc (LSE: ITRK) is listed on the London Stock Exchange and is a constituent of the FTSE 100 index.
www.intertek.com
This Interim Management Statement is prepared for and addressed only to the Company's shareholders as a whole and to no other person. The Company, its directors, employees, agents or advisers do not accept or assume responsibility to any other person to whom this Interim Management Statement is shown or into whose hands it may come and any such responsibility or liability is expressly disclaimed. Statements contained in this Interim Management Statement are based on the knowledge and information available to the Company's Directors at the date it was prepared and therefore the facts stated and views expressed may change after that date. By their nature, the statements concerning the risks and uncertainties facing the Company in this Interim Management Statement involve uncertainty since future events and circumstances can cause results and developments to differ materially from those anticipated. To the extent that this Interim Management Statement contains any statement dealing with any time after the date of its preparation such statement is merely predictive and speculative as it relates to events and circumstances which are yet to occur. The Company undertakes no obligation to update these forward-looking statements.