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ISS Group
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Interim report for the period 1 January - 30 September 2015: solid organic growth and improved margin
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ISS, one of the world’s leading facility services companies, announces its interim financial report for the first nine months of 2015.
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Highlights
- Solid organic revenue growth of 4.3% in the first nine months and 4.8% in Q3 (Q2 2015: 4.8%).
- Improved operating margin of 5.4% in the first nine months (2014: 5.3%) and 6.5% in Q3 (Q3 2014: 6.4%).
- Strong cash conversion over the last twelve months of 99% (Q2 2015: 99%).
- Profit before goodwill impairment and amortisation/impairment of brands and customer contracts increased to DKK 1,764 million in the first nine months of 2015 (2014: DKK 1,210 million).
- Net profit increased to DKK 1,392 million in the first nine months of 2015 (2014: DKK 890 million).
- Revenue generated from IFS increased 7% in local currency in Q3 (Q2 2015: 10%), and represented 33% of Group revenue (Q2 2015: 33%). Revenue from Global Corporate Clients represented 11% of Group revenue in Q3 (Q2 2015: 10%) and increased 11% in local currencies in Q3 (Q2 2015: 13%).
- The strategic initiatives including customer segmentation, organisational structure and excellence projects such as the procurement programme are progressing according to plans and support margin improvement.
- As previously announced, ISS has delayered the organisational structure, which will deliver more customer focus, faster decision making and further cost efficiencies.
With the following appointments to the Executive Group Management, all positions have been filled: Dan Ryan will join ISS from G4S to become Regional CEO Americas; Thomas Hinnerskov, currently Regional CEO Asia Pacific, will be appointed Regional CEO Western Europe and Dane Hudson, currently CEO Pacific, will be appointed Regional CEO Asia Pacific.
All appointments will be effective early 2016.
- The outlook for organic revenue growth in 2015 is improved to 4.0%-4.5% (from previously 3.5%-4.5%). ISS' expectations for operating margin (above 5.6%) and cash conversion (above 90%) are unchanged.
Jeff Gravenhorst, Group CEO, ISS A/S, said:
“Our strategic initiatives are moving ISS in the right direction. Again this quarter we delivered good growth rates and consistent margin improvements. Integrated facility services, international clients and emerging markets remain important growth drivers. We still have not seen any help from macroeconomic trends, as our growth has been driven by own initiatives and continued focus on our core business. Recently, we have won new important contracts with the Danish Broadcasting Corporation in the Nordics, the Gotthard Base Tunnel in Central Europe and we have mobilised the significant IFS contract at Homerton Hospital in the UK. Following the strong performance in Q3, and the continued benefits from our strategic initiatives we have improved our organic growth range to 4.0%-4.5% for the full year.”
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