COPENHAGEN, 13-3-2015 — /EuropaWire/ — ISS A/S (ISS.CO, ISS DC), a leading global facility services company, announces its financial results for fourth quarter and full year 2014:
- Organic revenue growth of 2.5% for the year (2013: 4.3%); 2.7% in Q4 2014 (Q3 2014: 2.4%)
- Due to the successful divestments of non-core activities executed in line with our strategy (-6%) and FX impact (-2%), full year 2014 revenue declined 5.5%
- Improved operating margin of 5.6% for the year (2013: 5.5%); 6.5% in Q4 (Q4 2013: 6.2%)
- Continued strong cash conversion of 98% (2013: 102%)
- Profit before goodwill impairment and amortisation / impairment of brands and customer contracts increased to DKK 1,816 million for the year (2013: DKK 1,026 million)
- Net profit increased to DKK 1,014 million (2013: loss of DKK 397 million)
- Proposed dividend for 2014 of DKK 4.90 per share of DKK 1 – equivalent to a pay-out ratio of 50% of profit before goodwill impairment and amortisation / impairment of brands and customer contracts
- Revenue from Integrated Facility Services (IFS) contracts increased 10% (currency adjusted) for the year to DKK 22.7 billion, representing 31% of overall revenue (2013: 26%). Revenue from Global Corporate Clients increased by 5% (currency adjusted) and now represents 9% of Group revenue (2013: 8%)
- Emerging markets represent 24% of total revenue for the Group (2013: 23%) and delivered 9% organic growth (2013: 11%)
- Net debt was 2.6x pro forma adjusted EBITDA at year end (2013: 4.5x)
- Contract with HP extended until the end of 2018. Other significant IFS wins included Molson Coors in North America and Czech Republic, BASF across five European countries, Bankia in Spain, Aller in the Nordic region, and Vattenfall in Germany
- Strategic initiatives including customer segmentation, organisational structure and global procurement project are progressing according to plan, and continue to support margin progression
- 14 businesses divested during the year, including landscaping activities in France, commercial security activities in Australia and New Zealand, and temporary labour and staffing activities in the Nordics
- After successfully listing on the Nasdaq Copenhagen Stock Exchange in March 2014, we have materially improved our capital structure through the repayment of a substantial part of the company’s debt, refinancing of the rest of the debt, and the issuance of investment grade bonds at historically low fixed rate coupons in November 2014
Jeff Gravenhorst, Group CEO, ISS A/S, said:
“We generated resilient organic growth, while improving our operating margin and ensuring strong cash conversion, in spite of difficult macroeconomic conditions. The performance was underpinned by strong growth in IFS and improving margins across several regions. Our successful IPO in March combined with debt refinancing and a number of strategic divestments have significantly improved our capital position. We have a strong foundation for future growth and have seen a solid start to 2015 with new contract wins including Huawei in China and UBS in the UK.”
In 2015, we will continue to focus on the implementation of the ISS Way Strategy, including the roll out of specific strategic initiatives focusing on leadership, IFS, procurement, customer segmentation, and organisational structure.
We expect an organic revenue growth rate of 2-4%, an operating margin above the 5.6% achieved in 2014, and cash conversion above 90%.
Lord Allen of Kensington Kt CBE Jeff Gravenhorst
Chairman Group CEO
Conference call details:
A conference call will be held on 12 March 2015 at 12:00 CET.
Presentation material will be available online prior to the conference call.
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For media enquiries:
Manuel Vigilius, Global Media Relations Manager, +45 38 17 64 04
For investor enquiries:
Nicholas Ward, Head of Group Investor Relations, +45 38 17 62 51
Martin Kjær Hansen, Investor Relations Manager, +45 38 17 64 31
The ISS Group was founded in Copenhagen in 1901 and has grown to become one of the world’s leading facility services companies. ISS offers a wide range of services such as: Cleaning, Catering, Security, Property and Support Services as well as Facility Management. Global revenue amounted to DKK 74.1 billion in 2014 and ISS as more than 510,000 employees and activities in more than 75 countries across Europe, Asia, North America, Latin America and Pacific, serving thousands of both public and private sector customers.