StockMarketWire.com - Mitie Group expected to see an increase in operating profit for full-year 2018-2019 as its transformation programme continued to make "steady progress" despite a challenging backdrop, the British outsourcing and energy services company said in a pre-close statement.

Operating profit for 2018/2019 would be in the range of £84-87m, above its restated operating profit of £83.2m the previous year, due to revenue growth, cost savings and a positive contribution from its acquisition of security services provider VSG, partly offset by reinvestment into the business.

Revenue growth for the full-year 2018/2019 was expected to be 7-8% with underlying revenue growth (excluding the VSG acquisition) of around 4%.

In terms of orders, the company's committed order book was broadly flat in the second half, including the benefit from the acquisition of VSG, but was expected to have declined by around 10% over the full year.

"Although our order book has softened, we have focused on adding more value and services to our top clients and, as a result, we have seen continued growth in these accounts throughout FY 18/19," said CEO Phil Bentley.

The firm's transformation programme - Project Helix - was on track to deliver run-rate benefits of some £45m in full-year 2018/2019 and around £50m by the end of full-year 2019/2020.

Looking further forward, the company said that Mitie was "well-positioned for future growth" despite a challenging backdrop in the industry and political uncertainty. It remained confident that it would emerge as an industry leader in its chosen service lines.

The firm expected to continue to grow revenue organically at 3-4%. It has successfully renewed a number of significant contracts in FY 18/19 albeit, in the first year of operation, at lower margins. Notwithstanding these margin headwinds it still expected to achieve its margin target of 4.5-5.5% over the medium term.







At 8:21am: [LON:MTO] MITIE Group PLC share price was -9p at 141p



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