Pest control firm Rentokil Initial posted more big losses at City Link yesterday but said it was hopeful the worst may be over for the parcels operation.
The division’s first quarter loss of £12.7m was up 18.7 per cent on a year earlier, although Rentokil said the performance improved through the quarter as a new management team got to grips with the business.
It still expects a significant improvement in City Link’s year-on-year performance during the second half of the year, amid cost savings and better productivity.
Across the group, which also operates textile and hygiene businesses, revenues were 2.4 per cent higher at £624.4m in the first three months of the year. Adjusted pre-tax profits were 4 per cent lower at £26.3m.
Chief executive Alan Brown said market conditions remained challenging, particularly in southern Europe, but that the momentum seen in sales during last year had continued into 2012.
Panmure Gordon stockbrokers said the first quarter profits were around 7 per cent lower than City forecasts.