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Trading statements

Regus confident of delivering in-line FY performance

03 November 2016 07:33

Regus said it is overall pleased with its Q3 and remains confident of delivering a FY performance in line with management's expectations.

The group generated revenue growth of 8.1% for the nine months to Sept. 30 at constant currency, enjoying strong profit performance with excellent cash conversion.

Importantly, post-tax cash returns on net growth investment have also increased further, it said.

"This year has been an important transitional period in the development of the Group," it said.

"As previously announced we have implemented a new field structure and made significant progress towards our goals of cost leadership and achieving more capital-light growth.

"In the three months ended 30 September 2016, Group revenue increased to £566.9m compared with £478.8m in the corresponding period last year, an increase of 3.8% at constant currency rates (up 18.4% at actual rates).

"For the nine months ended 30 September 2016, Group revenue increased to £1,644.5m compared with £1,415.8m for the same period last year, an improvement of 8.1% at constant currency rates (up 16.2% at actual rates).

"Group underlying operating profit performance has been strong and for the nine months ended 30 September 2016, in constant currency, remains consistent with the 30% improvement reported with the interim results.

"The operating profit at actual rates has benefited further from prevailing exchange rates which have provided a tailwind on the translation of our results during the third quarter.

"The Group's focus remains on building long-term shareholder value through delivering attractive returns from our existing business and continuing with the disciplined investment in new locations.

"Returns on our existing business have developed well and the returns to 30 September 2016 are ahead of those reported with our interim results, on a 12 month rolling basis. For those locations open on or before 31 December 2012 the returns are at record levels, driven by continued operational leverage.

"Underlying cash generation has remained strong. For the nine months ended 30 September 2016 underlying cash generation has increased 52% year-on-year to £208.9m (nine months to September 2015: £137.8m), reflecting the strong profit performance."

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Related Company: RGU

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