Mitie reaffirms outlook on solid third quarter

(Sharecast News) - Mitie Group reiterated its full-year outlook on Tuesday, boosted by strong revenue growth in the third quarter and a clutch of contract wins. The facilities management provider said revenues rose 10% in the three months to December end to £1.4bn, including 4% organic growth.

Contract wins, extensions and renewals were largely unchanged, with a total contract value of £4.7bn. New wins included a £100m per annum five-year hygiene contract with Transport for London, and agreements with Asda, Lidl and Eurostar to provide security services.

However, looking to current trading and Mitie flagged another "significant" contract win, worth up to $656m over eight years, to provide facilities management services for the US Navy at the Diego Garcia military base on the Chagos Islands. It also noted that the fourth quarter was typically its strongest, due to increased projects work and winter services.

As a result, the outsourcer said it remained on track to deliver organic double digit revenue and operating profit growth, to around £5.7bn and at least £260m respectively, over the full year.

Phil Bentley, chief executive, said: "We delivered another good trading performance in the third quarter...significantly outpacing the UK facilities management market.

"The integration of Marlowe continues at pace, with the first synergies expect in the balance of the year.

"Our pipeline and order book at are record levels, driven by long-term macro trends and the investments we have made in capabilities, sales and marketing, and AI."

Mitie completed its £366m cash and stock acquisition of Marlowe, a specialist provider of fire and security and environmental services, in August.