Rentokil Initial Plc Misses Earnings Estimates: What Analysts Forecast for 2025

Rentokil Initial plc missed analyst estimates in its latest half-yearly results, with revenues in line but statutory earnings per share 18% below expectations. Analysts expect revenues of £5.36bn in 2025, a 3.1% decline from last year, and EPS of £0.12, a 28% surge. The consensus price target remains at £4.23, with a narrow range of analyst estimates.

Rentokil Initial plc reported its earnings results for the half-year ended June 30, 2025. The company reported sales of GBP 3,364 million, a 3.1% increase compared to the previous year's GBP 3,266 million. However, net income fell to GBP 188 million, down from GBP 248 million a year ago, reflecting a 28% decrease in statutory earnings per share (EPS) from GBP 0.0909 to GBP 0.0649 [1].

The company's organic growth was 1.6%, with the international region showing strong performance with a 5.1% increase in revenue and 2.7% organic growth. However, the company faced cost pressures, leading to a decrease in the adjusted operating margin from 17.2% to 15.2%, a decline of 120 basis points [2]. North America's adjusted operating profit fell by 7.3%, with cost inflation and lower volumes impacting margins.

Rentokil Initial has expanded its satellite branches from 36 to 100, with plans to reach 150 by year-end. The door-to-door sales pilot generated approximately $12 million in annualized sales, showing promising early results. However, the hygiene and well-being segment experienced slower growth, with organic growth at only 0.4% in Q2, and there is a challenge in growing the contract portfolio, with a slight decline in contract revenue by 0.2% year-on-year [2].

The termite warranty claims provision increased from $236 million to $276 million due to higher costs of complex claims. The company expects this provision to remain volatile but is focused on managing it effectively. Analysts expect revenues of £5.36bn in 2025, a 3.1% decline from last year, and EPS of £0.12, a 28% surge. The consensus price target remains at £4.23 [1].

References:
[1] https://www.marketscreener.com/news/rentokil-initial-plc-reports-earnings-results-for-the-half-year-ended-june-30-2025-ce7c5fdcd08bf520
[2] https://ca.finance.yahoo.com/news/rentokil-initial-plc-rklif-q2-230034718.html