News Column

Johnson Service Group Beats Expectations On Textile Rental Strength

September 1, 2014

Alice Attwood

LONDON (Alliance News) - Johnson Service Group PLC said Tuesday that revenue and pretax profit rose in its first-half, leading the company to up its interim dividend as its textile rental division performed ahead of management expectations.

In its half-year results for the six months to June 30, the textile services group said pretax profit was up 46% to GBP6.5 million from GBP4.4 million the previous year while revenue was up 5.7% to GBP101.6 million from GBP96.1 million in the comparative half in 2013.

Operating profit was also higher for the period, up 25% to GBP9.4 million from GBP7.5 million the year before, said Johnson Service Group.

The company upped its interim dividend by 25% to 0.5 pence per share from the 0.4 pence per share paid last year as part of its progressive dividend policy.

On a divisional basis, the textile rental division performed ahead of management expectations, said the company, with revenue up 10% to GBP74.4 million from GBP67.6 million last year.

Following its acquisition of Bourne Service Group Ltd in March - which saw the company enter the volume hotel linen market - Johnson Service Group has expanded the range of services within its Textile Rental market which contributed significantly to the strength of the division's performance, it said.

The Bourne acquisition has been immediately earnings enhancing, said the company.

Johnson Services' Drycleaning business continues to focus on "service quality and convenience in a challenging market," said the FTSE 250-listed company, recording revenue marginally lower in the first-half, down to GBP27.2 million from GBP28.5 million last year.

Encouraged by its first-half performance, looking ahead the company expects its full-year results to come in "slightly ahead" of current market expectations. "The Board is continuing to seek further acquisitions in Textile Rental and to invest in additional capacity at existing locations. The significant increase in the interim dividend reflects the Board's confidence in the business going forward," said Paul Moody, non-executive chairman.

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Source: Alliance News

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