Mitie Reports Record Revenues Exceeding £4 Billion

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• Mitie Reports Record Revenues Exceeding £4 Billion

09 June 2023

FM outsourcing company Mitie has reported a record revenue that exceeds £4 billion for the first time.

A total contract value of £4.3 billion was awarded in the 2023 financial year, with a renewal rate of over over 90 per cent.

Phil Bentley, Group Chief Executive, said that replacing almost £450 million of short-term and higher margin COVID-related contract revenue was one of the main business challenges. This included a £365 million contract to manage 175 regional and local COVID-19 test sites and 105 mobile testing units across England, Scotland and Wales.

He said ”Group revenue in FY23 exceeded £4 billion for the first time, reflecting good momentum from our new contract wins, renewals and extensions, alongside contributions from contract re-pricing and acquisitions. Basic earnings per share grew by 3.3 per cent to 9.5p, benefiting from the refinancing of debt instruments and share buybacks, despite operating profit being slightly lower than last year due to the completion of the higher margin COVID work.

“When we exclude short-term COVID work, revenue and operating profit before other items increased by 14 per cent and 44 per cent respectively. Our operating margin excluding Covid work of 3.8 per cent (FY22: 3.0 per cent) reflects growth in projects work and the focus on margin enhancement initiatives. We expect to deliver an additional £5 million of Interserve synergies, and therefore increase our guidance for total synergies to £55 million by the end of FY24, significantly ahead of our initial expectation of £30 million at the time of acquisition.

“Mitie has been transformed over the last six years, and we have made further significant progress this year against each of our strategic pillars. We are now the largest facilities management business in the UK, and our unrelenting ambition is to drive the business to reach its full potential, not just financially but also through its positive contribution to the environment and society.

“Thanks go to all of our colleagues for their hard work in providing an exceptional service to our customers throughout the year. Our Net Promoter Score (NPS) rose a further 3pt to +42 in our survey conducted at the year end. Investing in our people and ensuring that Mitie is an ‘employer of choice’ remain top priorities. Our encouraging business performance during the year enabled us to offer a £10 million Winter Support package to help our colleagues through the cost-of-living crisis. Our employee engagement score rose by 7ppt to a record 57 per cent of colleagues ‘fully engaged’.”

The board is confident in meeting its growth expectations for FY24.

Picture: a photograph of Phil Bentley. Image Credit: Mitie

Article written by Ella Tansley | Published 09 June 2023

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