Intertek Group plc (LON:ITRK), a leading Total Quality Assurance provider to industries worldwide, has released its May Trading Update for the period from 1 January to 30 April 2023. All comparative comments in this statement reflect comparisons with the corresponding period during 2022. The Group’s half year results to 30 June 2023 will be announced on 28 July 2023.
Demand acceleration for Intertek ATIC solutions delivers 6.5% LFL revenue growth1
• January-April revenue of £1,059.6m: up 7.6% at CCY and 11.4% at actual rates
• LFL revenue growth of 6.5% at CCY with Products 5.5%, Trade 5.2% and Resources 12.5%
• Good business recovery in China with 7.5% LFL revenue growth at CCY
• Continuous progress on pricing, productivity and cost initiatives to deliver margin progression
• Disciplined day to day cash management in place to drive strong cash performance
• Strong balance sheet and accretive capital allocation policy to invest in growth
• Confirming 2023 outlook: Mid-single digit LFL revenue growth at CCY, margin accretion and strong cash
• Intertek 30 AAA growth strategy in place to unlock the significant value growth opportunity ahead
André Lacroix: Chief Executive Officer statement
“We have had a good start to 2023 as we benefitted from the increased demand for our ATIC solutions delivering 6.5% LFL revenue growth at constant currency. This was broad based with Products up by 5.5%, Trade ahead 5.2% and Resources grew 12.5%. We have also seen a broad based geographic performance including a strong rebound of our China business post Chinese New Year as both the export and domestic market benefitted from the lift of the Covid-19 restrictions at the beginning of the year.
For 2023, we continue to expect to deliver mid-single digit LFL revenue growth at constant currency driven by mid-single digit LFL revenue growth in Products and Trade and high-single digit revenue growth in Resources. We continue to make progress on our margin and cash priorities and are on track to deliver our 2023 guidance.
Our clients are increasing their focus on Risk-based Quality Assurance to operate with higher standards on quality, safety and sustainability in each part of their value chain, triggering a higher demand for our ATIC solutions which are powered by our Science- based Customer Excellence Total Quality Assurance advantage. We have made significant progress on our portfolio which is poised for faster growth at the global level given that all business lines are expected to benefit from attractive structural growth and at the local level given our strong business line portfolio.
At our Capital Markets event in London on 3rd and 4th May, we unveiled our Intertek 30 AAA growth strategy to capitalise on the best-in-class operating platform we have built and target the areas where we have opportunities to get better. Our passionate, innovative, and customer-centric organisation is energised to take Intertek to greater heights delivering AAA performance for all stakeholders. We are focussed on delivering value consistently, targeting mid-single digit LFL revenue growth, margin accretion to go back to our 17.5% peak margin and beyond, and strong cash generation, while pursuing disciplined investments in attractive growth and margin sectors.
We operate a differentiated, high-quality growth business with excellent fundamentals and intrinsic defensive characteristics, giving our customers the Intertek Science-based Total Quality Assurance advantage to strengthen their businesses. Our leading ATIC solutions are mission-critical for the world to operate safely and the growth in our end-markets is accelerating. The implementation of our Intertek 30 AAA growth strategy will capitalise on our high-quality earnings and cash compounder model to unlock the significant value growth opportunity ahead”
1. At CCY
| Revenue Performance | ||||
| 4 months – January to April | ||||
| 2023£m | 2022£m | Change atactual | Change at constant | |
| Group | ||||
| Revenue | 1,059.6 | 951.3 | 11.4% | 7.6% |
| LFL revenue | 1,049.4 | 951.3 | 10.3% | 6.5% |
| Products | ||||
| Revenue | 658.1 | 602.9 | 9.2% | 5.5% |
| LFL revenue | 658.1 | 602.9 | 9.2% | 5.5% |
| Trade | ||||
| Revenue | 212.5 | 195.1 | 8.9% | 5.2% |
| LFL Revenue | 212.5 | 195.1 | 8.9% | 5.2% |
| Resources | ||||
| Revenue | 189.0 | 153.3 | 23.3% | 18.9% |
| LFL revenue | 178.8 | 153.3 | 16.6% | 12.5% |
Analysts’ Call
A call for analysts and investors will be held today at 7.45am UK time; +44 (0) 33 0551 0200 (webcast). Details can be found at http://www.intertek.com/investors/ .
