Rentokil boss unveils recovery drive

The problems at Rentokil Initial were laid bare today as its new boss outlined ways to reverse the latest fall in profits at the services company.

As previously indicated by the pest control-to-washroom group, Rentokil’s half-year profits fell by 19.8% to £135.4m (€198.6m) after it continued to suffer from tough trading conditions and previous restructuring efforts.

Doug Flynn became chief executive five months ago and revealed in a review today that Rentokil was too introspective and focused on short-term goals.

He warned that operational costs had been squeezed to such an extent that quality of service had suffered. Prices were also pushed to “unsustainable levels” and costs relentlessly taken out, Mr Flynn added.

The new boss said his immediate attention would be on pest control and washroom and textiles, which he believed offered the best platform for growth. Across the group, Rentokil will look to make its sales and marketing efforts more effective and to ensure senior management were fully accountable.

The strategy was detailed in the week that it emerged former Granada boss Gerry Robinson was considering an approach for the company.

Robinson's interest came through Raphoe Management, which he has set up as a vehicle for investing in under-performing companies.

He recently stepped down as chairman of drinks group Allied Domecq.