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Mortice reports ‘strong performance’ in latest trading update

AIM-listed security and facilities management company, Mortice has reported its financial results for the year to 31 March are expected to be ahead of current market expectations following a strong performance of its combined existing and acquired businesses.

In the company’s latest trading update revenue increased by approximately 35 per cent to US$180 million (2016: US$133.5 million).

Mortice achieved strong growth across all parts of the business with facilities management revenues growing approximately 44 per cent to US$82 million (2016: US$56.8 million) and security services revenues growing approximately 28 per cent to US$97 million (2016: US$75.5 million).

The majority of sales continued to come from India, although overseas sales increased substantially following strong performances from Office & General (“O&G”) in the UK (now rebranded Tenon FM Ltd, and Frontline Security Pte. Ltd (“Frontline”) in Singapore. Both these businesses have now been fully integrated into the business and are performing ahead of management’s expectations at the time of acquisition.

The Company continued to add new clients and strengthen existing relationships during the period with key contract wins in India, including J&K Bank, Amazon and Kotak Mahindra Bank, Ocwen financial Corporation, and Jubilant each of which is worth in excess of $500,000 per annum. In the UK, O&G was appointed to London Universities’ £60 million cleaning framework and strengthened relationships with Amey, CBRE and the University of Arts London. O&G is now trading under the name Tenon FM Ltd as part of a group-wide rebranding initiative focused on creating a global brand presence.

Post period end the Company completed the £4.5 million acquisition of Elite Cleaning & Environmental Services. The earnings enhancing addition further strengthened the Company’s UK reach adding a number of blue chip clients to the Company’s customer base.

Commenting, Manjit Rajain, Executive Chairman of Mortice, said: “I am delighted by the Company’s strong performance during the period. We are creating a global footprint and remain extremely excited by the growth prospects across all parts of the business.”

Looking ahead, the Company stated it “sees tremendous scope for organic and acquisitive growth, both within existing markets and new territories”. Underpinned by high levels of recurring revenue and long-term client relationships, Mortice continues to have a strong pipeline across all parts of the business and continues to build on the momentum achieved during the period.

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