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Investing.com -- Rentokil Initial (NYSE:RTO) (LON:RTO) reported organic revenue growth of 1.8% in the first quarter, driven by strength in its international pest control business. However, the growth fell short of analyst expectations of 2.4%.
The pest control and hygiene group said organic growth in its U.S. pest control segment was just 0.5%, while the rest of the world delivered stronger growth of 4.7%.
Hygiene also underperformed, with 1.6% organic growth in Q1, held back by weakness in the U.K.
The company, which marks its centenary this year, posted total revenue of $1.64 billion for the quarter ended March 31, slightly up from $1.61 billion a year earlier. North America accounted for about 60% of total revenue in 2023.
Rentokil acknowledged that inbound lead flow and contract sales remained soft in early 2025, though it noted a return to growth in March after a decline in February. Lead generation from organic search initiatives remained subdued, but the company expects improvement as it rolls out new branches and a refreshed brand strategy.
Customer and colleague retention in North America showed a slight improvement in the quarter, supported by targeted retention efforts.
Rentokil did not reaffirm its full-year outlook. Jefferies analysts believe this "may suggest risks to expectations in the context of weak U.S. performance and rising macro uncertainties."
The company acquired six businesses through the first quarter, accounting for roughly $13 million of revenue.